EXHIBIT 10.1
STOCKHOLDER AGREEMENT
STOCKHOLDER AGREEMENT, dated as of August 4, 2005 (this "Agreement"),
among the holders of Series C Perpetual Convertible Preferred Stock, par value
$.01 per share (the "Company Series C Preferred Stock") listed on the signature
page(s) hereto (collectively, the "Stockholders" and, individually, the
"Stockholder") and HSBC Finance Corporation, a Delaware corporation ("Parent").
Capitalized terms used and not otherwise defined herein shall have the
respective meanings assigned to them in the Merger Agreement referred to below.
WHEREAS, as of the date hereof, the Stockholders collectively own of
record, own beneficially, and/or otherwise have voting control over shares of
capital stock of Metris Companies Inc., a Delaware corporation (the "Company"),
as set forth on Schedule I hereto (such shares, or any other voting or equity of
securities of the Company hereafter acquired by any Stockholder prior to the
termination of this Agreement, being referred to herein collectively as the
"Shares");
WHEREAS, concurrently with the execution of this Agreement, Parent, the
Company, and HSBC Corporation I, a Delaware corporation and directly wholly
owned subsidiary of Parent ("Merger Sub") are entering into an Agreement and
Plan of Merger, dated as of the date hereof (the "Merger Agreement"), pursuant
to which, upon the terms and subject to the conditions thereof, Merger Sub will
be merged with and into the Company, and the Company will be the surviving
corporation (the "Merger"); and
WHEREAS, as a condition to the willingness of Parent to enter into the
Merger Agreement, Parent has required that the Stockholders agree, and in order
to induce Parent to enter into the Merger Agreement, the Stockholders are
willing to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements contained herein, and intending to be legally bound
hereby, the parties hereby agree, severally and not jointly, as follows:
Section 1. Voting of Shares.
(a) Each Stockholder covenants and agrees that until the termination
of this Agreement in accordance with the terms hereof, at the Company
Stockholders Meeting or any other meeting of the stockholders of the Company,
however called, and in any action by written consent of the stockholders of the
Company, such Stockholder will vote, or cause to be voted, all of his, her or
its respective Shares (i) in favor of adoption of the Merger Agreement and
approval of the Merger contemplated by the Merger Agreement, as the Merger
Agreement may be modified or amended from time to time in a manner not adverse
to the Stockholders, and (ii) against any Acquisition Proposal.
(b) Each Stockholder hereby irrevocably grants to, and appoints,
Parent, and any individual designated in writing by it, and each of them
individually, as its proxy and attorney-in-fact (with full power of
substitution), for and in its name, place and stead, to vote his, her or its
Shares at any meeting of the stockholders of the Company called with respect to
any of the matters specified in, and in accordance and consistent with, this
Section 1. Each Stockholder
understands and acknowledges that Parent is entering into the Merger Agreement
in reliance upon the Stockholder's execution and delivery of this Agreement.
Each Stockholder hereby affirms that the irrevocable proxy set forth in this
Section 1(b) is given in connection with the execution of the Merger Agreement,
and that such irrevocable proxy is given to secure the performance of the duties
of such Stockholder under this Agreement. Except as otherwise provided for
herein, each Stockholder hereby (i) affirms that the irrevocable proxy is
coupled with an interest and may under no circumstances be revoked, (ii)
ratifies and confirms all that the proxies appointed hereunder may lawfully do
or cause to be done by virtue hereof and (iii) affirms that such irrevocable
proxy is executed and intended to be irrevocable in accordance with the
provisions of Section 212(e) of the Delaware General Corporation Law.
Notwithstanding any other provisions of this Agreement, the irrevocable proxy
granted hereunder shall automatically terminate upon the termination of this
Agreement.
Section 2. Transfer of Shares. Each Stockholder covenants and agrees
that such Stockholder will not directly or indirectly (i) sell, assign, transfer
(including by merger, testamentary disposition, interspousal disposition
pursuant to a domestic relations proceeding or otherwise by operation of law),
pledge, encumber or otherwise dispose of any of the Shares, (ii) deposit any of
the Shares into a voting trust or enter into a voting agreement or arrangement
with respect to the Shares or grant any proxy or power of attorney with respect
thereto which is inconsistent with this Agreement or (iii) enter into any
contract, option or other arrangement or undertaking with respect to the direct
or indirect sale, assignment, transfer (including by merger, testamentary
disposition, interspousal disposition pursuant to a domestic relations
proceeding or otherwise by operation of law) or other disposition of any Shares;
provided, however, that any Stockholder shall be entitled to transfer Shares by
way of gift or donation so long as the transferee agrees in writing to be bound
by the terms and conditions of this Agreement as a Stockholder.
Section 3. Representations and Warranties of the Stockholders. Each
Stockholder on its own behalf hereby severally represents and warrants to Parent
with respect to itself and its, his or her ownership of the Shares as follows:
(a) Ownership of Shares. The Stockholder beneficially owns all of
the Shares as set forth on Schedule I hereto and has good and marketable title
to such Shares, free and clear of any claims, liens, encumbrances and security
interests whatsoever. The Stockholder owns no Shares of Company Common Stock or
Company Series C Preferred Stock other than the Shares as set forth on Schedule
I hereto. The Stockholder has the power to authorize the voting of the Shares as
contemplated hereby, without restrictions, with respect to all of the Shares.
(b) Power, Binding Agreement. The Stockholder has the legal capacity
and all requisite power and authority to enter into and perform all of its
obligations, under this Agreement. This Agreement has been duly and validly
executed and delivered by the Stockholder and constitutes a valid and binding
obligation of the Stockholder, enforceable against the Stockholder in accordance
with its terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium and similar laws affecting creditors' rights and remedies generally,
and subject, as to enforceability, to general principles of equity, including
principles of commercial reasonableness, good faith and fair dealing (regardless
of whether enforcement is sought in a proceeding at law or in equity).
(c) No Conflicts. The execution and delivery of this Agreement do
not, and the consummation of the transactions contemplated hereby will not,
conflict with or result in any violation of, or default (with or without notice
or lapse of time, or both) under, or give rise to a right of termination,
cancellation or acceleration of any obligation or to loss of a material benefit
under, any provision of any loan or credit agreement, note, bond, mortgage,
indenture, lease, or other agreement, instrument, permit, concession, franchise,
license, judgment, order, decree, statute, law, ordinance, rule or regulation
applicable to the Stockholder, the Shares or any of the Stockholder's properties
or assets. Except as expressly contemplated hereby, and other than requirements
that the Stockholders dispose of their Shares in a pro rata manner, the
Stockholder is not a party to, and the Shares are not subject to or bound in any
manner by, any contract or agreement relating to the Shares, including without
limitation, any voting agreement, option agreement, purchase agreement,
stockholders' agreement, partnership agreement or voting trust. Except for
informational filings with the SEC, no consent, approval, order or authorization
of, or registration, declaration or filing with, any court, administrative
agency or commission or other governmental authority or instrumentality,
domestic, foreign or supranational, is required by or with respect to the
Stockholder in connection with the execution and delivery of this Agreement or
the consummation by the Stockholder of the transactions contemplated hereby.
(d) Brokers or Finders. Except as contemplated by Section 3.22 of
the Merger Agreement, no agent, broker, investment banker, financial advisor or
other firm or Person retained by the Stockholder or the Company is or will be
entitled to any broker's or finder's fee or any other similar commission or fee
in connection with any of the transactions contemplated by this Agreement.
Section 4. No Solicitation. Prior to the termination of this Agreement
in accordance with its terms, each Stockholder agrees, in its individual
capacity as a stockholder of the Company, that it will not, directly or
indirectly, (i) initiate, solicit, encourage or knowingly facilitate any
inquiries or the making of any Acquisition Proposal, (ii) have any discussions
with or provide any confidential information or data to any person relating to
an Acquisition Proposal, or engage in any negotiations concerning an Acquisition
Proposal, or (iii) approve or recommend, or propose to approve or recommend, or
execute or enter into, any letter of intent, agreement in principle, merger
agreement, asset purchase or share exchange agreement, option agreement or other
similar agreement related to any Acquisition Proposal.; provided that nothing
herein shall prohibit any Stockholder from engaging in any of such activities
with any person with whom the Company is entitled to engage in discussions and
negotiations pursuant to Section 6.6(b) of the Merger Agreement.
Section 5. Termination. This Agreement shall terminate upon the earlier
to occur of (i) the Effective Time or (ii) any termination of the Merger
Agreement in accordance with the terms thereof; provided that no such
termination shall relieve any party of liability for a breach hereof prior to
termination, and any such termination will not affect any rights hereunder which
by their terms do not terminate or expire prior to or at such termination.
Section 6. Specific Performance. The parties hereto agree that
irreparable damage would occur in the event any provision of this Agreement was
not performed in accordance with the terms hereof and that the parties shall be
entitled to specific performance of the terms hereof, in addition to any other
remedy at law or in equity.
Section 7. Fiduciary Duties. Each Stockholder is signing this Agreement
solely in such Stockholder's capacity as an owner of his, her or its respective
Shares, and nothing herein shall prohibit, prevent or preclude such Stockholder
from taking or not taking any action in his or her capacity as an officer or
director of the Company, to the extent permitted by the Merger Agreement.
Section 8. Waiver of Appraisal Rights. Each Stockholder, severally and
not jointly, hereby irrevocably and unconditionally waives, and agrees to
prevent the exercise of, any rights of appraisal, any dissenters' rights and any
similar rights relating to the Merger that such Stockholder may directly or
indirectly have by virtue of the ownership of any Shares.
Section 9. Miscellaneous.
(a) Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto with respect to the subject matter hereof
and supersedes all prior agreements and understandings, both written and oral,
between the parties with respect thereto. This Agreement may not be amended,
modified or rescinded except by an instrument in writing signed by each of the
parties hereto.
(b) Severability. If any term or other provision of this Agreement
is invalid, illegal or incapable of being enforced by any rule of law, or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible to the fullest extent
permitted by applicable law in a mutually acceptable manner in order that the
terms of this Agreement remain as originally contemplated to the fullest extent
possible.
(c) Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware without regard to the
principles of conflicts of law thereof.
(d) Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original and all of which together shall
constitute one and the same instrument.
(e) Notices. All notices and other communications hereunder shall be
in writing and shall be deemed duly delivered (i) three business days after
being sent by registered or certified mail, return receipt requested, postage
prepaid, or (ii) one business day after being sent for next business day
delivery, fees prepaid, via a reputable nationwide overnight courier service, in
each case to the intended recipient as set forth below:
(i) if to a Stockholder:
c/o Xxxxxx X. Xxx Partners, L.P.
000 Xxxxxxx Xxxxxx
00xx Xxxxx
Xxxxxx, XX 00000
with a copy to:
Weil, Gotshal & Xxxxxx LLP
000 Xxxxxxx Xxxxxx
00xx Xxxxx
Xxxxxx, XX 00000
Attn: Xxxxx Xxxxxx, Esq.
Telecopy: (000) 000-0000
and
(ii) if to Parent to:
HSBC Finance Corporation
0000 Xxxxxxx Xxxx
Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Telecopy No.: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxx Xxxxxxxxx Xxxx and Xxxx LLP 0000 X
Xxxxxx, XX Xxxxxxxxxx, X.X.
Attn: Xxxxxxx Xxxxxxxx, Esq.
Telecopy: (000) 000-0000
(f) No Third Party Beneficiaries. This Agreement is not intended,
and shall not be deemed, to confer any rights or remedies upon any person other
than the parties hereto and their respective successors and permitted assigns,
to create any agreement of employment with any person or to otherwise create any
third-party beneficiary hereto.
(g) Further Assurances: The Stockholder will, from time to time,
execute and deliver, or cause to be executed and delivered, such additional or
further consents, documents and other instruments as Parent may reasonably
request for the purpose of effectively carrying out the transactions
contemplated by this Agreement.
(h) Assignment. Neither this Agreement nor any of the rights,
interests or obligations under this Agreement may be assigned or delegated, in
whole or in part, by operation of law or otherwise by any of the parties hereto
without the prior written consent of the other parties, and any such assignment
without such prior written consent shall be null and void, except that Parent
may assign this Agreement to any direct or indirect wholly owned subsidiary of
Parent without the consent of the Stockholder, provided that Parent shall remain
liable for all of its obligations under this Agreement. Subject to the preceding
sentence, this Agreement shall be binding upon, inure to the benefit of, and be
enforceable by, the parties hereto and their respective successors and permitted
assigns.
(i) Interpretation. When reference is made in this Agreement to a
Section, such reference shall be to a Section of this Agreement, unless
otherwise indicated. The headings contained in this Agreement are for
convenience of reference only and shall not affect in any way the meaning or
interpretation of this Agreement. The language used in this Agreement shall be
deemed to be the language chosen by the parties hereto to express their mutual
intent, and no rule of strict construction shall be applied against any party.
Whenever the context may require, any pronouns used in this Agreement shall
include the corresponding masculine, feminine or neuter forms, and the singular
form of nouns and pronouns shall include the plural, and vice versa. Any
reference to any federal, state, local or foreign statute or law shall be deemed
also to refer to all rules and regulations promulgated thereunder, unless the
context requires otherwise. Whenever the words "include," "includes" or
"including" are used in this Agreement, they shall be deemed to be followed by
the words "without limitation." No summary of this Agreement prepared by the
parties shall affect in any way the meaning or interpretation of this Agreement.
(j) Submission to Jurisdiction. Each of the parties to this
Agreement (i) consents to submit itself to the personal jurisdiction of any
state or federal court sitting in the State of Delaware in any action or
proceeding arising out of or relating to this Agreement or any of the
transactions contemplated by this Agreement, (ii) agrees that all claims in
respect of such action or proceeding may be heard and determined in any such
court, (iii) agrees that it will not attempt to deny or defeat such personal
jurisdiction by motion or other request for leave from any such court and (iv)
agrees not to bring any action or proceeding arising out of or relating to this
Agreement or any of the transactions contemplated by this Agreement in any other
court. Each of the parties hereto waives any defense of inconvenient forum to
the maintenance of any action or proceeding so brought and waives any bond,
surety or other security that might be required of any other party with respect
thereto. Any party hereto may make service on another party by sending or
delivering a copy of the process to the party to be served at the address and in
the manner provided for the giving of notices in Section 9(e). Nothing in this
Section, however, shall affect the right of any party to serve legal process in
any other manner permitted by law.
(k) WAIVER OF JURY TRIAL. EACH OF PARENT AND EACH STOCKHOLDER HEREBY
IRREVOCABLY WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THE
ACTIONS OF PARENT OR EACH STOCKHOLDER IN THE NEGOTIATION, ADMINISTRATION,
PERFORMANCE AND ENFORCEMENT OF THIS AGREEMENT.
[Signature Page to follow]
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be signed individually or by its respective duly authorized officer
as of the date first written above.
HSBC FINANCE CORPORATION
By: /s/ SIDDHARTH X. XXXXX
-------------------------------------------------
Name: Siddharth X. Xxxxx
Title: Chairman and Chief Executive Officer
STOCKHOLDER AGREEMENT
COUNTERPART SIGNATURE PAGE
Xxxxxx X. Xxx Equity Fund IV, L.P.
By: THL Equity Advisors IV, LLC, its
general partner
By: Xxxxxx X. Xxx Partners, L.P., its
manager
By: Xxxxxx X. Xxx Advisors, LLC, its
general partner
By: /s/ XXXXXX X. XXX
-------------------------------------------------
Name: Xxxxxx X. Xxx
Title:
STOCKHOLDER AGREEMENT
COUNTERPART SIGNATURE PAGE
Xxxxxx X. Xxx Foreign Fund IV-B, L.P.
By: THL Equity Advisors IV, LLC, its
general partner
By: Xxxxxx X. Xxx Partners, L.P., its
manager
By: Xxxxxx X. Xxx Advisors, LLC, its
general partner
By: /s/ XXXXXX X. XXX
------------------------------------------------
Name: Xxxxxx X. Xxx
Title:
Xxxxxx X. Xxx Investors Limited Partnership
By: THL Investment Management Corp., its
general partner
By: /s/ XXXXXX X. XXX
------------------------------------------------
Name: Xxxxxx X. Xxx
Title:
Xxxxxx X. Xxx Charitable Investment L.P.
By: /s/ XXXXXX X. XXX
------------------------------------------------
Name: Xxxxxx X. Xxx
Title: General Partner
STOCKHOLDER AGREEMENT
COUNTERPART SIGNATURE PAGE
1997 XXXXXX X. XXX NOMINEE TRUST
By: U.S. BANK, N.A., not individually but solely as
trustee under a Trust Agreement dated as of
August 18, 1997, and known as the 1997
Xxxxxx X. Xxx Nominee Trust
By: /s/ XXXXXX XXXXXXX
------------------------------------------------
Name: Xxxxxx X. Xxxxxxx, Xx.
Title: Officer
/s/ XXXXX X. XXXXXXX
------------------------------------------------
Xxxxx X. Xxxxxxx
THE 1995 HARKINS GIFT TRUST
By: /s/ XXXXXXX X. XXXXXXX
--------------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Trustee
/s/ XXXXX X. XXXXXX
------------------------------------------------
Xxxxx X. Xxxxxx
/s/ X. XXXXXX XXXX
------------------------------------------------
X. Xxxxxx Xxxx
STOCKHOLDER AGREEMENT
COUNTERPART SIGNATURE PAGE
/s/ XXXXX X. XXXXXXXX
------------------------------------------------
Xxxxx X. Xxxxxxxx
/s/ XXXXXXX X. XXXXXX
------------------------------------------------
Xxxxxxx X. XxXxxx
/s/ XXXXXX X. XXXXXXX
------------------------------------------------
Xxxxxx X. Xxxxxxx
/s/ XXXXXX X. XXXXX, XX.
------------------------------------------------
Xxxxxx X. Xxxxx, Xx.
/s/ XXXX X. XXXXX
------------------------------------------------
Xxxx X. Xxxxx
/s/ XXXX X. XXXXXX
------------------------------------------------
Xxxx X. Xxxxxx
STOCKHOLDER AGREEMENT
COUNTERPART SIGNATURE PAGE
/s/ XXXXXXX X. XXXXXX
------------------------------------------------
Xxxxxxx X. Xxxxxx
/s/ XXXX X. XXXXXXXX
------------------------------------------------
Xxxx X. Xxxxxxxx
/s/ XXXXXXX X. XXXXXXX
------------------------------------------------
Xxxxxxx X. Xxxxxxx
/s/ XXXXX XXXXXXX
------------------------------------------------
Xxxxx Xxxxxxx
/s/ XXXXX XXXXX
------------------------------------------------
Xxxxx Xxxxx
/s/ XXXXXX X. XXXXXXXX
------------------------------------------------
Xxxxxx X. Xxxxxxxx
STOCKHOLDER AGREEMENT
COUNTERPART SIGNATURE PAGE
/s/ XXXXX X. XXXXXX
------------------------------------------------
Xxxxx X. Xxxxxx
/s/ XXXXXX X. XXXXXXX
------------------------------------------------
Xxxxxx X. Xxxxxxx
/s/ XXXXXXXX X. XXXXX
------------------------------------------------
Xxxxxxxx X. Xxxxx
XXXXXX XXXXXX XXX
1988 IRREVOCABLE TRUST
By: /s/ XXXXXXX X. XXXXXX
--------------------------------------------
Xxxxxxx X. Xxxxxx, not individually but
solely as Trustee
/s/ ILLEGIBLE
------------------------------------------------
for Xxxxxxx Xxxxxxx Xxx under POA dated 3/1/01
STOCKHOLDER AGREEMENT
COUNTERPART SIGNATURE PAGE
/s/ XXXXXXX X. XXXXXX
------------------------------------------------
Xxxxxxx X. Xxxxxx as
Trustee for Xxxxx Xxxxxx Xxx
/s/ XXXXXXX X. XXXXXX
------------------------------------------------
Xxxxxxx X. Xxxxxx
/s/ XXXXX XXXXXX
------------------------------------------------
Xxxxx Xxxxxx
SCHEDULE I(1)
NUMBER OF SHARES OF
NUMBER OF SHARES OF COMPANY SERIES C PREFERRED
STOCKHOLDER COMPANY COMMON STOCK STOCK
----------------------------------- -------------------- ---------------------------
Xxxxxx X. Xxx Equity Fund IV, LP 1,169,420.22
Xxxxxx X. Xxx Foreign Fund IV, LP 40,441.18
Xxxxxx X. Xxx Foreign Fund IV-B, LP 113,836.58
Xxxxxx X. Xxx Investors Limited
Partnership 340.61
Xxxxxx X. Xxx Charitable Investment
L.P. 7,608.69
1997 Xxxxxx X. Xxx Nominee Trust 17,887.67
Xxxxx X. Xxxxxxx 4,114.69
The 1995 Harkins Gift Trust 458.98
Xxxxx X. Xxxxxx 3,429.91
X. Xxxxxx Xxxx 3,429.91
Xxxxx X. Xxxxxxxx 3,429.91
Xxxxxxx X. XxXxxx 3,429.91
Xxxxxx X. Xxxxxxx 3,429.91
Xxxxxx X. Xxxxx, Xx. 3,429.91
Xxxx X. Xxxxx 1,432.51
Xxxx X. Xxxxxx 954.00
Xxxxxxx X. Xxxxxx 760.89
Xxxx X. Xxxxxxxx 760.89
Xxxxxxx X. Xxxxxxx 569.51
Xxxxx Xxxxxxx 217.71
Xxxxx Xxxxx 217.71
--------------------
(1) Shareholdings as of December 31, 2004. Shares owned by the Stockholders
include all shares of Company Series C Preferred paid as dividends thereon after
such date.
Xxxxxx X. Xxxxxxxx 401.12
Xxxxx X. Xxxxxx 87.66
Xxxxxx X. Xxxxxxx 87.66
Xxxxxxxx X. Xxxxx 57.86
Xxxxxx Xxxxxx Xxx 1998 Irrevocable
Trust 344.99
Xxxxxxx Xxxxxxx Xxx 344.99
Xxxxxxx X. Xxxxxx as Trustee for
Xxxxx Xxxxxx Xxx 226.37
Xxxxxxx X. Xxxxxx 87.66
Xxxxx Xxxxxx 87.66
