EXHIBIT 9
STOCKHOLDER AGREEMENT
This Stockholder Agreement (hereinafter the "Agreement") is made and
entered into as of January 12, 2001, by and between XXXXXXXXXX.XXX, INC. (the
"Company"), on the one hand, and BCG STRATEGIC INVESTORS, LLC, BARINGTON CAPITAL
GROUP, L.P., BARINGTON COMPANIES EQUITY PARTNERS, L.P. and DOT COM INVESTMENT
CORPORATION (each, a "Stockholder and collectively, the "Stockholders"), on the
other hand. As referred to in this Agreement, the Company and the Stockholders
are each a "Party" and collectively are the "Parties."
RECITALS
A. The Stockholders Beneficially Own in the aggregate 1,271,466
shares of the outstanding Company Common Stock;
B. The Stockholders have requested representation on the Board of
Directors of the Company (the "Board"), and have initiated a consent
solicitation (the "Consent Solicitation") to, among other things, appoint a
majority of the Board;
C. The Board has determined that it is in the best interests of the
stockholders of the Company to fill three vacancies on the Board and to take
the other actions contemplated by this Agreement; and
D. The Company and the Stockholders desire, in connection with the
appointment of three members to the Board, to make certain covenants and
agreements with one another pursuant to this Agreement.
NOW THEREFORE, in consideration of the covenants and promises set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:
ARTICLE I
STANDSTILL OBLIGATIONS AND TRANSFER RESTRICTIONS
1.1 Appointment of Stockholders' Nominees to the Board.
(a) Unless otherwise agreed by the Stockholder Nominees (as
hereinafter defined) and except as provided in Section 1.1(c), the Board shall
continue to consist of not more than seven (7) members.
(b) The Company hereby agrees that within twenty-four hours
following the date of this Agreement, the Board shall appoint Xxxxx Xxxxxxxxxxx,
as a Class A director, Xxxxxx Xxxxxx, Jr. as a Class B director and Xxxxxxx
Xxxxxxxx as a Class C director to fill the three current vacancies on the Board
(collectively, together with any additional or successor nominees appointed by
the Stockholders or the Stockholder Nominees pursuant to this Agreement, the
"Stockholder Nominees"). Following the appointment of the Stockholder Nominees,
Xxxxxxx Xxxxxxxx shall be
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appointed as Chairman of the Board for a term of not less than the Standstill
Period. The Stockholder Nominees shall be given representation on each committee
of the Board in proportion to the percentage of total board members they
represent. As compensation for the services to the Company during the Standstill
Period, Messrs. Xxxxxxxxxxx and Xxxxxxxx will receive, in the aggregate, $10,000
per month and immediately exercisable options to purchase an aggregate of
150,000 shares of Company Common Stock (the "Options") at an exercise price
equal to the closing price of the Company Common Stock as quoted on Nasdaq on
January 12, 2001, or the economic equivalent of such Options in stock
appreciation rights, as the parties shall mutually agree, and in each case in
compliance with all applicable laws; provided, however, that if any portion of
such Options shall be exercised prior to the conclusion of the Standstill
Period, then, during the Standstill Period, a majority of the Current Directors
(as hereinafter defined) shall be entitled to direct any and all voting of the
shares of Company Common Stock received upon such exercise of the Options (and
such restrictions shall be reflected in the Option documentation). In the event
that either Xx. Xxxxxxxx or Xx. Xxxxxxxxxxx shall voluntarily resign his
respective position as Chairman or President and Chief Executive Officer of the
Company (as hereinafter provided) prior to the termination of the Standstill
Period, then such resigning person shall return to the Company at no cost (or at
the exercise price in the case of Company Common Stock acquired pursuant to an
option exercise) that portion of the Options received by such person (or Company
Common Stock acquired upon exercise of Options) equal to the product of (A) the
aggregate number of shares of Company Common Stock underlying all Options
received by the resigning person divided by ninety (90), multiplied by (B) the
number of remaining days in the Standstill Period following such resignation.
During the Standstill Period, the Stockholders agree that they will not take any
action the purpose of which is the removal from the Board of any director of the
Company who held such position immediately prior to the execution of this
Agreement (each, a "Current Director" and collectively, the "Current
Directors"). If at any time during the Standstill Period there shall occur a
vacancy in a Board seat previously occupied by a Stockholder Nominee by reason
of resignation, removal, death or incapacity, then such vacancy shall be filled
by a person nominated by the remaining Stockholder Nominees then in office, or
if there shall be no such remaining Stockholder Nominees, by the Stockholders,
in each case with appropriate background and experience. If at any time during
the Standstill Period there shall occur a vacancy in a Board seat previously
occupied by a Current Director by reason of resignation, removal, death or
incapacity, then such vacancy shall be filled by a person nominated by the
remaining Current Directors then in office, or if there shall be no such
remaining Current Directors, by a majority of the stockholders of the Company
other than the Stockholders, in each case with appropriate background and
experience.
(c) Following the conclusion of the Standstill Period, in the
event that the Stockholders request in writing that the Company appoint a fourth
nominee of the Stockholders to the Board, the Board shall appoint Xxxxx Xxxxxx
to the Board. If Xxxxx Xxxxxx is unable or unwilling to serve on the Board, then
the Stockholders shall be entitled to nominate another individual with
appropriate background and experience to serve as their fourth nominee. If upon
such Stockholder request there shall be no vacancies on the Board, one Current
Director shall resign his Board seat and thereby create the necessary vacancy.
If no Current Director agrees to resign his Board seat following a request of
the Stockholders for an additional Board seat, then the Company hereby agrees to
support a consent solicitation on behalf of the Stockholders to increase the
Board by two seats and to appoint two nominees of the Stockholders to such newly
created seats.
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1.2 Appointment of New President and Chief Executive Officer.
Effective on January 18, 2001 and following the Company's
termination on that date of Xxxxxxxxx Puthukarai as the President and Chief
Executive Officer of the Company, the Board shall appoint Xxxxx Xxxxxxxxxxx as
the President and Chief Executive Officer of the Company for a term not less
than the Standstill Period. The Chief Executive Officer shall have such power
and authority as has been traditionally exercised by the Chief Executive Officer
of the Company which shall include, without limitation, the power to approve (i)
all cash expenditures of the Company in excess of $5,000 (excluding (A) payments
provided for in this Agreement and (B) the settlement of the current securities
class action lawsuit against the Company and any Current Director or any other
action brought against any Current Director or officer for which the Company has
an indemnification obligation, which expenditures the Board shall have the sole
authority to approve but with respect to any settlement of such securities class
action lawsuit, only in accordance with the procedures set forth in Section
3.4); (ii) all arrangements to terminate the Company's existing real property
and other lease obligations; (iii) all payments on music licensing arrangements;
(iv) hiring and firing of all employees (including officers other than the Chief
Executive Officer) and consultants; and (v) all severance arrangements entered
into after the date hereof. During the Standstill Period, Xx. Xxxxxxxxxxx shall
not be removed as President and Chief Executive Officer of the Company nor shall
his power and authorities be diminished except for Cause and with a vote of at
least 70% of the Board. For purposes of this Agreement, "Cause" shall mean (i)
willful malfeasance materially injurious to the Company or its stockholders in
their capacity as stockholders or (ii) conviction of a felony. During the
transition period from the date hereof until Mr. Puthukarai's termination, the
current President and Chief Executive Officer shall consult with Xx. Xxxxxxxxxxx
on all management decisions, including those matters enumerated above, and shall
not take any such action without Xx. Xxxxxxxxxxx'x approval.
1.3 The Stockholders' Standstill Obligations.(a) The Stockholders hereby
represent and warrant that, as of the date hereof, the Stockholders, together
with their Affiliates, Beneficially Own an aggregate of 1,271,466 shares of
Company Common Stock.
(b) During the Standstill Period, each Stockholder agrees that it
shall not, nor shall any Stockholder permit any Stockholder Controlled Person
to, nor shall any Stockholder act in concert with nor permit any Stockholder
Controlled Person to act in concert with any person to, directly or indirectly,
(i) acquire (other than upon the exercise of the Options) any additional
Beneficially Owned Stock or authorize or make a tender offer, exchange offer or
other offer or proposal, whether oral or written, to acquire Stock, if the
effect of such acquisition or Beneficial Ownership would be to increase above
the Standstill Limit the Stock represented by all Stock Beneficially Owned by
the Stockholders (including without limitation any 13D Group to which any
Stockholder or any Stockholder Controlled Person is a party).
(c) During the Standstill Period, each Stockholder agrees that it
shall not, nor shall any Stockholder permit any Stockholder Controlled Person
to, nor shall any Stockholder act in concert with nor permit any Stockholder
Controlled Person to act in concert with any person to, solicit or participate
in any solicitation of proxies, written consents or similar authorizations with
respect to any Stock, nor shall they seek to advise or influence in any manner
any person with respect to the voting of any Stock. Furthermore, the
Stockholders agree to immediately withdraw
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and terminate the Consent Solicitation (including, without limitation, promptly
filing a request to withdraw or otherwise terminate the preliminary Schedule 14A
filed by the Stockholders) and any other outstanding consent solicitation or
similar action with respect to the matters contemplated by this Section 1.3.
(d) During the Standstill Period, each Stockholder agrees that it
shall not, nor shall any Stockholder permit any Stockholder Controlled Person
to, nor shall any Stockholder act in concert with nor permit any Stockholder
Controlled Person to act in concert with any person to, deposit any Stock in a
voting trust or, except as otherwise provided or contemplated herein, subject
any Stock to any arrangement or agreement with any person with respect to the
voting of such Stock.
(e) During the Standstill Period, each Stockholder agrees that it
shall not, nor shall any Stockholder permit any Stockholder Controlled Person
to, nor shall any Stockholder act in concert with nor permit any Stockholder
Controlled Person to act in concert with any person to, join a 13D Group (other
than a group comprised solely of the Stockholders) or other group, or otherwise
act in concert with any third person for the purpose of acquiring, holding,
voting or disposing of Stock.
(f) During the Standstill Period, each Stockholder agrees that it
shall not, nor shall any Stockholder permit any Stockholder Controlled Person
to, nor shall any Stockholder act in concert with or permit any Stockholder
Controlled Person to act in concert with any person to, otherwise act, alone or
in concert with others, to seek control of the Board or to seek waiver of any
provision of this Agreement.
1.4 Transfer Restrictions. (a) During the Standstill Period, the
Stockholders shall not, directly or indirectly, sell, transfer, pledge, contract
to sell, sell any option or contract to purchase, purchase any option or
contract to sell, grant any option, right or warrant to purchase, transfer the
economic risk of ownership of, or otherwise dispose of (each, a "Transfer"), any
Stock in a manner prohibited by this Section 1.4. Any attempted Transfer not in
compliance with this Section 1.4 shall be null and void ab initio.
(b) Each Stockholder agrees that it shall not Transfer any Stock
to any person (other than an Affiliate of such Stockholder who agrees in writing
to be bound by the terms of this Agreement and which does not have the effect of
increasing the aggregate amount of Stock held by all Stockholders and their
Affiliates) who is, or after giving effect to the Transfer would be, (a) a
Beneficial Owner of five percent (5%) or more of any class of the then
outstanding Stock, (b) a Beneficial Owner of more than five percent (5%) of then
Total Current Voting Power or (c) required to file a Schedule 13D or Schedule
13G with the SEC with respect to such Stock.
1.5 Notification of Change in Beneficial Ownership. During the Standstill
Period, each Stockholder shall notify the Company in writing of any proposed
change in Beneficial Ownership of Stock by such Stockholder or any Stockholder
Controlled Person at least three (3) business days prior to such change or any
commitment to make such change, including the name of the transferee and the
material terms of such change.
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ARTICLE II
VOTING OBLIGATIONS
2.1 The Stockholders' Voting Obligations.(a) During the Standstill Period,
each of the Stockholders agrees that it shall take such action as may be
required so that all Stock Beneficially Owned by such Stockholder or any
Stockholder Controlled Person (and shall use all reasonable efforts to cause any
Stock held by an Affiliate of such Stockholder or any 13D Group of which such
Stockholder or any Affiliate of such Stockholder is a party) are voted for or
cast or cause to be voted or cast in the manner consistent with the terms of
this Agreement, including, but not limited to, in favor of the retention of the
Current Directors should such a vote arise.
(b) During the Standstill Period, each of the Stockholders, as
holders of shares of Stock, shall be present, in person or by proxy (and shall
cause any Stockholder Controlled Persons Beneficially Owning Stock to be so
present and shall use reasonable efforts to cause its Affiliates and all 13D
Groups of which it or any of its Affiliates is a party Beneficially Owning Stock
to be so present) at all meetings of stockholders of the Company so that all
shares of Stock Beneficially Owned by it, any of its Affiliates, any 13D Groups
of which it or any of its Affiliates is a party and any Stockholder Controlled
Person may be counted for purposes of determining the presence of a quorum at
such meetings.
ARTICLE III
ADDITIONAL OBLIGATIONS
3.1 Expenses of Consent Solicitation. In consideration of the benefits to
the Company of the agreements of the Stockholders and their Affiliates herein
contained and the substantial savings to be realized by the Company, the Company
hereby agrees to reimburse the Stockholders for all reasonable fees and expenses
up to an amount equal to $200,000 incurred by or on behalf of the Stockholders
in conjunction with or related to (i) the Consent Solicitation and (ii) the
transactions contemplated by this Agreement.
3.2 Insurance. The Company hereby agrees (and the Stockholders hereby
agree to take such action as necessary to cause the Stockholder Nominees (and
their successors on the Board) to utilize their Board authority to vote in favor
of) (i) to honor its indemnification obligations to all current and former
directors and officers, and (ii) to maintain in full force the Company's
existing director and officer insurance policies, and to use commercially
reasonable best efforts to obtain additional policies to continue the coverage
provided by the existing policies.
The Parties further agree that the Company shall continue to retain Xxxxxx
Xxxxxxx Xxxxxxxx & Xxxxxx, Professional Corporation as counsel to the Company
for purposes of defending the current securities class action suit in which the
Company and some of its current and/or former directors and/or officers are
defendants, provided, however, that the power to retain counsel shall at all
times remain with and be vested in the Board.
3.3 Existing Employment and Severance Obligations. The Stockholders agree
to take such action as necessary to cause the Stockholder Nominees (and their
successors on the Board) to utilize their Board authority to vote in favor of
the Company honoring all existing employment and severance obligations, which
obligations are set forth on Exhibit A hereto.
3.4 Settlement of Litigation. During the Standstill Period, the Board
shall not authorize any expenditure in settlement of any litigation unless, (i)
such authorization is made at a meeting in
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which the entire Board is present in person or by telephonic conference
(provided that if a director has been given a reasonable opportunity to attend
such meeting, including reasonable accommodation for any personal needs of such
director, and such director fails to attend such meeting, he shall be deemed
present for purposes of this clause (i)), counsel to the Company shall be
present and shall make a comprehensive presentation to the Board concerning the
facts and circumstances of the litigation, the legal issues involved and the
advisability (in such counsel's professional judgment) of the settlement, (iii)
if so requested by the Stockholder Nominees, counsel to the Stockholder Nominees
shall be given reasonable and appropriate opportunity to be present and to
express its professional judgment on the advisability of the settlement, and
(iv) at least a majority of the Board affirmatively determines in good faith
that such settlement is in the best interest of the Company and its
stockholders.
3.5 Amendment to Rights Plan. As soon as practicable following the
execution of this Agreement, the Company shall amend the Company's rights
agreement in a manner that (i) would allow a consent solicitation to be
conducted by the Stockholders on a private basis following termination of the
Standstill Period, and (ii) permits the issuance of the Options and the Common
Stock underlying the Options, in each case, without triggering the issuance of
rights as currently contemplated under such agreement.
ARTICLE IV
For the purpose of this Agreement, the following terms shall have the
meanings specified with respect thereto below:
"Affiliate" shall have the meaning set forth in Rule 12b-2 of the rules
and regulations promulgated under the Exchange Act; provided, however, that for
purposes of this Agreement, the Stockholders and their Affiliates, on the one
hand, and the Company, on the other, shall not be deemed to be "Affiliates" of
one another.
Any person shall be deemed the "Beneficial Owner" of and shall be deemed
to "Beneficially Own" and to have "Beneficial Ownership" of any securities:
(i) which such person (or, if such person is a Stockholder, any
Stockholder Controlled Person) beneficially owns, directly or indirectly, for
purposes of Section 13(d) of the Exchange Act and Rule 13d-3 thereunder (or any
comparable or successor law or regulation);
(ii) which a person (or, if such person is a Stockholder, any
Stockholder Controlled Person) has (A) the right to acquire (whether such right
is exercisable immediately or only after the passage of time) pursuant to any
agreement, arrangement or understanding (other than customary agreements with
and between underwriters and selling group members with respect to a bona fide
public offering of securities), or upon the exercise of conversion rights,
exchange rights, rights, warrants or options, or otherwise; or
(iii) which are beneficially owned, directly or indirectly, by any
other person (or any Affiliate thereof) with which a person (or, if such person
is the Stockholder, any Stockholder Controlled Person) has any agreement,
arrangement or understanding (other than customary agreements with and between
underwriters and selling group members with respect to a
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bona fide public offering of securities) for the purpose of acquiring, holding,
voting, or disposing of any securities of the Company.
"Company Common Stock" shall mean shares of the common stock of the
Company, par value $.01 per share, and any securities into which such shares are
exchanged or converted.
"Control" or "Controlled by" shall have the meaning set forth in Rule
12b-2 of the rules and regulations promulgated under the Exchange Act.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
"person" shall mean an individual, corporation, partnership, limited
liability company, association, trust, or other entity or organization,
including a government or political subdivision or an agency or instrumentality
thereof.
"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Shares" shall mean the outstanding shares of Company Common Stock as of
the date of this Agreement (and all securities issued with respect to or in
exchange for such shares pursuant to stock splits, stock dividends,
recapitalizations and similar events).
"Standstill Limit" shall mean 1,271,466 shares of Stock.
"Standstill Period" shall mean the period beginning on the date hereof and
ending at 12:00 a.m. New York City time on the ninetieth (90th) day following
the date of this Agreement.
"Stock" shall mean shares of the Company Common Stock, any other
securities of the Company or its successor having the power to vote in the
election of members of the Board or the board of directors of any successor to
the Company and any securities convertible, exchangeable for or otherwise
exercisable to acquire voting securities.
"Stockholder Controlled Person" shall mean any person over whom the
Stockholder exercises or has the right or ability to exercise, directly or
indirectly, Control.
"Total Current Voting Power" shall mean, with respect to any entity, at
the time of determination of Total Current Voting Power, the total number of
votes which may be cast in the election of members of the board of directors of
the entity if all securities entitled to vote in the election of such directors
are present and voted (or, in the event the entity is not a corporation, the
governing members, board or other similar body of such entity).
"Transfer" shall have the meaning ascribed to it in Section 1.4 hereof.
"13D Group" means any group of persons formed for the purpose of
acquiring, holding, voting or disposing of Stock which would be required under
Section 13(d) of the Exchange Act, and the rules and regulations promulgated
thereunder, to file a statement on Schedule 13D (a "Schedule 13D") pursuant to
Rule 13d-1(a) of the rules and regulations promulgated under the Exchange Act or
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a Schedule 13G of the rules and regulations promulgated under the Exchange Act
pursuant to Rule 13d-1(c) of the rules and regulations promulgated under the
Exchange Act with the SEC as a "person" within the meaning of Section 13(d)(3)
of the Exchange Act if such group Beneficially Owned Stock representing more
than 5% of any class of Stock then outstanding.
ARTICLE V
MISCELLANEOUS
5.1 Governing Law; Jurisdiction and Venue.(a) This Agreement is to be
construed in accordance with and governed by the laws of the State of Delaware
without giving effect to the principles of conflicts of laws.
(b) Any legal action or other legal proceeding relating to this
Agreement or the enforcement of any provision of this Agreement may be brought
or otherwise commenced in any state or federal court located in the State of
Delaware.
Each party hereto agrees to the entry of an order to enforce any
resolution, settlement, order or award made pursuant to this Section 5.1 by the
state and federal courts located in the State of Delaware and in connection
therewith hereby waives, and agrees not to assert by way of motion, as a
defense, or otherwise, any claim that such resolution, settlement, order or
award is inconsistent with or violative of the laws or public policy of the laws
of the State of Delaware or any other jurisdiction.
5.2 Assignment. This Agreement shall be binding upon and shall inure to
the benefit of the parties hereto and their respective successors and assignees.
5.3 Entire Agreement; Amendment. This Agreement and the agreements
referred to herein (to the extent referred to herein) constitute the full and
entire understanding and agreement between the parties with regard to the
subject matter hereof. Except as expressly provided herein, neither this
Agreement nor any term hereof may be amended, waived, discharged or terminated
other than by a written instrument signed by the party against whom enforcement
of any such amendment, waiver, discharge or termination is sought. No amendment
or waiver of any provision of this Agreement on behalf of the Company shall be
valid and/or effective unless and until such amendment or waiver is approved by
a majority of the Current Directors regardless of whether they are then serving
on the Board.
5.4 Notices, etc. All notices and other communications required or
permitted hereunder shall be made, if to the Company, to the Company's offices
at 00000 Xxxxxxxxx Xxxx., Xxxxx 00, Xxxxxx, XX 00000, Attn: Chief Financial
Officer, with a copy to Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx 000 Xxxx Xxxx Xxxx,
Xxxx Xxxx, XX 00000, Attn: Xxxxxx Xxxxxxx, and if to the Stockholders, to BCG
Strategic Investors, LLC at 000 Xxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attn: Xxxxx Xxxxxxxxxxx, with a copy to Xxxxxx Xxxxx Xxxxxxxx & Xxxxxxx
LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn: Xxxx Xxxxxxxx, and shall
be deemed delivered upon the receipt thereof.
5.5 Delays or Omissions. No delay or omission to exercise any right, power
or remedy accruing to a party under this Agreement shall impair any such right,
power or remedy nor shall it be construed to be a waiver of any such breach or
default, or an acquiescence therein, or of or in any
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similar breach or default thereafter occurring; nor shall any waiver of any
single breach or default be deemed a waiver of any other breach or default
theretofore or thereafter occurring.
5.6 Expenses. Except as otherwise specifically provided herein, the
Company and the Stockholders shall bear their own expenses incurred with respect
to this Agreement and the transactions contemplated hereby.
5.7 SPECIFIC PERFORMANCE. HE PARTIES HERETO AGREE THAT IRREPARABLE DAMAGE
WOULD OCCUR IN THE EVENT THAT ANY OF THE PROVISIONS OF THIS AGREEMENT WERE NOT
PERFORMED IN ACCORDANCE WITH ITS SPECIFIC INTENT OR WERE OTHERWISE BREACHED. IT
IS ACCORDINGLY AGREED THAT THE PARTIES SHALL BE ENTITLED TO AN INJUNCTION OR
INJUNCTIONS, WITHOUT BOND, TO PREVENT OR CURE BREACHES OF THE PROVISIONS OF THIS
AGREEMENT AND TO ENFORCE SPECIFICALLY THE TERMS AND PROVISIONS HEREOF, THIS
BEING IN ADDITION TO ANY OTHER REMEDY TO WHICH THEY MAY BE ENTITLED BY LAW OR
EQUITY, AND ANY PARTY SUED FOR BREACH OF THIS AGREEMENT EXPRESSLY WAIVES ANY
DEFENSE THAT A REMEDY IN DAMAGES WOULD BE ADEQUATE.
5.8 Further Assurances. The parties hereto shall do and perform or cause
to be done and performed all such further acts and things and shall execute and
deliver all such other agreements, certificates, instruments or documents as any
other party may reasonably request from time to time in order to carry out the
intent and purposes of this Agreement and the consummation of the transactions
contemplated hereby. Neither the Company nor any Stockholder shall voluntarily
undertake any course of action inconsistent with satisfaction of the
requirements applicable to them set forth in this Agreement and each shall
promptly do all such acts and take all such measures as may be appropriate to
enable them to perform as early as practicable the obligations herein and
therein required to be performed by them.
5.9 Facsimile; Counterparts. This Agreement may be executed by facsimile
and in any number of counterparts, each of which may be executed by fewer than
all of the parties, each of which shall be enforceable against the parties
actually executing such counterparts, and all of which together shall constitute
one instrument.
5.10 Severability. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision as close as possible to the intent of the parties.
5.11 Interpretation.
(a) The various section headings are inserted for purposes of
reference only and shall not affect the meaning or interpretation of this
Agreement or any provision hereof. The definitions contained in this Agreement
are applicable to the singular as well as the plural forms of such terms and to
the masculine as well as to the feminine and neuter genders of such terms, as
well as to the noun and verb forms of such definitions.
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(b) Each party hereto acknowledges that it has been represented by
competent counsel and participated in the drafting of this Agreement, and agrees
that any applicable rule of construction to the effect that ambiguities are to
be resolved against the drafting party shall not be applied in connection with
the construction or interpretation of this Agreement.
5.12 Attorneys' Fees. In any action at law or suit in equity in relation
to this Agreement, the prevailing party in such action or suit shall be entitled
to receive a reasonable sum for its attorneys' fees and all other reasonable
costs and expenses incurred in such action or suit.
5.13 Release of Claims.
(a) Each of the Stockholders, on behalf of itself and its heirs,
executors, assigns and Affiliates hereby fully and forever releases each of the
current officers, employees and Current Directors and their respective
Affiliates, as well as all former officers, directors and employees of the
Company (collectively, "Company Persons") from, and agrees not to xxx
concerning, any claim, demand, duty, obligation or cause of action in law,
equity or otherwise, whether presently known or unknown, suspected or
unsuspected, arising from or relating to any omissions, acts or facts that have
occurred through and including the date of this Agreement arising from or in any
way related to their service as officers, directors or employees of the Company.
(b) The Company on behalf of itself and its assigns and Affiliates
hereby fully and forever releases the Stockholders, their respective officers,
directors, partners, members, managers, Affiliates and employees (collectively,
"Stockholder Persons") from, and agrees not to xxx concerning, any claim,
demand, duty, obligation or cause of action in law, equity or otherwise, whether
presently known or unknown, suspected or unsuspected, arising from or relating
to any omissions, acts or facts that have occurred through and including the
date of this Agreement arising from or in any way related to their acquisition
of shares of the Company or the Consent Solicitation.
The parties agree that the releases set forth in this section shall
be and remain in effect in all respects as a complete general release as to the
matters released. Notwithstanding anything contained in this Section 5.13 to the
contrary, this Section 5.13 shall not apply to any claim, demand, duty,
obligation or cause of action in law, equity or otherwise arising out of a
breach of the obligations contained in this Agreement.
5.14 No Pending or Future Lawsuits. Each Party represents that it has no
lawsuits, claims, or actions pending in its name, or on behalf of any other
person or entity, against any other Party or any of its respective current or
former officers, directors, employees, partners, members or Affiliates, and
further represents that, with respect to any matter that has been released
pursuant to Section 5.13, it does not currently intend to bring any claims on
its own behalf or on behalf of any other person or entity against the other
Party or any of its respective current officers, directors, employees, partners,
members, managers or Affiliates, as well as respective former officers,
directors or employees. With respect to the matters released pursuant to Section
5.13, the Parties agree to refrain and forbear from commencing, instituting or
participating in, either as a named or unnamed party or class member, any
lawsuit, claim, administrative complaint, action or other proceeding brought
against any of the other Party's current or former officers or directors,
whether brought by themselves or by others on their behalf. In such event, this
Agreement may be pled as a full and complete defense thereto.
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5.15 Third Party Beneficiaries. In consideration for, among other value
delivered to the Company and the Stockholders, the Current Directors' continued
service on the Board, the Company Persons are hereby expressly and irrevocably
designated as third party beneficiaries to the Stockholders' and the Company's
obligations under the terms of this Agreement. The Stockholder Persons are
hereby expressly and irrevocably designated as third party beneficiaries to the
Company's obligations set forth in Section 5.13 of this Agreement.
5.16 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
WAIVES ALL RIGHT TO TRIAL BY JURY AND ANY ACTION, PROCEEDING OR COUNTERCLAIM
(WHETHER BASED ON CONTRACT, TORT, OR OTHERWISE) ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR THE ACTIONS OF ANY PARTY HERETO IN NEGOTIATION,
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF.
[The remainder of this page intentionally left blank]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
XXXXXXXXXX.XXX, INC.
By: /s/ Devarajan S. Puthukarai
---------------------------------
Name: Devarajan S. Puthukarai
Title: Chairman
BCG STRATEGIC INVESTORS, LLC
By: /s/ Xxxxx Xxxxxxxxxxx
----------------------------------
Name: Xxxxx Xxxxxxxxxxx
Title: Manager
BARINGTON CAPITAL GROUP, L.P.
By: LNA Capital Corp., its general
partner
By: /s/ Xxxxx Xxxxxxxxxxx
----------------------------------
Name: Xxxxx Xxxxxxxxxxx
Title: Chairman, President and
C.E.O.
[SIGNATURE PAGE TO STOCKHOLDER AGREEMENT]
-15-
BARINGTON COMPANIES EQUITY
PARTNERS, L.P.
By: Barington Companies Investors,
LLC, its general partner
By: /s/ Xxxxx Xxxxxxxxxxx
----------------------------------
Name: Xxxxx Xxxxxxxxxxx
Title: Manager
DOT COM INVESTMENT CORPORATION
By: /s/ Xxxxxxx Xxxxxxxx
----------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: President
[SIGNATURE PAGE TO STOCKHOLDER AGREEMENT]
-16-
