Initial Public Offering (IPO): Registration Statement (General Form) — Form S-1
Filing Table of Contents
Document/Exhibit Description Pages Size
1: S-1 Gerber Childrenswear, Inc. 131 744K
2: EX-4.2 Credit Agreement 108 427K
3: EX-10.1 Stock Purchase Agreement 51 215K
11: EX-10.10 Subordination and Interceditor Agreement 17 68K
12: EX-10.11 Junior Subordinated Note 25 100K
13: EX-10.13 License Agreement 28 91K
14: EX-10.14 License Agreement 31 73K
15: EX-10.15 Trademark License Agreement 33 127K
16: EX-10.16 Lease Agreement 7 31K
17: EX-10.17 Lease Agreement 6 28K
18: EX-10.18 Lease Agreement 6 28K
19: EX-10.19 Lease Agreement 11 37K
4: EX-10.2 Form of Executive Stock Purchase Agreement 21 90K
20: EX-10.20 Lease Agreement 40 120K
21: EX-10.21 Severance Agreement 2 14K
5: EX-10.3 Form of Manager Securities Purchase Agreement 17 69K
6: EX-10.4 Securities Purchase Agreement 13 60K
7: EX-10.5 Form of Director Stock Purchase Agreement 12 44K
8: EX-10.7 Stock Purchase Agreement 54 224K
9: EX-10.8 Share Purchase Agreement 52 242K
10: EX-10.9 Amended and Restated Credit Agreement 54 238K
22: EX-21.1 Subsidiaries of the Registrant 1 8K
23: EX-23.1 Consent of Ernst & Young LLP 1 10K
24: EX-23.2 Consent of Jc Holland & Co Psc 1 8K
25: EX-23.3 Consent Price Waterhouse 1 8K
26: EX-27.1 Financial Data Schedule 1 10K
EX-10.3 — Form of Manager Securities Purchase Agreement
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EXHIBIT 10.3
FORM OF MANAGER SECURITIES PURCHASE AGREEMENT
THIS AGREEMENT is made as of _______________ by and among
GCIH, Inc., a Delaware corporation (the "Company"), _________ (the "Manager")
and Citicorp Venture Capital, Ltd., a New York corporation, ("CVC"). CVC is made
a party to this Agreement solely for purposes of the repurchase rights of CVC
set forth in Section 4.
WHEREAS, the Company and/or its Subsidiaries have established
a written compensatory benefit plan for the participation of certain employees
(the "Plan"), and the Manager and other employees (collectively, the "Managers")
desire to participate in the Plan;
WHEREAS, pursuant to the Plan, the Company, and the Manager
desire to enter into an agreement pursuant to which Manager will purchase, and
the Company will sell __________ shares of the Company's Class B Common Stock,
par value $0.01 per share (the "Class B Common"), upon the terms and conditions
set forth herein. All of such shares of Class B Common and all shares of capital
stock hereafter acquired by the Manager are referred to herein as "Manager
Stock";
NOW, THEREFORE, the parties hereto agree as follows:
1. Definitions. As used herein, the following terms
shall have the following meanings.
"Affiliate" shall mean, as to any Person, any other Person
which directly or indirectly controls, or is under common control with, or is
controlled by, such Person. As used in this definition, "control" (including,
with its correlative meanings, "controlled by" and "under common control with")
shall mean possession, directly or indirectly, of power to direct or cause the
direction of management or policies (whether through ownership of securities or
partnership or other ownership interests, by contract or otherwise).
"Board" means the Company's board of directors.
"Book Value" of each share of Manager Stock shall be equal to
the quotient determined by dividing (A) the excess of Company's consolidated
assets over its consolidated liabilities as of the end of the fiscal quarter
immediately preceding the date of Manager's Termination, determined on a
consolidated basis in accordance with GAAP less the liquidation value of all of
the Company's outstanding preferred stock, if any by (B) the total number of
shares of Common Stock outstanding on a fully-diluted basis (including in such
calculation the aggregate conversion price an exercise price of all outstanding
convertible securities, options and warrants).
"Business Day" means any day other than a Saturday or Sunday
or a day on which commercial banks are required or authorized to close in New
York, New York.
"Cause" means (i) a material breach of this Agreement by the
Manager that is not susceptible to remedy or cure, or if susceptible to remedy
or cure, is not cured or remedied and continues for a reasonable period of time
after any Executive or the Manager's direct supervisor has given notice to
Manager specifying in reasonable detail the manner in which Manager has breached
this Agreement, (ii) the determination by any Executive, in the exercise of his
reasonable judgment, that the Manager committed a felony, a crime involving
moral turpitude or other act causing material harm to the standing and
reputation of the Company or its Subsidiaries in each case after notice to
Manager and reasonable procedure for Manager to state his case to any Executive,
(iii) the determination by any Executive, in the exercise of his reasonable
judgment, that the Manager breached his duty of loyalty to the Company and its
Subsidiaries after notice to Manager and reasonable procedure for Manager to
state his case to any Executive, or (iv) the Manager's continued failure to
perform his duties to the Company and its Subsidiaries after notice, and, if
susceptible to remedy or cure, is not cured or remedied and continues for a
reasonable period of time after any Executive or the Manager's direct supervisor
has given notice to the Manager specifying in reasonable detail the manner in
which the Manager has continued to fail to perform his duties.
"Common Stock" means the Class A Common, the Class B Common,
the Class C Common, and the Class D Common, as adjusted for any stock split,
stock dividend, share combination, share exchange, recapitalization, merger,
consolidation or other reorganization.
"CVC" means Citicorp Venture Capital, Ltd., a New York
corporation.
"Executives" shall mean Edward Kittredge, Richard Solar, David
Uren, and certain other executive officers of the Company or GCI.
"Manager Stock" is defined in the preamble hereto and will
include shares of the Company's capital stock issued with respect to Manager
Stock by way of a stock split, stock dividend or other recapitalization. Manager
Stock will cease to be Manager Stock when transferred pursuant to a Qualified
Public Offering or Sale of the Company. Manager Stock will continue to be
Manager Stock in the hands of any holder other than the Manager, including all
transferees of the Manager (except for the Company and CVC (or its designee)),
and except as otherwise provided herein, each such other holder of Manager Stock
will succeed to all rights and obligations attributable to the Manager as a
holder of Manager Stock hereunder.
"GAAP" means U.S. generally accepted accounting principles, as
in effect from time to time and as adopted by the Company with the consent of
its independent public accountants, consistently applied.
"GCI" means Gerber Childrenswear, Inc., a Delaware corporation
and wholly-owned subsidiary of the Company.
"Original Cost" of each share of Manager Stock purchased on
the date hereof will be equal to $1.00 per share.
"Permanent Disability" means Manager is unable to perform, by
reason of physical or mental incapacity, his duties or obligations under this
Agreement, for a period of ninety (90)
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consecutive days or a total period of one hundred twenty (120) days in any three
hundred sixty (360) day period.
"Person" means an individual, a partnership, a corporation, an
association, a joint stock company, a trust, a joint venture, an unincorporated
organization or a governmental entity or any department, agency or political
subdivision thereof.
"Qualified Public Offering" means any sale, in an
under-written public offering registered under the Securities Act, of shares of
the Company's Common Stock having an aggregate value of at least $30 million.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the date hereof, by and among the Company, CVC, the
Managers and others, as in effect from time to time.
"Sale of the Company" means the sale of the Company, in a
single transaction or a series of related transactions, to a third party (which
is not an Affiliate of the Approving Stockholders) (a) pursuant to which such
third party proposes to acquire all or substantially all of the outstanding
Common Stock (whether by merger, consolidation, recapitalization,
reorganization, purchase of the outstanding Common Stock or otherwise) or all or
substantially all of the consolidated assets of the Company, (b) which has been
approved by the Board and holders of a majority of the outstanding shares of
Common Stock issued to CVC and its Affiliates, other than Citicorp Mezzanine
Partners, L.P., a Delaware limited partnership ("CMP"), voting together as a
single class (the "Approving Stockholders"), and (c) pursuant to which all
holders of Common Stock receive with respect thereto (whether in such
transaction or, with respect to an asset sale, upon a subsequent liquidation)
the same form and amount of consideration per share of Common Stock or, if any
holders are given an option as to the form and amount of consideration to be
received, all holders are given the same option.
"Securities Act" means the Securities Act of 1933, as amended
from time to time.
"Stockholders Agreement" means the Stockholders Agreement,
dated as of the date hereof, by and among the Company, the Executives, CVC, the
Managers and others, as in effect from time to time.
"Subsidiary" means, with respect to any Person, any
corporation, partnership, association or other business entity of which (i) if a
corporation, a majority of the total voting power of shares of stock entitled
(without regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by that Person or one or more of the other Subsidiaries
of that Person or a combination thereof, or (ii) if a partnership, association
or other business entity, a majority of the partnership or other similar
ownership interest thereof is at the time owned or controlled, directly or
indirectly, by any Person or one or more Subsidiaries of that Person or a
combination thereof. For purposes hereof, a Person or Persons shall be deemed to
have a majority ownership interest in a partnership, association or other
business entity if such Person or Persons shall be allocated a majority of
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partnership, association or other business entity gains or losses or shall be or
control the managing director or general partner of such partnership,
association or other business entity.
2. Purchase and Sale of Manager Securities.
(a) Upon execution of this Agreement, the Manager will
purchase, and the Company will sell (i) _________ shares of Class B Common at a
price of $1.00 per share for a total purchase price of _________ (the "Purchase
Price"). The Company will deliver to the Manager certificates representing such
shares, and on the date hereof (the "Purchase Date"), the Manager will deliver
to the Company (or its designee) a check or wire transfer of immediately
available funds in the aggregate amount equal to the Purchase Price. The
Purchase Date may be extended at the option of the Company.
(b) Upon execution of this Agreement, the Manager shall
execute and deliver a joinder to the Stockholders Agreement and a joinder to the
Registration Rights Agreement.
(c) With respect to the Manager Stock, within 30 days after
the Manager purchases any Manager Stock from the Company, the Manager will make
an effective election with the Internal Revenue Service under Section 83(b) of
the Internal Revenue Code and the regulations promulgated thereunder in the form
of Exhibit A attached hereto.
(d) In connection with the purchase and sale of the Manager
Stock hereunder, the Manager represents and warrants to the Company that:
(i) The Manager Stock to be acquired by the Manager
pursuant to this Agreement will be acquired for the Manager's own account and
not with a view to, or intention of, distribution thereof in violation of the
Securities Act, or any applicable state securities laws, and the Manager Stock
will not be disposed of in contravention of the Securities Act or any applicable
state securities laws.
(ii) No commission, fee or other remuneration is to
be paid or given, directly or indirectly, to any Person for soliciting the
Manager to purchase the Manager Stock.
(iii) The Manager Stock is being offered pursuant to
a written compensatory benefit plan established by the Company for the
participation of certain of its employees, copies of which have been provided to
the Manager.
(iv) The Manager is able to bear the economic risk of
the Manager's investment in the Manager Stock for an indefinite period of time
and the Manager understands that the Manager Stock has not been registered under
the Securities Act and cannot be sold unless subsequently registered under the
Securities Act or an exemption from such registration is available.
(v) The Manager has had an opportunity to ask
questions and receive answers concerning the terms and conditions of the
offering of Manager Stock and has had full access to such other information
concerning the Company as the Manager has requested. The Manager has reviewed,
or has had an opportunity to review, the following documents: (A) the Stock
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Purchase Agreement; (B) the Company's Certificate of Incorporation and Bylaws;
(C) the loan agreements, notes and related documents with the Company's senior
lenders; (D) the loan agreement, notes and related documents with the Company's
senior subordinated lender; and (E) all of the materials provided by the Company
to any Person providing financing to the Company, including, but not limited to,
the Company's pro forma balance sheet, as well as financial projections,
estimates, forecasts, budgets, summaries, reports and other related documents.
(vi) This Agreement constitutes the legal, valid and
binding obligation of the Manager, enforceable in accordance with its terms, and
the execution, delivery and performance of this Agreement by the Manager does
not and will not conflict with, violate or cause a breach of any agreement,
contract or instrument to which the Manager is a party or any judgment, order or
decree to which the Manager is subject.
(e) As an inducement to the Company to issue the
Manager Stock to the Manager, and as a condition thereto, the Manager
acknowledges and agrees that neither the issuance of the Manager Stock to the
Manager nor any provision contained herein shall entitle the Manager to remain
in the employment of the Company and its Subsidiaries or affect the right of the
Company to terminate the Manager's employment at any time for any reason.
3. Vesting of Manager Stock. The Manager Stock originally
acquired by the Manager will become vested in accordance with the following
schedule if, as of each such date, the Manager is still employed by the Company
or its Subsidiaries.
[Enlarge/Download Table]
Cumulative Percentage of Shares of Manager Stock
Date Which Will Vest
------------------------------------------------- ------------------------------------------------
October 1, 1997 ("Year 1") 20%
Second anniversary of the date hereof ("Year 2") 40%
Third anniversary of the date hereof ("Year 3") 60%
Fourth anniversary of the date hereof ("Year 4") 80%
Fifth anniversary of the date hereof ("Year 5") 100%
If after ____________, the Manager ceases to be employed by
the Company or its Subsidiaries for any reason, including the death or Permanent
Disability of the Manager, the cumulative percentage of the Manager Stock to
become vested will be determined on a pro rata basis according to the number of
days elapsed since the prior anniversary date.
(b) Shares of Manager Stock which have become vested are
referred to herein as "Vested Shares," and all other shares of Manager Stock are
referred to herein as "Unvested Shares."
4. Repurchase Option on Manager Stock. In the event the Manager
ceases to be employed by the Company and its Subsidiaries for any reason (the
"Termination"), the Manager Stock (whether held by the Manager or one or more of
the Manager's transferees) will be subject to repurchase by first, the Company,
and second, CVC (or its designees) pursuant to the terms and conditions set
forth in this Section 4 (the "Repurchase Option").
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(a) (i) The purchase price for each Unvested Share of Manager
Stock will be the Manager's Original Cost for such share; (ii) the purchase
price for each Vested Share of Manager Stock will be the Book Value for such
share; and (iii) notwithstanding the foregoing, if the Manager's Termination was
for Cause, then the purchase price for each Vested Share and each Unvested Share
will be the Manager's Original Cost.
(b) The Board may elect to cause the Company to purchase (i)
all or a portion of the Unvested Shares and/or, (ii) all or a portion of the
Vested Shares by delivering written notice (the "Repurchase Notice") to the
holder or holders of the Manager Stock within 90 days after the Termination. The
Repurchase Notice will set forth the number of Unvested Shares and Vested Shares
to be acquired from each holder, the aggregate consideration to be paid for such
securities and the time and place for the closing of the transaction. The number
of shares of Manager Stock to be repurchased by the Company shall first be
satisfied to the extent possible from the Manager Stock held by the Manager at
the time of delivery of the Repurchase Notice. If the shares of Vesting Stock
then held by the Manager are less than the total number of shares of Manager
Stock the Company has elected to purchase the Company shall purchase the
remaining Manager Stock elected to be purchased from the other holder(s) of
Manager Stock, pro rata according to the amount of such Manager Stock held by
such other holder(s) at the time of delivery of such Repurchase Notice
(determined as nearly as practicable to the nearest share) provided, however,
that only those shares of Manager Stock subject to the Repurchase Option
pursuant to this Section 4 may be purchased by the Company pursuant to the terms
of this Section 4(b). The number of Unvested Shares and Vested Shares to be
repurchased hereunder will be allocated among the Manager and the other holders
of Manager Stock (if any) pro rata according to the number of shares of Manager
Stock to be purchased from such Persons.
(c) If for any reason the Company does not elect to purchase
all of the shares of Manager Stock that are subject to such Repurchase Option,
pursuant to the Repurchase Option, then CVC (or its designees) shall be entitled
to exercise the Repurchase Option for the Manager Stock the Company has not
elected to purchase (the "Available Securities"). Of the Available Securities,
the Vested Shares are referred to herein as "Available Vested Shares" and
Unvested Shares are referred to herein as "Available Unvested Shares". As soon
as practicable after the Company has determined that there will be Available
Securities, but in any event within 180 days after the Termination, the Company
shall give written notice (the "Option Notice") to CVC (or its designees)
setting forth the number of Available Vested Shares, Available Unvested Shares,
and the purchase price for each of such Available Securities. CVC (or its
designees) may elect to purchase all or a portion of (i) Available Vested
Shares, and/or (ii) all or a portion of the Available Unvested Shares by giving
written notice to the Company within 90 days after the Option Notice has been
given by the Company. As soon as practicable, and in any event within ten days
after the expiration of the 90-day period set forth above, the Company shall
notify each holder of Manager Stock as to the number of Vested Shares or
Unvested Shares being purchased from such holder by CVC (or its designees) (the
"Supplemental Repurchase Notice"). At the time the Company delivers the
Supplemental Repurchase Notice to the holder(s) of such Manager Stock, the
Company shall also deliver written notice to CVC (or its designees) setting
forth the number of Vested Shares and Unvested Shares which CVC (or its
designees) is entitled to purchase, the aggregate purchase price and the time
and place of the closing of the transaction.
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(d) The closing of the purchase of the Manager Stock pursuant
to the Repurchase Option shall take place on the date designated by the Company
in the Repurchase Notice or Supplemental Repurchase Notice, which date shall not
be later than the 60th day after the delivery of the later of such notices to be
delivered (or, if later, the 15th day after the Book Value is finally
determined) nor earlier than the fifth day after such delivery. The Company
and/or CVC (or its designee) will pay for the Manager Stock to be purchased
pursuant to the Repurchase Option by delivery of a certified or cashier's check
or wire transfer of funds. The purchasers of Manager Stock hereunder will be
entitled to receive customary representations and warranties from the sellers as
to title, authority and capacity to sell.
(e) Notwithstanding anything to the contrary contained in this
Agreement, all repurchases of Manager Stock by the Company shall be subject to
applicable restrictions contained in the Delaware General Corporation Law. If
any such restrictions prohibit the repurchase of Manager Stock hereunder which
the Company is otherwise entitled to make, the Company may make such repurchases
as soon as it is permitted to do so under such restrictions.
5. Restrictions on Transfer.
(a) The Manager Stock will bear the following legend:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT"), AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF
AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR AN
EXEMPTION FROM REGISTRATION THEREUNDER. THE SECURITIES
REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL
RESTRICTIONS ON TRANSFER, CERTAIN REPURCHASE OPTIONS AND
CERTAIN OTHER AGREEMENTS SET FORTH IN A MANAGER SECURITIES
PURCHASE AGREEMENT BETWEEN THE COMPANY AND THE SIGNATORY
THERETO DATED AS OF ______________________. A COPY OF SUCH
AGREEMENT MAY BE OBTAINED BY THE HOLDER HEREOF AT THE
COMPANY'S PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE."
(b) No holder of Manager Stock may sell, transfer or dispose
of any shares of Manager Stock (except pursuant to an effective registration
statement under the Securities Act) without first delivering to the Company an
opinion of counsel (reasonably acceptable in form and substance to the Company)
that neither registration nor qualification under the Securities Act and
applicable state securities laws is required in connection with such transfer.
(c) Each holder of Manager Stock agrees not to effect any
Qualified Public Offering or distribution of any Manager Stock or other equity
securities of the Company, or any securities convertible into or exchangeable or
exercisable for any of the Company's equity securities, during the seven days
prior to and the 180 days after the effectiveness of any underwritten public
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offering, except as part of such underwritten public offering or if otherwise
permitted by the Company.
6. Representations and Warranties of the Company. The Company
hereby represents and warrants to the Manager that:
(a) Immediately following the consummation of the Equity
Transactions, the authorized capital stock of the Company shall consist of (i)
______________ shares of Class A Common Stock par value $0.01 per share (the
"Class A Common"), of which ___________ shares shall be issued and outstanding,
(ii) __________ shares of Class B Common, of which ___________ shares shall be
issued and outstanding, (iii) ________ shares of Class C Common Stock, par value
$0.01 per share (the "Class C Common"), of which _________ shares shall be
issued and outstanding, (iv) ___________ shares of Class D Common Stock, par
value $0.01 per share (the "Class D Common") of which _________ shares shall be
reserved for issuance upon exercise of the Warrant held by CMP, and (v)
___________ shares of Series A Preferred of which ___________ shall be issued
and outstanding. Except as set forth in this Section 6(a) and except for capital
stock of the Company's Subsidiaries owned directly or indirectly by the Company,
as of immediately following the consummation of the transactions contemplated
hereby, neither the Company nor any Subsidiary shall have outstanding any stock
or securities convertible or exchangeable for any shares of its capital stock or
containing any profit participation features, nor shall it have outstanding any
rights or options to subscribe for or to purchase its capital stock or any stock
or securities convertible into or exchangeable for its capital stock or any
stock appreciation rights or phantom stock plans. As of immediately following
the consummation of the transactions contemplated hereby, all of the outstanding
shares of the Company's capital stock shall be validly issued, fully paid and
nonassessable.
(b) There are no statutory or contractual stockholders
preemptive rights or rights of refusal with respect to the issuance of the
Manager Stock hereunder. The Company has not violated any applicable federal or
state securities laws in connection with the offer, sale or issuance of any of
its capital stock, and the offer, sale and issuance of the Manager Stock
hereunder do not require registration under the Securities Act or any applicable
state securities laws. To the best of the Company's knowledge, there are no
agreements between the Company's stockholders with respect to the voting or
transfer of the Company's capital stock or with respect to any other aspect of
the Company's affairs, except for (i) the Stockholders Agreement, (ii) the
Registration Rights Agreement and (iii) the Manager Stock Purchase Agreements
dated as of the date hereof by and between the Company and certain employees of
the Company.
7. Confidential Information. The Manager acknowledges that the
information, observations and data obtained by him while employed by the Company
or any of its Subsidiaries concerning the business or affairs of the Company or
any Subsidiary ("Confidential Information") are the property of the Company or
such Subsidiary. Therefore, Manager agrees that he shall not disclose to any
unauthorized person or use for his own account any Confidential Information
without the prior written consent of the Board, unless and to the extent that
the aforementioned matters become generally known to and available for use by
the public other than as a result of Manager's acts or omissions to act. Manager
shall deliver to the Company at the termination of such Manager's employment, or
at any other time the Company may request, all memoranda, notes, plans, records,
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reports, computer tapes and software and other documents and data (and copies
thereof) relating to the Confidential Information, Work Product (as defined
below) and the business of the Company or any Subsidiary which he may then
possess or have under his control.
8. Inventions and Patents. Manager agrees that all inventions,
innovations, improvements, developments, methods, designs, analyses, drawings,
reports, and all similar or related information which relates to the Company's
or any of its Subsidiaries' actual or anticipated business, research and
development or existing or future products or services and which are conceived,
developed or made by Manager while employed by the Company or any of its
Subsidiaries ("Work Product") belong to the Company or such Subsidiary. Manager
will promptly disclose such Work Product to the Board and perform all actions
reasonably requested by the Board (whether during or after Manager's employment
period) to establish and confirm such ownership (including, without limitation,
assignments, consents, powers of attorney and other instruments).
9. Non-solicitation.
(a) During the time the Manager is employed by the Company and
its Subsidiaries and for a period of six months thereafter (the "Noncompete
Period"), Manager shall not directly or indirectly through another entity (i)
induce or attempt to induce any employee of the Company or any Subsidiary to
leave the employ of the Company or such Subsidiary, or in any way interfere with
the relationship between the Company or any Subsidiary and any employee thereof,
including without limitation, inducing or attempting to induce any union,
employee or group of employees to interfere with the business or operations of
the Company or its Subsidiaries, (ii) hire any person who was an employee of the
Company or any Subsidiary at any time during the Manager's employment period, or
(iii) induce or attempt to induce any customer, supplier, distributor,
franchisee, licensee or other business relation of the Company or any Subsidiary
to cease doing business with the Company or such Subsidiary, or in any way
interfere with the relationship between any such customer, supplier,
distributor, franchisee, licensee or business relation and the Company or any
Subsidiary.
(b) Manager agrees that: (i) the covenants set forth in this
Section 9 are reasonable in geographical and temporal scope and in all other
respects, (ii) the Company would not have entered into this Agreement but for
the covenants of Manager contained herein, and (iii) the covenants contained
herein have been made in order to induce the Company to enter into this
Agreement.
(c) If, at the time of enforcement of this Section 9, a court
shall hold that the duration, scope or area restrictions stated herein are
unreasonable under circumstances then existing, the parties agree that the
maximum duration, scope or area reasonable under such circumstances shall be
substituted for the stated duration, scope or area and that the court shall be
allowed to revise the restrictions contained herein to cover the maximum period,
scope and area permitted by law.
(d) Manager recognizes and affirms that in the event of his
breach of any provision of this Section 9, money damages would be inadequate and
the Company and CVC would have no adequate remedy at law. Accordingly, Manager
agrees that in the event of a breach or a threatened breach by Manager of any of
the provisions of this Section 9, the Company, in addition
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and supplementary to other rights and remedies existing in its favor, may apply
to any court of law or equity of competent jurisdiction for specific performance
and/or injunctive or other relief in order to enforce or prevent any violations
of the provisions hereof (without posting a bond or other security).
10. Notices. All notices, demands or other communications to be
given or delivered under or by reason of the provisions of this Agreement will
be in writing and will be deemed to have been given when delivered personally,
mailed by certified or registered mail, return receipt requested and postage
prepaid, or sent via a nationally recognized overnight courier, or sent via
facsimile to the recipient with a confirmation of receipt and accompanied by a
certified or registered mailing. Such notices, demands and other communications
will be sent to the address indicated below:
To the Company:
GCIH, Inc.
531 Main Street
Greenville, S.C. 29602
Attention: President
Telecopy No.: (803) 240-5977
With a copy to:
Citicorp Venture Capital, Ltd.
399 Park Avenue
14th Floor
New York, NY 10043
Attention: John Weber
Telecopy No.: (212) 888-2940
To the Manager:
c/o Gerber Childrenswear, Inc.
531 South Main Street
Greenville, SC 29602
Attention: [_______________]
Telecopy No.: (803) 240-5977
To CVC:
Citicorp Venture Capital
399 Park Avenue
14th Floor
New York, NY 10043
Attention: John Weber
Telecopy No.: (212) 888-2940
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With a copy to:
Kirkland & Ellis
153 East 53rd Street
New York, NY 10022
Attention: Kirk A. Radke, Esq.
Telecopy No.: (212) 446-4900
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party.
11. Miscellaneous.
(a) Transfers in Violation of Agreement. Any Transfer or
attempted Transfer of any Manager Stock in violation of any provision of this
Agreement shall be null and void, and the Company shall not record such Transfer
on its books or treat any purported transferee of such Manager Stock as the
owner of such securities for any purpose.
(b) Severability. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.
(c) Complete Agreement. This Agreement, the Stockholders
Agreement, and the Registration Rights Agreement embody the complete agreement
and understanding among the parties and supersede and preempt any prior
understandings, agreements or representations by or among the parties, written
or oral, which may have related to the subject matter hereof in any way.
(d) Counterparts. This Agreement may be executed in separate
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.
(e) Successors and Assigns. Except as otherwise provided
herein, this Agreement shall bind and inure to the benefit of and be enforceable
by the Manager, the Company, CVC and their respective successors and assigns
(including subsequent holders of Manager Stock); provided that the rights and
obligations of the Manager under this Agreement shall not be assignable except
in connection with a permitted transfer of Manager Stock hereunder.
(f) Third Party Beneficiary. This Agreement is intended for
the benefit of, and will be enforceable by, CVC.
11
(g) GOVERNING LAW. THE CORPORATE LAW OF THE STATE OF DELAWARE
WILL GOVERN ALL QUESTIONS CONCERNING THE RELATIVE RIGHTS OF THE COMPANY AND ITS
STOCKHOLDERS. ALL OTHER QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY AND
INTERPRETATION OF THIS AGREEMENT AND THE EXHIBITS HERETO WILL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE DOMESTIC LAWS OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICT OF LAW PROVISION OR RULE (WHETHER
OF THE STATE OF NEW YORK OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE
APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK.
(h) Remedies. Each of the parties to this Agreement (including
CVC) will be entitled to enforce its rights under this Agreement specifically,
to recover damages and costs (including reasonable attorneys' fees) caused by
any breach of any provision of this Agreement and to exercise all other rights
existing in its favor. The parties hereto agree and acknowledge that money
damages may not be an adequate remedy for any breach of the provisions of this
Agreement and that any party may in its sole discretion apply to any court of
law or equity of competent jurisdiction (without posting any bond or deposit)
for specific performance and/or other injunctive relief in order to enforce or
prevent any violations of the provisions of this Agreement.
(i) Amendment and Waiver. The provisions of this Agreement may
be amended and waived only with the prior written consent of the Company, the
Manager and CVC.
* * * * *
12
IN WITNESS WHEREOF, the parties hereto have executed this
Manager Stock Purchase Agreement as of the date first written above.
GCIH, INC.
By: ____________________________
Name:
Title:
GERBER CHILDRENSWEAR, INC.
By: ____________________________
Name:
Title:
_____________________________________
[MANAGER]
The undersigned is a party to this Agreement solely for purposes of the
repurchase rights of CVC set forth in Section 4:
CITICORP VENTURE CAPITAL, LTD.
By: ____________________________
Name:
Title:
CONSENT OF SPOUSE
The undersigned spouse of the Manager named in the attached
Agreement has read and understands the terms of the Agreement and has had an
opportunity to discuss it with individuals of her choice. The undersigned
understands that even if the securities referred to in the Agreement are
considered to be a part of the "marital property" belonging to her and the
Manager, the Agreement restricts the transfer or distribution of those
securities to anyone other than the Manager, a "Permitted Transferee" as such
term is defined in the Stockholders Agreement, the company which issued the
securities and certain other persons. The undersigned agrees to these
restrictions and waives any rights (other than to the economic value of such
securities) she might otherwise have in those shares as specifically
identifiable property.
____________________(Signature)
____________________(Print Name)
14
CONSENT OF MANAGER
The undersigned Manager named in the attached Agreement has
read and understands the terms of the Agreement and has had the opportunity to
discuss it with counsel, accountants, or other financial and legal advisors of
his/her choice.
The undersigned is able to bear the economic risk of his/her
investment in the Manager Stock for an indefinite period of time. The
undersigned understands that the Manager Stock has not been registered under the
Securities Act and cannot be sold unless subsequently registered under the
Securities Act or unless an exemption from such registration is available.
Further, the Manager is willing to bear the risk of such illiquidity. The
Manager understands that his/her execution of this Agreement and/or
participation in the Plan is not a condition of his/her employment with the
Company or GCI.
____________________(Signature)
____________________(Print Name)
15
EXHIBIT A
______________, 199_
ELECTION TO INCLUDE STOCK AND NOTES IN GROSS
INCOME PURSUANT TO SECTION 83(b) OF THE
INTERNAL REVENUE CODE
The undersigned purchased shares of Common Stock, par value
$0.01 per share (the "Shares"), of GCIH, Inc. (the "Company") on __________,
199_. Under certain circumstances, the Company has the right to repurchase the
Shares at cost from the undersigned (or from the holder of the Shares, if
different from the undersigned) should the undersigned cease to be employed by
the Company and its subsidiaries. Hence, the Shares are subject to a substantial
risk of forfeiture and are non-transferable. The undersigned desires to make an
election to have the Shares taxed under the provision of Code Section 83(b) at
the time he purchased the Securities.
Therefore, pursuant to Code Section 83(b) and Treasury
Regulation Section 1.83-2 promulgated thereunder, the undersigned hereby makes
an election, with respect to the Shares (described below), to report as taxable
income for calendar year 199_ the excess (if any) of the Shares' fair market
value on __________, 199_ over the purchase price thereof.
The following information is supplied in accordance with
Treasury Regulation Section 1.83-2(e):
1. The name, address and social security number of the
undersigned:
Name: ____________________
Address: ______________________
______________________
SSN: ______________________
2. A description of the property with respect to which
the election is being made: __________ shares of GCIH, Inc. Common Stock, par
value $0.01 per share.
3. The date on which the property was transferred:
__________, 199_. The taxable year for which such election is made: calendar
199_.
4. The restrictions to which the property is subject: If
during the first five years after the purchase of the Shares the undersigned
ceases to be employed by the Company or any of its subsidiaries, the unvested
portion of the Shares will be subject to repurchase by the Company at cost, and
at any time prior to a public offering by the Company or a sale of the Company
the undersigned ceases to be employed by the Company or any of its subsidiaries,
the vested portion of the Shares will be subject to repurchase by the Company at
book value. One-fifth of the Shares will become vested shares on each of the
first five anniversary dates of the purchase of the Shares.
A - 1
5. The fair market value on __________, 199_ of the
property with respect to which the election is being made, determined without
regard to any lapse restrictions: $1.00 per Share.
6. The amount paid for such property: $1.00 per Share.
A copy of this election has been furnished to the Secretary of
the Company pursuant to Treasury Regulations Section 1.83-2(e)(7).
Dated: _____________, 199_ __________________________
Name: [MANAGER]
A - 2
Dates Referenced Herein
| Referenced-On Page |
|---|
| This ‘S-1’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| Filed on: | | 3/4/98 | | | | | | | None on these Dates |
| | 10/1/97 | | 5 |
| List all Filings |
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