TABLE OF CONTENTS

 

		Page
ARTICLE I	GOVERNANCE	1
1.1	Board of Directors	1
1.2	Voting	4
ARTICLE II	OTHER COVENANTS	4
2.1	Preemptive Rights	4
2.2	Information Rights	6
2.3	Standstill	7
2.4	Transfer Restrictions	9
ARTICLE III  REPRESENTATIONS AND WARRANTIES		10
3.1	Representations and Warranties of the Shareholders	10
3.2	Representations and Warranties of the Company	11
ARTICLE IV  DEFINITIONS		11
4.1	Defined Terms	11
4.2	Terms Generally	15
ARTICLE V   MISCELLANEOUS		16
5.1	Term	16
5.2	Amendments and Waivers	16
5.3	Successors and Assigns	16
5.4	Confidentiality	16
5.5	Severability	17
5.6	Counterparts	17
5.7	Entire Agreement	17
5.8	Governing Law; Jurisdiction	17
5.9	WAIVER OF JURY TRIAL	18
5.10	Specific Performance	18
5.11	No Third-Party Beneficiaries	18
5.12	Notices	18
5.13	Corporate Opportunities	19

i

SHAREHOLDERS’ AGREEMENT, dated as of October 5, 2016 (as may be amended from time to time, this “Agreement”), by and among Signet Jewelers Limited, a Bermuda exempted company (the “Company”), and each of Green Equity Investors VI, L.P., a Delaware limited partnership (“Fund VI”), Green Equity Investors Side VI, L.P., a Delaware limited partnership (“Fund Side VI”), LGP Associates VI-A LLC, a Delaware limited liability company (“LGP Associates VI-A”), and LGP Associates VI-B LLC, a Delaware limited liability company (“LGP Associates VI-B” and, together with Fund VI, Fund Side VI and LGP Associates VI-A, the “Initial Shareholder”).  The obligations of the Initial Shareholder set forth in this Agreement shall be several and not joint among Fund VI, Fund Side VI, LGP Associates VI-A and LGP Associates VI-B and apportioned in percentages of 62.003520%, 36.954080%, 0.075200% and 0.967200% respectively.

 

W I T N E S S E T H:

 

WHEREAS, the Company, Fund VI and Fund Side VI have entered into an Investment Agreement, dated as of August 24, 2016 (as may be amended from time to time, the “Investment Agreement”), pursuant to which, among other things, the Company is issuing to the Initial Shareholder Series A Convertible Preference Shares (the “Convertible Preference Shares”);

 

WHEREAS, simultaneously with the execution and delivery of this Agreement by the parties hereto, the Company and the Initial Shareholder have entered into a Registration Rights Agreement, dated as of October 5, 2016 (as may be amended from time to time, the “Registration Rights Agreement”), pursuant to which, among other things, the Company grants the Initial Shareholder certain registration and other rights with respect to the Convertible Preference Shares and Common Shares; and

 

WHEREAS, each of the parties hereto wishes to set forth in this Agreement certain terms and conditions regarding the Initial Shareholder’s ownership of the Securities.

 

NOW, THEREFORE, in consideration of the mutual covenants, representations, warranties and agreements contained in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the parties agree as follows:

 

ARTICLE I

 

GOVERNANCE

 

 

 

 

 

 

 

 

 

 

 

 

ARTICLE II

 

OTHER COVENANTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ARTICLE III

 

REPRESENTATIONS AND WARRANTIES

 

 

 

 

 

 

 

 

ARTICLE IV

 

DEFINITIONS

 

 

“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person.  For purposes of this definition, “control,” as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise.  For purposes of this definition, the terms “controlling,” “controlled by” and “under common control with” have correlative meanings.  For purposes of this Agreement, none of the Shareholders and their respective Affiliates shall be deemed to be Affiliates of the Company or any of its Subsidiaries.

 

“Agreement” has the meaning set forth in the Preamble.

 

“Applicable Law” means all applicable provisions of (i) constitutions, statutes, laws, rules, regulations, ordinances, codes or orders of any Governmental Entity, and (ii) any orders, decisions, injunctions, judgments, awards or decrees of any Governmental Entity.

 

“Approved Holders” means the Initial Shareholder and any Permitted Transferees.

“Board” has the meaning set forth in Section 1.1(a).

 

“Cause” means (i) a conviction for a criminal offense involving dishonesty or (ii) engaging in conduct which brings the applicable director or the Company into disrepute and which results in material financial detriment to the Company.

 

“Closing” has the meaning set forth in the Investment Agreement.

 

“Common Shares” means the common shares, par value $0.18 per share of the Company.

 

“Company” has the meaning set forth in the Preamble.

 

“Company Competitor” means any Person that derives at least 10% of its sales (and in any event at least $25 million of its sales per calendar year) from the sale of jewelry products and watches (whether retail or wholesale).

 

“Confidential Information” means any and all confidential or proprietary information pertaining to the Company or its Affiliates, or the respective businesses and operations thereof, furnished or made available by the Company to, any Shareholder; provided, that “Confidential Information” shall not include information that (A) is at the time of disclosure, already in such Shareholder’s possession (provided, however, that such information is not known by such Shareholder following reasonable inquiry to be subject to an obligation of confidentiality owed to the Company or any other Person), (B) is or becomes generally available to the public other than as a result of a disclosure by such Shareholder or any of its Representatives in violation of this Agreement or any applicable confidentiality or non-disclosure agreement, (C) becomes available to such Shareholder on a non-confidential basis from a source other than the Company or its Representatives (provided, however, that such source is not known by such Shareholder following reasonable inquiry to be bound by an obligation of confidentiality owed to the Company or any other Person) or (D) is developed by such Shareholder without using all or any portion of Confidential Information or violating any of the obligations of such Shareholder under this Agreement.

 

“Confidentiality Agreement” means that certain Confidentiality Agreement, dated as of July 3, 2016, by and between the Company and Leonard Green & Partners, L.P.

 

“Contract” means any contract, agreement, note, bond, indenture, guarantee, subcontract, lease or undertaking.

 

“Convertible Preference Shares” has the meaning set forth in the Recitals.

 

“Equity-based Security” means any class or series of shares (including a new class of common shares of the Company other than Common Shares), any preference shares or any other equity-like or hybrid securities (including debt securities with equity components), including options, warrants, convertibles, exchangeable or exercisable securities, share appreciation rights or any other security or arrangement whose economic value is derived from the value of the equity of the Group Companies.

“Exchange Act” means the U.S. Securities and Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

 

“Fund VI” has the meaning set forth in the Preamble.

 

“Fund Side VI” has the meaning set forth in the Preamble.

 

“Governmental Entity” means any foreign, federal or local government, or regulatory or enforcement authority of any such government or any court, administrative agency or commission or other authority or instrumentality of any such government.

 

“Group Company” has the meaning set forth in Section 2.1(a).

 

“Initial Shareholder” has the meaning set forth in the Preamble.

 

“Investment Agreement” has the meaning set forth in the Recitals.

 

“Law” means any applicable federal, state, local, municipal, foreign or other law, statute, constitution, principle of common law, resolution, ordinance, code, order, edict, decree, rule, regulation, ruling or other legally binding requirement issued, enacted, adopted, promulgated, implemented or otherwise put into effect by or under the authority of any Governmental Entity.

 

“LGP Associates VI-A” has the meaning set forth in the Preamble.

 

“LGP Associates VI-B” has the meaning set forth in the Preamble.

 

“Majority Approved Holders” means, as of any date, the Approved Holders holding a majority of the Original Preference Shares then held by all Approved Holders.

 

“Majority Shareholders” means, as of any date, the Shareholders holding a majority of the Common Shares of the Company on a fully-diluted, as converted basis then held by all Shareholders.

 

“Original Preference Shares” means, as of any date, the Common Shares issuable upon conversion of the Series A Preference Shares issued pursuant to the Investment Agreement on the date hereof plus the Common Shares that were converted from Series A Preference Shares issued pursuant to the Investment Agreement as of the date hereof (without duplication).

 

“Other Investments” has the meaning set forth in Section 5.13.

 

“Percentage Ownership” means, as to any Shareholder and as of any date, the percentage equal to (i) the aggregate number of Common Shares held by such Shareholder on a fully diluted as-converted basis divided by (ii) the total number of issued Common Shares of the Company on a fully diluted, as-converted basis.

“Permitted Issuance” means any issuance of Common Shares or Equity-based Securities in connection with (i) bonus issues or share dividends, but solely to the extent that holders of Convertible Preference Shares participate in such issuance, (ii) share splits or subdivisions, (iii) reclassifications, redomestications and similar transactions (except to the extent that new capital is raised in connection therewith), (iv) kickers to bona fide lenders, (v) issuances in respect of any equity incentive, share option, restricted share or similar plan approved by the Board, (vi) issuances in respect of acquisitions of another Person (whether by amalgamation, merger, acquisition of the capital stock of such Person, acquisition of all or substantially all of the assets of such Person, or other reorganization), (vii) issuances in respect of any shareholder rights plan or (viii) issuances in respect of conversion of the Convertible Preference Shares.

 

“Permitted Transferee” means, with respect to any Person, (i) any Affiliate of such Person, (ii) any successor entity of such Person, (iii) with respect to any Person that is an investment fund, vehicle or similar entity, any other investment fund, vehicle or similar entity of which such Person or an Affiliate of such Person serves as the general partner, manager or advisor, or any successor entity of the foregoing and (iv) with the consent of the Company, such consent not to be unreasonably withheld, any limited partners of, or Affiliates of limited partners of, Fund VI, Fund Side VI, Green Equity Investors VII, L.P., a Delaware limited partnership, or Green Equity Investors Side VII, L.P., a Delaware limited partnership, or any of their parallel or feeder funds.

 

“Person” means any natural person, corporation, partnership, limited liability company, firm, association, trust, government, governmental agency or other entity, whether acting in an individual, fiduciary or other capacity.

 

“Preemptive Rights Acceptance Notice” has the meaning set forth in Section 2.1(b).

 

“Preemptive Rights Issuance” has the meaning set forth in Section 2.1(a).

 

“Preemptive Rights Offer Notice” has the meaning set forth in Section 2.1(b).

 

“Prohibited Transferee” has the meaning set forth in Section 2.4(c).

 

“Purchaser Group” has the meaning set forth in Section 5.13.

 

“Registration Rights Agreement” has the meaning set forth in the Recitals.

 

“Renounced Business Opportunities” has the meaning set forth in Section 5.13.

 

“Representative” means, with respect to any Person, any director, officer, employee, Affiliate, advisor (including any financial advisor, legal counsel, accountant or consultant), agent or other representative of such Person.

 

“Securities” shall mean the Convertible Preference Shares, including the Common Shares underlying the Convertible Preference Shares.

“Securities Act” means the U.S. Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

 

“Series A Certificate” has the meaning set forth in Section 1.1(b).

 

“Series A Preference Shares” means preference shares, par value $0.01 per share, designated as “Series A Convertible Preference Shares”, of the Company issued pursuant to the Investment Agreement.

 

“Shareholders” means the Initial Shareholder and any Person (i)(x) who acquires Convertible Preference Shares (or to whom Convertible Preference Shares is transferred), whether from a Shareholder, the Company or otherwise or, (y) to whom any rights, interests or obligations hereunder are assigned pursuant to Section 5.3 and (ii) in the case of both (i)(x) and (i)(y), who executes a written joinder agreement substantially in the form attached hereto as Exhibit A.

 

“Subsidiary” means, with respect to any Person, any corporation, partnership, joint venture, limited liability company or other entity (x) of which such Person or a subsidiary of such Person is a general partner or (y) of which a majority of the voting securities or other voting interests, or a majority of the securities or other interests of which having by their terms ordinary voting power to elect a majority of the board of directors or Persons performing similar functions with respect to such Person, is directly or indirectly owned by such Person and/or one or more subsidiaries thereof.

 

“Transfer” by any Person means directly or indirectly, to sell, transfer, assign, pledge (subject to Section 2.4(d)), encumber (subject to Section 2.4(d)), hypothecate or similarly dispose of, either voluntarily or involuntarily, or to enter into any contract, option or other arrangement or understanding with respect to the sale, transfer, assignment, pledge (subject to Section 2.4(d)), encumbrance (subject to Section 2.4(d)), hypothecation or similar disposition of, any securities owned by such Person or of any interest (including any voting interest) in any securities owned by such Person.

 

ARTICLE V

 

MISCELLANEOUS

 

 

 

 

 

 

 

 

 

 

 

If to the Company, to:

 

Signet Jewelers Limited
Clarendon House, 2 Church Street
Hamilton HM11, Bermuda
Attn:                          Mark Jenkins
E-mail:                      corporatesecretary@jewels.com
Fax:                          +44 (0) 20 7624 0835

 

with copies (which shall not constitute notice) to:

 

Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, NY 10153
Attn:                        Michael J. Aiello
E-mail:                    michael.aiello@weil.com
Fax:                          (212) 310-8007

If to the Initial Shareholder, to:

 

c/o Leonard Green & Partners, L.P.
11111 Santa Monica Blvd., #2000
Los Angeles, CA 90025
Attn:  Jonathan Seiffer
           Jeffrey Suer
E-mail: seiffer@leonardgreen.com; jsuer@leonardgreen.com
Facsimile:  (310) 954-0404

 

with a copy (which shall not constitute notice) to:

 

Latham & Watkins LLP
885 Third Avenue
New York, NY 10022-4834
Attn:                          Howard A. Sobel

                           Jason H. Silvera

 

 

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement by their authorized representatives as of the date first above written.

 

 

	SIGNET JEWELERS LIMITED
	By:	/s/ Mark S. Light
	Name:	Mark S. Light
	Title:	Chief Executive Officer

 

[Signature Page to Registration Rights Agreement]

 

	GREEN EQUITY INVESTORS VI, L.P.
	By: GEI Capital VI, LLC, its General Partner
	By:	/s/ Jonathan Seiffer
	Name:	Jonathan Seiffer
	Title:	Senior Vice President

 

	GREEN EQUITY INVESTORS SIDE VI, L.P.
	By: GEI Capital VI, LLC, its General Partner
	By:	/s/ Jonathan Seiffer
	Name:	Jonathan Seiffer
	Title:	Senior Vice President

 

	LGP ASSOCIATES VI-A LLC
	By: Peridot Coinvest Manager LLC, its manager
	By: Leonard Green & Partners, L.P., its manager
	By: LGP Management, Inc., its general partner
	By:	/s/ Jonathan Seiffer
	Name:	Jonathan Seiffer
	Title:	Senior Vice President

 

	LGP ASSOCIATES VI-B LLC
	By: Peridot Coinvest Manager LLC, its manager
	By: Leonard Green & Partners, L.P., its manager
	By: LGP Management, Inc., its general partner
	By:	/s/ Jonathan Seiffer
	Name:	Jonathan Seiffer
	Title:	Senior Vice President

 

 

 

 

[Signature Page to Registration Rights Agreement]

EXHIBIT A

JOINDER AGREEMENT

 

 

Signet Jewelers Limited.
Clarendon House, 2 Church Street

Hamilton HM11, Bermuda
Facsimile: +44 (0) 20 7624 0835
Attention: Mark Jenkins

 

Ladies and Gentlemen:

 

Reference is made to the Shareholders’ Agreement, dated as of [●], 2016 (as such agreement may have been or may be amended from time to time) (the “Agreement”), by and among Signet Jewelers Limited, a Bermuda exempted company, each of Green Equity Investors VI, L.P., a Delaware limited partnership, Green Equity Investors Side VI, L.P., a Delaware limited partnership, LGP Associates VI-A LLC, a Delaware limited liability company, LGP Associates VI-B LLC, a Delaware limited liability company, and any other parties identified on the signature pages of any joinder agreements substantially similar to this joinder agreement executed and delivered in accordance with the Agreement.  Capitalized terms used but not otherwise defined herein have the meanings set forth in the Agreement.

 

The undersigned agrees that, as of the date written below, the undersigned shall become a party to the Agreement, and shall be fully bound by, and subject to, all of the covenants, terms and conditions of the Agreement as a “Shareholder,” as though an original party thereto.  The undersigned represents and warrants that the representations and warranties set forth in Section 3.1 of the Agreement are true and correct in all respects as of the date hereof.

 

This joinder agreement and all claims or causes of action based upon, arising out of, or related to this Agreement (whether based on contract, equity, tort or any other theory) shall be governed by and construed in accordance with the laws of the State of Delaware (excluding choice‑of‑law principles of the laws of such State that would permit the application of the laws of a jurisdiction other than such State), without regard to any applicable conflicts-of-law principles.

 

IN WITNESS WHEREOF, the undersigned has executed this Joinder as of the [__]th day of [______________], [____].
                                                                                   

 

[__________________________]

 

                                            By:______________________________

Name:

Title: