-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, AgE2qZh1+fU7hyJMmVUI1f5y6plA5BVhywZkcSYX7P+MNIgeYyfK+BTJ4UX/U1kb yQrb+cOD9xnAq44pDl/rXA== 0000909518-03-000049.txt : 20030207 0000909518-03-000049.hdr.sgml : 20030207 20030207155938 ACCESSION NUMBER: 0000909518-03-000049 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20030207 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: BARNEYS NEW YORK INC CENTRAL INDEX KEY: 0001087414 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-WOMEN'S CLOTHING STORES [5621] IRS NUMBER: 134040818 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-58025 FILM NUMBER: 03544865 BUSINESS ADDRESS: STREET 1: 575 FIFTH AVE CITY: NEW YORK STATE: NY ZIP: 10017 BUSINESS PHONE: 2123393300 MAIL ADDRESS: STREET 1: 575 FIFTH AVE CITY: NEW YORK STATE: NY ZIP: 10017 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: SOCOL HOWARD CENTRAL INDEX KEY: 0001173882 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: C/O GUESS INC STREET 2: 1444 S ALAMEDA ST CITY: LOS ANGELES STATE: CA ZIP: 90021 BUSINESS PHONE: 2137653210 MAIL ADDRESS: STREET 1: C/O GUESS INC STREET 2: 1444 S ALAMEDA ST CITY: LOS ANGELES STATE: CA ZIP: 90021 SC 13D 1 jd2-3_13d.txt ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------- SCHEDULE 13D (RULE 13D-101) INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a) (AMENDMENT NO.________ ) BARNEYS NEW YORK, INC. - -------------------------------------------------------------------------------- (Name of Issuer) COMMON STOCK, PAR VALUE $0.01 PER SHARE 06808T-10-7 --------------------------------------- ----------- (Title of Class of Securities) (CUSIP Number) STEPHEN N. LIPTON, ESQ. 2100 SOUTH OCEAN LANE SUITE 1103 FORT LAUDERDALE, FLORIDA 33316 (954) 524-8811 - -------------------------------------------------------------------------------- (Name, Address and telephone Number of Person Authorized to Receive Notices and Communications) FEBRUARY 2, 2003 - -------------------------------------------------------------------------------- (Date of Event Which Requires Filing of This Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rules 13d-1(e), 13d-1(f) or 13d-1(g), check the following box [_]. Note. Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7(b) for other parties to whom copies are to be sent. (Continued on following pages) (Page 1 of 7 Pages) ================================================================================
- ------------------------------------ -------------------------------------------- --------------------------------------- CUSIP No. 06808T 107 13D Page 2 - ------------------------------------ -------------------------------------------- --------------------------------------- - ----------------- ------------------------------------------------------------------------------------------------------------------ 1 NAME OF REPORTING PERSON: Howard Socol I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY): Not Applicable - ----------------- ------------------------------------------------------------------------------------------------------------------ 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (A) [_] (B) [X] - ----------------- ------------------------------------------------------------------------------------------------------------------ 3 SEC USE ONLY - ----------------- -------------------------- --------------------------------------------------------------------------------------- 4 SOURCE OF FUNDS: 00 - ----------------- ------------------------------------------------------------------------------------------------------------------ 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): [_] - ----------------- ------------------------------------------------------------------------------------------------------------------ 6 CITIZENSHIP OR PLACE OF ORGANIZATION: United States - --------------------------- ------ ------------------------------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER: SHARES 0 ------ ------------------------------------------------------------------------------------------------- BENEFICIALLY 8 SHARED VOTING POWER: OWNED BY 596,117 ------ ------------------------------------------------------------------------------------------------- EACH 9 SOLE DISPOSITIVE POWER: REPORTING 0 ------ ------------------------------------------------------------------------------------------------- PERSON WITH 10 SHARED DISPOSITIVE POWER: 396,117 - ----------------- ------------------------------------------------------------------------------------------------------------------ 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON: 596,117 - ----------------- ------------------------------------------------------------------------------------------------------------------ 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: [_] - ----------------- ------------------------------------------------------------------------------------------------------------------ 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 4.1% - ----------------- ------------------------------------------------------------------------------------------------------------------ 14 TYPE OF REPORTING PERSON: IN - ----------------- ------------------------------------------------------------------------------------------------------------------ SEE INSTRUCTIONS BEFORE FILLING OUT!
Item 1. Security and Issuer. -------------------- The title and class of equity security to which this Statement on Schedule 13D relates is the common stock, par value $0.01 per share ("Common Stock"), of Barneys New York, Inc., a Delaware corporation (the "Company"). The address of the Company's principal executive offices is 575 Fifth Avenue, New York, New York 10017. Item 2. Identity and Background. ------------------------ This statement is being filed by Howard Socol (the "Reporting Person" or "Mr. Socol"), for and on behalf of himself. The business address of Mr. Socol is Barneys New York, Inc., 575 Fifth Avenue, New York, New York 10017. Mr. Socol is the Chairman of the Board of Directors, President and Chief Executive Officer of the Company. The Company is a leading upscale retailer of men's, women's and children's apparel and accessories, and items for the home. The address of the Company is 575 Fifth Avenue, New York, New York 10017. Mr. Socol is a citizen of the United States of America. During the last five years the Reporting Person has not been (i) convicted of any criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. Item 3. Source and Amount of Funds or Other Consideration. -------------------------------------------------- The response to Item 4 hereof is incorporated herein by reference. Item 4. Purpose of Transaction. ----------------------- Pursuant to an employment agreement effective as of January 8, 2001, as amended on January 10, 2003, between the Company and Mr. Socol, Mr. Socol has been granted options (the "Options") to purchase up to 792,234 shares of Common Stock, which will vest over the term of his employment. Options to purchase 396,117 shares of Common Stock are currently vested and Options to purchase the remaining 396,117 shares vest on January 31, 2004. In addition, upon a change in control of the Company, if the Company terminates Mr. Socol's employment without cause or if Mr. Socol terminates his employment for good reason, the Options to purchase the remaining 396,117 shares will fully vest. None of the Options have been exercised as of February 2, 2003. On January 10, 2003, the Company agreed to make a restricted stock award of 200,000 shares of Common Stock to Mr. Socol on February 2, 2003 (the first day of the Company's 2003 fiscal year). Pursuant to the restricted stock award agreement between the Company and Mr. Socol, until the shares vest, the shares are subject to a right of repurchase by the Company upon Mr. Socol's resignation without good reason or termination for cause. 100,000 of the shares vest on January 31, 2004 and the other 100,000 shares vest on January 31, 2005, provided that Mr. Socol does not terminate his employment before these dates. In addition, upon a change in control of the Company before Mr. Socol's service terminates, if the Company terminates Mr. Socol's employment without cause or if Mr. Socol terminates his employment for good reason, all 200,000 shares will fully vest. Until such time as the Company exercises its right of repurchase, Mr. Socol has the right to vote the shares. Pursuant to a stockholders agreement dated as of January 8, 2001, Bay Harbour Management L.C. ("Bay Harbour"), Whippoorwill Associates, Inc. ("Whippoorwill") and Mr. Socol have agreed to provide each other certain co-sale rights in connection with any sales of their Common Stock. Mr. Socol also agreed to vote half of his shares as directed by Bay Harbour and half as directed by Whippoorwill. The Reporting Person acquired the Options and the restricted shares in connection with his employment arrangement and for investment purposes. The Reporting Person may acquire additional securities of the Company or dispose of securities of the Company at any time and from time to time in the open market or otherwise. Although the foregoing represents the range of activities presently contemplated by the Reporting Person with respect to the Company, it should be noted that the possible activities of the Reporting Person are subject to change at any time. The Reporting Person is the Chairman of the Board of Directors, President and Chief Executive Officer of the Company and, accordingly, will be in a position to influence the operations and activities of the Company. Except as set forth above, the Reporting Person does not have any present plans or proposals which relate to or would result in any of the actions described in subparagraphs (a) through (j) of Item 4 of Schedule 13D. Item 5. Interest in Securities of the Issuer. ------------------------------------- (a) As of February 2, 2003, the Reporting Person beneficially owned 596,117 shares of Common Stock, representing approximately 4.1% of the outstanding shares of Common Stock (based on the number of shares outstanding as of December 13, 2002 (13,903,227 shares), as reported in the Company's Form 10-Q for the quarterly period ended November 2, 2002, plus the 200,000 restricted shares granted to Mr. Socol, and as determined in accordance with Rule 13d-3(d)(1)). Such shares include Options to purchase up to 396,117 shares of Common Stock which were exercisable as of February 2, 2003. The number of shares indicated as being beneficially owned by Mr. Socol does not include the shares of Common Stock held by Bay Harbour and Whippoorwill which are the subject of the stockholders agreement and with respect to which Mr. Socol disclaims beneficial ownership. (b) The responses of the Reporting Person to (i) Rows (7) through (10) of the cover pages of this statement on Schedule 13D and (ii) Item 4 hereof are incorporated herein by reference. Pursuant to the restricted stock award agreement between the Company and Mr. Socol, until the 200,000 restricted shares vest, the shares will be held in escrow and Mr. Socol may not transfer the shares. (c) Except for the transaction described in Item 4 hereof, the Reporting Person has not effected any transactions in the Common Stock of the Company during the past 60 days. (d), (e): Not Applicable Item 6. Contracts, Arrangements, Understandings or Relationships With ------------------------------------------------------------- Respect to Securities of the Issuer. ------------------------------------ On January 8, 2001, Mr. Socol entered into a Registration Rights Agreement with the Company (the "Registration Rights Agreement"). Pursuant to the Registration Rights Agreement, Mr. Socol may make a written request of the Company for registration with the Securities and Exchange Commission under and in accordance with the provisions of the Securities Act of 1933, as amended (the "Securities Act"), of all or part of his registrable securities, which include the Common Stock (a "Demand Registration"). Any such Demand Registration must be for at least 10% of the registrable securities then beneficially owned by Mr. Socol. The Company shall not be required to file a registration statement in connection with such Demand Registration prior to six months after the consummation of an initial public offering of shares of Common Stock under the Securities Act. Pursuant to the Registration Rights Agreement, Mr. Socol was also granted piggyback registration rights. In addition, the response to Item 4 hereof is incorporated herein by reference. Item 7. Materials to be Filed as Exhibits. ---------------------------------- Exhibit 1 Registration Rights Agreement, dated as of January 8, 2001, by and between Barneys New York, Inc. and Howard Socol (incorporated by reference to Exhibit 10.34 to the Company's Form 10-K for the fiscal year ended February 3, 2001, filed May 4, 2001). Exhibit 2 Stockholders Agreement, dated as of January 8, 2001, among Bay Harbour Management L.C., Whippoorwill Associates, Inc. and Howard Socol (incorporated by reference to Exhibit 1 to Amendment No. 3 to Schedule 13D filed by Whippoorwill Associates, Inc. on January 15, 2003 with respect to its ownership of the Company's Common Stock). Exhibit 3 Employment Agreement, effective as of January 8, 2001, between Barneys New York, Inc. and Howard Socol (incorporated by reference to Exhibit 10.33 to the Company's Form 10-K for the fiscal year ended February 3, 2001, filed May 4, 2001). Exhibit 4 First Amendment to Employment Agreement, effective as of January 10, 2003, between Barneys New York, Inc. and Howard Socol. Exhibit 5 Restricted Stock Award Agreement, dated February 2, 2003, between Barneys New York, Inc. and Howard Socol. Exhibit 6 Option Award Agreement, dated January 8, 2001, between Barneys New York, Inc. and Howard Socol. SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Dated: February 7, 2003 /s/ Howard Socol ----------------------- Howard Socol EXHIBIT INDEX ------------- Exhibit No. - ----------- Exhibit 1 Registration Rights Agreement, dated as of January 8, 2001, by and between Barneys New York, Inc. and Howard Socol (incorporated by reference to Exhibit 10.34 to the Company's Form 10-K for the fiscal year ended February 3, 2001, filed May 4, 2001). Exhibit 2 Stockholders Agreement, dated as of January 8, 2001, among Bay Harbour Management L.C., Whippoorwill Associates, Inc. and Howard Socol (incorporated by reference to Exhibit 1 to Amendment No. 3 to Schedule 13D filed by Whippoorwill Associates, Inc. on January 15, 2003 with respect to its ownership of the Company's Common Stock). Exhibit 3 Employment Agreement, effective as of January 8, 2001, between Barneys New York, Inc.and Howard Socol (incorporated by reference to Exhibit 10.33 to the Company's Form 10-K for the fiscal year ended February 3, 2001, filed May 4, 2001). Exhibit 4 First Amendment to Employment Agreement, effective as of January 10, 2003, between Barneys New York, Inc. and Howard Socol. Exhibit 5 Restricted Stock Award Agreement, dated February 2, 2003, between Barneys New York, Inc. and Howard Socol. Exhibit 6 Option Award Agreement, dated January 8, 2001, between Barneys New York, Inc. and Howard Socol. EX-99 3 jd2-3_ex4.txt 4 Exhibit 4 First Amendment to Employment Agreement Howard Socol This First Amendment to the Employment Agreement between Howard Socol ("Executive") and Barneys New York, Inc. ("Company") dated January 8, 2001 ("Employment Agreement") is made and effective as of this 10th day of January, 2003 by the Executive and the Company. 1. Section 3.2 of the Employment Agreement is hereby amended and restated in its entirety to read as follows: The term of this Agreement means the period commencing on the Agreement Date and ending on January 31, 2005 ("Agreement Term"); provided that (i) if the Company is then actively engaged in good faith bona fide discussions with one or two interested buyers each of whom is financially able to take over control of the Company or (ii) if the Company has been actively searching for a new Chief Executive Officer for at least three months immediately prior to that date and has by then identified one or two candidates for that position, upon written notice by the Company to the Executive prior to the expiration of the Agreement Term the Company may extend the Agreement Term for no more than six (6) additional months in order to conclude a transaction which could result in a Change in Control or to hire a new Chief Executive Officer; provided further that in the event the discussions then underway with such buyers and such candidates end before the end of the additional six-month extension of the Agreement Term, Executive shall be entitled to resign and shall be unconditionally released from any further employment with the Company. During any such extension of the Agreement Term, the Executive shall receive an increased salary of 150% of his salary rate immediately prior to such extension and shall not be eligible for any annual bonus with respect to such period. 2. Section 3.3(c) of the Employment Agreement is hereby amended and restated to read as follows: (c)(i) During the Agreement Term constituting the period commencing on February 1, 2001 and ending on January 31, 2003, the Executive shall also earn an annual bonus for each full fiscal year of the Company equal to the following amount: (1) if the Company achieves 90% of the business plan target EBITDA for such fiscal year, 50% of annual Salary paid with respect to such year; (2) if the Company achieves 100% of business plan target EBITDA for such year, 75% of annual Salary paid with respect to such year ("Target Bonus"); (3) if the Company achieves 125% of business plan target EBITDA for such fiscal year, 100% of annual Salary paid with respect to such year; and (4) if the Company achieves 150% or more of business plan target EBITDA for such fiscal year, 125% of annual Salary paid with respect to such year. (ii) During the Agreement Term constituting the period commencing on February 1, 2003 and ending on January 31, 2005, the Executive shall earn an annual bonus for each full fiscal year of the Company equal to the following amount: if the Company achieves 90% of the business plan target EBITDA for such fiscal year, 90% of his annual Salary paid with respect to such year, plus an additional percentage of his annual Salary paid with respect to such year equal to the additional percentage of the Company's business plan target EBITDA for such year in excess of 90% of the Company's business plan target EBITDA for such year, without limit. (iii) The Bonus for each fiscal year shall be paid to Executive by the Company in cash not later than the March 31 next following the end of such fiscal year or, if later, the fifth (5th) business day after the Company's receipt of its audited financial statements for such fiscal year. 3. Section 3.5(d) is amended by deleting "2007" as it appears therein and replacing such year with "2008" and by deleting "2004" as it appears therein and replacing such year with "2005". 4. Section 3.5 is amended by adding a new subsection (e) at the end thereof to read as follows: (e) Equity Compensation Guarantee. ------------------------------ (1) In the event that the Executive does not voluntarily resign from his employment with the Company in breach of the Employment Agreement prior to January 31, 2005, or such later date to which the Agreement Term may be extended pursuant to the first proviso of Section 3.2, the Company hereby guarantees that the aggregate value of all stock options granted to Executive shall, as of the date of the first Change of Control that occurs, be at least equal to the greater of: (i) the Target Value (as defined below) in the event the Company achieves a cumulative amount of EBITDA ("Cumulative EBITDA Threshold") through January 31, 2005 (or such shorter period as may 2 be provided below) greater than the minimum amount mutually agreed to by Executive and the Executive Committee or (ii) $5,000,000. In the event the applicable Target Value exceeds the aggregate value of all of the Executive's stock options granted by the Company as of the date of a Change of Control, the Company shall make a lump sum cash payment to the Executive equal to the amount, if any, of such excess promptly following the Change of Control. (2) Definitions. "Target Value" means the amount guaranteed to be earned by Executive in respect of stock options granted by the Company to the Executive and shall be determined based on the cumulative amount of EBITDA during the Measurement Period. The Target Value shall be a minimum of $5 million and shall be $10 million if the Company achieves at least the highest Cumulative EBITDA Threshold during the Measurement Period. If the Company achieves cumulative EBITDA during the Measurement Period between the lowest and highest Cumulative EBITDA Thresholds, the Target Value shall be a pro rata amount determined by straight line interpolation. The Target Value shall be adjusted in the event Executive's employment with the Company is terminated prior to January 31, 2004 by reason of his death or Disability so that the Target Value is in the same proportion as the aggregate number of shares underlying the vested and exercisable portion of Executive's options (including shares that were purchased by exercising such options) bears to 792,234. "Measurement Period" means the period from the first day of the Company's 2002 fiscal year through the end of the Company's 2004 fiscal year; provided, however, in the event Executive's employment is terminated for any reason (other than his voluntary resignation in breach of the Employment Agreement) or a Change of Control occurs prior to the end of the Company's 2004 fiscal year, the Measurement Period shall be the period from the first day of the Company's 2002 fiscal year until the later of the end of the Company's 2002 fiscal year or the end of the Company's fiscal year immediately preceding the Executive's Termination Date. For example, if a Change of Control occurs on November 30, 2003, the Measurement Period shall be the Company's 2002 fiscal year, and if a Change of Control instead occurs a year later (i.e. November 30, 2004), the Measurement Period shall be the Company's 2002 and 2003 fiscal years. (3) For purposes of this Section 3.5(e), the aggregate value of Executive's stock options granted by the Company shall be determined as of the date of a Change of Control and shall include the aggregate value of shares of stock acquired pursuant and subject to stock options in excess of the aggregate exercise price therefor. In the event the shares of Stock received under a stock option have been sold or otherwise transferred prior to the date of a Change of Control, the value of such shares shall be the gross amount actually realized in cash by Executive or, in the case of a gift, discounted 3 sale or other transfer without full and adequate consideration entirely in cash, the last sales price on the last day on which shares of Stock were actually traded prior to the date of transfer multiplied by the number of such shares sold or transferred by Executive. (4) In the event the Executive becomes entitled to the guarantee hereunder, this Section 3.5(e) shall survive the expiration of the Agreement Term such that the guarantee shall be determined, and an amount (if any) shall be payable thereunder, upon the first Change of Control that occurs after such expiration. (5) In the event Executive desires to sell or otherwise transfer any shares of Stock acquired from any stock options, the Executive shall provide the Board with at least 10 business days' prior written notice of such sale or transfer ("Sale Notice"). The Sale Notice shall generally describe the proposed transaction, including the price at which the sale or other transfer is being made (or the equivalent cash price based on the last sale price on the last day on which shares of Stock were actually traded prior to the date of such notice). The Company shall have ten (10) business days from the date it receives such notice to decide whether to (i) purchase the shares of Stock at the price set forth in the Sale Notice, (ii) permit the Executive to complete his proposed sale or other transfer in accordance with the terms described in the Sale Notice or (iii) direct the Executive to defer any such sale or transfer for a period of up to six (6) months (and the Company may at any time during such deferral period purchase the shares at the greater of the cash price set forth in the Sale Notice or the last sale price on the last day on which shares of Stock were actually traded prior to the date of such purchase). In the event the Company directs the Executive to defer his proposed sale or other transfer for a period of up to six (6) months, the Company shall, prior to the end of such six-month period, either allow the Executive to participate in a third party transaction at a price no less than the price set forth in the Sale Notice or, absent any such transaction, purchase such shares at the greater of the price set forth in the Sale Notice or the last sale price on the last day on which shares of Stock were actually traded prior to the date of such purchase. In the event any sale or transfer by Executive of his shares is deferred for more than 60 days after the date that a Sale Notice was received by the Company at the Company's direction, the Company shall arrange for a letter of credit or other means of securing its obligation to Executive under this Section 3.5 that is reasonably satisfactory to the Executive. Notwithstanding any other provision of this Section 3.5, this paragraph shall not apply to a sale, gift or other transfer of shares of Stock by the Executive to his spouse or his children, his estate or to any trust or other entity for the exclusive benefit for any of them, and such shares shall be treated as if they were still owned by the Executive solely for purposes of this Section 3.5. 5. Section 4.1 of the Employment Agreement is hereby amended to read as follows: 4 4.1 [Deleted]. 6. Section 5.2 of the Employment Agreement is hereby amended and restated to read as follows: Termination for Cause or By Executive Other Than For Good Reason. If the Company shall terminate the Executive's employment for Cause or the Executive shall terminate employment other than for Good Reason during the Agreement Term, this Agreement (other than Articles IX and X) shall terminate without further obligation by the Company to the Executive, other than (a) the obligation immediately to pay Executive in cash all Accrued Obligations and (b) the obligations of the Company under all Stock Options and Stock Awards granted to the Executive that have vested as of the Termination Date, subject to Article III. 7. Section 5.3 of the Employment Agreement is hereby amended to read as follows: 5.3 [Deleted]. 8. The Company shall make a restricted stock award to the Executive on the first day of the Company's 2003 fiscal year in the amount of 200,000 shares of common stock of the Company upon the terms and conditions set forth in the form of Restricted Stock Award Agreement attached hereto and made a part hereof. In Witness Whereof the parties hereto have duly executed this Amendment as of the date first above written. BARNEYS NEW YORK, INC. By: /s/ Marc H. Perlowitz --------------------------------------------- Name: Marc H. Perlowitz Title: Executive Vice President /s/ Howard Socol -------------------------------------------------- HOWARD SOCOL 5 EX-99 4 jd2-6_ex5.txt 5 Exhibit 5 BARNEYS NEW YORK, INC. RESTRICTED STOCK AWARD AGREEMENT FEBRUARY 2, 2003 SECTION 1. GRANT OF STOCK AWARD. (a) STOCK AWARD. On the terms and conditions set forth in this Agreement, Barneys New York, Inc. ("COMPANY") hereby grants to Howard Socol ("Grantee") a restricted stock award equal to 200,000 shares of common stock ("GRANTED SHARES"), par value $.01 per share, of the Company upon the terms set forth herein. (b) DEFINED TERMS. Capitalized terms not otherwise defined herein (including Section 7 hereof) shall have the meaning set forth in the Employment Agreement dated January 8, 2001, as amended as of December 2, 2002, between the Company and Grantee ("EMPLOYMENT AGREEMENT"). SECTION 2. ISSUANCE OF SHARES (a) STOCK CERTIFICATES. The Company shall cause to be issued a certificate or certificates for the Granted Shares representing this award, registered in the name of the Grantee. (b) STOCKHOLDER RIGHTS. Until such time as the Company exercises the Right of Repurchase, the Grantee (or any successor in interest) shall have all the rights of a stockholder (including, without limitation, voting, dividend and liquidation rights) with respect to the Granted Shares, subject, however, to the restrictions of this Agreement. (c) ESCROW. For so long as Granted Shares are subject to the Right of Repurchase, the Company shall cause such certificate or certificates to be deposited in escrow. The Grantee shall deliver to the Company a duly-executed blank stock power (in the form attached hereto as Exhibit A). All regular cash dividends paid on Granted Shares shall be held in escrow and shall be paid to the Grantee as the Restricted Shares are no longer subject to the Right of Repurchase. Granted Shares together with any other assets or securities held in escrow hereunder, shall be (i) surrendered to the Company for repurchase and cancellation upon the Company's exercise of its Right of Repurchase, or (ii) released to the Grantee to the extent the Granted Shares are not Restricted Shares. In any event, all Granted Shares which have vested (and any other vested assets and securities attributable thereto) shall be released promptly following the date the Grantee's Service terminates. Any new, substituted or additional securities or other property described in Sections 4(e) and 5(e) below shall be immediately delivered to the Company to be held in escrow, but only to the extent the related Shares are at the time Restricted Shares. (d) SECTION 83(B) ELECTION. Section 83 of the Code provides that the Grantee is not subject to federal income tax until the Right of Repurchase with respect to the Granted Shares lapses. If the Grantee chooses, the Grantee may make an election under Section 83(b) of the Code, which would cause the Grantee to recognize income in the amount of the Fair Market Value of the Granted Shares (determined as of the date of the award). A Section 83(b) election must be filed with the Internal Revenue Service within thirty (30) days after the date of this award. THE FORM FOR MAKING A SECTION 83(B) ELECTION IS ATTACHED AS EXHIBIT B. THE GRANTEE ACKNOWLEDGES THAT IT IS THE GRANTEE'S SOLE RESPONSIBILITY TO TIMELY FILE THE SECTION 83(B) ELECTION IF HE CHOOSES AND THAT FAILURE TO FILE A SECTION 83(B) ELECTION WITHIN THE APPLICABLE THIRTY (30) DAY PERIOD MAY RESULT IN THE RECOGNITION OF ORDINARY INCOME WHEN THE RIGHT OF REPURCHASE LAPSES. (e) WITHHOLDING REQUIREMENTS. The Company may withhold any tax (or other governmental obligation) as a result of the grant of this award and/or the filing of a Section 83(b) election as a condition to the grant of this award, and the Grantee shall make arrangements satisfactory to the Company to enable it to satisfy all such withholding requirements. SECTION 3. SECURITIES LAW ISSUES. (a) SECURITIES NOT REGISTERED. The Granted Shares have not been registered under the Securities Act and are being issued to the Grantee in reliance upon the exemption for grants made to executive officers of the Company under Section 4(2) of the Securities Act. (b) GRANTEE REPRESENTATIONS. The Grantee hereby confirms that he or she has been informed that the Granted Shares are restricted securities under the Securities Act and that the Granted Shares may not be resold or transferred unless they are first registered under the Securities Act or unless an exemption from such registration is available. Accordingly, the Grantee hereby represents and acknowledges as follows: (i) The Granted Shares are being acquired by Grantee for his own account, for investment, and not with a view to sale or distribution thereof; (ii) The Grantee is familiar with the provisions of Rule 144 promulgated under the Securities Act, which exempts certain resales of securities subject, among other things, to certain volume and holding period requirements. (iii) The Grantee further acknowledges that he is an "accredited investor" within the meaning of Rule 501 of the Regulation D promulgated under the Securities Act. (c) REGISTRATION RIGHTS. The Company and the Grantee acknowledge that the Granted Shares shall be deemed "Registrable Securities" pursuant to the Registration Rights Agreement dated January 8, 2001, between the Company and the Grantee. (d) TRANSFEREE OBLIGATIONS. Each person (other than the Company) to whom the Granted Shares are transferred by means of a permitted transfer must, as a condition precedent to the validity of such transfer, acknowledge in writing to the Company that such person is bound by the provisions of this Agreement and that the transferred Granted Shares are subject to the Right of Repurchase to the same extent such shares would be so subject if retained by the Grantee. (e) PERMITTED TRANSFERS. Sections 3(c), 4(a) and 5(a) shall not apply to any of the following permitted transfers: (i) a transfer by beneficiary designation, will or intestate succession or (ii) a transfer to the Grantee's spouse, 2 children or grandchildren (or their issue) or to a trust established by the Grantee for the benefit of the Grantee or the Grantee's spouse, children or grandchildren (or their issue), provided in either case that the Transferee agrees in writing on a form prescribed by the Company to be bound by all provisions of this Agreement. If the Grantee transfers any Shares acquired under this Agreement, either under this Subsection or after the Company has failed to exercise the Right of Repurchase, then such rights shall be applicable to the Transferee to the same extent as to the Grantee. (f) LEGENDS. All certificates evidencing Granted Shares shall bear the following legends: "THE SHARES REPRESENTED HEREBY MAY NOT BE SOLD, ASSIGNED, TRANSFERRED, ENCUMBERED OR IN ANY MANNER DISPOSED OF, EXCEPT IN COMPLIANCE WITH THE TERMS OF A WRITTEN AGREEMENT BETWEEN THE COMPANY AND THE REGISTERED HOLDER OF THE SHARES (OR THE PREDECESSOR IN INTEREST TO THE SHARES). SUCH AGREEMENT GRANTS TO THE COMPANY CERTAIN REPURCHASE RIGHTS. THE SECRETARY OF THE COMPANY WILL UPON WRITTEN REQUEST FURNISH A COPY OF SUCH AGREEMENT TO THE HOLDER HEREOF WITHOUT CHARGE." "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION THEREOF UNDER THE ACT COVERING SUCH SECURITIES, THE SAME IS MADE IN ACCORDANCE WITH RULE 144 UNDER THE ACT OR THE COMPANY RECEIVES AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF THE ACT." (g) REMOVAL OF LEGENDS. If, in the opinion of the Company, any legend placed on a stock certificate representing Granted Shares is no longer required, the holder of such certificate shall be entitled to exchange such certificate for a certificate representing the same number of shares but without such legend. (h) ADDITIONAL RESTRICTIONS. Regardless of whether the offering and sale of Shares under the Plan have been registered under the Securities Act or have been registered or qualified under the securities laws of any state, the Company at its discretion may impose restrictions upon the sale, pledge or other transfer of such Shares (including the placement of appropriate legends on stock certificates or the imposition of stop-transfer instructions) if, in the judgment of the Company, such restrictions are necessary or desirable in order to achieve compliance with the Securities Act or the securities laws of any state or any other law. (i) GRANTEE UNDERTAKING. The Grantee agrees to take whatever additional action and execute whatever additional documents the Company may deem necessary or advisable to carry out or effect one or more of the obligations or restrictions imposed on either the Grantee or upon the Restricted Shares pursuant to the provisions of this Agreement. 3 (j) ADMINISTRATION. Any determination by the Company in connection with any of the matters set forth in this Section 3 shall be conclusive and binding on the Grantee and all other persons. SECTION 4. RIGHT OF REPURCHASE. (a) RIGHT OF REPURCHASE. Unless the Granted Shares have become completely vested in accordance with the terms hereof, the Granted Shares initially shall be Restricted Shares and shall be subject to a right (but not an obligation) of repurchase by the Company. The Grantee shall not transfer, assign, encumber or otherwise dispose of any Restricted Shares, except transfers permitted under Section 3(e) hereof. If the Grantee transfers any Restricted Shares, then this Section 4 shall apply to the Transferee to the same extent as to the Grantee. (b) EXERCISE NOTICE. In the event the Company wishes to exercise its Right of Repurchase, the Company shall provide the Grantee with sixty (60) days prior written notice of its intent to exercise its right. A sample Right of Repurchase Exercise Notice is attached hereto as Exhibit C. Such notice shall contain the purchase price for the Shares being repurchased which shall be One Dollar ($1) in the aggregate for all such Shares, and all other terms and conditions of the offer (including, without limitation, the proposed consummation date of the repurchase). The purchase price shall be paid in cash or by cancellation of indebtedness as the Company, in its sole discretion, shall determine. (c) LAPSE OF REPURCHASE RIGHT. The Right of Repurchase shall lapse with respect to the one-half of the Granted Shares on January 31, 2004 and the remaining half of the Granted Shares on January 31, 2005, provided in each case the Grantee has not terminated his Service prior to such date. In addition, the Right of Repurchase shall lapse and all of the remaining Restricted Shares shall become vested if (i) the Company is subject to a Change in Control before the Grantee's Service terminates or (ii) the Grantee's Service is terminated by the Company without Cause or by the Grantee for Good Reason. In addition, upon Grantee's termination of Service by reason of his death or Disability in accordance with the Employment Agreement, the Right of Repurchase shall lapse with respect to a number of the Restricted Shares determined by multiplying (i) the number of shares as to which the Right of Repurchase would have lapsed on the next following January 31 after the date of termination of Service by (ii) a fraction the numerator of which is the number of days since the preceding January 31st or the Effective Date, whichever is later ("Beginning Date"), up to and including the date of Executive's death or Disability and the denominator of which is the number of days from the Beginning Date through January 31 next following the date of Executive's death or disability. (d) REPURCHASE PRICE. If the Company exercises the Right of Repurchase, it shall pay the Grantee an amount for all of the Restricted Shares being repurchased equal to One Dollar ($1) in the aggregate. (e) ADDITIONAL SHARES OR SUBSTITUTED SECURITIES. In the event of the declaration of a stock dividend, the declaration of an extraordinary dividend payable in a form other than stock, a spin-off, a stock split, an adjustment in conversion ratio, a recapitalization or a similar transaction affecting the Company's outstanding securities without receipt of consideration, any new, substituted or additional securities or other property (including money paid other than as an 4 ordinary cash dividend) which are by reason of such transaction distributed with respect to any Shares subject to this Section 4 or into which such Shares thereby become convertible shall immediately be subject to this Section 4. (f) TERMINATION OF RIGHTS AS STOCKHOLDER. If the Company makes available, at the time and place and in the amount and form provided in this Agreement, the consideration for the Shares to be purchased in accordance with this Section 4, then after such time the person from whom such Shares are to be purchased shall no longer have any rights as a holder of such Shares (other than the right to receive payment of such consideration in accordance with this Agreement). Such Shares shall be deemed to have been purchased in accordance with the applicable provisions hereof, whether or not the certificate(s) therefor have been delivered as required by this Agreement. SECTION 5. MISCELLANEOUS PROVISIONS. (a) NO RETENTION RIGHTS. Nothing in this award shall confer upon the Grantee any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Company or of the Grantee, which rights are hereby expressly reserved by each, to terminate his or her Service at any time and for any reason, with or without cause, subject however to the Employment Agreement. (b) NOTIFICATION. Any notification required by the terms of this Agreement shall be given in writing and shall be deemed effective upon personal delivery or upon deposit with the United States Postal Service, by registered or certified mail, with postage and fees prepaid. A notice shall be addressed to the Company at its principal executive office and to the Grantee at the address that he or she most recently provided to the Company. (c) ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between the parties hereto with regard to the subject matter hereof and supersedes any other agreements which relate to the subject matter hereof. (d) WAIVER. The failure of the Company in any instance to exercise the Right of Repurchase shall not constitute a waiver of any other repurchase rights that may subsequently arise under the provisions of this Agreement or any other agreement between the Company and the Grantee. No waiver of any breach or condition of this Agreement shall be deemed to be a waiver of any other or subsequent breach or condition whether of like or different nature. (e) ASSIGNMENT. The Company may assign the Right of Repurchase to any person or entity selected by the Board of Directors, including, without limitation, one or more stockholders of the Company. (f) SUCCESSORS AND ASSIGNS. The provisions of this Agreement shall inure to the benefit of, and be binding upon, the Company and its successors and assigns and upon the Grantee, the Grantee's assigns and the legal representatives, heirs and legatees of the Grantee's estate, whether or not any such person shall have become a party to this Agreement and have agreed in writing to be join herein and be bound by the terms hereof. 5 (g) CHOICE OF LAW. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York, as such laws are applied to contracts entered into and performed in such State. SECTION 6. DEFINITIONS. (a) "AGREEMENT" shall mean this Stock Award Agreement. (b) "RESTRICTED SHARE" shall mean a Share that is subject to a Right of Repurchase. (c) "RIGHT OF REPURCHASE" shall mean the Company's right of repurchase described in Section 4 of this Agreement. (d) "SECURITIES ACT" shall mean the Securities Act of 1933, as amended. (e) "SERVICE" shall mean service as an employee of the Company or any of its subsidiaries. For any purpose under this Agreement, Service shall be deemed to continue while the Grantee is on a bona fide leave of absence, if such leave was approved by the Company in writing or if continued crediting of Service for such purpose is expressly required by the terms of such leave or by applicable law (as determined by the Company). (f) "SHARE" shall mean one share of common stock of the Company, with a par value of $.01 per share. (g) "TRANSFEREE" shall mean any person to whom the Grantee has directly or indirectly transferred any Granted Share. This Agreement has been executed as of the day and year first above written. BARNEYS NEW YORK, INC. By: /s/ Marc H. Perlowitz -------------------------------- Name: Marc H. Perlowitz Title: Executive Vice President /s/ Howard Socol ------------------------------- HOWARD SOCOL 6 EXHIBIT A STOCK POWER FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto Barneys New York, Inc. (the "Company"),________________________________________________ (_________________) shares of the common stock, par value $.01 per share, of the Company standing in his name on the books of the Company represented by Certificate No. ________________herewith and does hereby irrevocably constitute and appoint_________________________________ his attorney-in-fact, with full power of substitution, to transfer such shares on the books of the Company. Dated: ________________, 20____ Signature: ---------------------------------- Howard Socol INSTRUCTIONS: Please do not fill in any blanks other than the signature line and printed name and mailing address. Please print your name exactly as you would like your name to appear on the issued stock certificate. The purpose of this assignment is to enable the Company to exercise the Repurchase Right without requiring additional signatures on your part. EXHIBIT B SECTION 83(B) ELECTION This statement is being made under Section 83(b) of the Internal Revenue Code, pursuant to Treas. Reg. Section 1.83-2. (1) The taxpayer who performed the services is: Name: Howard Socol Address: ---------------------------------------------- New York, New York Social Security Number: --------------------------------------------- (2) The property with respect to which the election is being made is _________ shares of the common stock, par value $.01 per share, of Barneys New York, Inc. (3) The property was issued on February 2, 2003. (4) The taxable year in which the election is being made is the calendar year 2003. (5) The property is subject to a right of repurchase pursuant to which the issuer has the right to acquire the property in the aggregate for $1 in the event of the taxpayer's resignation without good reason or termination for cause at any time prior to the vesting date. The issuer's repurchase right lapses in a series of installments over an approximately two-year period ending on January 31, 2005. (6) The fair market value at the time of transfer (determined without regard to any restriction other than a restriction which by its terms will never lapse) is $___________ per share. (7) No amount was paid for such property. (8) A copy of this statement was furnished to Barneys New York, Inc. for whom taxpayer rendered the services underlying the transfer of property. (9) This statement is executed on February ___, 2003. - ------------------------------------- ------------------------------------- Spouse (if any) Taxpayer This election must be filed with the Internal Revenue Service Center with which taxpayer files his or her Federal income tax returns and must be made within thirty (30) days after the execution date of the Notice of Stock Award. This filing should be made by registered or certified mail, return receipt requested. You should retain two (2) copies of the completed form for filing with your Federal and state tax returns for the current tax year and an additional copy for your records. EXHIBIT C RIGHT OF REPURCHASE EXERCISE NOTICE [Date] Howard Socol Barneys New York, Inc. 575 Fifth Avenue New York, New York 10017 Re: Exercise of Right of Repurchase Dear Howard: Barneys New York, Inc. (the "Company") wishes to exercise its right of repurchase pursuant to that certain Restricted Stock Award Agreement dated February 2, 2003 between the Company and you (the "Restricted Stock Award Agreement") and buy back from you all shares of common stock of the Company granted under such agreement to you and as to which such right of repurchase has not lapsed. As provided in the Restricted Stock Award Agreement, the Company shall pay you ONE DOLLAR ($1.00) in the aggregate for all shares being repurchased hereunder. Shares shall be repurchased on [insert date]. The Company shall pay the repurchase price to you by delivery of payment in cash or by check on or within two (2) days following such date. Once the payment is made available to you, you shall no longer be considered a stockholder with respect to those shares. Should you have any additional questions, please contact [insert contact person and contact information]. Very truly yours, EX-99 5 jd2-5_ex6.txt 6 Exhibit 6 January 8, 2001 Howard Socol 136 Sullivan Street Penthouse New York, New York 10012 Re: Grant of Stock Option Dear Howard: On March 8, 2000, the Board of Directors of Barneys New York, Inc. (the "Company") adopted the Employee Stock Option Plan (the "Plan"). The Plan provides for the grant of options to certain key employees of the Company and its subsidiaries. A copy of the Plan is annexed hereto and shall be deemed a part hereof as if fully set forth herein. The terms defined herein shall apply for purposes of this grant instead of the meanings ascribed to such terms in the Plan. Subject to approval of an amendment to the Plan by the Company stockholders to increase the number of shares that may be issued thereunder individually and in the aggregate, the Stock Option Committee of the Board of Directors hereby grants to you, as a matter of separate inducement and not in lieu of any salary or other compensation for your services, the option (the "Option") to purchase, in accordance with the terms and conditions set forth herein (incorporating provisions of your employment agreement dated January 8, 2001) and in the Plan (except as modified herein by this grant), an aggregate of 792,234 shares of Common Stock, $0.01 par value per share (the "Shares"), of the Company at a price of $9.625 per Share, such option price being determined by the Board of Directors to be equal to the fair market value of such share at the date hereof. The Option is not an "incentive stock option" within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended. Subject to the provisions set forth herein, this Option shall vest and may be exercised by you, on a cumulative basis, during a period commencing on the date of grant of this Option and terminating at the close of business on January 7, 2007 (the "Expiration Date"), as follows: (a) up to 198,059 Shares of the total number of Shares subject to this Option may be purchased by you on or after January 31, 2002, provided you are employed by the Company on such date; (b) up to an additional 198,059 Shares of the total number of Shares subject to this Option may be purchased by you on or after January 31, 2003, provided you are employed by the Company on such date; and (c) up to an additional 396,116 Shares of the total number of Shares subject to this Option may be purchased by you on or after January 31, 2004, provided you are employed by the Company on such date. Further, this Option granted herein shall vest and may be exercised in its entirety upon your termination of employment by the Company without "cause" or your resignation for "good reason" (as such terms are defined in and in the manner provided in your employment agreement) or upon a "change in control" of the Company (as defined in your employment agreement). An additional number of Shares subject to this Option shall vest and become exercisable on the date of your death or disability in the amounts and in the manner provided in your employment agreement, which provides that such number is determined by multiplying (i) the number of Shares that would have vested at the end of the fiscal year in which your death or disability occurs by (ii) a fraction the numerator of which is the number of days in such fiscal year up to and including the date of your death or disability and the denominator of which is 365. The unvested portion of this Option granted herein will automatically and without notice terminate and become null and void on the earlier of: (i) your termination of employment for cause (as such term is defined in and in the manner provided in your employment agreement), (ii) your resignation without good reason (as such term is defined in and in the manner provided in your employment agreement), (iii) your death or disability (as such term is defined in and in the manner provided in your employment agreement) or (iv) the Expiration Date. The unexercised portion of this Option granted herein will automatically and without notice terminate and become null and void on the Expiration Date. If, however, prior to the Expiration Date, your employment with the Company and any parent or subsidiary corporation terminates, the vested and unexercised portion of this Option will terminate on the applicable date as described below; provided, however, that none of the events described below shall extend the period of exercisability of this Option beyond the Expiration Date: (a) the second anniversary of the date of termination, if your employment is terminated prior to January 31, 2004, by reason of your death, disability, resignation without good reason or dismissal for cause (as such terms are defined in your employment agreement), except that your Option will be exercisable only to the extent that it would have been exercisable on the date of termination; or (b) the Expiration Date, if your employment is terminated on or after January 31, 2004, or if your employment is terminated prior to January 31, 2004 other than by reason of your death, disability, resignation without good reason or dismissal for cause (as such terms are defined in your employment agreement), 2 except that your Option will be exercisable only to the extent that it would have been exercisable on the date of termination. In no event shall you exercise this Option for a fraction of a Share or for less than one hundred (100) Shares (unless the number purchased is the total balance for which the Option is then exercisable). This Option is not transferable by you otherwise than by will or the laws of descent and distribution, and is exercisable, during your lifetime, only by you. This Option may not be assigned, transferred (except by will or the laws of descent and distribution), pledged, hypothecated or disposed of in any way (whether by operation of law or otherwise) and shall not be subject to execution, attachment or similar proceeding. Any attempted assignment, transfer, pledge, hypothecation or other disposition of this Option contrary to the provisions hereof, and the levy of any attachment or similar proceeding upon the Option, shall be null and void and without effect. Any exercise of this Option shall be in writing addressed to the Secretary of the Company at the principal place of business of the Company, shall be substantially in the form attached hereto and shall be accompanied by a certified or bank cashier's check to the order of the Company in the full amount of the purchase price of the Shares so purchased. If the Company, in its sole discretion shall determine that it is necessary, to comply with applicable securities laws, the certificate or certificates representing the Shares purchased pursuant to the exercise of this Option shall bear an appropriate legend in form and substance, as determined by the Company, giving notice of applicable restrictions on transfer under or in respect of such laws. Subject to any rights you may have under your employment agreement, you hereby covenant and agree with the Company that if, at the time of exercise of this Option, there does not exist a Registration Statement on an appropriate form under the Securities Act of 1933, as amended (the "Act"), which Registration Statement shall have become effective and shall include a prospectus which is current with respect to the Shares subject to this Option (i) that you are purchasing the Shares for your own account and not with a view to the resale or distribution thereof and (ii) that any subsequent offer for sale or sale of any such Shares shall be made either pursuant to (x) a Registration Statement on an appropriate form under the Act, which Registration Statement shall have become effective and shall be current with respect to the Shares being offered and sold, or (y) a specific exemption from the registration requirements of the Act, but in claiming such exemption, you shall, prior to any offer for sale or sale of such Shares, obtain a favorable written opinion from counsel for or approved by the Company as to the applicability of such exemption. You further agree not to sell or otherwise dispose of the Shares acquired pursuant to this Option for a period of six (6) months following the date of grant of this Option. 3 The Company may withhold from sums due or to become due to you from the Company an amount necessary to satisfy its obligation to withhold taxes incurred by reason of the exercise of this Option, or may require you to reimburse the Company in such amount. The Company may hold the stock certificate to which you are entitled upon the exercise of this Option as security for the payment of withholding tax liability, until cash sufficient to pay such liability has been accumulated. Please indicate your acceptance of all the terms and conditions of this Option and the Plan by signing and returning a copy of this letter. Very truly yours, BARNEYS NEW YORK, INC. By: /s/ Marc H. Perlowitz ---------------------------------------- Name: Marc H. Perlowitz Title: Executive Vice President ACCEPTED: /s/ Howard Socol - -------------------- Howard Socol Date: January 8, 2001 4 -----END PRIVACY-ENHANCED MESSAGE-----