EXHIBIT 10.2
FORM OF VOTING AGREEMENT
THIS VOTING AGREEMENT (this "Agreement") dated as of _______, 2006, by
and among Bluefly, Inc., a Delaware corporation (the "Company"), Quantum
Industrial Partners LDC ("QIP"), SFM Domestic Investments, LLC, ("SFM" and,
together with QIP, the "Xxxxx Parties"), Maverick Fund USA, Ltd., Maverick Fund,
L.D.C., Maverick Fund II, Ltd. (collectively, the "Maverick Parties"),
Prentice-Bluefly, LLC (collectively, the "Prentice Parties"; the Xxxxx Parties,
the Maverick Parties and the Prentice Parties, collectively, the
"Stockholders").
WHEREAS, on June 5, 2006, the parties hereto entered into a Stock
Purchase Agreement (the "Purchase Agreement"; capitalized terms not defined
herein shall have the meaning ascribed to them in the Purchase Agreement), which
contemplates, among other things, the execution of this Agreement.
NOW, THEREFORE, in consideration for the mutual covenants contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, agree as follows:
ARTICLE I
BOARD OF DIRECTORS
SECTION 1.1 Designation of Directors.
(a) Subject to Section 1.5(a), the Xxxxx Parties shall be entitled
to designate to serve on the Board of Directors of the Company (the "Board"),
three designees.
(b) Subject to Section 1.5(b), the Maverick Parties shall be
entitled to designate to serve on the Board, one designee.
(c) Subject to Section 1.5(c), the Prentice Parties shall be
entitled to designate to serve on the Board, one designee.
SECTION 1.2 Nomination. Subject to limitations, if any, imposed by stock
exchange rules in effect from time to time, the Company agrees to cause the
persons designated pursuant to Section 1.1 to be nominated for election at every
meeting of the stockholders of the Company called with respect to the election
of members of the Board, and at every adjournment or postponement thereof, and
on every action or approval by written consent with respect to the election of
members of the Board.
SECTION 1.3 Agreement to Vote.
(a) The Stockholders agree to vote all shares of capital stock
of the Company owned by them in favor of the persons designated pursuant to
Section 1.1. The failure of any Stockholder entitled to designate nominees
pursuant to Section 1.1 to fully exercise its respective designation rights
shall not constitute a waiver or dimunition of such rights nor shall it prevent
such Stockholder from exercising such rights prospectively.
(b) Should a person designated pursuant to Section 1.1 be unwilling
or unable to serve, or otherwise cease to serve (including by means of removal
in accordance with the following sentence), the Stockholders who originally
nominated such director shall be entitled to designate any replacement director.
(c) If (i) the Xxxxx Parties propose to remove any director
designated by the Xxxxx Parties, (ii) the Maverick Parties propose to remove any
director designated by the Maverick Parties or (iii) the Prentice Parties
propose to remove any director designated by the Prentice Parties, the
Stockholders agree to cooperate in, and shall vote all shares of capital stock
of the Company owned by them (or, if any action is being taken by written
consent, execute a written consent) in support of, such removal and any
resulting vacancy shall be filled in accordance with the preceding clause (b).
The Stockholders agree not to take any action to remove, with or without cause,
any director other than in accordance with the foregoing.
(d) The Stockholders agree that for a period of six (6) months
after the Closing Date, they shall not vote any shares of capital stock of the
Company owned by them in favor of any merger, consolidation, sale, or other
similar transaction involving the sale of any outstanding shares of capital
stock of the Company.
SECTION 1.4 Committees of the Board of Directors.
(a) The Company and the Xxxxx Parties agree that one person
designated by the Xxxxx Parties pursuant to Section 1.1(a) shall serve on the
Option Plan/Compensation Committee and the Nominating and Governance Committee
of the Company (and any successor committees thereof); provided that such
designee is "independent" (as defined in applicable Nasdaq rules) after any
applicable transition period has elapsed.
(b) The Company and the Maverick Parties agree that the person
designated by the Maverick Parties pursuant to Section 1.1(b) shall serve on the
Option Plan/Compensation Committee and the Nominating and Governance Committee
of the Company (and any successor committees thereof); provided that such
designee is "independent" (as defined in applicable Nasdaq rules).
(c) The Company and the Prentice Parties agree that the person
designated by the Prentice Parties pursuant to Section 1.1(c) shall serve on the
Option Plan/Compensation Committee and the Nominating and Governance Committee
of the Company (and any successor committees thereof); provided that such
designee is "independent" (as defined in applicable Nasdaq rules).
(d) The parties hereto agree that if the Company establishes
an Executive Committee (or a committee with executive or similar functions) of
the Board (the "Executive Committee"), then (i) the persons designated by the
Xxxxx Parties pursuant to Section 1.1(a) shall serve on such Executive
Committee, (ii) the person designated by the Maverick Parties pursuant to
Section 1.1(b) shall serve on such Executive Committee and (iii) the person
designated by the Prentice Parties pursuant to Section 1.1(c) shall serve on
such Executive Committee.
SECTION 1.5 Resignation.
(a) (i) If the Xxxxx Parties dispose of their capital stock of
the Company so that they own less than the greater of 70% of their Current
Shares or the minimum number of shares that are required to be owned under
applicable Nasdaq rules which would allow the Xxxxx Parties to designate three
directors to serve on the Board, they shall cause one of the directors
designated by them pursuant to Section 1.1(a) to resign from the Board.
(ii) If the Xxxxx Parties dispose of their capital stock of
the Company so that they own less than the greater of 60% of their Current
Shares or the minimum number of shares that are required to be owned under
applicable Nasdaq rules which would allow the Xxxxx Parties to designate two
directors to serve on the Board, they shall cause two of the directors
designated by them pursuant to Section 1.1(a) to resign from the Board.
(iii) If the Xxxxx Parties dispose of their capital stock of
the Company so that they own less than the greater of 30% of their Current
Shares or the minimum number of shares that are required to be owned under
applicable Nasdaq rules which would allow the Xxxxx Parties to designate one
director to serve on the Board (a "Xxxxx Termination Event"), they shall cause
each of the directors designated by them pursuant to Section 1.1(a) to resign
from the Board.
(b) If the Maverick Parties dispose of their capital stock of
the Company so that they own less than the greater of 50% of their Current
Shares or the minimum number of shares that are required to be owned under
applicable Nasdaq rules which would allow the Maverick Parties to designate one
director to serve on the Board (a "Maverick Termination Event"), they shall
cause the director designated by them pursuant to Section 1.1(b) to resign from
the Board.
(c) If the Prentice Parties dispose of their capital stock of the
Company so that they own less than the greater of 50% of their Current
Shares or the minimum number of shares that are required to be owned under
applicable Nasdaq rules which would allow the Prentice Parties to designate one
director to serve on the Board (a "Prentice Termination Event"), they shall
cause the director designated by them pursuant to Section 1.1(c) to resign from
the Board.
(d) "Current Shares" shall mean the shares of capital stock of the
Company owned by or for the benefit of the Xxxxx Parties, the Maverick Parties
or the Prentice Parties, as applicable, immediately following the Closing,
including shares of capital stock of the Company issuable upon exercise of
warrants or options outstanding immediately following the Closing.
SECTION 1.6 Liability. No Party who shall vote or consent or withhold
consent or make a request in their capacity as a shareholder of the Company with
respect to any securities subject to this Agreement on, to or from any matter in
compliance with the terms hereof shall, as a result of any such vote or consent
or withholding of consent or making of a request, have any obligation or
liability to any other party hereto (whether such other party shall also vote or
consent or withhold consent or make a request with respect to any securities,
then subject to this Agreement).
ARTICLE II
MISCELLANEOUS
SECTION 2.1 Entire Agreement. This Agreement, the Purchase Agreement and
the other Transaction Documents constitute the entire agreement between the
parties hereto with respect to the subject matter hereof and supersede all
previous negotiations, commitments and writings with respect to such subject
matter.
SECTION 2.2 Assignments; Parties in Interest. Neither this Agreement nor
any of the rights, interests or obligations hereunder may be assigned by any of
the parties hereto without the prior written consent of the other parties. This
Agreement shall be binding upon and inure solely to the benefit of each party
hereto, and nothing herein, express or implied, is intended to or shall confer
upon any Person not a party hereto any right, benefit or remedy of any nature
whatsoever under or by reason hereof, except as otherwise provided herein. In
the event that any Stockholder desires to transfer any shares of capital stock
(or rights to purchase shares of capital stock) owned by such Stockholder to any
affiliate of such Stockholder, then it shall be a condition to such transfer
that any such affiliate transferee agree to become a party to, and bound by,
this Agreement in the same capacity as the Stockholder that transferred such
shares of capital stock (or rights to purchase shares of capital stock) to it.
SECTION 2.3 Term.
(a) The rights and obligations of the Xxxxx Parties hereunder
(except with respect to Section 1.5(a)) shall automatically terminate upon
occurrence of a Xxxxx Termination Event.
(b) The rights and obligations of the Maverick Parties hereunder
(except with respect to Section 1.5(b)) shall automatically terminate upon
occurrence of a Maverick Termination Event.
(c) The rights and obligations of the Prentice Parties hereunder
(except with respect to Section 1.5(c)) shall automatically terminate upon the
occurrence of a Prentice Termination Event.
SECTION 2.4 Amendments. This Agreement may not be amended or modified
except by an instrument in writing signed by, or on behalf of, the parties
against whom such amendment or modification is sought to be enforced.
SECTION 2.5 Descriptive Headings. The descriptive headings of this
Agreement are inserted for convenience of reference only and do not constitute a
part of and shall not be utilized in interpreting this Agreement.
SECTION 2.6 Notices and Addresses. Any notice, demand, request, waiver, or
other communication under this Agreement shall be in writing and shall be deemed
to have been duly given on the date of service, if personally served or sent by
facsimile; on the business day after notice is delivered to a courier or mailed
by express mail, if sent by courier delivery service or express mail for next
day delivery; and on the fifth business day after mailing, if mailed to the
party
to whom notice is to be given, by first class mail, registered, return receipt
requested, postage prepaid and addressed as follows:
To the Company: Bluefly, Inc.
00 Xxxx 00xx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Chief Financial Officer and General Counsel
With a copy (which shall not constitute notice) to:
Dechert LLP
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
To the Xxxxx Parties: Quantum Industrial Partners LDC
SFM Domestic Investments LLC
c/x Xxxxx Fund Management LLC
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxx Xxxxxxxxxxxx
With a copy (which shall not constitute notice) to:
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxx Xxxxxxxx, Esq.
To the Maverick Parties: Maverick Fund USA, Ltd.
Maverick Fund, L.D.C.
Maverick Fund II, Ltd.
c/o Maverick Capital, Ltd.
000 Xxxxxxxx Xxxxx, 00xx Xxxxx
Xxxxxx Xxxxx 00000
Facsimile: (000) 000-0000
Attention: General Counsel
With a copy (which shall not constitute notice) to:
Shearman & Sterling
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxxx, Esq.
To the Prentice Parties: Prentice Capital Management, L.P.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx
Facsimile: (000) 000-0000
With a copy (which shall not constitute notice) to:
Xxxxxxx Xxxx & Xxxxx, LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
Facsimile: (000) 000-0000
SECTION 2.7 Severability. In the event that any provision of this
Agreement becomes or is declared by a court of competent jurisdiction to be
illegal, void or unenforceable, the remainder of this Agreement will continue in
full force and effect and the application of such provision to other persons or
circumstances will be interpreted so as reasonably to effect the intent of the
parties hereto. The Parties further agree to replace such void or unenforceable
provision of this Agreement with a valid and enforceable provision that will
achieve, to the extent possible, the economic, business and other purposes of
such void or unenforceable provision.
SECTION 2.8 Governing Law; Choice of Forum. This Agreement shall be
governed by and construed in accordance with the internal laws of the State of
New York, without regard to conflicts of law principles. Each of the parties
hereto hereby irrevocably and unconditionally submits to the exclusive
jurisdiction of any court of the State of New York or any federal court sitting
in the City of New York for purposes of any suit, action or other proceeding
arising out of this Agreement (and agrees not to commence any action, suit or
proceedings relating hereto except in such courts). Each of the parties hereto
agrees that service of any process, summons, notice or document by U.S.
registered mail at its address set forth herein shall be effective service of
process for any action, suit or proceeding brought against it in any such court.
Each of the parties hereto hereby irrevocably and unconditionally waives any
objection to the laying of venue of any action, suit or proceeding arising out
of this Agreement, which is brought by or against it, in the courts of the State
of New York or any federal court sitting in the State of New York and hereby
further irrevocably and unconditionally waives and agrees not to plead or claim
in any such court that any such action, suit or proceeding brought in any such
court has been brought in an inconvenient forum.
SECTION 2.9 Counterparts; Facsimile Signatures. This Agreement may be
executed in one or more counterparts, all of which shall be considered one and
the same agreement and shall
become effective when one or more counterparts have been signed by each of the
parties and delivered to the other party, it being understood that all parties
need not sign the same counterpart. This Agreement may be executed by facsimile,
and a facsimile signature shall have the same force and effect as an original
signature on this Agreement.
SECTION 2.10 Independent Nature of New Investors' Obligations and Rights.
The obligations of each New Investor under any Transaction Document are several
and not joint with the obligations of any other New Investor, and no New
Investor shall be responsible in any way for the performance of the obligations
of any other New Investor under any Transaction Document. Nothing contained
herein or in any Transaction Document, and no action taken by any party hereto
pursuant thereto, shall be deemed to constitute the New Investors and the Xxxxx
Parties as a partnership, an association, a joint venture or any other kind of
entity, or create a presumption that the New Investors and the Xxxxx Parties are
in any way acting in concert or as a group with respect to such obligations or
the transactions contemplated by the Transaction Documents. Each New Investor
shall be entitled to independently protect and enforce its rights, including
without limitation the rights arising out of this Agreement or out of the other
Transaction Documents, and it shall not be necessary for any other New Investor
to be joined as an additional party in any proceeding for such purpose. Each New
Investor has been represented by its own separate legal counsel in their review
and negotiation of the Transaction Documents.
SECTION 2.11 Specific Performance. Each of the parties hereto, in addition
to being entitled to exercise all of its rights hereunder, including recovery of
damages, shall be entitled to specific performance of its rights under this
Agreement. Each party agrees that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions
of this Agreement and hereby agrees to waive the defense in any action for
specific performance that a remedy at law would be adequate.
SECTION 2.12 No Violations. Each of the parties hereto agree that no party
hereto shall be obligated to comply with any provisions of this Agreement
relating to the voting of shares of capital stock of the Company if doing so
would constitute a violation of law or public policy.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, this Agreement has been duly executed on the date
first set forth above.
BLUEFLY, INC.
By:
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Name:
Title:
QUANTUM INDUSTRIAL PARTNERS LDC
By:
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Name:
Title:
SFM DOMESTIC INVESTMENTS LLC
By:
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Name:
Title:
MAVERICK FUND USA, LTD
By: MAVERICK CAPITAL, LTD.,
as its Investment Manager
By:
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Name:
Title:
MAVERICK FUND L.D.C.
By: MAVERICK CAPITAL, LTD.,
as its Investment Manager
By:
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Name:
Title:
MAVERICK FUND II, LTD
By: MAVERICK CAPITAL, LTD.,
as its Investment Manager
By:
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Name:
Title:
PRENTICE-BLUEFLY, LLC
By: PRENTICE CAPITAL MANAGEMENT, LP,
as its Manager
By:
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Name:
Title:
