Form 8-K - Current report

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 13, 2024

 

 

 

CAPRI HOLDINGS LTD

(Exact name of registrant as specified in its charter)

 

 

 

 

British Virgin Islands		001-35368		N/A
(State or other jurisdiction of incorporation)		(Commission File Number)		(I.R.S. Employer Identification No.)

90 Whitfield Street

2nd Floor

London, United Kingdom

W1T 4EZ

(Address of principal executive offices)

(Zip Code)

44 207 632 8600

(Registrant’s telephone number, including area code)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Ordinary Shares, no par value		CPRI		New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

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Item 1.01

Entry into a Material Definitive Agreement.

The disclosure set forth below under Item 1.02 of this Current Report on Form 8-K is incorporated by reference herein.

 

Item 1.02

Termination of a Material Definitive Agreement.

As previously disclosed, on August 10, 2023, Capri Holdings Limited (the “Company”) entered into an Agreement and Plan of Merger (the “Merger Agreement”), by and among the Company, Tapestry, Inc., a Maryland corporation (“Tapestry”), and Sunrise Merger Sub, Inc., a British Virgin Islands business company limited by shares and a wholly owned subsidiary of Tapestry (“Merger Sub” and, together with the Company and Tapestry, the “Parties”), pursuant to which, and upon the terms and subject to the conditions therein, Merger Sub would be merged with and into the Company, with the Company surviving the Merger and continuing as a wholly owned subsidiary of Tapestry.

On November 13, 2024, the Parties entered into a Termination Agreement (the “Termination Agreement”), pursuant to which the Parties agreed to terminate the Merger Agreement, effective immediately. In connection with the termination, consistent with the Merger Agreement, Tapestry agreed to reimburse the Company approximately $45 million in cash on November 14, 2024. The Parties also agreed to release each other from any and all liability, claims, rights, actions, causes of action, suits, liens, obligations, accounts, debts, demands, agreements, promises, liabilities, controversies, costs, charges, damages, expenses and fees (including attorney’s, financial advisor’s or other fees) in connection with, arising out of or related to the Merger Agreement or the transactions contemplated therein or thereby.

The foregoing descriptions of the Merger Agreement and the Termination Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of the Merger Agreement, which was filed as an exhibit to the Company’s Current Report on Form 8-K filed on August 10, 2023, and the Termination Agreement, which is attached hereto as Exhibit 10.1, each of which is incorporated by reference herein.

 

Item 5.02

Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On November 13, 2024, the Board of Directors of the Company (the “Board”) and the Compensation Committee of the Board (the “Committee”) met and, subject to the entry into of the Termination Agreement, approved the grant of special retention awards to the Chief Financial Officer and Chief Operating Officer, Thomas J. Edwards, Jr., and General Counsel and Chief Sustainability Officer, Krista A. McDonough, to recognize the substantial efforts and time that these executives devoted to the Company’s anticipated merger and to ensure their continued employment and dedication following the entry into of the Termination Agreement. These awards consist of (i) a 2025 target retention award in the amount of $800,000 for Mr. Edwards and $275,000 for Ms. McDonough, in each case 50% of which will be paid on December 13, 2024 and 50% of which will be paid on June 13, 2025 subject to the executive’s employment on such date (other than due to certain terminations, in which case such amount will vest and be paid immediately); and (ii) a special performance bonus in the amount of $250,000 for each of Mr. Edwards and Ms. McDonough, which will also be paid on December 13, 2024. The executive will be obligated to pay to the Company an amount equal to the special performance bonus if prior to December 13, 2025 the executive terminates his or her employment (other than for good reason or due to death or disability) or the Company terminates the executive’s employment for cause. The executive’s payment obligation will terminate upon a change in control of the Company.

In addition, on November 13, 2024, the Board and the Committee met and, subject to the entry into of the Termination Agreement, approved an amendment to the terms of the letter agreement between its Chief People Officer, Jenna Hendricks, and the Company, dated December 15, 2023 (the “Acceleration Letter”), to provide that the Company will eliminate Ms. Hendricks’ obligation to pay the Company an amount equal

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to the special bonus award of $500,000 that was paid under the Acceleration Letter. If, prior to December 13, 2025, Ms. Hendricks’ employment terminates other than (i) as a result of a Covered Termination (as defined in the Acceleration Letter) or (ii) due to her death or disability, she will be obligated to pay the Company $250,000. Ms. Hendricks’ payment obligation will terminate upon a change in control of the Company.

Subject to the entry into of the Termination Agreement, the Board and the Committee also approved an amendment to the terms of the equity awards granted to employees following the date of the Merger Agreement to align these awards with the standard terms of the Company’s awards prior to the entry into of the Merger Agreement. The amendment provides for full vesting of the awards upon a covered termination of employment during the twenty-four months following a change in control of the Company, as opposed to the pro-rated vesting that was applicable in connection with the Tapestry transaction. This amendment applies broadly to all employees that participated in the Company’s equity incentive plan during the applicable time period (including the named executive officers, but excluding Mr. John D. Idol, who is retirement eligible under the equity incentive plan and not subject to pro-rated vesting).

 

Item 7.01

Regulation FD Disclosure.

On November 14, 2024, the Company issued a press release announcing the termination of the Merger Agreement and the entry into the Termination Agreement as well as its strategies to return to growth. A copy of the press release is furnished herewith as Exhibit 99.1.

The information contained in Item 7.01 of this report shall not be incorporated by reference into any filing of the registrant, whether made before, on or after the date hereof, regardless of any general incorporation language in such filing, unless expressly incorporated by specific reference to such filing. The information contained in Item 7.01 of this report shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section.

Forward-Looking Statements

This report contains statements which are, or may be deemed to be, “forward-looking statements.” Forward-looking statements are prospective in nature and are not based on historical facts, but rather on current expectations and projections of management of the Company about future events and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements. All statements other than statements of historical facts included herein, may be forward-looking statements. Without limitation, any statements preceded or followed by or that include the words “plans”, “believes”, “expects”, “intends”, “will”, “should”, “could”, “would”, “may”, “anticipates”, “might” or similar words or phrases, are forward-looking statements. These forward-looking statements are not guarantees of future financial performance. Such forward-looking statements involve known and unknown risks and uncertainties that could significantly affect expected results and are based on certain key assumptions, which could cause actual results to differ materially from those projected or implied in any forward-looking statements, including regarding the terminated merger with Tapestry (the “Terminated Merger”). These risks, uncertainties and other factors include, but are not limited to, our ability to respond to changing fashion, consumer traffic and retail trends; fluctuations in demand for our products; high consumer debt levels, recession and inflationary pressures; loss of market share and increased competition; reductions in our wholesale channel; the impact of the COVID-19 pandemic, or other unforeseen epidemics, pandemics, disasters or catastrophes; levels of cash flow and future availability of credit, the Company’s ability to successfully execute its growth strategies; departure of key employees or failure to attract and retain highly qualified personnel; risks associated with operating in international markets and global sourcing activities, including disruptions or delays in manufacturing or shipments; the risk of cybersecurity threats and privacy or data security breaches; extreme weather conditions and natural disasters; general economic, political, business or market conditions; acts of war and other geopolitical conflicts; risks related to disruption of management time from ongoing business operations due to the Terminated Merger; the risk that any announcements relating to the Terminated

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Merger could have adverse effects on the market price of the Company’s ordinary shares; the significant costs, expenses and fees for professional services and other transaction costs in connection with the Terminated Merger and the risk that the termination payment made by Tapestry to the Company is insufficient to cover such costs, expenses and fees; the risk of any litigation relating to the Terminated Merger; the risk that the Terminated Merger could have an adverse effect on the ability of the Company to retain and maintain relationships with customers, suppliers and other business partners and retain and hire key personnel and on its operating results and business generally, as well as those risks that are outlined in the Company’s disclosure filings and materials, which you can find on http://www.capriholdings.com, such as its Form 10-K, Form 10-Q and Form 8-K reports that have been filed with the SEC. Please consult these documents for a more complete understanding of these risks and uncertainties. Any forward-looking statement in this report speaks only as of the date made and the Company disclaims any obligation to update or revise any forward-looking or other statements contained herein other than in accordance with legal and regulatory obligations.

 

Item 9.01

Financial Statements and Exhibits.

(d) Exhibits

 

Exhibit Number		Description
10.1†		Termination Agreement, dated November 13, 2024, by and among Tapestry, Inc. Capri Holdings Limited and Sunrise Merger Sub, Inc.
99.1		Press Release of Capri Holdings Limited, dated November 14, 2024.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

†	Schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The registrant hereby undertakes to furnish supplementally copies of any of the omitted schedules upon request by the SEC.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Dated: November 14, 2024				CAPRI HOLDINGS LIMITED
				By:		/s/ Krista McDonough
				Name:		Krista McDonough
				Title:		Senior Vice President, General Counsel & Chief Sustainability Officer

Exhibit 10.1

Execution Version

TERMINATION AGREEMENT

This TERMINATION AGREEMENT (this “Agreement”), dated as of November 13, 2024, is by and among Tapestry, Inc., a Maryland corporation (“Tapestry”), Sunrise Merger Sub, Inc., a British Virgin Islands business company limited by shares with BVI company number 2129509 incorporated under the laws of the territory of the British Virgin Islands and a wholly owned subsidiary of Tapestry (“Merger Sub”), and Capri Holdings Limited, a British Virgin Islands business company limited by shares with BVI company number 524407 incorporated under the laws of the territory of the British Virgin Islands (“Capri”). Unless the context otherwise requires, capitalized terms used but not defined herein have the respective meanings given to them in the Merger Agreement (as defined below).

WHEREAS, Tapestry, Merger Sub and Capri entered into that certain Agreement and Plan of Merger, dated as of August 10, 2023 (the “Merger Agreement”);

WHEREAS, Section 8.1(a) of the Merger Agreement provides that the Merger Agreement may be terminated by the mutual written consent of Tapestry and Capri; and

WHEREAS, the Parties desire to terminate the Merger Agreement and agree as to the reimbursement by Tapestry of certain Company Expenses incurred by Capri in connection therewith and certain other matters as set forth herein.

NOW, THEREFORE, in consideration of the covenants, agreements and other provisions set forth herein and for 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:

1. Termination. Pursuant to Section 8.1(a) of the Merger Agreement, the Parties hereby agree that the Merger Agreement, including all schedules and exhibits thereto, and all ancillary agreements contemplated thereby or entered pursuant thereto (excluding, for clarity the Confidentiality Agreement, which shall terminate on its terms) (collectively, the “Transaction Documents”), are hereby terminated effective immediately as of the entry into this Agreement (the “Termination Time”) and, notwithstanding anything to the contrary in the Transaction Documents (for clarity, including and notwithstanding Section 8.2(a) of the Merger Agreement), the Transaction Documents are terminated in their entirety and shall be of no further force or effect whatsoever (the “Termination”).

2. Payment. Tapestry agrees to reimburse Capri, on November 14, 2024, by wire transfer of immediately available funds to the account set forth on Schedule I, for Company Expenses in an amount equal to $45,088,675 (the “Termination Payment”). The payment of the Termination Payment shall be the sole and exclusive remedy of Capri, its affiliates (as defined in the Merger Agreement) and its Representatives against Tapestry and any of its Representatives and affiliates for any loss or damage suffered as a result of the failure of the Merger or for a breach of, or failure to perform under, the Merger Agreement (including all schedules and exhibits thereto) or otherwise or in respect of any oral representation made or alleged to have been made in connection therewith, and upon payment of such amount, none of Tapestry, Merger Sub or their respective Representatives or affiliates shall have any further liability or obligation relating to or arising out of the Merger Agreement (including all schedules, annexes and exhibits thereto), whether in equity or at law, in contract, in tort or otherwise.

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3. Mutual Release; Disclaimer of Liability. Subject only to the payment of the amount contemplated by Section 2 of this Agreement, each of Tapestry, Merger Sub and Capri, each on behalf of itself and each of its respective past, present or future successors, Subsidiaries, affiliates, assignees, officers, directors, employees, Representatives, agents, attorneys, auditors, stockholders and advisors and the heirs, successors and assigns of each of them (the “Releasors”), does, to the fullest extent permitted by Law, hereby fully release, forever discharge and covenant not to sue any other Party, any of their respective past, present or future successors, Subsidiaries, affiliates, assignees, officers, directors, employees, Representatives, agents, attorneys, auditors, stockholders and advisors and the heirs, successors and assigns of each of them (collectively the “Releasees”), from and with respect to any and all liability, claims, rights, actions, causes of action, suits, liens, obligations, accounts, debts, demands, agreements, promises, liabilities, controversies, costs, charges, damages, expenses and fees (including attorney’s, financial advisor’s or other fees), whether based on any Law or right of action, known or unknown, mature or unmatured, contingent or fixed, liquidated or unliquidated, accrued or unaccrued, which Releasors, or any of them, ever had or now have or can have or shall or may hereafter have against the Releasees, or any of them, in connection with, arising out of or related to (a) the Transaction Documents or the transactions contemplated therein or thereby (including, for the avoidance of doubt, the negotiation thereof and all due diligence activities undertaken in connection therewith, but excluding, for clarity, the Confidentiality Agreement) and (b) any public statements made prior to the date hereof relating to the foregoing (collectively, “Claims”). The release contemplated by this Section 3 is intended to be as broad as permitted by Law and is intended to, and does, extinguish all Claims of any kind whatsoever, whether in Law or equity or otherwise, that are based on or relate to facts, conditions, actions or omissions (known or unknown) that have existed or occurred at any time to and including the Termination Time. Each of the Releasors hereby expressly waives to the fullest extent permitted by Law the provisions, rights and benefits of California Civil Code section 1542 (or any similar Law), which provides: “A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.” Nothing in this Section 3 shall (i) apply to any action by any Party to enforce the rights and obligations imposed pursuant to this Agreement or (ii) constitute a release by any Party for any Claim arising under this Agreement.

4. Covenant Not to Sue. Each of Tapestry and Merger Sub, on the one hand, and Capri, on the other hand, on behalf of itself and its Releasors, covenants not to bring any Claim before any court, arbitrator, or other tribunal in any jurisdiction, whether as a claim, a cross claim, or counterclaim, in respect of any Transaction Document or the transactions contemplated therein or thereby. Any Releasee may plead this Agreement as a complete bar to any such Claim brought in derogation of this covenant not to bring a Claim. The covenants contained in this Section 4 shall become effective upon the effectiveness of Section 3 of this Agreement and shall survive indefinitely regardless of any statute of limitations.

5. Non-solicitation. The Parties hereby agree that the term of Section 5 of the Confidentiality Agreement shall continue through December 13, 2024.

 

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6. Non-Disparagement. For a period from the entry into this Agreement through June 13, 2025, except as required by applicable Law or the rules or regulations of any Governmental Entity, by the order of any court of competent jurisdiction or in connection with any legal or judicial process (e.g., by oral questions, interrogatories, requests for information or documents in legal proceedings, subpoena, civil investigative demand or other similar legal process or by applicable statute, rule, regulation or by governmental regulatory authorities), in which case the Party making such statements shall provide prompt written notice to the extent permitted by Law to the other Parties in advance of making such statements, none of the Parties shall, directly or indirectly, make any public statements or any private statements to third parties (in each case, oral or written) in respect of the Merger Agreement or the transactions contemplated thereby that could reasonably be understood as disparaging the other Parties or their respective affiliates or Representatives.

7. Representations and Warranties. Each Party represents and warrants to the others that: (a) such Party has all requisite corporate power and authority to enter into this Agreement and to take the actions contemplated hereby; (b) the execution and delivery of this Agreement and the actions contemplated hereby have been duly authorized by all necessary corporate or other action on the part of such Party; (c) none of the Parties has assigned or transferred any of its Claims to a third party; and (d) this Agreement has been duly and validly executed and delivered by such Party and, assuming the due authorization, execution and delivery of this Agreement by the other Parties hereto, constitutes a legal, valid and binding obligation of such Party enforceable against such Party in accordance with its terms, except as that enforceability may be (i) limited by any applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or similar Laws affecting the enforcement of creditors’ rights generally and (ii) subject to general principles of equity (regardless of whether that enforceability is considered in a proceeding in equity or at law).

8. Further Assurances. Each Party shall, and shall cause its Subsidiaries and affiliates to, reasonably cooperate with each other in the taking of all actions necessary, proper or advisable under this Agreement and applicable Laws to effectuate the Termination. Without limiting the generality of the foregoing, the Parties shall, and shall cause their respective Subsidiaries and affiliates to, reasonably cooperate with each other in connection with the withdrawal of any applications to or termination of proceedings before any Governmental Entity, including the FTC, or under any Regulatory Law, in each case to the extent applicable, in connection with the transactions contemplated by the Transaction Documents.

9. Third-Party Beneficiaries. Except for the provisions of Section 3 and Section 4, with respect to which each Releasee is an expressly intended third-party beneficiary thereof, this Agreement is not intended to (and does not) confer on any Person other than the Parties any rights or remedies or impose on any Person other than the Parties any obligations.

10. Entire Agreement. This Agreement constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all other prior agreements and understandings, both written and oral, between the Parties or any of them with respect to the subject matter hereof.

 

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11. Amendments. Any amendment, modification or waiver of any provision of this Agreement, or any consent to departure from the terms of this Agreement, shall not be binding unless in writing and signed by the Party or Parties against whom such amendment, modification, waiver or consent is sought to be enforced.

12. Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, without giving effect to conflicts of laws principles that would result in the application of the Law of any other state.

13. Submission to Jurisdiction; Appointment of Agent for Service of Process. Each of the Parties hereto hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of the Court of Chancery of the State of Delaware, or, if (and only if) such court finds it lacks jurisdiction, the Federal court of the United States of America sitting in Delaware, or, if (and only if) such courts find they lack jurisdiction, any state court sitting in Delaware, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or the agreements delivered in connection herewith or the transactions contemplated hereby or thereby or for recognition or enforcement of any judgment relating thereto, and each of the Parties hereby irrevocably and unconditionally: (a) agrees not to commence any such action or proceeding, except in the Court of Chancery of the State of Delaware, or, if (and only if) such court finds it lacks jurisdiction, the Federal court of the United States of America sitting in Delaware, or, if (and only if) such courts find they lack jurisdiction, any state court sitting in Delaware, and any appellate court from any thereof; (b) agrees that any claim in respect of any such action or proceeding may be heard and determined in the Court of Chancery of the State of Delaware, or, if (and only if) such court finds it lacks jurisdiction, the Federal court of the United States of America sitting in Delaware, or, if (and only if) such courts find they lack jurisdiction, any state court sitting in Delaware, and any appellate court from any thereof; (c) waives, to the fullest extent it may legally and effectively do so, any objection that it may now or hereafter have to the laying of venue of any such action or proceeding in such courts; and (d) waives, to the fullest extent permitted by Law, the defense of an inconvenient forum to the maintenance of such action or proceeding in such courts. Each of the Parties hereto agrees that, notwithstanding the foregoing, a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by applicable Law. Each Party irrevocably consents to service of process inside or outside the territorial jurisdiction of the courts referred to in this Section 13 in the manner provided for notices in Section 9.4 of the Merger Agreement. Nothing in this Agreement will affect the right of any Party to serve process in any other manner permitted by applicable Law. EACH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE SUCH WAIVERS, (B) IT UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF SUCH WAIVERS, (C) IT MAKES SUCH WAIVERS VOLUNTARILY AND (D) IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 13.

 

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14. Specific Performance. The Parties agree that irreparable injury, for which monetary damages (even if available) would not be an adequate remedy, will occur in the event that any of the provisions of this Agreement is not performed in accordance with its specific terms or is otherwise breached. Accordingly, it is agreed that each Party shall be entitled to an injunction or injunctions to prevent or remedy any breaches or threatened breaches of this Agreement by any other Party, a decree or order of specific performance specifically enforcing the terms and provisions of this Agreement and any further equitable relief, in each case in accordance with Section 13, this being in addition to any other remedy to which such Party entitled under the terms of this Agreement at law or in equity. No Party’s pursuit of an injunction, specific performance or other equitable remedies at any time shall be deemed an election of remedies or waiver of the right to pursue any other right or remedy to which such Party may be entitled.

15. Severability. Any term or provision of this Agreement that is deemed or determined by a court of competent jurisdiction to be invalid or unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation or in any other jurisdiction. If a court of competent jurisdiction declares that any term or provision hereof is invalid or unenforceable, the Parties agree that the court making such determination shall have the power to limit the term or provision, to delete specific words or phrases, or to replace any invalid or unenforceable term or provision with a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision, and this Agreement shall be enforceable as so modified. In the event such court does not exercise the power granted to it in the prior sentence, the Parties agree to replace such invalid or unenforceable term or provision with a valid and enforceable term or provision that will achieve, to the maximum extent possible, the economic, business and other purposes of such invalid or unenforceable term and the overall purpose of this Agreement as expressly described herein.

16. Notices. The provisions of Section 9.4 of the Merger Agreement are hereby incorporated herein mutatis mutandis.

17. Counterparts. This Agreement may be executed in one or more counterparts, and by the different Parties in separate counterparts, each of which when executed will be deemed to be an original but all of which taken together will constitute one and the same agreement.

[Signature page follows]

 

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IN WITNESS WHEREOF, Tapestry, Merger Sub and Capri have caused this Agreement to be executed as of the date first written above.

 

TAPESTRY, INC.
By:		/s/ Joanne C. Crevoiserat
Name:		Joanne C. Crevoiserat
Title:		Chief Executive Officer
SUNRISE MERGER SUB, INC.
By:		/s/ David E. Howard
Name:		David E. Howard
Title:		Sole Director
CAPRI HOLDINGS LIMITED
By:		/s/ John Idol
Name:		John Idol
Title:		Chief Executive Officer

[Signature Page to Termination Agreement]

Exhibit 99.1

Capri Holdings Announces Termination of Merger With Tapestry

NOVEMBER 14, 2024

Announces Strategic Initiatives to Return to Growth

Schedules Conference Call With Investors

 

(Photo: Business Wire)

https://www.capriholdings.com/StrategyPresentation

LONDON—(BUSINESS WIRE)— Capri Holdings Limited (NYSE:CPRI), a global fashion luxury group, today announced the mutual termination of its definitive merger agreement with Tapestry, Inc. Capri and Tapestry mutually agreed that terminating the merger agreement was in the best interests of both companies as the required closing condition of receiving necessary U.S. regulatory approvals was unlikely to be met by the merger agreement’s outside date of February 10, 2025. The Company also announced its strategies to return to growth, which management will discuss on a call today at 11:00 a.m. ET. The Company will share more details of its strategies at an Investor Day in late February 2025.

John D. Idol, the Company’s Chairman and Chief Executive Officer, said, “With the termination of the merger agreement, we are now focusing on the future of Capri and our three iconic luxury houses. Looking ahead, I remain confident in Capri’s long-term growth potential for numerous reasons. First, we have an incredible portfolio of luxury houses, each with their own rich heritage, exclusive DNA and strong consumer loyalty. Second, we have a solid distribution network to build upon. With over 1,200 directly operated luxury retail locations globally combined with our robust digital platform we have a strong framework for the future. Additionally, our extensive wholesale network serves as an important channel to reach consumers in areas where we do not have our own stores. Third, we have the management team, design talent and a global workforce of 15,000 employees to successfully execute our initiatives. Fourth, we have the financial strength to implement our strategies.”

Mr. Idol concluded, “Given our Company’s performance over the past 18 months, we have recently started to implement a number of strategic initiatives to return our luxury houses to growth. Across Versace, Jimmy Choo and Michael Kors, we are focused on brand desirability through exciting communication, compelling product and omni-channel consumer experience. While our strategies are tailored uniquely for each brand, our overarching goals are similar.”

Capri Strategy Update

 

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Communication Strategy

 

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Engage and inspire both new and existing consumers

 

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Product Strategy

 

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Create exciting fashion product that resonates with our consumers

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Omni-channel Strategy

 

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Leverage digital capabilities to grow E-commerce

 

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Improve retail store sales densities

 

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Wholesale Strategy

 

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Stabilize revenue by aligning product offering to better meet consumer preferences

 

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Corporate Social Responsibility Strategy

 

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Build upon our corporate values with communities both internally and externally

Michael Kors Strategy Update

 

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Communication Strategy

 

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Implement dynamic, new marketing plans that appeal to a broader consumer base

 

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Increase marketing investments

 

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Product Strategy

 

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Focus on creating exciting fashion product with compelling value

 

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Rebuild core and Signature assortments

 

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Strategic pricing review across the assortment to drive higher full price sell-throughs

 

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Omni-channel Strategy

 

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Leverage digital capabilities to grow E-commerce

 

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Improve retail store sales densities

 

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Anticipate the store fleet will be reduced to approximately 650 stores over time

 

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Renovate approximately 150 stores over the two years

 

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Wholesale Strategy

 

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Stabilize revenue by aligning product offering to better meet consumer preferences

Versace Strategy Update

 

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Communication Strategy

 

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Continue to leverage strong brand awareness to drive engagement

 

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Product Strategy

 

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Inject more energy into the assortment to better balance fun and elegant

 

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Develop broader assortment to reengage with the aspirational luxury consumer

 

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Further develop accessories offering

 

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Omni-channel Strategy

 

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Leverage digital capabilities to grow E-commerce

 

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Improve retail store sales densities

 

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Anticipate that store fleet will remain flat at approximately 230 stores

 

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Wholesale Strategy

 

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Resume growth by aligning product offering to better meet consumer preferences

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Jimmy Choo Strategy Update

 

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Communication Strategy

 

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Continue to engage new and existing customers through effective campaigns and collaborations

 

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Product Strategy

 

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Enhance assortment to appeal to aspirational luxury consumers

 

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Further develop accessories offering

 

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Expand casual footwear assortment

 

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Omni-channel Strategy

 

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Leverage digital capabilities to grow E-commerce

 

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Improve retail store sales densities

 

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Anticipate that store fleet will remain flat at approximately 220 stores

 

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Wholesale Strategy

 

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Stabilize revenue by aligning product offering to better meet consumer preferences

Conference Call Information

A conference call to discuss Capri Holdings strategic initiatives to return to growth is scheduled for today, November 14, 2024 at 11:00 a.m. ET. Those who wish to participate in the call may do so by dialing [phone] or [phone] for international callers, conference ID 13750220. A live webcast of the conference call will also be available on the Company’s website, www.capriholdings.com.

In addition, a replay of the call will be available shortly after the conclusion of the call and remain available until November 21, 2024. To access the telephone replay, listeners should dial [phone] or [phone] for international callers. The access code for the replay is 13750220. A replay of the webcast will also be available within two hours of the conclusion of the call.

Investor Day 2025

Capri Holdings intends to host an Investor Day in New York, NY in late February 2025, where it will provide more detail on the company’s strategic actions and its financial prospects. Specific details for that event will be announced at a later date.

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About Capri Holdings Limited

Capri Holdings is a global fashion luxury group consisting of iconic, founder-led brands Versace, Jimmy Choo and Michael Kors. Our commitment to glamorous style and craftsmanship is at the heart of each of our luxury brands. We have built our reputation on designing exceptional, innovative products that cover the full spectrum of fashion luxury categories. Our strength lies in the unique DNA and heritage of each of our brands, the diversity and passion of our people and our dedication to the clients and communities we serve. Capri Holdings Limited is publicly listed on the New York Stock Exchange under the ticker CPRI.

Forward-Looking Statements

This press release contains statements which are, or may be deemed to be, “forward-looking statements.” Forward-looking statements are prospective in nature and are not based on historical facts, but rather on current expectations and projections of the management of Capri about future events and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements. All statements other than statements of historical facts included herein, may be forward-looking statements. Without limitation, any statements preceded or followed by or that include the words “plans”, “believes”, “expects”, “intends”, “will”, “should”, “could”, “would”, “may”, “anticipates”, “might” or similar words or phrases, are forward-looking statements. Such forward-looking statements involve known and unknown risks and uncertainties that could significantly affect expected results and are based on certain key assumptions, which could cause actual results to differ materially from those projected or implied in any forward-looking statements. These risks, uncertainties and other factors are identified in the Company’s Annual Report on Form 10-K for the fiscal year ended March 30, 2024 filed with the Securities and Exchange Commission. Please consult these documents for a more complete understanding of these risks and uncertainties. Any forward-looking statement in this press release speaks only as of the date made and Capri disclaims any obligation to update or revise any forward-looking or other statements contained herein other than in accordance with legal and regulatory obligations.

Investor Relations:

Jennifer Davis

[phone]

[e-mail]

Media:

[e-mail]

Source: Capri Holdings Limited

Multimedia Files:

 

(Photo: Business Wire)

Document and Entity Information	Nov. 13, 2024
Cover [Abstract]
Document Type	8-K
Document Period End Date	Nov. 13, 2024
Entity Registrant Name	CAPRI HOLDINGS LTD
Entity Incorporation State Country Code	D8
Entity File Number	001-35368
Entity Tax Identification Number	00-0000000
Entity Address Address Line 1	90 Whitfield Street
Entity Address Address Line 2	2nd Floor
Entity Address City Or Town	London
Entity Address Country	GB
Entity Address Postal Zip Code	W1T 4EZ
Country Region	44
City Area Code	207
Local Phone Number	632 8600
Written Communications	false
Soliciting Material	false
Pre Commencement Tender Offer	false
Pre Commencement Issuer Tender Offer	false
Security 12b Title	Ordinary Shares, no par value
Trading Symbol	CPRI
Security Exchange Name	NYSE
Entity Emerging Growth Company	false
Entity Central Index Key	0001530721
Amendment Flag	false

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