TIFFANY & CO. (NYSE:TIF) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement.
Cooperation Agreement with JANA.
On February 20, 2017, JANA Partners LLC (JANA) and Tiffany
Co. (the Company) entered into a Cooperation Agreement
(the JANA Agreement).
to the JANA Agreement, the Company has agreed that, subject to
the conditions set forth therein, the board of directors of the
Company (the Board) will appoint each of Roger Farah,
James Lillie and Francesco Trapani (each, a Designee and
collectively, the Designees) to the Board no later than
ten (10) business days after the date of the JANA Agreement. The
Company also agreed that, subject to the conditions set forth
therein, the Board will nominate each of the Designees for
election to the Board at the Companys 2017 Annual Meeting of
Stockholders (the 2017 Annual Meeting).
Each of the Designees must, at all times while serving as a
member of the Board, comply with all policies and guidelines
applicable to all non-employee Board members, including, without
limitation, the Companys Corporate Governance Principles, Code of
Conduct and all trading and confidentiality obligations and
guidelines. In addition, each of the Designees will provide to
the Company an irrevocable resignation letter from the Board that
will be effective (subject to Board acceptance) if JANA ceases to
comply with or breaches any of the terms of the JANA Agreement in
any material respect and, if capable of being cured, such
material breach or failure has not been cured within fifteen (15)
days after receipt by JANA of written notice from the Company
specifying such material breach or failure, and, solely with
respect to Mr. Trapani (in his capacity as a Designee), such
resignation letter will be effective (subject to Board
acceptance) if Mr. Trapani ceases to comply with or breaches any
of the terms of a separate cooperation agreement, entered into on
February 20, 2017 between the Company and Mr. Trapani (the
Trapani Agreement) (as described below) in any material
respect and, if capable of being cured, such material breach or
failure has not been cured by Mr. Trapani within fifteen (15)
days after receipt by Mr. Trapani of written notice from the
Company specifying such material breach or failure.
If any of the Designees resigns, refuses to or cannot serve (due
to death or disability) during the Standstill Period (as defined
below), the Company and JANA shall cooperate in good faith to
identify and select a replacement director or directors, as
applicable, who is mutually acceptable to each of the parties
(acting reasonably). Any replacement director must, among other
matters, (A)be independent of JANA and its affiliates and
(B)qualify as an independent director of the Company under the
listing rules of the New York Stock Exchange and under the
Companys Corporate Governance Principles and otherwise qualify to
serve as a director under the Companys by-laws and Corporate
Governance Principles.
JANA has agreed to various standstill provisions for the duration
of the Standstill Period, including, among other things, that it
will not:
| 1. |
in any way participate in any solicitation of proxies, or advise, encourage or influence any person with respect to the voting of any securities of the Company for the election of directors or approval of any stockholder proposals |
| 2. |
acquire any ownership interest that would result in the ownership by JANA (together with any affiliates, as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the Exchange Act), and any individual or entity that would be deemed to be part of a group, as defined in Section 13(d)(3) of the Exchange Act), of 10% or more of the shares of common stock, par value $0.01, of the Company (the Common Stock) outstanding at such time (for purposes of the calculation of ownership interest, it being agreed that all shares of Common Stock which a person has the right to acquire to the exercise of any rights in connection with any securities or any agreement, regardless of when such rights may be exercised and whether they are conditional and including economic ownership to a cash settled call option or other derivative security, contract or instrument related to the price of shares of Common Stock shall be included) |
| 3. |
sell, directly or indirectly, through swap or hedging transactions or otherwise, securities of the Company or any rights decoupled from the underlying securities of the Company to a third party that would result in such third party, together with its affiliates, owning more than 4.9% of the Common Stock outstanding at such time or |
| 4. |
effect any tender or exchange offer, merger, consolidation, acquisition, sale of all or substantially all assets or sale, spinoff, splitoff or other similar separation of one or more business units, scheme of arrangement, plan of arrangement or other business combination, recapitalization, reorganization, liquidation, dissolution or other extraordinary transaction involving the Company. |
JANA has also agreed that, during the Standstill Period, it will
vote its shares in favor of each of the Designees and all
directors who are members of the Board as of the date of the JANA
Agreement. It will also vote its shares in accordance with the
Boards recommendations on all other matters, except with respect
to proposals relating to (a) authorizing or approving certain
extraordinary transactions, (b) the implementation of takeover
defenses or (c) new or amended incentive compensation plans.
to the JANA Agreement, JANA is committed to be independent of Mr.
Trapani going forward.
The Company and JANA have agreed, subject to certain exceptions,
that during the Standstill Period they will not make, cause to be
made or encourage any other person to make or cause to be made,
any public statement or announcement that constitutes an ad
hominem attack on, or otherwise disparages, defames or
slanders, in the case of the Company, JANA or its affiliates or
any of their respective officers, directors or employees and, in
the case of JANA, the Company or affiliates thereof or any of
their respective officers, directors or employees.
In addition, the Company has also agreed that it (i) will appoint
Mr. Trapani to the committee of the Board that is overseeing the
Companys search for a new chief executive officer and to the
Nominating/Corporate Governance Committee and (ii) until the end
of the Standstill Period, will not increase the size of the Board
if doing so would result in the Board having a number of members
in excess of twelve (12) (except that, upon appointment of the
Designees, the Board may increase the size to be up to thirteen
(13) members) and will not nominate more than twelve
(12) individuals for election at the 2017 Annual Meeting;
provided, that the Company is permitted to increase the size of
the Board in order to accommodate the appointment to the Board
and subsequent nomination of (x) a chief executive officer hired
by the Company with the Boards approval after the appointment of
the Designees and (y) one or more additional directors in
connection with, or as a result of, a bona fide strategic
transaction unanimously approved by the Board after the
appointment of the Designees, the terms of which require such
appointment or nomination. to the JANA Agreement, the Company
will be limiting waivers under the retirement age provisions in
its governance documents, such that, in accordance with the
mandatory retirement age, one current director will not stand for
reelection at the 2017 Annual Meeting and two current directors
will not stand for reelection at the 2018 Annual Meeting of
Stockholders.
The Standstill Period means the period commencing on the date of
the JANA Agreement and terminating on the date that is the
earlier of (A)the later of (x) the date that is thirty (30) days
prior to the expiration of the Companys advance notice period for
the nomination of directors at the Companys 2018 Annual Meeting
of Stockholders and (y) if the Designees are included, and the
Designees and JANA have agreed in advance to such inclusion (it
being understood that JANA will respond to any request as to
whether it agrees to such inclusion within five (5) business days
after notice to JANA of such inclusion) on the Companys slate of
director nominees for the 2018 Annual Meeting of Stockholders or
for any annual meeting of stockholders of the Company subsequent
thereto (each, an Applicable Meeting), the date that is
thirty (30) days prior to the expiration of the Companys advance
notice period for the nomination of directors at the next annual
meeting of stockholders following the Applicable Meeting and (B)a
material breach by the Company of its obligations under the JANA
Agreement which is not cured within fifteen (15) days after
receipt by the Company of written notice from JANA specifying the
material breach.
The JANA Agreement terminates upon the expiration of the
Standstill Period. The Company’s obligations under the JANA
Agreement terminate earlier if JANA ceases to comply with or
breaches any of the terms of the JANA Agreement in any material
respect and, if capable of being cured, such material breach or
failure has not been cured within fifteen (15) days after receipt
by JANA of written notice from the Company specifying such
material breach or failure, and, solely with respect to Mr.
Trapani (in his capacity as a Designee), if Mr. Trapani ceases to
comply with or breaches any of the terms of the Trapani Agreement
(as described below) in any material respect and, if capable of
being cured, such material breach or failure has not been cured
by Mr. Trapani within fifteen (15) days after receipt by Mr.
Trapani of written notice from the Company specifying such
material breach or failure.
Cooperation Agreement with Francesco Trapani
On February 20, 2017, Mr. Trapani and the Company entered into
the Trapani Agreement.
to the Trapani Agreement, Mr. Trapani has agreed that he,
together with his affiliates, will be subject to substantially
the same standstill provisions that JANA has agreed to under the
JANA Agreement.
Mr. Trapani has also agreed that, during the Standstill Period,
he will vote his shares in favor of each of the Designees and all
directors who are members of the Board as of the date of the
Trapani Agreement. Mr. Trapani will also vote his shares in
accordance with the Boards recommendations on all other matters,
except with respect to proposals relating to (a) authorizing or
approving certain extraordinary transactions, (b) the
implementation of takeover defenses or (c) new or amended
incentive compensation plans. It is agreed that nothing in the
Trapani Agreement (i) limits Mr. Trapanis ability to act or vote
on any matter in his capacity as a director of Company, or (ii)
prohibits, limits or restricts Mr. Trapani from exercising his
fiduciary duties as a director to the Company or its stockholders
under applicable law.
to the Trapani Agreement, Mr. Trapani is committed to be
independent of JANA going forward.
The Company and Mr. Trapani have agreed, subject to certain
exceptions, that during the Standstill Period they will not make,
cause to be made or encourage any other person to make or cause
to be made, any public statement or announcement that constitutes
an ad hominem attack on, or otherwise disparages,
defames or slanders, in the case of the Company, Mr. Trapani or
his affiliates and, in the case of Mr. Trapani, the Company or
affiliates thereof or any of their respective officers, directors
or employees.
The Trapani Agreement terminates upon the expiration of the
Standstill Period.
The foregoing summary of the JANA Agreement and the Trapani
Agreement are not complete and are subject to, and qualified by
reference to, the full text of the JANA Agreement and Trapani
Agreement, which are filed as Exhibits 10.37 and 10.38 to this
Current Report on Form 8-K and incorporated herein by reference.
| Item 5.02 |
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
The information included in Item 1.01 of this Current Report on
Form 8-K is hereby incorporated by reference into this Item 5.02.
| Item 7.01 | Regulation FD Disclosure |
A copy of the joint press release issued by the Company and JANA
on February 21, 2017 describing the entry into the JANA Agreement
and the Trapani Agreement and the appointments of Messrs. Farah,
Lillie and Trapani is filed herewith as Exhibit 99.1.
In accordance with General Instruction B.2 of Form 8-K, the
information set forth under Item 7.01 of this Current Report on
Form 8-K, including Exhibit 99.1, shall not be deemed filed for
the purposes of Section 18 of the Exchange Act, or otherwise
subject to the liabilities of that section, nor shall it be
deemed incorporated by reference in any filing under the
Securities Act of 1933, as amended, or the Exchange Act, except
as expressly stated by specific reference in such filing.
Item 9.01 Financial Statements and Exhibits
| (d) | Exhibits: | ||
|
Exhibit No. |
Description |
||
| 10.37 |
Cooperation Agreement, dated February 20, 2017, between JANA Partners LLC and Tiffany Co. |
||
| 10.38 |
Cooperation Agreement, dated February 20, 2017, between Francesco Trapani and Tiffany Co. |
||
| 99.1 |
Joint Press Release issued by JANA Partners LLC and Tiffany Co. on February 21, 2017 |
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About TIFFANY & CO. (NYSE:TIF)
Tiffany & Co. is a holding company that operates through its subsidiary companies. The Company’s principal subsidiary, Tiffany and Company (Tiffany), is a jeweler and specialty retailer. Through its subsidiaries, the Company designs and manufactures products and operates TIFFANY & CO. retail stores. The Company’s segments include Americas, Asia-Pacific, Japan, Europe and Other. The Americas segment includes sale in Company-operated TIFFANY & CO. stores in the United States, Canada and Latin America. The Asia-Pacific segment includes over 80 Company-operated TIFFANY & CO. stores in China, Korea, Hong Kong, Taiwan, Australia, Singapore, Macau, Malaysia and Thailand. The Japan segment includes approximately 60 Company-operated TIFFANY & CO. stores. The retail sales in Europe are transacted in over 40 Company-operated TIFFANY & CO. stores. The Other segment includes retail sales and wholesale distribution; wholesale sales of diamonds, and licensing agreements. TIFFANY & CO. (NYSE:TIF) Recent Trading Information
TIFFANY & CO. (NYSE:TIF) closed its last trading session up +3.17 at 86.18 with 2,755,002 shares trading hands.