<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 5)*
DREYER'S GRAND ICE CREAM, INC.
(Name of Issuer)
COMMON STOCK, $1.00 PAR VALUE
(Title of Class of Securities)
26187810
(CUSIP Number)
James H. Ball, Esq. with a copy to:
Senior Vice President, Secretary Mary Ellen Kanoff, Esq.
and General Counsel Latham & Watkins
Nestle Holdings, Inc. 633 West Fifth Street
c/o Nestle USA, Inc. Suite 4000
800 North Brand Boulevard Los Angeles, California 90071
Glendale, California 91203 (213) 485-1234
(818) 549-7050
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
June 14, 1997
(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 which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ].
Check the following box if a fee is being paid with the statement. [ ] (A fee is
not required only if the reporting person: (1) has a previous statement on file
reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-1(a) for other parties to whom copies are to be
sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Page 1 of 11 Pages
<PAGE> 2
SCHEDULE 13D
- ------------------------------------------------- ---------------------
CUSIP No. 26187810
- ------------------------------------------------- ---------------------
- --------------------------------------------------------------------------------
1 NAME OF PERSON
NESTLE HOLDINGS, INC.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF MEMBER OF A GROUP* (a) [ ]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
AF
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS [ ]
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
4,056,008
NUMBER OF
SHARES --------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY EACH 0
REPORTING --------------------------------------------
PERSON WITH 9 SOLE DISPOSITIVE POWER
4,056,008
--------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
4,056,008
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES*
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
28.1%
- --------------------------------------------------------------------------------
14 TYPE OF PERSON REPORTING*
CO
- --------------------------------------------------------------------------------
* SEE INSTRUCTIONS BEFORE FILLING OUT
Page 2 of 11 Pages
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SCHEDULE 13D
- ------------------------------------------------- ---------------------
CUSIP No. 26187810
- ------------------------------------------------- ---------------------
- --------------------------------------------------------------------------------
1 NAME OF PERSON
NESTLE S.A.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF MEMBER OF A GROUP* (a) [ ]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
AF
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS [ ]
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
SWITZERLAND
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
4,056,008
NUMBER OF --------------------------------------------
SHARES 8 SHARED VOTING POWER
BENEFICIALLY 0
OWNED BY EACH --------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON WITH 4,056,008
--------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
4,056,008
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES*
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
28.1%
- --------------------------------------------------------------------------------
14 TYPE OF PERSON REPORTING*
CO
- --------------------------------------------------------------------------------
* SEE INSTRUCTIONS BEFORE FILLING OUT
Page 3 of 11 Pages
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This Amendment No. 5 amends and restates in its entirety the
Schedule 13D previously filed by Nestle Holdings, Inc., a Delaware corporation
("Holdings") and Nestle S.A., a corporation organized under the laws of
Switzerland ("Nestle") on May 16, 1994, as amended and restated by Amendment No.
1 to Schedule 13D filed on June 16, 1994, as amended by Amendment No. 2 to
Schedule 13D filed on October 5, 1994, as amended by Amendment No. 3 to Schedule
13D filed on April 7, 1995 and as amended by Amendment No. 4 to Schedule 13D
filed on March 12, 1997 (as so amended, the "Schedule 13D"), and relates to the
shares of Common Stock, $1.00 par value per share (the "Shares"), of Dreyer's
Grand Ice Cream, Inc., a Delaware corporation (the "Issuer").
ITEM 2. IDENTITY AND BACKGROUND.
This statement is being filed jointly by Nestle Holdings,
Inc., a Delaware corporation ("Holdings") and Nestle S.A., a corporation
organized under the laws of Switzerland ("Nestle" and, together with Holdings,
the "Reporting Persons"). Holdings is a wholly-owned subsidiary of Nestle.
Holdings is principally engaged in the business of holding
United States operating subsidiaries which produce and distribute food and
beverage products. The address of its principal business and principal office is
Five High Ridge Park, Stamford, Connecticut 06905. Nestle is a holding company
which holds interests in worldwide operating companies which: manufacture and
sell food and beverage products throughout the world; engage in research and
development activities; manufacture and sell cosmetic products; and develop,
manufacture and sell pharmaceutical products. The address of its principal
business and principal office is Ave Nestle 55, CH-1800 Vevey, Switzerland.
For information with respect to the identity and background of
(i) each executive officer and director of Holdings and (ii) each executive
officer and director of Nestle, see Schedule I hereto.
During the last five years, none of the Reporting Persons nor,
to the best knowledge of the Reporting Persons, any person named in Schedule I:
(i) has been convicted in a criminal proceeding (excluding traffic violations or
similar misdemeanors); or (ii) was 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 judgement, 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.
Holdings borrowed the $106,000,000 used for its acquisition of
3,000,000 Shares and Series A Warrants to purchase 1,000,000 Shares (the "Series
A Warrants") and the Series B Warrants to purchase 1,000,000 Shares (the "Series
B Warrants") from an indirect wholly owned subsidiary of Holdings. Such
acquisition was effected pursuant to the Purchase Agreement defined and
described in Items 4 and 6 below. As described in Item 6 below, on June 14,
1997, the Series A Warrants expired unexercised.
Holdings used $1,425,200 in working capital to fund its
acquisition of an additional 56,008 Shares pursuant to the Right of First
Refusal Agreements defined and described in Item 6 below.
If and when Holdings chooses to exercise the Series B
Warrants, it is presently expected that the $32,000,000 required to be paid by
Holdings for the Shares issuable upon the exercise of such warrants ("Warrant
Shares") will be obtained from the working capital of Holdings or borrowed from
Page 4 of 11 Pages
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one of Holdings' wholly owned subsidiaries. Should the circumstances set forth
in the Purchase Agreement occur which would require Holdings to pay up to an
additional $8,000,000 (as described in Item 6) with respect to the initial
3,000,000 Shares and, to the extent purchased, the Warrant Shares, it is
presently expected that such funds will be obtained from the working capital of
Holdings or borrowed from one of Holdings' wholly owned subsidiaries.
ITEM 4. PURPOSE OF TRANSACTION.
Holdings acquired the 3,056,008 Shares and the Series B
Warrants (and may be acquiring up to 1,000,000 Warrant Shares and additional
Shares if Holdings' rights of first refusal under the Right of First Refusal
Agreements (as defined in Item 6, below) and preemptive rights (as described in
Item 6, below) are exercised) for investment purposes. As described in Item 6
below, on June 14, 1997, the Series A Warrants expired unexercised. A
significant aspect of Holdings' investment analysis with respect to its
acquisition of such securities related to the concurrent distribution
relationship between Nestle USA-Food Division, Inc., formerly known as Nestle
Ice Cream Company ("NICC"), an affiliate of Holdings, and the Issuer pursuant to
the Distributor Agreement entered into by NICC and the Issuer on June 14, 1994
(the "Distributor Agreement"). Pursuant to the Distributor Agreement, the Issuer
distributes NICC's ice cream novelty products in certain domestic markets. The
execution of such agreement by NICC and the Issuer satisfied a condition to
closing under the Purchase Agreement, which closing occurred on June 14, 1994
after the satisfaction of certain customary closing conditions ("Closing").
Holdings entered into a Stock and Warrant Purchase Agreement
dated as of May 6, 1994 with the Issuer, as amended (the "Purchase Agreement"),
pursuant to which Holdings is subject to a number of so-called "standstill"
restrictions, including limitations on the number of Shares which Holdings can
beneficially own, such ownership limitations ranging from 25% to less than 35%
of the Shares on a Fully Diluted (as defined in the Purchase Agreement) basis
depending upon the circumstances and certain conditions described in the
Purchase Agreement and Right of First Refusal Agreements (the "Standstill
Restrictions"). Pursuant to the Standstill Restrictions, after June 14, 1997
Holdings may "submit any number of acquisition proposals" to the Board of
Directors of the Issuer, provided that any such "submission(s) would not require
public disclosure thereof" by the Issuer or Holdings.
Holdings is also subject to various restrictions on its
ability to sell the Shares and the Series B Warrants (the "Transfer
Restrictions"). Pursuant to such restrictions, on and after June 14, 1997,
Holdings may, in addition to certain other permitted transfers described in the
Purchase Agreement, transfer the Shares or the Series B Warrants provided that
such transfer is (i) in a public distribution, (ii) pursuant to Rule 144 of the
Securities Act of 1933, as amended or (iii) in a private sale to an
institutional or financial purchaser who would not, after giving effect to the
sale, beneficially own, either individually or in the aggregate with such
purchaser's affiliates, more than 5% of the Issuer's outstanding common stock,
on a Fully Diluted basis. If the sale would cause such purchasers beneficial
ownership to exceed 5%, Holdings must obtain the Issuer's consent.
Pursuant to the Registration Rights Agreement (as defined in
Item 6 below), on and after June 14, 1997, Holdings is entitled to exercise
certain registration rights with respect to the Shares purchased by it under the
terms of the Purchase Agreement and the Shares that may be purchased by it under
the terms of the Warrant Agreement (as defined in Item 6 below) and the Right
of First Refusal Agreements. These rights generally include the ability to make
three demand registrations (with a fourth demand under certain circumstances)
and an unlimited number of "piggyback" registrations.
Holdings presently intends generally to maintain the
percentage beneficial ownership of the Shares permitted under the Standstill
Restrictions and the Transfer Restrictions. However, subject to the Standstill
Restrictions and the Transfer Restrictions and depending on general market and
economic conditions affecting the Issuer and Holdings' view of the prospects for
the Issuer and other relevant factors, Holdings may purchase additional Shares
or dispose of some or all of its Shares from time to time in open market
transactions, private transactions or otherwise. See Item 6, below, for
additional information with respect to the Standstill Restrictions. Also see
Item 6, below, for discussion of Holdings' (i) preemptive rights, and (ii)
rights of first refusal with respect to certain Shares.
Holdings analyzes and reviews its strategic alternatives with
respect to its investment in, and distribution relationship with, the Issuer on
an ongoing basis. Holdings has made no decision regarding increasing its
investment in the Issuer, disposing of some or all of its investment in the
Issuer or acquiring control of the Issuer in the future. Any such decision will
depend upon general market and economic conditions affecting the Issuer and
Holdings' view of the prospects for the Issuer and other relevant factors.
Page 5 of 11 Pages
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The Purchase Agreement provides that so long as Holdings
beneficially owns 10% or more of the Shares on a Fully Diluted basis, Holdings
is entitled to nominate to the Issuer's Board of Directors that number of
nominees which bears the same proportion to the total number of the Issuer's
directors as the number of Shares owned by Holdings bears to the total number of
Shares of the Issuer then outstanding. Holdings is entitled to a minimum
representation on the Issuer's Board of Directors of two directors. Pursuant to
its rights under the Purchase Agreement, Holdings nominated, and the Issuer's
Board of Directors elected, Timm F. Crull to the Issuer's Board of Directors on
March 7, 1995 and Steven Langman to the Issuer's Board of Directors on March 5,
1997. As of the date hereof, both individuals continue to serve as directors of
the Issuer.
Except as set forth herein, none of the Reporting Persons,
nor, to the best knowledge of the Reporting Persons, any person named in
Schedule I, has any present plans or proposals with respect to any material
change in the Issuer's business or corporate structure or any other action
referred to in clauses (a) through (j) of Item 4 of Schedule 13D.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) As of the date hereof, Holdings beneficially owns
4,056,008 shares. According to the Issuer's Quarterly Report on Form 10-Q for
the quarterly period ended March 29, 1997, on May 9, 1997, there were
13,401,899 Shares outstanding. Based upon that number and assuming that the
1,000,000 Warrant Shares have been issued, the beneficial ownership of Holdings
constitutes approximately 28.1% of the Issuer's outstanding Shares. Nestle may
be deemed to beneficially own the 4,056,008 Shares beneficially owned by
Holdings due to the fact that Holdings is a wholly owned subsidiary of Nestle.
(b) Holdings has the sole power to vote or to direct the
vote, and to dispose or to direct the disposition of, the Shares beneficially
owned by it. Nestle may be deemed to have the sole power to vote or direct the
vote, and to dispose or direct the disposition of, the Shares beneficially owned
by Holdings due to the fact that Holdings is a wholly owned subsidiary of
Nestle.
(c) Not applicable
(d) Holdings has the right to receive and the power to
direct the receipt of dividends from, or the proceeds from the sale of, the
Shares beneficially owned by it. Nestle may be deemed to have the right to
receive and the power to direct the receipt of dividends from, or the proceeds
from the sale of, the Shares beneficially owned by Holdings due to the fact that
Holdings is a wholly owned subsidiary of Nestle.
(e) Not applicable
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER.
As described in Item 4, Holdings acquired the 3,000,000 Shares
and the Series B Warrants pursuant to the Purchase Agreement and acquired the
additional 56,008 Shares pursuant to the Right of First Refusal Agreements.
Pursuant to the Rogers Right of First Refusal Agreement (as defined below) and
an undertaking agreement dated as of March 3, 1997 between the University of
California Berkeley Foundation (the "Foundation") and Holdings, the Foundation
has agreed to be bound by the terms and conditions of the Rogers Right of First
Refusal Agreement with respect to 3,616 Shares transferred to it by T. Gary
Rogers and/or his affiliates.
Page 6 of 11 Pages
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The Purchase Agreement contains the Standstill Restrictions
referred to in Item 4. Pursuant to such restrictions, Holdings has agreed, among
other things and except in certain circumstances, (i) not to purchase any Shares
if the effect of such purchase would be to increase its beneficial ownership
position of Shares to more than 25% of the outstanding Shares on a Fully Diluted
basis, (ii) not to engage in the solicitation of proxies and (iii) not to make
any acquisition proposals.
The Standstill Restrictions terminate on the earlier of the
tenth anniversary of Closing or one year after Holdings beneficially owns less
than 1% of the Issuer's outstanding Shares on a Fully Diluted basis. Such
restrictions are subject to earlier termination if, among other things, the
Issuer pursues an extraordinary transaction or a third party acquires, in
certain circumstances, beneficial ownership of 20% or more of the then
outstanding Shares. After termination of the Standstill Restrictions, Holdings
has agreed not to acquire beneficial ownership of 35% or more of the outstanding
Shares on a Fully Diluted basis except pursuant to an offer for all of the
outstanding Shares at the same price per share. Pursuant to the Standstill
Restrictions, and as described in Item 4 above, after June 14, 1997 Holdings may
"submit any number of acquisition proposals" to the Board of Directors of the
Issuer, provided that any such "submission(s) would not require public
disclosure thereof" by the Issuer or Holdings.
The Purchase Agreement also contains the Transfer Restrictions
referred to in Item 4. Pursuant to such restrictions, on and after June 14,
1997, Holdings may, in addition to certain other permitted transfers described
in the Purchase Agreement, transfer the Shares or the Series B Warrants provided
such transfer is (i) in a public distribution, (ii) pursuant to Rule 144 of the
Securities Act of 1933, as amended or (iii) in a private sale to an
institutional or financial purchaser who would not, after giving effect to the
sale, beneficially own, either individually or in the aggregate with such
purchaser's affiliates, more than 5% of the Issuer's outstanding common stock,
on a Fully Diluted basis. If the sale would cause such purchasers beneficial
ownership to exceed 5%, Holdings must obtain the Issuer's consent.
Such transfer restrictions are subject to earlier
termination: (i) upon the death, resignation or removal of T. Gary Rogers,
Chairman and Chief Executive Officer of the Issuer, and William F. Cronk, III,
President of the Issuer, (ii) upon the sale of 50% or more of the Shares
beneficially owned as of May 6, 1994 by either (A) T. Gary Rogers and William F.
Cronk, III or (B) T. Gary Rogers (in both cases, excluding the Shares owned by
the Rogers and the Cronks (both as defined below) which are purchased by
Holdings pursuant to the Right of First Refusal Agreements), (iii) if the Issuer
commits certain breaches leading to termination of the Distributor Agreement or
(iv) under certain other circumstances.
Under the Purchase Agreement, Holdings was granted certain
preemptive rights pursuant to which, in the event of a sale by the Issuer of
Shares or certain other securities for cash, Holdings may purchase from the
Issuer the amount of such Shares or securities required in order for Holdings to
maintain the same percentage of beneficial ownership of the Issuer before and
after such sale. Holdings was also granted the right to nominate at least two
directors to the Issuer's board of directors.
Pursuant to the Purchase Agreement, Holdings entered into a
warrant agreement with the Issuer on June 14, 1994 (the "Warrant Agreement"). On
June 14, 1997, the Series A Warrants beneficially owned by Holdings expired
unexercised. These warrants were exercisable into 1,000,000 Shares at an
exercise price of $32 per share. Holdings continues to own the Series B Warrants
which are currently exercisable into 1,000,000 Shares at an exercise price of
$32 per share, subject to certain anti-dilution adjustments. The Series B
Warrants are exercisable through June 14, 1999.
Subject to certain conditions and anti-dilution adjustments,
the Issuer has the right to cause Holdings to exercise the Series B Warrants at
$32.00 per Warrant Share at any time prior to their expiration if the average of
the quoted prices of the outstanding Shares for 130 consecutive trading days
equals or exceeds $60 (subject to equitable adjustment) per Share. Subject to
certain notice requirements, the Issuer had a similar right to cause an exercise
of the Series A Warrants at $32 per Warrant Share and the Series A and the
Page 7 of 11 Pages
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Series B Warrants at $24.00 per Share at any time prior to June 14,
1997. These rights have expired unexercised.
Pursuant to the Purchase Agreement, if within five years from
Closing the average of the quoted prices of the outstanding Shares for 130
consecutive trading days equals or exceeds $60.00 (subject to equitable
adjustment) per Share, then Holdings has agreed to pay an additional $2.00
(subject to equitable adjustment) for each of the 3,000,000 Shares and, to the
extent purchased, the 1,000,000 Warrant Shares issuable upon exercise of the
Series B Warrants.
On June 14, 1994, Holdings entered into right of first refusal
agreements with each of T. Gary Rogers and his affiliates (the "Rogers") (the
"Rogers Right of First Refusal Agreement") and William F. Cronk, III and his
affiliates (the "Cronks") (collectively, the "Right of First Refusal
Agreements"). Under such agreements, so long as Holdings beneficially owns 10%
or more of the outstanding Shares, Holdings has rights of first refusal with
respect to any and all Shares beneficially owned by the Rogers and the Cronks,
whether owned now or in the future, including without limitation Shares issuable
upon exercise of stock options. As of March 31, 1997, the Rogers and the Cronks
beneficially owned 1,833,658 and 1,003,681 Shares, respectively, that are
subject to such rights of first refusal.
Pursuant to the Purchase Agreement, Holdings' exercise of its
rights of first refusal is an exception to the 25% beneficial ownership
standstill limitation, but is subject to Holdings not beneficially owning 35% or
more of the Issuer's shares on a Fully Diluted basis after giving effect to the
purchase of Shares pursuant to the exercise of such rights. Holdings, however,
has the unrestricted right to sell Shares in order to permit the full exercise
of its rights of first refusal.
On June 14, 1994, Holdings entered into a registration rights
agreement with the Issuer (the "Registration Rights Agreement"). Pursuant to
such agreement, Holdings has certain registration rights with respect to the
Shares purchased by it under the terms of the Purchase Agreement and the Shares
that may be purchased by it under the terms of the Warrant Agreement and Right
of First Refusal Agreements. These rights generally include the ability to make
three "demand" registrations (with a fourth demand under certain circumstances)
and an unlimited number of "piggyback" registrations. In addition, the Issuer,
on May 6, 1994, entered into an agreement amending its registration rights
agreement with certain affiliates with respect to the Shares (the "GE
Amendment"). This amendment provides for consistent treatment of Holdings, on
the one hand, and the affiliates of General Electric Company, on the other hand,
with respect to "demand" and "piggyback" registrations of certain Shares
beneficially owned by each of them.
On June 14, 1994, the Issuer entered into an agreement (the
"Rights Agreement Amendment") amending its rights agreement (the "Rights
Agreement") with First Interstate Bank of California. Pursuant to such Rights
Agreement Amendment, Holdings, subject to certain conditions, became an exempted
person under the Rights Agreement thereby allowing Holdings and its affiliates
and associates to acquire any of the Shares without causing the rights issued
pursuant to the Rights Agreement to become exercisable.
The above descriptions of the Purchase Agreement, Warrant
Agreement, Right of First Refusal Agreements, Registration Rights Agreement, GE
Amendment and Rights Agreement Amendment set forth in this Item 6 and in Items 4
and 5 are summaries, and the complete text is set forth in Exhibits 10.1 through
10.8 to this filing which are incorporated herein by reference.
Except as set forth above, to the best knowledge of the
Reporting Persons, there are no other contracts, arrangements, understandings or
relationships (legal or otherwise) among persons named in Item 2 and between
such persons and any person with respect to any securities of the Issuer,
including but not limited to, transfer or voting of any of the securities of the
Issuer, finder's fees, joint ventures, loan or option arrangements, puts or
calls, guarantees or profits, division of
Page 8 of 11 Pages
<PAGE> 9
profits or losses, or the giving or withholding of proxies, or a pledge or
otherwise subject to a contingency the occurrence of which would give another
person voting power over the securities of the Issuer.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
10.1 Stock and Warrant Purchase Agreement dated as of
May 6, 1994 by and between Dreyer's Grand Ice Cream,
Inc. and Nestle Holdings, Inc.(1)
10.2 First Amendment to Stock and Warrant Purchase
Agreement dated as of June 14, 1994 by and between
Dreyer's Grand Ice Cream, Inc. and Nestle Holdings,
Inc.(2)
10.3 Warrant Agreement dated as of June 14, 1994 by and
between Dreyer's Grand Ice Cream, Inc. and Nestle
Holdings, Inc. (3)
10.4 Right of First Refusal Agreement dated as of June 14,
1994 by and between Nestle Holdings, Inc. and T. Gary
Rogers and Kathleen T. Rogers, Individually and as
Co-Trustees of the Rogers Revocable Trust.
10.5 Right of First Refusal Agreement dated as of June 14,
1994 by and between Nestle Holdings, Inc. and William
F. Cronk, III and Janet M. Cronk, Individually and as
Co-Trustees of the Cronk Revocable Trust.
10.6 Registration Rights Agreement dated as of June 14,
1994 by and between Dreyer's Grand Ice Cream, Inc.
and Nestle Holdings, Inc. (4)
10.7 Amendment to Registration Rights Agreement dated
May 6, 1994 by and among Dreyer's Grand Ice Cream,
Inc., Trustees of General Electric Pension Trust, GE
Investment Private Placement Partners, I and General
Electric Capital Corporation. (5)
10.8 First Amendment to Amended and Restated Rights
Agreement dated as of June 14, 1994 by and between
Dreyer's Grand Ice Cream, Inc. and First Interstate
Bank of California (as successor Rights Agent to Bank
of America NT & SA). (6)
24. Power of Attorney. (7)
99. Joint Filing Agreement dated as of June 16, 1994 by
and between Nestle Holdings, Inc. and Nestle S.A.
relating to the filing of a joint statement on
Schedule 13D. (8)
(1) Incorporated by reference to Exhibit 2.1 to Dreyer's Grand Ice
Cream, Inc.'s Current Report on Form 8-K filed with the
Securities and Exchange Commission ("Commission") on May 9,
1994.
(2) Incorporated by reference to Exhibit 2.1 to Dreyer's Grand Ice
Cream, Inc.'s Quarterly Report on Form 10-Q for the quarter
ended June 25, 1994, filed with the Commission on August 9,
1994.
(3) Incorporated by reference to Exhibit 4.3 to Dreyer's Grand Ice
Cream, Inc.'s Quarterly Report on Form 10-Q for the quarter
ended June 25, 1994, filed with the Commission on August 9,
1994.
(4) Incorporated by reference to Exhibit 4.2 to Dreyer's Grand Ice
Cream, Inc.'s Quarterly Report on Form 10-Q for the quarter
ended June 25, 1994, filed with the Commission on August 9,
1994.
Page 9 of 11 Pages
<PAGE> 10
(5) Incorporated by reference to Exhibit 4.1 to Dreyer's Grand Ice
Cream, Inc.'s Quarterly Report on Form 10-Q for the quarter
ended March 26, 1994 filed with the Commission on May 10,
1994.
(6) Incorporated by reference to Exhibit 4.1 to Dreyer's Grand Ice
Cream, Inc.'s Quarterly Report on Form 10-Q for the quarter
ended June 25, 1994, filed with the Commission on August 9,
1994.
(7) Incorporated by reference to Exhibit 24 to Amendment No. 1 to
the Schedule 13D of Nestle Holdings, Inc., filed with the
Commission on June 16, 1994.
(8) Incorporated by reference to Exhibit 99 to Amendment No. 1 to
the Schedule 13D of Nestle Holdings, Inc., filed with the
Commission on June 16, 1994.
Page 10 of 11 Pages
<PAGE> 11
SIGNATURE
After reasonable inquiry and to the best of our knowledge and
belief, we certify that the information set forth in this statement is true,
complete and correct.
NESTLE HOLDINGS, INC.
By: /s/ James H. Ball
-----------------------------------
Name: James H. Ball
Title: Senior Vice President and
General Counsel
NESTLE S.A.
By: /s/ James H. Ball
-----------------------------------
James H. Ball, attorney-in-fact for
Name: H.P. Frick
Title: Senior Vice President and
General Counsel of Nestle S.A.
Dated: June 17, 1997
Page 11 of 11 Pages
<PAGE> 12
SCHEDULE I
NESTLE HOLDINGS, INC.
EXECUTIVE OFFICERS AND DIRECTORS
<TABLE>
<CAPTION>
Name Present Business Address Present Principal Occupation Citizenship
- ---- ------------------------ ---------------------------- -----------
<S> <C> <C> <C>
Executive Officers
Carlos E. Represas Nestle S.A. Chairman of Board Mexico
Avenue Nestle 55
CH-1800 Vevey
Switzerland
Joseph M. Weller Nestle Holdings, Inc. Chief Executive Officer and President United States
c/o Nestle USA, Inc.
800 North Brand Boulevard
Glendale, CA 91203
Peter D. Argentine Nestle Holdings, Inc. Senior Vice President, Finance United States
c/o Nestle USA, Inc.
800 North Brand Boulevard
Glendale, CA 91203
James H. Ball Nestle Holdings, Inc. Senior Vice President, General Counsel and United States
c/o Nestle USA, Inc. Secretary
800 North Brand Boulevard
Glendale, CA 91203
Alexander Spitzer Nestle Holdings, Inc. Senior Vice President, Taxes United States
Five High Ridge Pk.
Stamford, CT 06905
E. Simon Jones Nestle Holdings, Inc. Vice President, Taxes United Kingdom
Five High Ridge Pk.
Stamford, CT 06905
Manfred R. Lehmann Nestle Holdings, Inc. Vice President and Treasurer Switzerland and
Five High Ridge Pk. United States
Stamford, CT 06905
Kimberly A. Lund Nestle Holdings, Inc. Vice President and Controller United States
c/o Nestle USA, Inc.
800 North Brand Boulevard
Glendale, CA 91203
Mark E. Siegal Nestle Holdings, Inc. Vice President, Taxes United States
Five High Ridge Pk.
Stamford, CT 06905
</TABLE>
<PAGE> 13
<TABLE>
<S> <C> <C> <C>
Directors
Carlos E. Represas Nestle S.A. Chairman of Board Mexico
Avenue Nestle 55
CH-1800 Vevey
Switzerland
Joseph M. Weller Nestle Holdings, Inc. Chief Executive Officer and President United States
c/o Nestle USA, Inc.
800 North Brand Boulevard
Glendale, CA 91203
Mario A. Corti Nestle Holdings, Inc. Director Switzerland
c/o Nestle USA, Inc.
800 North Brand Boulevard
Glendale, CA 91203
Robert D. Carpenter Nestle S.A. Director United States
Avenue Nestle 55
CH-1800 Vevey
Switzerland
Peter D. Argentine Nestle Holdings, Inc. Senior Vice President, Finance United States
c/o Nestle USA, Inc.
800 North Brand Boulevard
Glendale, CA 91203
</TABLE>
<PAGE> 14
NESTLE, S.A.
EXECUTIVE OFFICERS AND DIRECTORS
<TABLE>
<CAPTION>
Name Present Business Address Present Principal Occupation Citizenship
- ---- ------------------------ ---------------------------- -----------
<S> <C> <C> <C>
Executive Officers
Peter Brabeck-Letmathe Nestle S.A. Chief Executive Officer Austria
Avenue Nestle 55
CH-1800 Vevey
Switzerland
Mario A. Corti Nestle S.A. Executive Vice President Switzerland
Avenue Nestle 55 Finance/Control
CH-1800 Vevey
Switzerland
Francisco Castaner Nestle S.A. Executive Vice President Spain
Avenue Nestle 55 Pharma & Cosmetics
CH-1800 Vevey Human Resources
Switzerland Corporate Affairs
Michael W.O. Garrett Nestle S.A. Executive Vice President Austria/
Avenue Nestle 55 Zone AOA United Kingdom
CH-1800 Vevey
Switzerland
Rupert Gasser Nestle S.A. Executive Vice President Switzerland/
Avenue Nestle 55 Technical, Production, R&D Austria
CH-1800 Vevey
Switzerland
Robert Raeber Nestle S.A. Executive Vice President Switzerland
Avenue Nestle 55 Zone EUR
CH-1800 Vevey
Switzerland
Carlos E. Represas Nestle S.A. Executive Vice President Mexico
Avenue Nestle 55 Zone AMS
CH-1800 Vevey
Switzerland
Philippe H. Veron Nestle S.A. Executive Vice President France
Avenue Nestle 55 Strategic Business Units Marketing
CH-1800 Vevey
Switzerland
</TABLE>
<PAGE> 15
<TABLE>
<S> <C> <C> <C>
Directors
Helmut Maucher Nestle S.A. Chairman of the Board of Nestle S.A. Germany
En Bergere
CH-1800 Vevey
Switzerland
Peter Bockli Bockli & Thomann Law Professor and Lawyer at Bockli & Switzerland
Case postale 2348 Thomann
CH-4002 Basel
Switzerland
George Blum Societe de Banque Suisse Chairman of the Board of Societe de Banque Switzerland
Aeschenplatz 6 Suisse
CH-4002 Bale
Peter Brabeck-Lemathe Nestle S.A. Chief Executive Officer of Nestle S.A. Austria
Avenue Nestle 55
CH-1800 Vevey
Switzerland
Reto F. Domeniconi Clos des Mesanges Retired Switzerland
Ch. de Sainte-Croix 13
CH-1807 Blonay
Arthur Dunkel 6-4 Boulevard du Theatre Professor and Consultant Switzerland
CH-1024 Geneve
Fritz Gerber Roche Holding S.A. Chairman of the Board of Roche Holding Switzerland
P.O. Box S.A.
CH-4002 Bale
Rainer E. Gut Credit Suisse Chairman of the Board of Credit Suisse Switzerland
CH-8070 Zurich
Switzerland
Jean-Pierre Meyers L'Oreal Director of L'Oreal France
41, Rue Matre
F-92117 Clichy-Cedex
France
David de Pury de Pury, Pictat, Partner of de Pury, Turretini & Cie, S.A. Switzerland
Turretini & Cie S.A.
P.O. Box 8242
8050 Zurich
Stephan Schmidheiny Anova Holding S.A. Chairman of the Board of Anova Holding Switzerland
Hurdnerstrasse 10 S.A.
CH-8640 Hurden
Switzerland
Vreni Spoerry Claridenstrasse 3 Vice President Schwitzer Verband Switzerland
CH-8810 Horgen Volksdienst
Switzerland Member of Swiss Parliment
Robert Studer U.B.S. Group President of U.B.S. Group Switzerland
Bahnhofstasse 45
CH-8001 Zurich
Switzerland
</TABLE>
<PAGE> 16
<TABLE>
<S> <C> <C> <C>
Paul A. Volcker c/o James D. Wolfensohn, Inc. Retired United States
599 Lexington Ave.
New York, NY 10022
</TABLE>
<PAGE> 17
EXHIBIT INDEX
<TABLE>
<S> <C> <C>
10.1 Stock and Warrant Purchase Agreement dated as of May 6, 1994
by and between Dreyer's Grand Ice Cream, Inc. and Nestle
Holdings, Inc.(1)
10.2 First Amendment to Stock and Warrant Purchase Agreement dated
as of June 14, 1994 by and between Dreyer's Grand Ice Cream,
Inc. and Nestle Holdings, Inc.(2)
10.3 Warrant Agreement dated as of June 14, 1994 by and between
Dreyer's Grand Ice Cream, Inc. and Nestle Holdings, Inc. (3)
10.4 Right of First Refusal Agreement dated as of June 14, 1994 by
and between Nestle Holdings, Inc. and T. Gary Rogers and
Kathleen T. Rogers, Individually and as Co-Trustees of the
Rogers Revocable Trust.
10.5 Right of First Refusal Agreement dated as of June 14, 1994 by
and between Nestle Holdings, Inc. and William F. Cronk, III
and Janet M. Cronk, Individually and as Co-Trustees of the
Cronk Revocable Trust.
10.6 Registration Rights Agreement dated as of June 14, 1994 by and
between Dreyer's Grand Ice Cream, Inc. and Nestle Holdings,
Inc. (4)
10.7 Amendment to Registration Rights Agreement dated May 6, 1994
by and among Dreyer's Grand Ice Cream, Inc., Trustees of
General Electric Pension Trust, GE Investment Private
Placement Partners, I and General Electric Capital
Corporation. (5)
10.8 First Amendment to Amended and Restated Rights Agreement dated
as of June 14, 1994 by and between Dreyer's Grand Ice Cream,
Inc. and First Interstate Bank of California (as successor
Rights Agent to Bank of America NT & SA). (6)
24. Power of Attorney. (7)
99. Joint Filing Agreement dated as of June 16, 1994 by and
between Nestle Holdings, Inc. and Nestle S.A. relating to the
filing of a joint statement on Schedule 13D. (8)
(1) Incorporated by reference to Exhibit 2.1 to Dreyer's Grand Ice Cream,
Inc.'s Current Report on Form 8-K filed with the Commission on May 9,
1994.
(2) Incorporated by reference to Exhibit 2.1 to Dreyer's Grand Ice Cream,
Inc.'s Quarterly Report on Form 10-Q for the quarter ended June 25,
1994, filed with the Commission on August 9, 1994.
(3) Incorporated by reference to Exhibit 4.3 to Dreyer's Grand Ice Cream,
Inc.'s Quarterly Report on Form 10-Q for the quarter ended June 25,
1994, filed with the Commission on August 9, 1994.
(4) Incorporated by reference to Exhibit 4.2 to Dreyer's Grand Ice Cream,
Inc.'s Quarterly Report on Form 10-Q for the quarter ended June 25,
1994, filed with the Commission on August 9, 1994.
(5) Incorporated by reference to Exhibit 4.1 to Dreyer's Grand Ice Cream,
Inc.'s Quarterly Report on Form 10-Q for the quarter ended March 26,
1994 filed with the Commission on May 10, 1994.
(6) Incorporated by reference to Exhibit 4.1 to Dreyer's Grand Ice Cream,
Inc.'s Quarterly Report on Form 10-Q for the quarter ended June 25,
1994, filed with the Commission on August 9, 1994.
(7) Incorporated by reference to Exhibit 24 to Amendment No. 1 to the
Schedule 13D of Nestle Holdings, Inc., filed with the Commission on
June 16, 1994.
(8) Incorporated by reference to Exhibit 99 to Amendment No. 1 to the
Schedule 13D of Nestle Holdings, Inc., filed with the Commission on
June 16, 1994.
</TABLE>
<PAGE> 1
================================================================================
Exhibit 10.4
RIGHT OF FIRST REFUSAL AGREEMENT
BY AND BETWEEN
T. GARY ROGERS AND KATHLEEN T. ROGERS
INDIVIDUALLY AND AS CO-TRUSTEES OF THE
ROGERS REVOCABLE TRUST
AND
NESTLE HOLDINGS, INC.
DATED AS OF JUNE 14, 1997
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C> <C>
SECTION 1. Right of First Refusal......................................... 2
(a) Grant of Right........................................................ 2
(b) Exercise of Right..................................................... 2
(c) Elective Sales........................................................ 2
(d) Rule 144 Sales........................................................ 3
(e) Closing............................................................... 3
SECTION 2. Transfers of Shares............................................ 4
(a) Restrictions.......................................................... 4
(b) Exceptions to Restrictions............................................ 4
(c) Endorsement of Certificates........................................... 5
(d) Improper Transfer..................................................... 6
SECTION 3. Representations and Warranties of the Seller................... 6
(a) Beneficial Ownership.................................................. 6
(b) Good and Valid Title.................................................. 6
(c) Due Authorization; Good and Valid Title Upon Purchase................. 7
(d) No Inconsistent Agreements............................................ 7
(e) Brokerage or Finder's Fees............................................ 7
(f) Third Party Consents, etc............................................. 7
(g) Governmental Consents, etc............................................ 8
(h) Agreement is Valid, Binding and Enforceable........................... 8
SECTION 4. Representations and Warranties of the Purchaser................ 8
(a) Organization and Qualification........................................ 8
(b) Due Authorization..................................................... 8
(c) Purchase Representations.............................................. 8
(d) Accredited Investor................................................... 8
SECTION 5. Covenants of the Seller........................................ 9
</TABLE>
i
<PAGE> 3
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C> <C>
SECTION 6. Miscellaneous.................................................. 9
(a) Further Assurances.................................................... 9
(b) Severability.......................................................... 9
(c) Specific Enforcement.................................................. 10
(d) Entire Agreement...................................................... 10
(e) Counterparts.......................................................... 10
(f) Notices and Other Communications...................................... 10
(g) Amendments............................................................ 11
(h) Successors and Assigns................................................ 11
(i) Survival of Representations and Warranties............................ 11
(j) Governing Law......................................................... 11
(k) Signatures............................................................ 12
(l) Termination........................................................... 12
</TABLE>
ii
<PAGE> 4
RIGHT OF FIRST REFUSAL AGREEMENT
THIS RIGHT OF FIRST REFUSAL AGREEMENT (the "Agreement") is
dated as of June 14, 1994 (the "Effective Date") and entered into by and between
T. GARY ROGERS ("G.Rogers"), T. GARY ROGERS as co-trustee of the Rogers
Revocable Trust created under that certain Trust Agreement Establishing Rogers
Revocable Trust dated as of December 31, 1981, as amended and restated by that
certain First Amendment by Restatement of the Trust Agreement Establishing
Rogers Revocable Trust dated as of March 19, 1991, as amended by that certain
amendment dated as of June 1, 1994 (the "Rogers Revocable Trust") ("G.Trustee"),
KATHLEEN T. ROGERS ("K.Rogers"), and KATHLEEN T. ROGERS as co-trustee of the
Rogers Revocable Trust ("K.Trustee," and together with G.Rogers, G.Trustee and
K.Rogers, the "Seller") and NESTLE HOLDINGS, INC., a Delaware corporation (the
"Purchaser"). Capitalized terms used herein but not otherwise defined shall have
the meaning assigned such terms in the Purchase Agreement (as defined below).
WHEREAS, the Purchaser and Dreyer's Grand Ice Cream, Inc., a
Delaware corporation ("Dreyer's") have entered into a Stock and Warrant Purchase
Agreement dated as of May 6, 1994 (the "Purchase Agreement") providing, among
other things, for the purchase by the Purchaser of three million shares of the
Common Stock of Dreyer's, par value $1.00 per share (the "Common Stock"), and
warrants exercisable for two million shares of Common Stock;
WHEREAS, the Seller currently Beneficially Owns 1,863,730
shares of Common Stock (of which 1,585,350 shares are owned of record by
G.Trustee and K.Trustee, 178,380 shares are issuable upon exercise of stock
options owned of record by G.Rogers (the "Stock Options") and 100,000 shares are
owned of record by G.Rogers and K.Rogers as co-trustees of the Four Rogers Trust
created under that certain Trust Agreement Establishing Four Rogers Trust dated
as of December 23, 1986 (the "Four Rogers Trust")) and may acquire additional
shares of Common Stock or other voting securities of Dreyer's in the future (the
shares of Common Stock and other voting securities of Dreyer's (i) now owned by
the Seller, (ii) issuable upon exercise of the Stock Options or any other
options or warrants of Dreyer's now owned by the Seller, (iii) issuable upon
conversion or exchange of any other securities of Dreyer's now owned by the
Seller or (iv) hereafter acquired by, or which become Beneficially Owned by, the
Seller or any of its Affiliates, are referred to herein as the "Shares");
WHEREAS, a condition to the closing of the transactions
contemplated by the Purchase Agreement is that the Seller shall have granted the
Purchaser a right of first refusal with respect to the Shares; and
WHEREAS, the Purchaser and the Seller desire to provide for
such grants and to establish various rights and obligations in connection
therewith.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements herein set forth, the parties hereto agree as
follows:
1
<PAGE> 5
SECTION 1. Right of First Refusal.
(a) Grant of Right. In consideration of the payment of
$1,000 by the Purchaser to the Seller, the receipt and sufficiency of which is
hereby acknowledged, the Seller hereby grants to the Purchaser a right of first
refusal with respect to all of the Shares (the "Right of First Refusal").
(b) Exercise of Right. Subject to Sections 1(c) and (d),
if at any time the Seller receives a bona fide offer (an "Offer") from any
person or entity to purchase any or all of the Shares which the Seller wishes to
accept, the Seller shall cause the Offer to be reduced to writing and shall
notify the Purchaser in writing of its wish to accept the Offer (the "Offer
Notice"). The Offer Notice shall contain an irrevocable offer to sell such
Shares to the Purchaser at a purchase price equal to the price contained in, and
on the same terms and conditions of, the Offer and shall be accompanied by a
true copy of the Offer (which shall identify the offeror). At any time within
five business days after the date of receipt by the Purchaser of the Offer
Notice (the "Right of First Refusal Exercise Period"), the Purchaser shall have
the right to purchase all, but not less than all, the Shares covered by the
Offer at the same price and on the same terms and conditions as the Offer by
notifying the Seller in writing of its election to purchase the Shares (the
"Right of First Refusal Exercise Notice"). Upon the Seller's receipt of the
Right of First Refusal Exercise Notice, the Seller shall sell the Shares to the
Purchaser pursuant to the provisions of Section 1(e). If at the end of the Right
of First Refusal Exercise Period the Purchaser has not delivered a Right of
First Refusal Exercise Notice to the Seller, the Seller may, during the
succeeding 90-day period, sell not less than all of the Shares covered by the
Offer to the offeror at a price not less than that contained in the Offer and on
terms and conditions not less favorable in the aggregate to the Seller than
those contained in the Offer. Upon such sale, the Right of First Refusal shall
terminate with respect to the Shares so sold. If at the end of 90 days following
the expiration of the Right of First Refusal Exercise Period the Seller has not
completed the sale of the Shares covered by the Offer (or tendered or exchanged
such Shares pursuant to a tender or exchange offer) as aforesaid, then the
Seller shall not thereafter sell such Shares without again complying with the
provisions of this Section 1.
(c) Elective Sales. If at any time the Seller has a bona
fide intention to sell any of the Shares, but at such time has not received an
Offer from any person or entity to purchase such Shares, the Seller shall
provide the Purchaser with a notice (the "Elective Sale Notice") which (i)
notifies the Purchaser of such intention, (ii) sets forth the number of Shares
desired to be sold (the "Elective Shares") and (iii) irrevocably offers to sell
the Elective Shares to the Purchaser at a purchase price and on terms and
conditions set forth in such notice. At any time within five business days after
the date of receipt by the Purchaser of the Elective Sale Notice (the "Elective
Sale Exercise Period"), the Purchaser shall have the right to purchase all, but
not less than all, of the Elective Shares at the price and on the terms and
conditions set forth in the Elective Sale Notice by notifying the Seller in
writing of its election to purchase such Shares (the "Elective Sale Exercise
Notice"). Upon the Seller's receipt of the Elective Sale Exercise Notice, the
Seller shall sell the Elective Shares to the Purchaser pursuant to the
provisions of Section 1(e). If at the end of the Elective Sale Exercise Period
the Purchaser has not delivered an Elective Sale Exercise Notice to the Seller,
the Seller may, during the succeeding 90-day period, sell not less than all of
the Elective Shares at a price not less than that
2
<PAGE> 6
contained in the Elective Sale Notice and on terms and conditions not less
favorable in the aggregate to the Seller than those contained in the Elective
Sale Notice. Upon such sale, the Right of First Refusal shall terminate with
respect to the Elective Shares so sold. If at the end of 90 days following the
expiration of the Elective Sale Exercise Period the Seller has not completed the
sale of the Elective Shares as aforesaid, then the Seller shall not thereafter
sell the Elective Shares without again complying with the provisions of this
Section 1.
(d) Rule 144 Sales. If at any time the Seller has a bona
fide intention to sell any of the Shares pursuant to Rule 144 ("Rule 144") of
the Rules and Regulations issued under the Securities Act of 1933, as amended
(the "Act") during the immediately succeeding 90 calendar day period (such
period being referred to as the "Qualified Period"), the Seller shall provide
the Purchaser with a notice (the "Rule 144 Notice") which (i) notifies the
Purchaser of such intention, (ii) sets forth the number of Shares desired to be
sold (the "Rule 144 Shares") and (iii) irrevocably offers to sell the Rule 144
Shares to the Purchaser at a per-share price equal to (1) the reported closing
price of the outstanding shares of Common Stock on the day preceding the date of
the Rule 144 Notice as reported by the Nasdaq National Market System, (2) if
such shares are listed on a national securities exchange, the last reported
sales price of the outstanding shares of Common Stock on such exchange (which
shall be for consolidated trading if applicable to such exchange) on the day
preceding the date of the Rule 144 Notice, or (3) if neither so reported or
listed, the last reported bid price of such shares (the "Rule 144 Purchase
Price"). At any time within five business days after the date of receipt by the
Purchaser of the Rule 144 Notice (the "Rule 144 Exercise Period"), the Purchaser
shall have the right to purchase all, but not less than all, of the Rule 144
Shares by notifying the Seller in writing of its election to purchase such
Shares (the "Rule 144 Exercise Notice"), whereupon the Purchaser shall be
unconditionally (unless prohibited by applicable law) obligated to purchase the
Rule 144 Shares. Upon the Seller's receipt of the Rule 144 Exercise Notice, the
Seller shall sell the Rule 144 Shares to the Purchaser pursuant to the
provisions of Section 1(e). If at the end of the Rule 144 Exercise Period the
Purchaser has not delivered a Rule 144 Exercise Notice to the Seller, then the
Seller may, during the Qualified Period, sell any or all of the Rule 144 Shares
pursuant to Rule 144 at a per-share price not less than 97.5% of the Rule 144
Purchase Price. Such sale shall be otherwise without restriction and shall not
require further notice to the Purchaser. Upon such sale, the Right of First
Refusal shall terminate with respect to the Rule 144 Shares so sold. If at the
end of the Qualified Period the Seller has not sold all of the Rule 144 Shares
as aforesaid, then the Seller shall not thereafter sell such unsold Shares
without again complying with the provisions of this Section 1.
(e) Closing. If the Purchaser exercises its Right of
First Refusal with respect to any Shares, then the closing of the purchase of
the subject Shares shall take place at the principal office of Latham & Watkins,
633 West Fifth Street, Suite 4000, Los Angeles, California 90071-2007, at 10:00
a.m. California time, on the later of (i) the 10th business day following the
receipt by the Seller of the Right of First Refusal Exercise Notice or Elective
Sale Exercise Notice or Rule 144 Exercise Notice, as the case may be, or (ii) if
applicable, the closing date provided for in the Offer Notice or Elective Sale
Notice, as the case may be; provided, however, that if any of the Shares to be
acquired by the Purchaser would result in the Purchaser holding "Excess Shares"
under Section 6.1(d) of the Purchase Agreement, then the closing of the purchase
of those Shares shall occur, at the Purchaser's sole and absolute
3
<PAGE> 7
discretion, no later than 90 calendar days following the receipt by the Seller
of the Right of First Refusal Exercise Notice or Elective Sale Exercise Notice
or Rule 144 Exercise Notice, as the case may be; provided, further, however,
that if at the time the Seller receives the Right of First Refusal Exercise
Notice or Elective Sale Exercise Notice or Rule 144 Exercise Notice, as the case
may be, the requirements of the HSR Act must be complied with in order for the
Purchaser to consummate the purchase of the Shares contemplated by such notice,
then (A) as soon as practicable, the Seller shall cause Dreyer's to make all
filings required under the HSR Act and the Purchaser shall make all filings
required under the HSR Act and (B) the closing of the purchase of the subject
Shares shall occur only after the applicable waiting period, including any
extension thereof, under the HSR Act shall have expired or been terminated and
neither the Department of Justice nor the Federal Trade Commission shall have
instituted any litigation to enjoin or delay the consummation of such purchase.
The payment of the appropriate purchase price shall be paid by delivery to the
Seller (or Seller's bank or other financial institution if so directed by the
Seller) of a certified check payable to the Seller (or Seller's bank or other
financial institution if so directed by the Seller) against delivery of
certificates or other instruments representing the Shares, appropriately
endorsed or executed by the Seller, together with such instruments of transfer
and conveyance, satisfactory in form and substance to the Purchaser, sufficient
to vest the Purchaser with good and marketable title, free and clear of any and
all liens, charges, encumbrances, covenants, conditions, restrictions, voting
trust arrangements, adverse claims or rights whatsoever (collectively, the
"Encumbrances").
SECTION 2. Transfers of Shares.
(a) Restrictions. The Seller agrees that it shall not,
directly or indirectly, offer, sell, transfer, assign or otherwise dispose of
(or make any exchange, gift, assignment or pledge of) (collectively, "Transfer")
any of the Shares except as provided in Section 1 and this Section 2.
(b) Exceptions to Restrictions.
The provisions of Section 2(a) shall not apply to a Transfer,
if such Transfer is made without consideration (except for Section 2(b)(vi)), by
the Seller to:
(i) any lineal descendant of G.Rogers and
K.Rogers or any spouse of such lineal descendant;
(ii) a trust for the sole benefit of G.Rogers and
K.Rogers and/or one or more of G.Rogers' and K.Rogers' family members;
(iii) a corporation or other entity a
majority of the equity interests of which are owned by G.Rogers and K.Rogers
and/or G.Rogers' and K.Rogers' family members;
(iv) an educational or charitable organization;
(v) the executor, administrator or personal
representative of G.Rogers or K.Rogers or the guardian or conservator of
G.Rogers or K.Rogers if G.Rogers or K.Rogers
4
<PAGE> 8
is adjudged disabled or incompetent by a court of competent jurisdiction, acting
in his or her capacity as such; or
(vi) a bank or other financial institution, if
such Transfer is solely in the form of a pledge to secure bona fide indebtedness
of the Seller to such bank or other financial institution.
Provided, however, that none of the foregoing Transfers shall be permitted
unless:
(1) Such Transfer complies with all applicable
requirements of the Securities Act of 1933, as amended (the "Act") and the
Securities Exchange Act of 1934, as amended;
(2) Prior to such Transfer, the Seller
shall have caused the transferee to execute an agreement in form and substance
reasonably satisfactory to the Purchaser, providing that such transferee shall
fully comply with the terms of this Agreement;
(3) The Transferred Shares shall remain subject
to the Purchaser's Right of First Refusal and to this Section 2; and
(4) With respect to a Transfer to a bank or
other financial institution in the form of a pledge pursuant to Section
2(b)(vi), the bank or other financial institution to which such pledge is made
agrees in writing that (i) the Purchaser's Right of First Refusal with respect
to the Shares so pledged (the "Pledged Shares") is senior to any security
interest or lien of such bank or financial institution created by such pledge,
(ii) any sale of the Pledged Shares by such bank or financial institution is
subject to the Purchaser's Right of First Refusal and shall be conducted in
accordance with the terms of this Agreement and (iii) any Pledged Shares may be
sold to the Purchaser pursuant to the terms of this Agreement without the bank's
or other financial institution's prior consent, and once so sold, such Shares
shall be free and clear of any and all claims or liens of such bank or other
financial institution.
(c) Endorsement of Certificates.
(i) Upon the execution of this Agreement, the
certificates representing all Shares shall be endorsed as follows:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY
NOT BE TRANSFERRED, SOLD, ASSIGNED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS SUCH
TRANSFER COMPLIES WITH THE PROVISIONS OF THE RIGHT OF
FIRST REFUSAL AGREEMENT, DATED AS OF JUNE 14, 1994,
BY AND BETWEEN T. GARY ROGERS AND KATHLEEN T. ROGERS,
INDIVIDUALLY AND AS CO-TRUSTEES OF THE ROGERS
REVOCABLE TRUST AND NESTLE
5
<PAGE> 9
HOLDINGS, INC., A COPY OF WHICH IS ON FILE
AT THE OFFICES OF DREYER'S GRAND ICE
CREAM, INC.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE
BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY
STATE SECURITIES LAWS AND MAY BE OFFERED, SOLD OR
TRANSFERRED ONLY IF EXEMPTIONS FROM SUCH REGISTRATION
REQUIREMENTS ARE AVAILABLE.
(ii) All certificates representing Shares hereafter
issued to or acquired by the Seller shall bear the legend set forth above.
Certificates for Shares as to which the Right of First Refusal has terminated
shall be issued without such legend when Transferred.
(d) Improper Transfer.
Any attempt to Transfer or encumber any Shares not in
accordance with this Agreement shall be null and void and neither the issuer of
such securities nor any transfer agent of such securities shall give any effect
to such attempted transfer or encumbrance in its stock records.
SECTION 3. Representations and Warranties of
the Seller. The Seller represents and warrants as of the Effective Date as
follows:
(a) Beneficial Ownership. The Seller Beneficially Owns a
total of 1,863,730 shares of Common Stock of which 1,585,350 shares are owned of
record by G.Trustee and K.Trustee, 178,380 shares are issuable upon exercise of
the Stock Options and 100,000 shares are owned of record by G.Rogers and
K.Rogers as co-trustees of the Four Rogers Trust. Except as set forth in the
preceding sentence, no other shares of Dreyer's capital stock, or any securities
convertible into or exchangeable for, or options or warrants to purchase, shares
of Dreyer's capital stock, or any other voting securities of Dreyer's are
Beneficially Owned by the Seller or any of its Affiliates.
(b) Good and Valid Title. The Seller has good, valid and
marketable title to the Shares which are the subject of this Agreement, free and
clear of any and all Encumbrances, except as created hereby and by the Rogers
BOA Security Documents; provided, however, that Bank of America National Trust
and Savings Association ("Bank of America") has consented to the grant by the
Seller to the Purchaser of the Right of First Refusal with respect to all Shares
pursuant to the Agreement Regarding Right of First Refusal, the form of which is
attached as Exhibit J to the Purchase Agreement (the "Consent"), and has agreed
that (i) the Purchaser's Right of First Refusal is senior to any security
interest of Bank of America with respect to the Shares, (ii) any sale of Shares
by Bank of America is subject to the Purchaser's Right of First Refusal and
shall be conducted in accordance with the terms of this Agreement and, where
6
<PAGE> 10
applicable, the Consent and (iii) any Shares may be sold to the Purchaser
pursuant to the terms of this Agreement without Bank of America's prior consent,
provided that such Shares are sold at a price equal to or greater than the
lesser of their fair market value (which for purposes of the Consent only is
calculated based on the average closing price of Dreyer's Common Stock for the 5
trading days prior to the date on which the Purchaser provides the notice under
this Agreement initiating the subject sale) or an amount sufficient to repay
Bank of America in full, and once so sold, such Shares shall be free and clear
of any and all claims and liens of Bank of America.
(c) Due Authorization; Good and Valid Title Upon
Purchase. The Seller has all right, power and authority to enter into this
Agreement and to consummate the transactions contemplated hereby, including,
without limitation, the transfer, conveyance and sale to the Purchaser of the
Shares upon the Purchaser's exercise of the Right of First Refusal. G.Trustee
and K.Trustee are the only trustees of the Rogers Revocable Trust. The execution
and delivery of this Agreement and the consummation by G.Trustee and K.Trustee
of the transactions contemplated hereby are authorized by that certain Trust
Agreement Establishing Rogers Revocable Trust dated as of December 31, 1981, as
amended and restated by that certain First Amendment by Restatement of the Trust
Agreement Establishing Rogers Revocable Trust dated as of March 19, 1991, as
amended by that certain amendment dated as of June 1, 1994 and the laws of the
State of California. This Agreement has been duly executed and delivered by the
Seller and constitutes a valid and binding agreement of the Seller enforceable
in accordance with its terms. Upon consummation of any purchase of the Shares
upon exercise of the Right of First Refusal, the Seller shall deliver good and
marketable title to the Shares sold to the Purchaser, free and clear of any and
all Encumbrances and upon the sale to the Purchaser of such Shares, there shall
be no options, warrants, calls, commitments or agreements of any nature
whatsoever granted by the Seller or Dreyer's pursuant to which any person will
have the right to purchase or otherwise acquire the Shares.
(d) No Inconsistent Agreements. The Seller is not a party
to, subject to or bound by any agreement or judgment, order, writ, prohibition,
injunction or decree of any court or other governmental body or any statute,
law, rule or regulation that would prevent the execution, delivery or
performance of this Agreement by the Seller, or the transfer, conveyance and
sale of the Shares to the Purchaser upon exercise of its rights hereunder,
including, without limitation, the Rogers BOA Security Documents, as amended by
the amendment in the form of Exhibit J to the Purchase Agreement.
(e) Brokerage or Finder's Fees. No broker or finder has
acted or will act for the Seller in connection with this Agreement or the
transactions contemplated hereby, and no broker or finder or other person is
entitled to any brokerage or finder's fees or other commissions in respect of
such transactions based in any way on agreements, arrangements or understandings
made by or on behalf of the Seller.
(f) Third Party Consents, etc. The Seller has obtained
all consents, approvals and waivers from any individual, firm, corporation,
partnership, trust, unincorporated organization or other entity, or any
successors (by merger or otherwise) to the foregoing,
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<PAGE> 11
including, without limitation, Bank of America, known by the Seller to be
necessary to permit the Seller to consummate the transactions contemplated by
this Agreement.
(g) Governmental Consents, etc. To the best of its
knowledge, the Seller is not required to obtain any consent, approval or
authorization of, or to make any declaration or filing with, any governmental
authority as a condition to or in connection with the valid execution, delivery
and performance of this Agreement or the consummation by the Seller of the
transactions contemplated hereby, except for any filings required (i) under the
HSR Act and (ii) pursuant to state and federal securities laws.
(h) Agreement is Valid, Binding and Enforceable. This
Agreement has been duly and validly executed and delivered by the Seller and
constitutes a legal, valid and binding obligation of the Seller, enforceable in
accordance with its terms.
SECTION 4. Representations and Warranties of
the Purchaser. The Purchaser represents and warrants as of the Effective Date as
follows:
(a) Organization and Qualification. The Purchaser is a
corporation duly organized and existing in good standing under the laws of the
State of Delaware and has the corporate power to own its property and to carry
on its business as now being conducted. The Purchaser is duly qualified to do
business and in good standing in every jurisdiction in which the nature of the
respective business conducted or property owned by it makes such qualification
necessary, except where the failure to so qualify would not prevent consummation
of the transactions contemplated hereby or have a material adverse effect on the
results of operations (on a recurring basis), financial condition or business of
the Purchaser and its subsidiaries taken as a whole.
(b) Due Authorization. The Purchaser has all right, power
and authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation by the Purchaser of the transactions contemplated hereby have been
duly authorized by all necessary action on behalf of the Purchaser. This
Agreement has been duly executed and delivered by the Purchaser and constitutes
a valid and binding agreement of the Purchaser enforceable in accordance with
its terms.
(c) Purchase Representations. Any Shares purchased by the
Purchaser pursuant to its exercise of the Right of First Refusal granted to the
Purchaser hereunder will be purchased by it for its own account and not with a
view to or for sale in connection with any distribution thereof in any
transaction that would violate the securities laws of the United States or any
state thereof. The Purchaser acknowledges that any Shares purchased pursuant to
such exercise have not been registered under the Act and may be sold or disposed
of in the absence of such registration only pursuant to an exemption from such
registration.
(d) Accredited Investor. The Purchaser is an "accredited
investor" within the meaning of Rule 501 promulgated under the Act.
8
<PAGE> 12
SECTION 5. Covenants of the Seller.
The Seller covenants as follows for the period from the
Effective Date until such time as the Right of First Refusal has terminated in
respect of all of the Shares in accordance with the provisions of Section 1.
(a) The Seller shall not do or permit any act which would
cause any representation or warranty in this Agreement to be or become untrue in
any material respect;
(b) The Seller shall use its best efforts to take all
action required to obtain all consents, approvals and agreements of, and to give
all notices and make all other filings with, any person, entity, government or
agency necessary to authorize, approve or permit the consummation of the
transactions contemplated by this Agreement. In addition, the Seller covenants
and agrees to use its best efforts to take, or cause to be taken, all action or
do, or cause to be done, all things necessary, proper or advisable under
applicable laws and regulations to consummate and make effective the
transactions contemplated hereby and to cause the fulfillment of the Seller's
obligations hereunder.
(c) The Seller shall give prompt notice to the Purchaser
of (i) the occurrence, or failure to occur, of any event which occurrence or
failure would be likely to cause any representation or warranty contained in
this Agreement to be untrue or inaccurate in any material respect and (ii) any
material failure of the Seller to comply with or satisfy any covenant, condition
or agreement to be complied with or satisfied by it hereunder, and the Seller
shall use its best efforts to remedy same.
(d) The Seller shall not become a party to, subject to or
bound by any agreement that would prevent or prohibit the consummation of the
transactions contemplated by this Agreement, including without limitation, the
transfer, conveyance and sale of the Shares to the Purchaser upon exercise of
the Right of First Refusal, free and clear of any and all Encumbrances.
SECTION 6. Miscellaneous.
(a) Further Assurances. Upon the terms and subject to the
conditions contained herein, each of the parties hereto agrees (i) to use its
best efforts to take, or cause to be taken, all action or do, or cause to be
done, all things necessary, proper or advisable under applicable laws and
regulations to consummate and make effective the transactions contemplated
hereby and to cause the fulfillment of its obligations hereunder, (ii) to
execute any documents, instruments or conveyances of any kind which may be
reasonably necessary or advisable to carry out any of the transactions
contemplated hereby and (iii) to cooperate with each other in connection with
the foregoing.
(b) Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain
9
<PAGE> 13
in full force and effect and shall in no way be affected, impaired or
invalidated. It is hereby stipulated and declared to be the intention of the
parties that they would have executed the remaining terms, provisions, covenants
and restrictions without including any of such which may be hereafter declared
invalid, void or unenforceable.
(c) Specific Enforcement. The Purchaser, on the one hand,
and the Seller, on the other, acknowledge and agree that irreparable damage
would occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached. It
is accordingly agreed that the parties shall be entitled to an injunction to
prevent breaches of the provisions of this Agreement and to enforce specifically
the terms and provisions hereof in any court of the United States or any state
thereof having jurisdiction, this being in addition to any other remedy to which
they may be entitled at law or equity.
(d) Entire Agreement. This Agreement contains the entire
understanding of the parties with respect to the transactions contemplated
hereby.
(e) Counterparts. This Agreement may be executed in one
or more counterparts, all of which shall be considered one and the same
agreement, and shall become effective when one or more of the counterparts have
been signed by each party and delivered to the other parties, it being
understood that all parties need not sign the same counterpart.
(f) Notices and Other Communications. Except as otherwise
provided, all notices, consents, requests, instructions and other communications
provided for herein shall be promptly given, if in writing and delivered
personally, by telecopy, express courier or sent by registered mail, postage
prepaid, if to:
THE SELLER:
c/o Dreyer's Grand Ice Cream, Inc.
5929 College Avenue
Oakland, California 94618
Attention: T. Gary Rogers
With a copy to:
Edmund R. Manwell, Esq.
Manwell & Milton
101 California Street, Suite 3750
San Francisco, California 94111
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<PAGE> 14
THE PURCHASER:
President
Nestle Holdings, Inc.
c/o Nestle USA, Inc.
800 North Brand Boulevard
Glendale, California 91203
With copies to:
James H. Ball, Esq.
Senior Vice President and General Counsel
Nestle USA, Inc.
800 North Brand Boulevard
Glendale, California 91203
and
Wayne F. Erdelack, Esq.
Vice President and Deputy General Counsel
Nestle USA, Inc.
30003 Bainbridge Road
Solon, Ohio 44139
or to such other address as any party may, from time to time, designate in a
written notice given in a like manner.
(g) Amendments. This Agreement may not be amended,
modified or supplemented other than by a written instrument signed by all
parties hereto which are, at the time of such amendment or modification, subject
to this Agreement.
(h) Successors and Assigns. All covenants and agreements
contained herein shall bind and inure to the benefit of the parties hereto and
their respective successors and assigns (including, without limitation,
successor trustees under the Rogers Revocable Trust); provided, however, that
the Seller may not assign any of its rights or obligations hereunder except in
accordance with the provisions of Section 2 and the Purchaser may not assign any
of its rights or obligations hereunder except to its affiliates.
(i) Survival of Representations and Warranties. All
representations and warranties contained herein or made in writing by any party
in connection herewith shall survive the execution and delivery of this
Agreement, regardless of any investigation made by or on behalf of any party.
(j) Governing Law. This Agreement shall be governed by
and construed and enforced in accordance with the laws of the State of Delaware.
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<PAGE> 15
(k) Signatures. This Agreement shall be effective upon
delivery of original signature pages or facsimile copies thereof executed by
each of the parties hereto.
(l) Termination. The Right of First Refusal granted by
the Seller to the Purchaser shall terminate when the Purchaser no longer
Beneficially Owns 10% or more of the outstanding voting securities of Dreyer's,
on a Fully Diluted basis; provided, however, that for purposes of this Section
6(l), the Purchaser's Beneficial Ownership of Dreyer's outstanding voting
securities on a Fully Diluted basis shall be deemed to be reduced solely as a
result of sales of shares by the Purchaser, but not by reason of a percentage
reduction occurring as a result of the issuance by Dreyer's of any shares of its
capital stock, or any other securities, or any securities convertible into or
exchangeable for, or options or warrants to purchase, shares of its capital
stock or any other securities, other than the issuance of such securities
pursuant to (i) the conversion of any of the 6.25% Subordinated Convertible
Notes of Dreyer's due June 30, 2001, (ii) the exercise of any options
outstanding as of the Effective Date which were granted pursuant to any stock
option plan of Dreyer's or (iii) the exercise of any rights (excluding the
Rights) outstanding as of the Effective Date which were granted pursuant to any
employee stock purchase or gift plan of Dreyer's.
[SIGNATURE PAGE TO FOLLOW]
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<PAGE> 16
IN WITNESS WHEREOF, the Purchaser and the Seller have caused
this Agreement to be executed and delivered as of the day and year first above
first written.
/s/ T. GARY ROGERS
---------------------------------------
T. Gary Rogers
/s/ T. GARY ROGERS
---------------------------------------
T. Gary Rogers as co-trustee of the
Rogers Revocable Trust
/s/ KATHLEEN T. ROGERS
---------------------------------------
Kathleen T. Rogers
/s/ KATHLEEN T. ROGERS
---------------------------------------
Kathleen T. Rogers as co-trustee of the
Rogers Revocable Trust
NESTLE HOLDINGS, INC.
/s/ MARIO A. CORTI
---------------------------------------
By: Mario A. Corti
Title: Senior Vice President - Finance
S-1
<PAGE> 1
================================================================================
Exhibit 10.5
RIGHT OF FIRST REFUSAL AGREEMENT
BY AND BETWEEN
WILLIAM F. CRONK, III AND JANET M. CRONK,
INDIVIDUALLY AND AS CO-TRUSTEES OF THE
THE CRONK REVOCABLE TRUST
AND
NESTLE HOLDINGS, INC.
DATED AS OF JUNE 14, 1994
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C> <C>
SECTION 1. Right of First Refusal......................................... 2
(a) Grant of Right........................................................ 2
(b) Exercise of Right..................................................... 2
(c) Elective Sales........................................................ 2
(d) Rule 144 Sales........................................................ 3
(e) Closing............................................................... 3
SECTION 2. Transfers of Shares............................................ 4
(a) Restrictions.......................................................... 4
(b) Exceptions to Restrictions............................................ 4
(c) Endorsement of Certificates........................................... 5
(d) Improper Transfer..................................................... 6
SECTION 3. Representations and Warranties of the Seller................... 6
(a) Beneficial Ownership.................................................. 6
(b) Good and Valid Title.................................................. 6
(c) Due Authorization; Good and Valid Title
Upon Purchase......................................................... 7
(d) No Inconsistent Agreements............................................ 7
(e) Brokerage or Finder's Fees............................................ 7
(f) Third Party Consents, etc............................................. 8
(g) Governmental Consents, etc............................................ 8
(h) Agreement is Valid, Binding and Enforceable........................... 8
SECTION 4. Representations and Warranties of the
Purchaser...................................................... 8
(a) Organization and Qualification........................................ 8
(b) Due Authorization..................................................... 8
(c) Purchase Representations.............................................. 8
(d) Accredited Investor................................................... 9
SECTION 5. Covenants of the Seller........................................ 9
</TABLE>
i
<PAGE> 3
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C> <C>
SECTION 6. Miscellaneous.................................................. 9
(a) Further Assurances.................................................... 9
(b) Severability.......................................................... 10
(c) Specific Enforcement.................................................. 10
(d) Entire Agreement...................................................... 10
(e) Counterparts.......................................................... 10
(f) Notices and Other Communications...................................... 10
(g) Amendments............................................................ 11
(h) Successors and Assigns................................................ 11
(i) Survival of Representations and Warranties............................ 11
(j) Governing Law......................................................... 12
(k) Signatures............................................................ 12
(l) Termination........................................................... 12
</TABLE>
ii
<PAGE> 4
RIGHT OF FIRST REFUSAL AGREEMENT
THIS RIGHT OF FIRST REFUSAL AGREEMENT (the"Agreement") is
dated as of June 14, 1994 (the "Effective Date") and entered into by and between
WILLIAM F. CRONK, III ("W.Cronk"), WILLIAM F. CRONK, III as co-trustee of the
Cronk Revocable Trust created under that certain Trust Agreement Establishing
Cronk Revocable Trust dated as of December 30, 1981, as amended and restated by
that certain Amended Revocable Trust Agreement dated as of October 12, 1987 and
as amended by those certain amendments thereto dated as of May 3, 1988, February
4, 1990, December 16, 1990, December 6, 1991 and June 12, 1994 (the "Cronk
Revocable Trust") ("W.Trustee"), JANET M. CRONK ("J.Cronk"), and JANET M. CRONK
as co-trustee of the Cronk Revocable Trust ("J.Trustee," and together with
W.Cronk, W.Trustee and J.Cronk, the "Seller") and NESTLE HOLDINGS, INC., a
Delaware corporation (the "Purchaser"). Capitalized terms used herein but not
otherwise defined shall have the meaning assigned such terms in the Purchase
Agreement (as defined below).
WHEREAS, the Purchaser and Dreyer's Grand Ice Cream, Inc., a
Delaware corporation ("Dreyer's") have entered into a Stock and Warrant Purchase
Agreement dated as of May 6, 1994 (the "Purchase Agreement") providing, among
other things, for the purchase by the Purchaser of three million shares of the
Common Stock of Dreyer's, par value $1.00 per share (the "Common Stock"), and
warrants exercisable for two million shares of Common Stock;
WHEREAS, the Seller currently Beneficially Owns 1,115,901
shares of Common Stock (of which 895,521 shares are owned of record by W.Trustee
and J.Trustee, 178,380 shares are issuable upon exercise of stock options owned
of record by W.Cronk (the "Stock Options"), 14,000 shares are owned of record by
William Jeffrey Cronk as trustee of the William Jeffrey Cronk 1993 Irrevocable
Trust created under that certain Trust Agreement Establishing the Cronk Family
1993 Irrevocable Trusts dated as of February 19, 1993, as amended (the "Cronk
Family Trust Agreement") (the "WJC Trust"), 14,000 shares are owned of record by
William C. Collett as trustee of the Robert James Cronk 1993 Irrevocable Trust
created under the Cronk Family Trust Agreement (the "RJC Trust") and 14,000
shares are owned of record by William C. Collett as trustee of the Christopher
Clay Cronk 1993 Irrevocable Trust created under the Cronk Family Trust Agreement
(the "CCC Trust")) and may acquire additional shares of Common Stock or other
voting securities of Dreyer's in the future (the shares of Common Stock and
other voting securities of Dreyer's (i) now owned by the Seller, (ii) issuable
upon exercise of the Stock Options or any other options or warrants of Dreyer's
now owned by the Seller, (iii) issuable upon conversion or exchange of any other
securities of Dreyer's now owned by the Seller or (iv) hereafter acquired by, or
which become Beneficially Owned by, the Seller or any of its Affiliates, are
referred to herein as the "Shares");
WHEREAS, a condition to the closing of the transactions
contemplated by the Purchase Agreement is that the Seller shall have granted the
Purchaser a right of first refusal with respect to the Shares; and
WHEREAS, the Purchaser and the Seller desire to provide for
such grants and to establish various rights and obligations in connection
therewith.
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<PAGE> 5
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements herein set forth, the parties hereto agree as
follows:
SECTION 1. Right of First Refusal.
(a) Grant of Right. In consideration of the payment of
$1,000 by the Purchaser to the Seller, the receipt and sufficiency of which is
hereby acknowledged, the Seller hereby grants to the Purchaser a right of first
refusal with respect to all of the Shares (the "Right of First Refusal").
(b) Exercise of Right. Subject to Sections 1(c) and (d),
if at any time the Seller receives a bona fide offer (an "Offer") from any
person or entity to purchase any or all of the Shares which the Seller wishes to
accept, the Seller shall cause the Offer to be reduced to writing and shall
notify the Purchaser in writing of its wish to accept the Offer (the "Offer
Notice"). The Offer Notice shall contain an irrevocable offer to sell such
Shares to the Purchaser at a purchase price equal to the price contained in, and
on the same terms and conditions of, the Offer and shall be accompanied by a
true copy of the Offer (which shall identify the offeror). At any time within
five business days after the date of receipt by the Purchaser of the Offer
Notice (the "Right of First Refusal Exercise Period"), the Purchaser shall have
the right to purchase all, but not less than all, the Shares covered by the
Offer at the same price and on the same terms and conditions as the Offer by
notifying the Seller in writing of its election to purchase the Shares (the
"Right of First Refusal Exercise Notice"). Upon the Seller's receipt of the
Right of First Refusal Exercise Notice, the Seller shall sell the Shares to the
Purchaser pursuant to the provisions of Section 1(e). If at the end of the Right
of First Refusal Exercise Period the Purchaser has not delivered a Right of
First Refusal Exercise Notice to the Seller, the Seller may, during the
succeeding 90-day period, sell not less than all of the Shares covered by the
Offer to the offeror at a price not less than that contained in the Offer and on
terms and conditions not less favorable in the aggregate to the Seller than
those contained in the Offer. Upon such sale, the Right of First Refusal shall
terminate with respect to the Shares so sold. If at the end of 90 days following
the expiration of the Right of First Refusal Exercise Period the Seller has not
completed the sale of the Shares covered by the Offer (or tendered or exchanged
such Shares pursuant to a tender or exchange offer) as aforesaid, then the
Seller shall not thereafter sell such Shares without again complying with the
provisions of this Section 1.
(c) Elective Sales. If at any time the Seller has a bona
fide intention to sell any of the Shares, but at such time has not received an
Offer from any person or entity to purchase such Shares, the Seller shall
provide the Purchaser with a notice (the "Elective Sale Notice") which (i)
notifies the Purchaser of such intention, (ii) sets forth the number of Shares
desired to be sold (the "Elective Shares") and (iii) irrevocably offers to sell
the Elective Shares to the Purchaser at a purchase price and on terms and
conditions set forth in such notice. At any time within five business days after
the date of receipt by the Purchaser of the Elective Sale Notice (the "Elective
Sale Exercise Period"), the Purchaser shall have the right to purchase all, but
not less than all, of the Elective Shares at the price and on the terms and
conditions set forth in the Elective Sale Notice by notifying the Seller in
writing of its election to purchase such Shares (the "Elective Sale Exercise
Notice"). Upon the Seller's receipt of the Elective Sale Exercise Notice, the
Seller shall sell the Elective Shares to the Purchaser pursuant to the
2
<PAGE> 6
provisions of Section 1(e). If at the end of the Elective Sale Exercise Period
the Purchaser has not delivered an Elective Sale Exercise Notice to the Seller,
the Seller may, during the succeeding 90-day period, sell not less than all of
the Elective Shares at a price not less than that contained in the Elective Sale
Notice and on terms and conditions not less favorable in the aggregate to the
Seller than those contained in the Elective Sale Notice. Upon such sale, the
Right of First Refusal shall terminate with respect to the Elective Shares so
sold. If at the end of 90 days following the expiration of the Elective Sale
Exercise Period the Seller has not completed the sale of the Elective Shares as
aforesaid, then the Seller shall not thereafter sell the Elective Shares without
again complying with the provisions of this Section 1.
(d) Rule 144 Sales. If at any time the Seller has a bona
fide intention to sell any of the Shares pursuant to Rule 144 ("Rule 144") of
the Rules and Regulations issued under the Securities Act of 1933, as amended
(the "Act") during the immediately succeeding 90 calendar day period (such
period being referred to as the "Qualified Period"), the Seller shall provide
the Purchaser with a notice (the "Rule 144 Notice") which (i) notifies the
Purchaser of such intention, (ii) sets forth the number of Shares desired to be
sold (the "Rule 144 Shares") and (iii) irrevocably offers to sell the Rule 144
Shares to the Purchaser at a per-share price equal to (1) the reported closing
price of the outstanding shares of Common Stock on the day preceding the date of
the Rule 144 Notice as reported by the Nasdaq National Market System, (2) if
such shares are listed on a national securities exchange, the last reported
sales price of the outstanding shares of Common Stock on such exchange (which
shall be for consolidated trading if applicable to such exchange) on the day
preceding the date of the Rule 144 Notice, or (3) if neither so reported or
listed, the last reported bid price of such shares (the "Rule 144 Purchase
Price"). At any time within five business days after the date of receipt by the
Purchaser of the Rule 144 Notice (the "Rule 144 Exercise Period"), the Purchaser
shall have the right to purchase all, but not less than all, of the Rule 144
Shares by notifying the Seller in writing of its election to purchase such
Shares (the "Rule 144 Exercise Notice"), whereupon the Purchaser shall be
unconditionally (unless prohibited by applicable law) obligated to purchase the
Rule 144 Shares. Upon the Seller's receipt of the Rule 144 Exercise Notice, the
Seller shall sell the Rule 144 Shares to the Purchaser pursuant to the
provisions of Section 1(e). If at the end of the Rule 144 Exercise Period the
Purchaser has not delivered a Rule 144 Exercise Notice to the Seller, then the
Seller may, during the Qualified Period, sell any or all of the Rule 144 Shares
pursuant to Rule 144 at a per-share price not less than 97.5% of the Rule 144
Purchase Price. Such sale shall be otherwise without restriction and shall not
require further notice to the Purchaser. Upon such sale, the Right of First
Refusal shall terminate with respect to the Rule 144 Shares so sold. If at the
end of the Qualified Period the Seller has not sold all of the Rule 144 Shares
as aforesaid, then the Seller shall not thereafter sell such unsold Shares
without again complying with the provisions of this Section 1.
(e) Closing. If the Purchaser exercises its Right of
First Refusal with respect to any Shares, then the closing of the purchase of
the subject Shares shall take place at the principal office of Latham & Watkins,
633 West Fifth Street, Suite 4000, Los Angeles, California 90071-2007, at 10:00
a.m. California time, on the later of (i) the 10th business day following the
receipt by the Seller of the Right of First Refusal Exercise Notice or Elective
Sale Exercise Notice or Rule 144 Exercise Notice, as the case may be, or (ii) if
applicable, the closing date provided for in the Offer Notice or Elective Sale
Notice, as the case may be;
3
<PAGE> 7
provided, however, that if any of the Shares to be acquired by the Purchaser
would result in the Purchaser holding "Excess Shares" under Section 6.1(d) of
the Purchase Agreement, then the closing of the purchase of those Shares shall
occur, at the Purchaser's sole and absolute discretion, no later than 90
calendar days following the receipt by the Seller of the Right of First Refusal
Exercise Notice or Elective Sale Exercise Notice or Rule 144 Exercise Notice, as
the case may be; provided, further, however, that if at the time the Seller
receives the Right of First Refusal Exercise Notice or Elective Sale Exercise
Notice or Rule 144 Exercise Notice, as the case may be, the requirements of the
HSR Act must be complied with in order for the Purchaser to consummate the
purchase of the Shares contemplated by such notice, then (A) as soon as
practicable, the Seller shall cause Dreyer's to make all filings required under
the HSR Act and the Purchaser shall make all filings required under the HSR Act
and (B) the closing of the purchase of the subject Shares shall occur only after
the applicable waiting period, including any extension thereof, under the HSR
Act shall have expired or been terminated and neither the Department of Justice
nor the Federal Trade Commission shall have instituted any litigation to enjoin
or delay the consummation of such purchase. The payment of the appropriate
purchase price shall be paid by delivery to the Seller (or Seller's bank or
other financial institution if so directed by the Seller) of a certified check
payable to the Seller (or Seller's bank or other financial institution if so
directed by the Seller) against delivery of certificates or other instruments
representing the Shares, appropriately endorsed or executed by the Seller,
together with such instruments of transfer and conveyance, satisfactory in form
and substance to the Purchaser, sufficient to vest the Purchaser with good and
marketable title, free and clear of any and all liens, charges, encumbrances,
covenants, conditions, restrictions, voting trust arrangements, adverse claims
or rights whatsoever (collectively, the "Encumbrances").
SECTION 2. Transfers of Shares.
(a) Restrictions. The Seller agrees that it shall not,
directly or indirectly, offer, sell, transfer, assign or otherwise dispose of
(or make any exchange, gift, assignment or pledge of) (collectively, "Transfer")
any of the Shares except as provided in Section 1 and this Section 2.
(b) Exceptions to Restrictions.
The provisions of Section 2(a) shall not apply to a Transfer,
if such Transfer is made without consideration (except for Section 2(b)(vi)), by
the Seller to:
(i) any lineal descendant of W.Cronk and J.Cronk
or any spouse of such lineal descendant;
(ii) a trust for the sole benefit of W.Cronk and
J.Cronk and/or one or more of W.Cronk's and J.Cronk's family members;
(iii) a corporation or other entity a majority of
the equity interests of which are owned by W.Cronk and J.Cronk and/or W.Cronk's
and J.Cronk's family members;
(iv) an educational or charitable organization;
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(v) the executor, administrator or personal
representative of W.Cronk or J.Cronk or the guardian or conservator of W.Cronk
or J.Cronk if W.Cronk or J.Cronk is adjudged disabled or incompetent by a court
of competent jurisdiction, acting in his or her capacity as such; or
(vi) a bank or other financial institution, if
such Transfer is solely in the form of a pledge to secure bona fide indebtedness
of the Seller to such bank or other financial institution.
Provided, however, that none of the foregoing Transfers shall
be permitted unless:
(1) Such Transfer complies with all applicable
requirements of the Securities Act of 1933, as amended (the "Act") and the
Securities Exchange Act of 1934, as amended;
(2) Prior to such Transfer, the Seller shall have
caused the transferee to execute an agreement in form and substance reasonably
satisfactory to the Purchaser, providing that such transferee shall fully comply
with the terms of this Agreement;
(3) The Transferred Shares shall remain subject
to the Purchaser's Right of First Refusal and to this Section 2; and
(4) With respect to a Transfer to a bank or
other financial institution in the form of a pledge pursuant to Section
2(b)(vi), the bank or other financial institution to which such pledge is made
agrees in writing that (i) the Purchaser's Right of First Refusal with respect
to the Shares so pledged (the "Pledged Shares") is senior to any security
interest or lien of such bank or financial institution created by such pledge,
(ii) any sale of the Pledged Shares by such bank or financial institution is
subject to the Purchaser's Right of First Refusal and shall be conducted in
accordance with the terms of this Agreement and (iii) any Pledged Shares may be
sold to the Purchaser pursuant to the terms of this Agreement without the bank's
or other financial institution's prior consent, and once so sold, such Shares
shall be free and clear of any and all claims or liens of such bank or other
financial institution.
(c) Endorsement of Certificates.
(i) Upon the execution of this Agreement, the
certificates representing all Shares shall be endorsed as follows:
THE SECURITIES REPRESENTED BY THIS
CERTIFICATE MAY NOT BE TRANSFERRED, SOLD,
ASSIGNED, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF UNLESS SUCH
TRANSFER COMPLIES WITH THE PROVISIONS OF
THE RIGHT OF FIRST REFUSAL AGREEMENT,
DATED AS OF JUNE 14, 1994, BY AND BETWEEN
WILLIAM F. CRONK, III AND JANET M. CRONK,
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INDIVIDUALLY AND AS CO-TRUSTEES OF THE CRONK
REVOCABLE TRUST AND NESTLE HOLDINGS, INC., A COPY OF
WHICH IS ON FILE AT THE OFFICES OF DREYER'S GRAND ICE
CREAM, INC.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE
BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY
STATE SECURITIES LAWS AND MAY BE OFFERED, SOLD OR
TRANSFERRED ONLY IF EXEMPTIONS FROM SUCH REGISTRATION
REQUIREMENTS ARE AVAILABLE.
(ii) All certificates representing Shares hereafter
issued to or acquired by the Seller shall bear the legend set forth above.
Certificates for Shares as to which the Right of First Refusal has terminated
shall be issued without such legend when Transferred.
(d) Improper Transfer.
Any attempt to Transfer or encumber any Shares not in
accordance with this Agreement shall be null and void and neither the issuer of
such securities nor any transfer agent of such securities shall give any effect
to such attempted transfer or encumbrance in its stock records.
SECTION 3. Representations and Warranties of the
Seller. The Seller represents and warrants as of the Effective Date as follows:
(a) Beneficial Ownership. The Seller Beneficially Owns a
total of 1,115,901 shares of Common Stock of which 895,521 shares are owned of
record by W.Trustee and J.Trustee, 178,380 shares are issuable upon exercise of
the Stock Options, 14,000 shares are owned of record by the William Jeffrey
Cronk as trustee of the WJC Trust, 14,000 shares are owned of record by William
C. Collett as trustee of the RJC Trust and 14,000 shares are owned of record by
William C. Collett as trustee of the CCC Trust. Except as set forth in the
preceding sentence, no other shares of Dreyer's capital stock, or any securities
convertible into or exchangeable for, or options or warrants to purchase, shares
of Dreyer's capital stock, or any other voting securities of Dreyer's are
Beneficially Owned by the Seller or any of its Affiliates.
(b) Good and Valid Title. The Seller has good, valid and
marketable title to the Shares which are the subject of this Agreement, free and
clear of any and all Encumbrances, except as created hereby and by the Rogers
BOA Security Documents; provided, however, that Bank of America National Trust
and Savings Association ("Bank of America") has consented to the grant by the
Seller to the Purchaser of the Right of First Refusal with respect to all Shares
pursuant to the Agreement Regarding Right of First Refusal, the form of which is
attached as Exhibit K to the Purchase Agreement (the "Consent"), and has agreed
that (i) the Purchaser's
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Right of First Refusal is senior to any security interest of Bank of America
with respect to the Shares, (ii) any sale of Shares by Bank of America is
subject to the Purchaser's Right of First Refusal and shall be conducted in
accordance with the terms of this Agreement and, where applicable, the Consent
and (iii) any Shares may be sold to the Purchaser pursuant to the terms of this
Agreement without Bank of America's prior consent, provided that such Shares are
sold at a price equal to or greater than the lesser of their fair market value
(which for purposes of the Consent only is calculated based on the average
closing price of Dreyer's Common Stock for the 5 trading days prior to the date
on which the Purchaser provides the notice under this Agreement initiating the
subject sale) or an amount sufficient to repay Bank of America in full, and once
so sold, such Shares shall be free and clear of any and all claims and liens of
Bank of America.
(c) Due Authorization; Good and Valid Title Upon
Purchase. The Seller has all right, power and authority to enter into this
Agreement and to consummate the transactions contemplated hereby, including,
without limitation, the transfer, conveyance and sale to the Purchaser of the
Shares upon the Purchaser's exercise of the Right of First Refusal. W.Trustee
and J.Trustee are the only trustees of the Cronk Revocable Trust. The execution
and delivery of this Agreement and the consummation by W.Trustee and J.Trustee
of the transactions contemplated hereby are authorized by that certain Trust
Agreement Establishing Cronk Revocable Trust dated as of December 30, 1981, as
amended and restated by that certain Amended Revocable Trust Agreement dated as
of October 12, 1987 and as amended by those certain amendments thereto dated as
of May 3, 1988, February 4, 1990, December 16, 1990, December 6, 1991 and June
12, 1994 and the laws of the State of California. This Agreement has been duly
executed and delivered by the Seller and constitutes a valid and binding
agreement of the Seller enforceable in accordance with its terms. Upon
consummation of any purchase of the Shares upon exercise of the Right of First
Refusal, the Seller shall deliver good and marketable title to the Shares sold
to the Purchaser, free and clear of any and all Encumbrances and upon the sale
to the Purchaser of such Shares, there shall be no options, warrants, calls,
commitments or agreements of any nature whatsoever granted by the Seller or
Dreyer's pursuant to which any person will have the right to purchase or
otherwise acquire the Shares.
(d) No Inconsistent Agreements. The Seller is not a party
to, subject to or bound by any agreement or judgment, order, writ, prohibition,
injunction or decree of any court or other governmental body or any statute,
law, rule or regulation that would prevent the execution, delivery or
performance of this Agreement by the Seller, or the transfer, conveyance and
sale of the Shares to the Purchaser upon exercise of its rights hereunder,
including, without limitation, the Cronk BOA Security Documents, as amended by
the amendment in the form of Exhibit K to the Purchase Agreement.
(e) Brokerage or Finder's Fees. No broker or finder has
acted or will act for the Seller in connection with this Agreement or the
transactions contemplated hereby, and no broker or finder or other person is
entitled to any brokerage or finder's fees or other commissions in respect of
such transactions based in any way on agreements, arrangements or understandings
made by or on behalf of the Seller.
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(f) Third Party Consents, etc. The Seller has obtained
all consents, approvals and waivers from any individual, firm, corporation,
partnership, trust, unincorporated organization or other entity, or any
successors (by merger or otherwise) to the foregoing, including, without
limitation, Bank of America, known by the Seller to be necessary to permit the
Seller to consummate the transactions contemplated by this Agreement.
(g) Governmental Consents, etc. To the best of its
knowledge, the Seller is not required to obtain any consent, approval or
authorization of, or to make any declaration or filing with, any governmental
authority as a condition to or in connection with the valid execution, delivery
and performance of this Agreement or the consummation by the Seller of the
transactions contemplated hereby, except for any filings required (i) under the
HSR Act and (ii) pursuant to state and federal securities laws.
(h) Agreement is Valid, Binding and Enforceable. This
Agreement has been duly and validly executed and delivered by the Seller and
constitutes a legal, valid and binding obligation of the Seller, enforceable in
accordance with its terms.
SECTION 4. Representations and Warranties of the
Purchaser. The Purchaser represents and warrants as of the Effective Date as
follows:
(a) Organization and Qualification. The Purchaser is a
corporation duly organized and existing in good standing under the laws of the
State of Delaware and has the corporate power to own its property and to carry
on its business as now being conducted. The Purchaser is duly qualified to do
business and in good standing in every jurisdiction in which the nature of the
respective business conducted or property owned by it makes such qualification
necessary, except where the failure to so qualify would not prevent consummation
of the transactions contemplated hereby or have a material adverse effect on the
results of operations (on a recurring basis), financial condition or business of
the Purchaser and its subsidiaries taken as a whole.
(b) Due Authorization. The Purchaser has all right, power
and authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation by the Purchaser of the transactions contemplated hereby have been
duly authorized by all necessary action on behalf of the Purchaser. This
Agreement has been duly executed and delivered by the Purchaser and constitutes
a valid and binding agreement of the Purchaser enforceable in accordance with
its terms.
(c) Purchase Representations. Any Shares purchased by the
Purchaser pursuant to its exercise of the Right of First Refusal granted to the
Purchaser hereunder will be purchased by it for its own account and not with a
view to or for sale in connection with any distribution thereof in any
transaction that would violate the securities laws of the United States or any
state thereof. The Purchaser acknowledges that any Shares purchased pursuant to
such exercise have not been registered under the Act and may be sold or disposed
of in the absence of such registration only pursuant to an exemption from such
registration.
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(d) Accredited Investor. The Purchaser is an "accredited
investor" within the meaning of Rule 501 promulgated under the Act.
SECTION 5. Covenants of the Seller.
The Seller covenants as follows for the period from the
Effective Date until such time as the Right of First Refusal has terminated in
respect of all of the Shares in accordance with the provisions of Section 1.
(a) The Seller shall not do or permit any act which would
cause any representation or warranty in this Agreement to be or become untrue in
any material respect;
(b) The Seller shall use its best efforts to take all
action required to obtain all consents, approvals and agreements of, and to give
all notices and make all other filings with, any person, entity, government or
agency necessary to authorize, approve or permit the consummation of the
transactions contemplated by this Agreement. In addition, the Seller covenants
and agrees to use its best efforts to take, or cause to be taken, all action or
do, or cause to be done, all things necessary, proper or advisable under
applicable laws and regulations to consummate and make effective the
transactions contemplated hereby and to cause the fulfillment of the Seller's
obligations hereunder.
(c) The Seller shall give prompt notice to the Purchaser
of (i) the occurrence, or failure to occur, of any event which occurrence or
failure would be likely to cause any representation or warranty contained in
this Agreement to be untrue or inaccurate in any material respect and (ii) any
material failure of the Seller to comply with or satisfy any covenant, condition
or agreement to be complied with or satisfied by it hereunder, and the Seller
shall use its best efforts to remedy same.
(d) The Seller shall not become a party to, subject to or
bound by any agreement that would prevent or prohibit the consummation of the
transactions contemplated by this Agreement, including without limitation, the
transfer, conveyance and sale of the Shares to the Purchaser upon exercise of
the Right of First Refusal, free and clear of any and all Encumbrances.
SECTION 6. Miscellaneous.
(a) Further Assurances. Upon the terms and subject to the
conditions contained herein, each of the parties hereto agrees (i) to use its
best efforts to take, or cause to be taken, all action or do, or cause to be
done, all things necessary, proper or advisable under applicable laws and
regulations to consummate and make effective the transactions contemplated
hereby and to cause the fulfillment of its obligations hereunder, (ii) to
execute any documents, instruments or conveyances of any kind which may be
reasonably necessary or advisable to carry out any of the transactions
contemplated hereby and (iii) to cooperate with each other in connection with
the foregoing.
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(b) Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated. It is hereby
stipulated and declared to be the intention of the parties that they would have
executed the remaining terms, provisions, covenants and restrictions without
including any of such which may be hereafter declared invalid, void or
unenforceable.
(c) Specific Enforcement. The Purchaser, on the one hand,
and the Seller, on the other, acknowledge and agree that irreparable damage
would occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached. It
is accordingly agreed that the parties shall be entitled to an injunction to
prevent breaches of the provisions of this Agreement and to enforce specifically
the terms and provisions hereof in any court of the United States or any state
thereof having jurisdiction, this being in addition to any other remedy to which
they may be entitled at law or equity.
(d) Entire Agreement. This Agreement contains the entire
understanding of the parties with respect to the transactions contemplated
hereby.
(e) Counterparts. This Agreement may be executed in one
or more counterparts, all of which shall be considered one and the same
agreement, and shall become effective when one or more of the counterparts have
been signed by each party and delivered to the other parties, it being
understood that all parties need not sign the same counterpart.
(f) Notices and Other Communications. Except as otherwise
provided, all notices, consents, requests, instructions and other communications
provided for herein shall be promptly given, if in writing and delivered
personally, by telecopy, express courier or sent by registered mail, postage
prepaid, if to:
THE SELLER:
c/o Dreyer's Grand Ice Cream, Inc.
5929 College Avenue
Oakland, California 94618
Attention: William F. Cronk, III
With a copy to:
Edmund R. Manwell, Esq.
Manwell & Milton
101 California Street, Suite 3750
San Francisco, California 94111
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THE PURCHASER:
President
Nestle Holdings, Inc.
c/o Nestle USA, Inc.
800 North Brand Boulevard
Glendale, California 91203
With copies to:
James H. Ball, Esq.
Senior Vice President and General Counsel
Nestle USA, Inc.
800 North Brand Boulevard
Glendale, California 91203
and
Wayne F. Erdelack, Esq.
Vice President and Deputy General Counsel
Nestle USA, Inc.
30003 Bainbridge Road
Solon, Ohio 44139
or to such other address as any party may, from time to time, designate in a
written notice given in a like manner.
(g) Amendments. This Agreement may not be amended,
modified or supplemented other than by a written instrument signed by all
parties hereto which are, at the time of such amendment or modification, subject
to this Agreement.
(h) Successors and Assigns. All covenants and agreements
contained herein shall bind and inure to the benefit of the parties hereto and
their respective successors and assigns (including, without limitation,
successor trustees under the Cronk Revocable Trust); provided, however, that the
Seller may not assign any of its rights or obligations hereunder except in
accordance with the provisions of Section 2 and the Purchaser may not assign any
of its rights or obligations hereunder except to its affiliates.
(i) Survival of Representations and Warranties. All
representations and warranties contained herein or made in writing by any party
in connection herewith shall survive the execution and delivery of this
Agreement, regardless of any investigation made by or on behalf of any party.
(j) Governing Law. This Agreement shall be governed by
and construed and enforced in accordance with the laws of the State of Delaware.
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(k) Signatures. This Agreement shall be effective upon
delivery of original signature pages or facsimile copies thereof executed by
each of the parties hereto.
(l) Termination. The Right of First Refusal granted by
the Seller to the Purchaser shall terminate when the Purchaser no longer
Beneficially Owns 10% or more of the outstanding voting securities of Dreyer's,
on a Fully Diluted basis; provided, however, that for purposes of this Section
6(l), the Purchaser's Beneficial Ownership of Dreyer's outstanding voting
securities on a Fully Diluted basis shall be deemed to be reduced solely as a
result of sales of shares by the Purchaser, but not by reason of a percentage
reduction occurring as a result of the issuance by Dreyer's of any shares of its
capital stock, or any other securities, or any securities convertible into or
exchangeable for, or options or warrants to purchase, shares of its capital
stock or any other securities, other than the issuance of such securities
pursuant to (i) the conversion of any of the 6.25% Subordinated Convertible
Notes of Dreyer's due June 30, 2001, (ii) the exercise of any options
outstanding as of the Effective Date which were granted pursuant to any stock
option plan of Dreyer's or (iii) the exercise of any rights (excluding the
Rights) outstanding as of the Effective Date which were granted pursuant to any
employee stock purchase or gift plan of Dreyer's.
[SIGNATURE PAGE TO FOLLOW]
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IN WITNESS WHEREOF, the Purchaser and the Seller have caused
this Agreement to be executed and delivered as of the day and year first above
first written.
/s/ WILLIAM F. CRONK, III
--------------------------------------
William F. Cronk, III
/s/ WILLIAM F. CRONK, III
--------------------------------------
William F. Cronk, III as co-trustee of
the Cronk Revocable Trust
/s/ JANET M. CRONK
--------------------------------------
Janet M. Cronk
/s/ JANET M. CRONK
--------------------------------------
Janet M. Cronk as co-trustee of
the Cronk Revocable Trust
NESTLE HOLDINGS, INC.
/s/ MARIO A. CORTI
--------------------------------------
By: Mario A. Corti
Title: Senior Vice President - Finance
S-1
