Item 1.01 Entry into a Material Definitive Agreement.
On November 16, 2023, Hanesbrands Inc. (the “Company”) entered into a Cooperation Agreement (the “Cooperation Agreement”) with Barington Companies Equity Partners, L.P., Barington Capital Group, L.P., Barington Companies Management, LLC and James A. Mitarotonda (collectively, “Barington”) regarding the composition of the Company’s Board of Directors (the “Board”) and related matters, as further described below. The term of the Cooperation Agreement ends on the date that is 30 days prior to the notice deadline under the Company’s Amended and Restated Bylaws for the submission of stockholder director nominations with respect to the Company’s 2025 annual meeting of stockholders (the “Cooperation Period”), unless earlier terminated in conjunction with the Advisor’s termination of its advisory services, as described below.
Appointment of John Mehas as Director
Pursuant to the Cooperation Agreement, the Company agreed to appoint John Mehas as a new independent director on the Board, to serve for an initial term expiring at the Company’s 2024 annual meeting of stockholders (the “2024 Annual Meeting”). The Company also agreed to include Mr. Mehas among the Company’s slate of director nominees for election at the 2024 Annual Meeting and to support Mr. Mehas for election in a manner consistent with its support for the other nominees of the Company.
Appointment of Barington Companies Management, LLC as Advisor
Pursuant to the Cooperation Agreement, Barington Companies Management, LLC will serve as an advisor to the Company (the “Advisor”) during the Cooperation Period. The Advisor will provide advisory services to the Company from time to time with respect to the Company’s business, operations, strategic and financial matters, corporate governance and the composition of the Board. The Company will pay the Advisor a fee of $20,000 per month that it serves as the Advisor. From and after five months from the effective date of the Cooperation Agreement, the Advisor may, upon receipt of such written termination notice to the Company, terminate its agreement to serve as the Advisor. In accordance with the terms of the Cooperation Agreement, any such termination will also result in the termination of the Cooperation Agreement upon the later of 30 days following the receipt of such written notice and the written certification of Barington’s compliance with certain confidentiality-related provisions.
Voting and Standstill Agreements
Furthermore, under the terms of the Cooperation Agreement and during the Cooperation Period, Barington agreed to vote all of its shares of the Company’s common stock (and the shares of its affiliates) (i) in favor of the election of directors nominated by the Board at the 2024 Annual Meeting, (ii) against any stockholder nominations for directors that are not approved and recommended by the Board for election, (iii) against any proposals to remove any member of the Board and (iv) otherwise in accordance with the Board’s recommendation on all other proposals or business subject to stockholder action, subject to certain exceptions set forth in the Cooperation Agreement. Barington also agreed to certain customary standstill restrictions during the Cooperation Period, including, among other things, restrictions against acquiring any shares of the Company’s common stock that would result in Barington beneficially owning more than 5.0% of the outstanding common stock, soliciting proxies, making stockholder proposals and nominating directors for election to the Board.
The foregoing summary of the Cooperation Agreement does not purport to be complete and is qualified in its entirety by reference to the Cooperation Agreement, a copy of which is attached hereto as Exhibit 10.1 and is 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 set forth in Item 1.01 is incorporated into this Item 5.02 by reference.
On November 16, 2023, the Board increased the number of members of the Board from 10 to 13 and appointed Colin Browne, Natasha Chand and John Mehas (each, an “Appointee”) to serve as directors of the Company, effective immediately. Each Appointee will serve for an initial term expiring at the 2024 Annual Meeting and until his or her successor is elected and qualified, or until his or her earlier resignation or removal. The Board
