Contract
Exhibit
99.1
X.
X. Xxxxxx Company, Inc.
13,388,673
Shares of Common Stock of 50¢ par value
Contribution
Agreement
May
18, 2009
Evercore
Trust Company, N.A.
As
Investment Manager of a Segregated Account in the
X.
X. Penney Corporation, Inc. Pension Plan Trust
0000
Xxx Xxxx Xxxxxx, 0xx
Xxxxx
Xxxxxxxxxx,
X.X. 00000
Ladies
and Gentlemen:
X. X. Xxxxxx Company, Inc. (the
“Company”) has agreed to satisfy a future funding obligation of its wholly-owned
subsidiary, X. X. Penney Corporation, Inc., to the X. X. Xxxxxx Corporation,
Inc. Pension Plan Trust (the “Trust”) created under the X. X. Penney
Corporation, Inc. Pension Plan by contributing to the Trust 13,388,673 shares of
the Company’s Common Stock of 50¢ par value (the “Shares”). In order
to accomplish such contribution, the Company hereby issues and sells the Shares
to the Trust in consideration of the satisfaction of such funding
obligation. By executing this Contribution Agreement (the
“Agreement”), Evercore Trust Company, N.A. as Investment Manager (the “Manager”)
of a segregated account in the Trust, accepts the Shares on behalf of the
Trust.
The Shares will be subject to the
registration rights set forth in the Registration Rights Agreement, dated the
date hereof (the “Registration Rights Agreement”), by and between the Company
and the Manager. Pursuant to the Registration Rights Agreement, and
in accordance with the terms therein, the Company will agree, for the benefit of
the Trust, (i) to file with the Securities and Exchange Commission (the
“Commission”) a registration statement (the “Registration Statement”) with
respect to the resale of the Shares by the Trust and (ii) to use its reasonable
commercial efforts to cause the Registration Statement to be declared effective
under the Securities Act of 1933, as amended (the “1933 Act”), and to maintain
the effectiveness of such Registration Statement.
1. The
Company represents and warrants to the Manager as of the date hereof (the
“Closing Date”), that:
(a)
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The
Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of
Delaware;
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(b)
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The
authorized and outstanding capital stock of the Company as of January 31,
2009 is as set forth in the Company’s Annual Report on Form 10-K for the
fiscal year ended January 31, 2009 as filed with the Commission (including
any amendment thereof filed prior to the date of this
Agreement);
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(c)
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The
Shares have been duly authorized and, when issued to and accepted by the
Trust, will be fully paid and
non-assessable;
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(d)
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This
Agreement has been duly authorized, executed and delivered by the Company
and the Registration Rights Agreement has been duly authorized, executed
and delivered by the Company, and each constitutes a valid and legally
binding agreement of the Company enforceable against the Company in
accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors’ rights and to general
equity principles and except as to the enforceability of the
indemnification or contribution provisions contained
therein;
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(e)
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The
issuance of the Shares to the Trust and the compliance by the Company with
all of the provisions of the Registration Rights Agreement and this
Agreement and the consummation of the transactions herein and therein
contemplated will not conflict with or result in a breach of any of the
terms or provisions of, or constitute a default under, any material
indenture, mortgage, deed of trust, loan agreement or other material
agreement or instrument to which the Company or any of its subsidiaries is
a party or by which the Company or any of its subsidiaries is bound, nor
will such action result in any violation of the provisions of the Restated
Certificate of Incorporation, as amended, or Bylaws, as amended of the
Company or the charter or bylaws of any of its subsidiaries or any statute
or any order, rule or regulation of any court or governmental agency or
body having jurisdiction over the Company or any of its subsidiaries or
any of their respective properties;
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(f)
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The
Company is subject to Section 13 or 15(d) of the Securities Exchange Act
of 1934, as amended;
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(g)
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Neither
the Company nor any person acting on its behalf has offered or sold the
Shares by means of any general solicitation or general advertising within
the meaning of Rule 502(c) under the 1933
Act;
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(h)
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No
commission within the meaning of Section 408(e)(2) of the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”), brokerage
fee or other charge will become due or payable in connection
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with
the execution and delivery of this Agreement and the transactions
contemplated hereby, including the contribution of the Shares;
and
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(i)
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Subject
to compliance by the Manager with Section 3 hereof and the accuracy of the
Manager’s representations stated herein, it is not necessary in connection
with the offer, sale and delivery of the Shares by the Company to the
Trust to register the Shares under the 1933
Act.
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2. The
Company and the Manager agree and acknowledge that the aggregate value of the
Shares on the date hereof is $340,000,000 and that such amount shall be applied
as a credit against the obligation to fund the Trust for purposes of the
Internal Revenue Code of 1986, as amended, and ERISA. For purposes of
this Agreement, the amount of such credit shall be considered the purchase price
paid by the Trust for the Shares.
3. The
Manager, acting on behalf of the Trust:
(a)
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Acknowledges
that the Shares have not been registered under the 1933 Act and are being
issued to the Trust in reliance upon an exemption from such registration
under the 1933 Act;
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(b)
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Represents
that the Trust is an institutional “accredited investor” within the
meaning of Rule 501 under the 1933
Act;
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(c)
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Confirms
that the Manager has been informed that the Shares are “restricted
securities” under the 1933 Act and may not be resold or transferred until
the Shares are first registered under the federal securities laws or
unless an exemption from such registration is
available;
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(d)
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Is
aware of the adoption of Rule 144 under the 1933 Act (“Rule 144”) by the
Commission, which permits limited public resale of securities acquired in
a nonpublic offering, subject to the satisfaction of certain conditions,
including, among other things: the availability of certain
current public information about the issuer, the sale being through a
broker in an unsolicited “broker’s transaction” and the amount of
securities being sold during any three (3) month period not exceeding
specified limitations;
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(e)
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Represents
that prior to accepting the contribution of the Shares on behalf of the
Trust, it acquired sufficient information about the Company to reach an
informed and knowledgeable decision to accept the contribution of the
Shares. The Manager has such knowledge and experience in
financial and business matters as to make it capable of evaluating the
risks of the prospective investment and to make an informed investment
decision. The Trust is able to bear the economic risk of its
investment in the Shares;
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(f)
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Agrees
that the Trust shall make no disposition of the Shares except pursuant to
an effective Registration Statement or, alternatively, if requested by the
Company, the Manager shall have provided the Company an opinion of counsel
(which opinion of counsel may be rendered by counsel to the Company) in
form and substance reasonably satisfactory to the Company, that (i) the
proposed disposition does not require registration of the Shares under the
1933 Act or (ii) all appropriate action necessary for compliance with the
registration requirements of the 1933 Act or of any exemption from
registration available under the 1933 Act (including Rule 144) has been
taken. The Company shall not be required (i) to transfer on its
books any Shares that have been sold or transferred in violation of the
provisions of this Agreement nor (ii) to treat as the owner of the Shares,
or otherwise to accord voting or dividend rights to, any transferee to
whom the Shares have been transferred in contravention of this
Agreement;
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(g)
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Agrees
that the Trust shall make no disposition of the Shares that is contrary to
the terms of the Registration Rights Agreement, as amended from time to
time;
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(h)
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Acknowledges
that, in order to reflect the restrictions on the disposition of the
Shares, the Shares will be endorsed with restrictive legends, including
the following legend (or substantially similar
legend);
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“The
securities represented hereby have not been registered or qualified under the
Securities Act of 1933 or the securities laws of any state, and may be offered
and sold only if registered and qualified pursuant to federal and state
securities laws or if the Company is provided an opinion of counsel reasonably
satisfactory to the Company that registration and qualification under federal
and state laws is not required.”
If
required by the authorities of any state in connection with the issuance of the
Shares, the legend or legends required by such state authorities shall also be
endorsed on such shares.
(i)
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Represents
that as of the date of this Agreement, there are no selling arrangements
between the Manager, acting on behalf of the Trust, and any underwriter,
broker or dealer.
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4. It
is understood that, except as provided in the Registration Rights Agreement and
the Engagement Letter, dated May 5, 2009, by and among Evercore Trust Company,
N.A., the Benefit Plans Investment Committee of X. X. Xxxxxx Corporation, Inc.
and X. X. Penney Corporation, Inc., the Trust will pay all of its own costs and
expenses, including the fees of counsel.
5. This
Agreement shall be binding upon, and inure solely to the benefit of, the Trust,
the Manager, the Company and each person who controls the Company or the Trust,
respectively, and their respective heirs, executors, administrators, successors
and assigns, and no other person shall acquire or have any right under or by
virtue of this Agreement. No purchaser of any Shares from the Trust
shall be deemed a successor or assign by reason merely of such
purchase.
6. This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York.
7. This
Agreement may be executed by the parties hereto in counterparts, each of which
shall be deemed to be an original, but all such respective counterparts shall
together constitute one and the same instrument.
If
the foregoing is in accordance with your understanding, please sign and return
to us five counterparts hereof, and upon the acceptance hereof by the Manager,
this letter and such acceptance hereof shall constitute a binding agreement
between each of the Manager and the Company.
Very truly yours,
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X. X. Xxxxxx Company, Inc. | |||
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By:
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/s/ Xxxxxx X. Xxxxxxxxx | |
Name: Xxxxxx X. Xxxxxxxxx | |||
Title: Executive Vice President
and Chief Financial Officer
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Accepted as
of the date hereof:
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EVERCORE TRUST COMPANY, N.A. | |||
As Investment Manager of a Segregated Account in
the
X. X. Penney Corporation, Inc. Pension Plan
Trust
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By:
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/s/ Xxxxxx X. Xxxxxxxx | |
Name: Xxxxxx X. Xxxxxxxx | |||
Title: Managing Director | |||