UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 2)*
Lifeway Foods, Inc.
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(Name of Issuer)
Common Stock, no par value
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(Title of Class of Securities)
531914109
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(CUSIP Number)
Fanny Picard Michael Harrison, Esq.
GROUPE DANONE Danone Foods, Inc.
7 rue de Teheran 120 White Plains Road
75381 Paris Cedex 08 Tarrytown, New York 10591
France
Telephone: (33-1) 44-35-20-20 Telephone: (914) 366-9700
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(Name, Address and Telephone Number of Persons Authorized
to Receive Notices and Communications)
Copy to:
John J. Madden, Esq.
Shearman & Sterling
599 Lexington Avenue
New York, New York 10022
Telephone: (212) 848-4000
November 5, 1999
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(Date of Event which requires Filing of this Statement)
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If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of ss. 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the
following box |_|.
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See ss. 240.13d-7(b) 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).
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CUSIP No. 531914109
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1. Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
GROUPE DANONE
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2. Check the Appropriate Box if a Member of a Group
(a) |_|
(b) |_|
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3. SEC Use Only
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4. Source of Funds (See Instructions)
WC
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5. Check if Disclosure of Legal Proceedings is Required Pursuant to
Item 2(d) or 2(e).
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6. Citizenship or Place of Organization
France
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7. Sole Voting Power
0
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8. Number of Shares Shared Voting Power
Beneficially
Owned 782,927
By ----------------------------------------------
9. Each Sole Dispositive Power
Reporting Person
With 0
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10. Shared Dispositive Power
782,927
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11. Aggregate Amount Beneficially Owned by Each Reporting Person
782,927
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12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(See Instructions)
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13. Percent of Class Represented by Amount in Row (11)
18.1%
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14. Type of Reporting Person (See Instructions)
HC/CO
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CUSIP No. 531914109
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1. Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
DANONE FOODS, INC.
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2. Check the Appropriate Box if a Member of a Group
(a) |_|
(b) |_|
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3. SEC Use Only
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4. Source of Funds (See Instructions)
AF
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5. Check if Disclosure of Legal Proceedings is Required Pursuant to
Item 2(d) or 2(e).
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6. Citizenship or Place of Organization
Delaware
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7. Sole Voting Power
0
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8. Number of Shares Shared Voting Power
Beneficially
Owned 782,927
By ----------------------------------------------
9. Each Sole Dispositive Power
Reporting Person
With 0
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10. Shared Dispositive Power
782,927
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11. Aggregate Amount Beneficially Owned by Each Reporting Person
782,927
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12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(See Instructions)
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13. Percent of Class Represented by Amount in Row (11)
18.1%
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14. Type of Reporting Person (See Instructions)
CO
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Amendment No. 2 to Schedule 13D
GROUPE DANONE, a societe anonyme organized under the laws of the
Republic of France, and Danone Foods, Inc. ("Danone Foods"), a Delaware
corporation, hereby amend and supplement the statement on Schedule 13D (the
"Statement") previously filed by GROUPE DANONE and Danone Foods with the
Securities and Exchange Commission on October 12, 1999, as amended, with respect
to the common stock, no par value (the "Lifeway Common Stock") of Lifeway Foods,
Inc., an Illinois corporation, with its principal executive offices at 6431 W.
Oakton Street, Morton Grove, Illinois 60053 (the "Issuer"). Except as amended
and supplemented, the Statement, including the definitions of terms not
otherwise defined herein, remains in full force and effect.
Item 3. Source and Amount of Funds or Other Consideration
On October 30, 1999, Danone Foods entered into a Stock Purchase
Agreement (the "Shaw Stock Purchase Agreement") with Clark Street Associates, an
Illinois general partnership, the Roger D. Shaw Trust U/A/D 7/28/33 F/B/O
Margaret W. Shaw, the Margaret W. Shaw Trust U/A/D 10/06/83 and the William W.
Shaw Trust U/A/D 12/28/63 (collectively the "Shaw Entities"). Pursuant to the
Shaw Stock Purchase Agreement, on October 30, 1999, Danone Foods acquired 25,000
shares of Lifeway Common Stock directly from the Shaw Entities at a price of
U.S. $10.00 per share. The total consideration paid by Danone Foods to acquire
the 25,000 shares of Lifeway Common Stock was U.S. $250,000.
On November 4, 1999, Danone Foods entered into a Stock Purchase
Agreement with Carl Everhart, Robert Everhart and Nicole Everhart (the "Everhart
Stock Purchase Agreement"). Pursuant to the Everhart Stock Purchase Agreement,
on November 4, 1999, Danone Foods acquired 9,050 shares of Lifeway Common Stock
directly from Carl Everhart, Robert Everhart and Nicole Everhart at a price of
U.S. $10.00 per share. The total consideration paid by Danone Foods to acquire
the 9,050 shares of Lifeway Common Stock was U.S. $90,500.
On November 5, 1999, Danone Foods entered into a Stock Purchase
Agreement with Pol & Galina Sikar and Montrose Glass & Mirror Corporation (the
"Sikar Stock Purchase Agreement"). Pursuant to the Sikar Stock Purchase
Agreement, on November 5, 1999, Danone Foods acquired 10,000 shares of Lifeway
Common Stock directly from Pol & Galina Sikar and Montrose Glass & Mirror
Corporation at a price of U.S. $10.00 per share. The total consideration paid by
Danone Foods to acquire the 10,000 shares of Lifeway Common Stock was U.S.
$100,000.
On November 9, 1999, Danone Foods entered into a Stock Purchase
Agreement with Kirgam International, Inc., an Illinois corporation (the "Kirgam
Stock Purchase Agreement"). Pursuant to the Kirgam Stock Purchase Agreement, on
November 9, 1999, Danone Foods
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acquired 13,610 shares of Lifeway Common Stock directly from Kirgam
International, Inc. at a price of U.S. $10.00 per share. The total consideration
paid by Danone Foods to acquire the 13,610 shares of Lifeway Common Stock was
U.S. $136,100.
On November 10, 1999, Danone Foods entered into a Stock Purchase
Agreement with Patrick W. Shaw, the Roger D. Shaw Trust U/A/D 7/28/33 F/B/O
Margaret W. Shaw and the William W. Shaw Trust U/A/D 12/28/63 (the "Shaw II
Stock Purchase Agreement"). Pursuant to the Shaw II Stock Purchase Agreement, on
November 10, 1999, Danone Foods acquired 5,000 shares of Lifeway Common Stock
directly from Patrick W. Shaw, the Roger D. Shaw Trust U/A/D 7/28/33 F/B/O
Margaret W. Shaw and the William W. Shaw Trust U/A/D 12/28/63 at a price of U.S.
$10.00 per share. The total consideration paid by Danone Foods to acquire the
5,000 shares of Lifeway Common Stock was U.S. $50,000.
GROUPE DANONE provided Danone Foods with funds from internally
generated working capital to finance the foregoing acquisitions.
Item 4. Purpose of Transactions
Danone Foods has acquired the 62,660 shares of Lifeway Common Stock for
the purpose of making an additional equity investment in the Issuer and to
complement the development of a commercial relationship with the Issuer. Danone
Foods intends to acquire up to an additional 1.9% of the aggregate number of
outstanding shares of Lifeway Common Stock through privately negotiated
transactions.
Item 5. Interest in Securities of the Issuer
1. GROUPE DANONE
(a)-(b) Following the acquisition of shares of Lifeway Common Stock
pursuant to the Shaw Stock Purchase Agreement, the Everhart Stock Purchase
Agreement, the Sikar Stock Purchase Agreement, the Kirgam Stock Purchase
Agreement and the Shaw II Stock Purchase Agreement, GROUPE DANONE beneficially
owns and has the shared power to vote and to dispose of 782,927 shares of
Lifeway Common Stock, representing 18.1% of the shared voting power of the
outstanding shares of Lifeway Common Stock. The calculation of the foregoing
percentage is based on the number of shares of Lifeway Common Stock disclosed to
Danone Foods by the Issuer as outstanding as of October 1, 1999. Except as set
forth herein, to the knowledge of GROUPE DANONE, no director or executive
officer of GROUPE DANONE beneficially owns any other shares of Lifeway Common
Stock.
(c) Except as set forth in the Statement, as amended, and except as
described herein, there have been no transactions by GROUPE DANONE in securities
of the Issuer during the past sixty days. Except as set forth herein, to the
knowledge of GROUPE DANONE, there have been no transactions by any director or
executive officer of GROUPE DANONE in securities of the Issuer during the past
sixty days.
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(d) No one other than GROUPE DANONE and Danone Foods is known to have
the right to receive or the power to direct the receipt of dividends from, or
the proceeds from the sale of, the shares of Lifeway Common Stock purchased by
Danone Foods.
(e) Not applicable.
2. Danone Foods, Inc.
(a)-(b) Following the acquisition of shares of Lifeway Common Stock
pursuant to the Shaw Stock Purchase Agreement, the Everhart Stock Purchase
Agreement, the Sikar Stock Purchase Agreement, the Kirgam Stock Purchase
Agreement and the Shaw II Stock Purchase Agreement, Danone Foods beneficially
owns and has the shared power to vote and to dispose of 782,927 shares of
Lifeway Common Stock, representing 18.1% of the shared voting power of the
outstanding shares of Lifeway Common Stock. The calculation of the foregoing
percentage is based on the number of shares of Lifeway Common Stock disclosed to
Danone Foods by the Issuer as outstanding as of October 1, 1999. Except as set
forth herein, to the knowledge of Danone Foods, no director or executive officer
of Danone Foods beneficially owns any other shares of Lifeway Common Stock.
(c) Except as set forth in the Statement, as amended, and except as
described herein, there have been no transactions by Danone Foods in securities
of the Issuer during the past sixty days. Except as set forth herein, to the
knowledge of Danone Foods, there have been no transactions by any director or
executive officer of Danone Foods in securities of the Issuer during the past
sixty days.
(d) No one other than Danone Foods and GROUPE DANONE is known to have
the right to receive or the power to direct the receipt of dividends from, or
the proceeds from the sale of, the shares of Lifeway Common Stock purchased by
Danone Foods.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understanding or Relationships with Respect to
Securities of the Issuer
The Shaw Stock Purchase Agreement
Pursuant to the Shaw Stock Purchase Agreement, on October 30, 1999,
Danone Foods purchased 25,000 shares of Lifeway Common Stock directly from the
Shaw Entities at a purchase price of U.S. $10.00 per share.
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The Everhart Stock Purchase Agreement
Pursuant to the Everhart Stock Purchase Agreement, on November 4, 1999,
Danone Foods purchased 9,050 shares of Lifeway Common Stock directly from Carl
Everhart, Robert Everhart and Nicole Everhart at a purchase price of U.S. $10.00
per share.
The Sikar Stock Purchase Agreement
Pursuant to the Sikar Stock Purchase Agreement, on November 5, 1999,
Danone Foods purchased 10,000 shares of Lifeway Common Stock directly from Pol &
Galina Sikar and Montrose Glass & Mirror Corporation at a purchase price of U.S.
$10.00 per share.
The Kirgam Stock Purchase Agreement
Pursuant to the Kirgam Stock Purchase Agreement, on November 9, 1999,
Danone Foods purchased 13,610 shares of Lifeway Common Stock directly from
Kirgam International, Inc. at a purchase price of U.S. $10.00 per share.
The Shaw II Stock Purchase Agreement
Pursuant to the Shaw II Stock Purchase Agreement, on November 10, 1999,
Danone Foods purchased 5,000 shares of Lifeway Common Stock directly from
Patrick W. Shaw, the Roger D. Shaw Trust U/A/D 7/28/33 F/B/O Margaret W. Shaw
and the William W. Shaw Trust U/A/D 12/28/63 at a purchase price of U.S. $10.00
per share.
The preceding summary of the above agreements is not intended to be
complete and is qualified in its entirety by reference to the full text of the
Shaw Stock Purchase Agreement, the Everhart Stock Purchase Agreement, the Sikar
Stock Purchase Agreement, the Kirgam Stock Purchase Agreement and the Shaw II
Stock Purchase Agreement, copies of each of which are filed as an Exhibit hereto
and are incorporated herein by reference.
Item 7. Material to be Filed as Exhibits
The following Exhibits are filed with this Amendment No. 2:
Exhibit 11 Power of Attorney, dated October 12, 1999, granted by
GROUPE DANONE authorizing Fanny Picard to sign
statements on Schedule 13D and amendments thereto (filed
as Exhibit 4 to the Statement and incorporated herein by
reference).
Exhibit 12 Power of Attorney, dated October 12, 1999, granted by
Danone Foods authorizing Fanny Picard to sign statements
on Schedule 13D and amendments thereto (filed as Exhibit
5 to the Statement and incorporated herein by
reference).
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Exhibit 13 Stock Purchase Agreement, dated as of October 30, 1999,
between Danone Foods and Clark Street Associates, the
Roger D. Shaw Trust U/A/D 7/28/33 F/B/O Margaret W.
Shaw, the Margaret W. Shaw Trust U/A/D 10/06/83 and the
William W. Shaw Trust U/A/D 12/28/63.
Exhibit 14 Stock Purchase Agreement, dated as of November 4, 1999,
between Danone Foods and Carl Everhart, Robert Everhart
and Nicole Everhart.
Exhibit 15 Stock Purchase Agreement, dated as of November 5, 1999,
between Danone Foods and Pol & Galina Sikar and Montrose
Glass & Mirror Corporation.
Exhibit 16 Stock Purchase Agreement, dated as of November 9, 1999,
between Danone Foods and Kirgam International, Inc.
Exhibit 17 Stock Purchase Agreement, dated as of November 10, 1999,
between Danone Foods and Patrick W. Shaw, the Roger D.
Shaw Trust U/A/D 7/28/33 F/B/O Margaret W. Shaw and the
William W. Shaw Trust U/A/D 12/28/63.
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After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: November 10, 1999
GROUPE DANONE
By: /s/ Fanny Picard
---------------------------------
Name: Fanny Picard
Title: Attorney-In-Fact
<PAGE>
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: November 10, 1999
DANONE FOODS, INC.
By: /s/ Fanny Picard
---------------------------------
Name: Fanny Picard
Title: Attorney-In-Fact
<PAGE>
Exhibit 13
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STOCK PURCHASE AGREEMENT
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Between
CLARK STREET ASSOCIATES,
THE ROGER D. SHAW TRUST U/A/D 7/28/33
F/B/O MARGARET W. SHAW,
THE MARGARET W. SHAW TRUST U/A/D 10/06/83,
THE WILLIAM W. SHAW TRUST U/A/D 12/28/63
and
DANONE FOODS, INC.
Dated as of October 30, 1999
<PAGE>
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS
1.01. Certain Defined Terms...................................................1
ARTICLE II
PURCHASE AND SALE
2.01. Purchase and Sale of the Shares.........................................2
2.02. Purchase Price..........................................................2
2.03. Closing.................................................................3
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLER
3.01. Authorization...........................................................3
3.02. Ownership of Shares.....................................................4
3.03. No Conflict.............................................................4
3.04. Absence of Litigation...................................................4
3.05. Brokers.................................................................4
3.06. Disclosure; Access to Information.......................................4
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
4.01. Organization and Authority of the Purchaser.............................5
4.02. No Conflict.............................................................5
4.03. Investment Purpose......................................................5
4.04. Brokers.................................................................5
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Section Page
ARTICLE V
ADDITIONAL AGREEMENTS
5.01. Public Announcements....................................................6
5.02. Further Action..........................................................6
5.03. Investigation...........................................................6
ARTICLE VI
CONDITIONS TO CLOSING
6.01. Condition to Obligations of the Seller..................................7
6.02. Conditions to Obligations of the Purchaser..............................7
ARTICLE VII
TERMINATION
7.01. Termination.............................................................7
7.02. Effect of Termination...................................................8
ARTICLE VIII
GENERAL PROVISIONS
8.01. Waiver..................................................................8
8.02. Expenses................................................................8
8.03. Notices.................................................................8
8.04. Headings...............................................................10
8.05. Severability...........................................................10
8.06. Entire Agreement.......................................................10
8.07. Assignment.............................................................10
8.08. No Third Party Beneficiaries...........................................10
8.09. Amendment..............................................................10
8.10. Governing Law..........................................................10
8.11. Waiver of Jury Trial...................................................11
8.12. Counterparts...........................................................11
8.13. Specific Performance...................................................11
8.14. Survival of Representations and Warranties.............................11
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STOCK PURCHASE AGREEMENT, dated as of October 30, 1999, between Clark
Street Associates, an Illinois general partnership, the Roger D. Shaw Trust
U/A/D 7/28/33 F/B/O Margaret W. Shaw, the Margaret W. Shaw Trust U/A/D 10/06/83
and the William W. Shaw Trust U/A/D 12/28/63 (each a "Seller", and collectively,
the "Sellers") and Danone Foods, Inc., a Delaware corporation (the "Purchaser").
W I T N E S S E T H:
WHEREAS, the Sellers own at least 25,000 shares of common stock, no par
value per share (the "Common Stock") of Lifeway Foods, Inc., an Illinois
corporation (the "Company"); and
WHEREAS, the Sellers wish to sell to the Purchaser, and the Purchaser
wishes to purchase from the Sellers, 25,000 shares of the Common Stock (such
shares to be sold pursuant to this Agreement being individually, a "Share" and,
collectively, the "Shares"), upon the terms and subject to the conditions set
forth herein.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements and covenants hereinafter set forth, the Purchaser and the Sellers
hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"Action" means any claim, action, suit, arbitration, inquiry,
proceeding or investigation by or before any Governmental Authority.
"Affiliate" means, with respect to any specified Person, any other
Person that directly, or indirectly through one or more intermediaries,
controls, is controlled by, or is under common control with, such specified
Person.
"Business" means the business of manufacturing, marketing and selling
cultured, probiotic and functional food products in the health food industry and
all other business which prior to the date hereof has been conducted by the
Company and the Subsidiaries.
"Closing" has the meaning specified in Section 2.03(a).
"Closing Date" has the meaning specified in Section 2.03(a).
"Common Stock" has the meaning specified in the recitals to this
Agreement.
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"control" (including the terms "controlled by" and "under common
control with"), with respect to the relationship between or among two or more
Persons, means the possession, directly or indirectly or as trustee or executor,
of the power to direct or cause the direction of the affairs or management of a
Person, whether through the ownership of voting securities, as trustee or
executor, by contract or otherwise, including, without limitation, the
ownership, directly or indirectly, of securities having the power to elect a
majority of the board of directors or similar body governing the affairs of such
Person.
"Encumbrance" means any security interest, pledge, mortgage, lien
(including, without limitation, environmental and tax liens), charge,
encumbrance, adverse claim, preferential arrangement or restriction of any kind,
including, without limitation, any restriction on the use, voting, transfer,
receipt of income or other exercise of any attributes of ownership.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Governmental Authority" means any United States federal, state, local,
supranational or any foreign government, governmental, regulatory or
administrative authority, agency or commission or any court, tribunal, or
judicial or arbitral body.
"Governmental Order" means any order, writ, judgment, injunction,
decree, stipulation, determination or award entered by or with any Governmental
Authority.
"Law" means any federal, state, local or foreign statute, law,
ordinance, regulation, rule, code, order, other requirement or rule of law.
"Person" means any individual, partnership, firm, corporation,
association, trust, unincorporated organization or other entity, as well as any
syndicate or group that would be deemed to be a person under Section 13(d)(3) of
the Securities Exchange Act of 1934, as amended.
"Purchase Price" has the meaning specified in Section 2.02.
ARTICLE II
PURCHASE AND SALE
SECTION 2.01. Purchase and Sale of the Shares. Upon the terms and
subject to the conditions contained in this Agreement, at the Closing, the
Sellers shall sell to the Purchaser, and the Purchaser shall purchase from the
Sellers, 25,000 Shares.
SECTION 2.02. Purchase Price. The purchase price shall be $10.00 per
Share (the "Purchase Price") payable as provided in Section 2.03(b).
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SECTION 2.03. Closing. (a) Subject to the terms and conditions of this
Agreement, the sale and purchase of the Shares contemplated by this Agreement
shall take place at a closing (the "Closing") to be held at the offices of
Shearman & Sterling at 10:00 A.M., New York time, on such date on or before
October 31, 1999 as the Purchaser may determine, or at such other place or at
such other time or on such other date as the Sellers and the Purchaser may
mutually agree upon in writing (the date on which the Closing takes place being
the "Closing Date").
(b) At the Closing, (i) the Sellers shall deliver or cause to be
delivered to the Purchaser stock certificates evidencing the Shares duly
endorsed in blank, or accompanied by stock powers duly executed in blank, in
form satisfactory to the Purchaser and (ii) the Purchaser shall, at the election
of the Sellers, (x) deliver to the Sellers a certified check in the amount of
$70,000, made payable to the order of Clark Street Associates, a certified check
in the amount of $110,000, made payable to the order of Roger D. Shaw Trust
U/A/D 7/28/33 F/B/O Margaret W. Shaw, a certified check in the amount of
$50,000, made payable to the order of Margaret W. Shaw Trust U/A/D 10/06/83 and
a certified check in the amount of $20,000, made payable to the order of William
W. Shaw Trust U/A/D 12/28/63 or (y) pay to the Sellers the amount of $250,000 by
wire transfer of immediately available funds to the bank accounts designated by
the Sellers. The Sellers agree to provide the Purchaser with notice of such
election at least one day prior to the Closing Date.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLER
As an inducement to the Purchaser to enter into this Agreement, each of
the Sellers hereby, severally but not jointly, represent and warrant to the
Purchaser as follows:
SECTION 3.01. Authorization. Each Seller, if it is an individual, has
all requisite right, power and authority and full legal capacity to execute and
deliver this Agreement, to perform his or her obligations hereunder and to
consummate the transactions contemplated hereby. Each Seller, if it is a
corporation or other legal entity, is duly organized, validly existing and in
good standing under the laws of its incorporation or formation and has all
requisite power and authority to enter into this Agreement, to carry out its
obligations hereunder and to consummate the transactions contemplated hereby.
The execution and delivery of this Agreement by such Seller, the performance by
such Seller of its obligations hereunder and the consummation by such Seller of
the transactions contemplated hereby have been duly authorized by all requisite
action on the part of such Seller. This Agreement has been duly and validly
executed and delivered by each Seller, and this Agreement constitutes a legal,
valid and binding obligation of such Seller enforceable against such Seller in
accordance with its terms.
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SECTION 3.02. Ownership of Shares. Each Seller has good and marketable
title to, and is the record and beneficial owner of, the number of Shares set
forth next to such Seller's name in Schedule B to this Agreement, free and clear
of all Encumbrances. Upon delivery of the Shares by the Sellers to the Purchaser
at the Closing and payment of the Purchase Price for the Shares, as herein
provided, the Purchaser will receive good and marketable title to the Shares,
free and clear of all Encumbrances.
SECTION 3.03. No Conflict. Except as may result from any facts or
circumstances relating solely to the Purchaser, the execution, delivery and
performance of this Agreement by each Seller do not and will not (a) conflict
with or violate any Law or Governmental Order applicable to such Seller or (b)
conflict with, result in any breach of, constitute a default (or event which
with the giving of notice or lapse of time, or both, would become a default)
under, require any consent under, or give to others any rights of termination,
amendment, acceleration, suspension, revocation or cancellation of, or result in
the creation of any Encumbrance on any of the Shares pursuant to, any note,
bond, mortgage or indenture, contract, agreement, lease, sublease, license,
permit, franchise or other instrument, obligation or arrangement to which such
Seller is a party or by which any of the Shares are bound or affected or which
would have a material adverse effect on the ability of such Seller to consummate
the transactions contemplated by this Agreement.
SECTION 3.04. Absence of Litigation. There are no Actions by or against
any Seller pending before any Governmental Authority (or, to the best knowledge
of such Seller after due inquiry, threatened to be brought by or before any
Governmental Authority) relating to or affecting the Shares or which could
affect the legality, validity or enforceability of this Agreement or the
consummation of the transactions contemplated hereby. Each Seller is not subject
to any Governmental Order (nor, to the best knowledge of each Seller, are there
any such Governmental Orders threatened to be imposed by any Governmental
Authority) relating to or affecting the Shares or which would affect the
legality, validity or enforceability of this Agreement or the consummation of
the transactions contemplated hereby.
SECTION 3.05. Brokers. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement based upon arrangements
made by or on behalf of each Seller.
SECTION 3.06. Disclosure; Access to Information. Each Seller has
received and reviewed the materials listed in Schedule A to this Agreement, but
has not necessarily relied on all the information contained in such materials.
Each Seller acknowledges that the materials listed in Schedule A to this
Agreement contain certain information concerning the Company and each Seller
agrees to maintain, and to cause its Affiliates to maintain the confidentiality
of any and all such information furnished to each Seller, except with the prior
written consent of the Purchaser or as may be required by any Governmental Order
or judicial proceeding.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
As an inducement to the Sellers to enter into this Agreement, the
Purchaser hereby represents and warrants to the Sellers as follows:
SECTION 4.01. Organization and Authority of the Purchaser. The
Purchaser is a corporation duly organized, validly existing and in good standing
under the laws of Delaware. The Purchaser has all necessary corporate power and
authority to enter into this Agreement, to carry out its obligations hereunder
and to consummate the transactions contemplated hereby. The execution and
delivery of this Agreement by the Purchaser, the performance by the Purchaser of
its obligations hereunder and the consummation by the Purchaser of the
transactions contemplated hereby have been duly authorized by all requisite
action on the part of the Purchaser. This Agreement has been duly executed and
delivered by the Purchaser, and (assuming due authorization, execution and
delivery by the Sellers thereto) constitute legal, valid and binding obligations
of the Purchaser enforceable against the Purchaser in accordance with their
terms.
SECTION 4.02. No Conflict. Except as may result from any facts or
circumstances relating solely to any Seller, the execution, delivery and
performance of this Agreement by the Purchaser do not and will not (a) violate,
conflict with or result in the breach of any provision of the certificate of
incorporation, by-laws or other similar organizational documents of the
Purchaser, (b) conflict with or violate any Law or Governmental Order applicable
to the Purchaser or (c) conflict with, or result in any breach of, constitute a
default (or event which with the giving of notice or lapse or time, or both,
would become a default) under, require any consent under, or give to others any
rights of termination, amendment, acceleration, suspension, revocation, or
cancellation of, or result in the creation of any Encumbrance on any of the
assets or properties of the Purchaser pursuant to, any note, bond, mortgage or
indenture, contract, agreement, lease, sublease, license, permit, franchise or
other instrument or arrangement to which the Purchaser is a party or by which
any of such assets or properties are bound or affected which, with respect to
clauses (b) and (c) above would have a material adverse effect on the ability of
the Purchaser to consummate the transactions contemplated by this Agreement.
SECTION 4.03. Investment Purpose. The Purchaser is acquiring the Shares
solely for the purpose of investment and not with a view to, or for offer or
sale in connection with, any distribution thereof.
SECTION 4.04. Brokers. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions
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contemplated by this Agreement based upon arrangements made by or on behalf of
the Purchaser.
ARTICLE V
ADDITIONAL AGREEMENTS
SECTION 5.01. Public Announcements. The Sellers shall not make, or
cause to be made, any press release or public announcement in respect of this
Agreement or the transactions contemplated hereby or otherwise communicate with
any news media without the prior written consent of the Purchaser, and the
Sellers shall cooperate with the Purchaser as to the timing and contents of any
such press release or public announcement.
SECTION 5.02. Further Action. Each of the parties hereto shall use all
reasonable efforts to take, or cause to be taken, all appropriate action, do or
cause to be done all things necessary, proper or advisable under applicable Law,
and execute and deliver such documents and other papers, as may be required to
carry out the provisions of this Agreement and consummate and make effective the
transactions contemplated hereby.
SECTION 5.03. Investigation. (a) Each Seller acknowledges and agrees
that it (i) has made its own inquiry and investigation into, and, based thereon,
has formed an independent judgment concerning, the Company, the Business and the
Shares, including with limitation, the value thereof, (ii) has been furnished
with or given adequate access to such information as it has requested about the
Company, the Business and the Shares and (iii) except as provided in this
Agreement, will not assert any claim against the Purchaser, the Company or any
of their respective directors, officers, employees, agents, stockholders,
Affiliates, consultants, investment bankers or representatives, or hold the
Purchaser, the Company or any such Persons liable, for any inaccuracies,
misstatements or omissions with respect to information furnished by the
Purchaser, the Company or such Persons concerning the Company, the Business or
the Shares.
(b) In connection with each Seller's investigation of the Company and
the Business, each Seller may receive from the Purchaser and the Company, or
their respective representatives, certain estimates, projections and other
forecasts for the Company and the Business. Each Seller acknowledges that there
are uncertainties inherent in attempting to make such estimates, projections,
forecasts, plans and budgets, that such Seller is familiar with such
uncertainties, that it is taking full responsibility for making its own
evaluation of, and neither the Purchaser nor the Company shall have any
responsibility with respect to, the adequacy and accuracy of any such estimates,
projections, forecasts, plans and budgets so furnished to it, and that such
Seller will not assert any claim against the Purchaser, the Company or any of
their respective directors, officers, employees, agents, stockholders,
Affiliates, consultants, investment
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bankers or representatives, or hold the Purchaser, the Company or any such
Persons liable with respect thereto.
ARTICLE VI
CONDITIONS TO CLOSING
SECTION 6.01. Condition to Obligations of the Seller. The obligations
of each Seller to consummate the transactions contemplated by this Agreement
shall be subject to the fulfillment, at or prior to the Closing, of the
condition that the representations and warranties of the Purchaser contained in
this Agreement shall have been true and correct when made and shall be true and
correct in all material respects as of the Closing Date, with the same force and
effect as if made as of the Closing Date, and the covenants and agreements
contained in this Agreement to be complied with by the Purchaser at or prior to
the Closing shall have been complied with in all material respects.
SECTION 6.02. Conditions to Obligations of the Purchaser. The
obligations of the Purchaser to consummate the transactions contemplated by this
Agreement shall be subject to the fulfillment, at or prior the Closing, of the
condition that the representations and warranties of the Sellers contained in
this Agreement shall have been true and correct when made and shall be true and
correct in all material respects as of the Closing Date with the same force and
effect as if made as of the Closing Date, the covenants and agreements contained
in this Agreement to be complied with by the Sellers at or prior to the Closing
shall have been complied with in all material respects, and the Purchaser shall
have received a certificate signed by each Seller to such effect.
ARTICLE VII
TERMINATION
SECTION 7.01. Termination. This Agreement may be terminated at any time
prior to the Closing:
(a) by the mutual written consent of the Purchaser and the Sellers;
(b) by either the Purchaser or the Sellers if the Closing shall not
have occurred by December 31, 1999; provided, however, that the right to
terminate this Agreement under this Section 7.01(b) shall not be available
to any party whose failure to fulfill any obligation under this Agreement
shall have been the cause of, or shall have resulted in, the failure of the
Closing to occur on or prior to such date;
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<PAGE>
(c) by either the Purchaser or the Sellers in the event that any
Governmental Authority shall have issued an order, decree or ruling or taken
any other action restraining, enjoining or otherwise prohibiting the
transactions contemplated by this Agreement and such order, decree, ruling
or other action shall have become final and nonappealable; or
(d) by the Purchaser if, between the date hereof and the time scheduled
for the Closing, any Seller makes a general assignment for the benefit of
creditors, or any proceeding shall be instituted by or against any Seller
seeking to adjudicate it bankrupt or insolvent, or seeking arrangement,
adjustment, protection, relief or composition of its debts under any Law
relating to bankruptcy, insolvency or reorganization.
SECTION 7.02. Effect of Termination. In the event of termination of
this Agreement as provided in Section 7.01, this Agreement shall forthwith
become void and there shall be no liability on the part of any party hereto
except that nothing herein shall relieve any party from liability for any breach
of this Agreement.
ARTICLE VIII
GENERAL PROVISIONS
SECTION 8.01. Waiver. The Sellers and the Purchaser may (a) extend the
time for the performance of any of the obligations or other acts of the other
party, (b) waive any inaccuracies in the representations and warranties of the
other party contained herein or in any document delivered by the other party
pursuant hereto or (c) waive compliance with any of the agreements or conditions
of the other party contained herein. Any such extension or waiver shall be valid
only if set forth in an instrument in writing signed by the party to be bound
thereby. Any waiver of any term or condition shall not be construed as a waiver
of any subsequent breach or a subsequent waiver of the same term or condition,
or a waiver of any other term or condition, of this Agreement. The failure of
any party to assert any of its rights hereunder shall not constitute a waiver of
any of such rights.
SECTION 8.02. Expenses. (a) Except as otherwise specified in this
Agreement, all costs and expenses, including, without limitation, fees and
disbursements of counsel, financial advisors and accountants, incurred in
connection with this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such costs and expenses.
(b) The Sellers will pay any stamp duties, capital duties and taxes
payable upon the sale of the Shares.
SECTION 8.03. Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given or made (and
shall be deemed
8
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to have been duly given or made upon receipt) by delivery in person, by courier
service, by cable, by telecopy, by telegram, by telex or by registered or
certified mail (postage prepaid, return receipt requested) to the respective
parties at the following addresses (or at such other address for a party as
shall be specified in a notice given in accordance with this Section 8.03):
(a) if to the Sellers:
Thomasville Route Box 60B
Birch Tree, MO 65438
Fax: (417) 764-3706
Attention: William W. Shaw
(b) if to the Purchaser:
Danone Foods, Inc.
120 White Plains Road
Tarrytown, New York 10591
Fax: (914) 366-2865
Attention: General Counsel
with a copy to:
Groupe Danone
7 rue de Teheran
75381 Paris Cedex 08
Fax: 33-1-44-352-554
Attention: General Counsel
and a copy to:
Groupe Danone
7 rue de Teheran
75381 Paris Cedex 08
Fax: 33-1-44-352-097
Attention: Director of Corporate Development
and
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Shearman & Sterling
599 Lexington Avenue
New York, NY 10022
Telecopy: 212-848-7179
Attention: John J. Madden, Esq.
SECTION 8.04. Headings. The descriptive headings contained in this
Agreement are for convenience of reference only and shall not affect in any way
the meaning or interpretation of this Agreement.
SECTION 8.05. Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any Law or
public policy, all other terms and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in an acceptable manner in
order that the transactions contemplated hereby are consummated as originally
contemplated to the greatest extent possible.
SECTION 8.06. Entire Agreement. This Agreement constitutes the entire
agreement of the parties hereto with respect to the subject matter hereof and
thereof and supersedes all prior agreements and undertakings, both written and
oral, among the parties hereto with respect to the subject matter hereof and
thereof.
SECTION 8.07. Assignment. This Agreement may not be assigned by
operation of law or otherwise without the express written consent of the Sellers
and the Purchaser (which consent may be granted or withheld in the sole
discretion of the Sellers or the Purchaser); provided, however, that the
Purchaser may assign this Agreement to an Affiliate of the Purchaser without the
consent of the Sellers.
SECTION 8.08. No Third Party Beneficiaries. This Agreement shall be
binding upon and inure solely to the benefit of the parties hereto and their
permitted assigns and nothing herein, express or implied, is intended to or
shall confer upon any other Person any legal or equitable right, benefit or
remedy of any nature whatsoever under or by reason of this Agreement.
SECTION 8.09. Amendment. This Agreement may not be amended or modified
except (a) by an instrument in writing signed by, or on behalf of, the Sellers
and the Purchaser or (b) by a waiver in accordance with Section 8.01.
SECTION 8.10. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Illinois, without giving
effect to its
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principles or rules of conflict of laws to the extent such principles or rules
would require or permit the application of the laws of another jurisdiction.
SECTION 8.11. Waiver of Jury Trial. Each of the parties hereto hereby
waives to the fullest extent permitted by applicable law, any right it may have
to a trial by jury in respect to any litigation directly or indirectly arising
out of, under or in connection with this Agreement. Each of the parties hereto
(a) certifies that no representative, agent or attorney of any other party has
represented, expressly or otherwise, that such other party would not, in the
event of litigation, seek to enforce that foregoing waiver and (b) acknowledges
that it and the other parties hereto have been induced to enter into this
Agreement, by, among other things, the mutual waivers and certifications in this
Section 8.11.
SECTION 8.12. Counterparts. This Agreement may be executed in one or
more counterparts, and by the different parties hereto in separate counterparts,
each of which when executed shall be deemed to be an original but all of which
taken together shall constitute one and the same agreement.
SECTION 8.13. Specific Performance. The parties hereto agree that
irreparable damage would occur in the event any provision of this Agreement was
not performed in accordance with the terms hereof and that the parties shall be
entitled to specific performance of the terms hereof, in additional to any other
remedy at Law or equity.
SECTION 8.14. Survival of Representations and Warranties. The
representations and warranties of the parties hereto contained in Articles III
and IV shall survive the Closing until the second anniversary thereof.
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IN WITNESS WHEREOF, each of the parties hereto have caused this
Agreement to be executed as of the date first written above by their respective
officers thereunto duly authorized.
CLARK STREET ASSOCIATES
By: /s/ William W. Shaw, Trustee
----------------------------------
Name: William W. Shaw, Trustee
Title: Partner
ROGER D. SHAW TRUST U/A/D 7/28/33
F/B/O MARGARET W. SHAW
By: /s/ William W. Shaw
----------------------------------
Name: William W. Shaw
Title: Trustee
MARGARET W. SHAW TRUST
U/A/D 10/06/83
By: /s/ William W. Shaw
----------------------------------
Name: William W. Shaw
Title: Trustee
WILLIAM W. SHAW TRUST
U/A/D 12/28/63
By: /s/ Roger D. Shaw Jr.
----------------------------------
Name: Roger D. Shaw Jr.
Title: Trustee
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DANONE FOODS, INC.
By: /s/ Michael Harrison
----------------------------------
Name: Michael Harrison
Title: Vice President
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SCHEDULE A
1. The "Company Profile and Representation" prepared by the Company and dated
June 7, 1999; and
2. The "Due Diligence Findings" Report (without attachments), dated June 2,
1999, prepared for and on behalf of the Purchaser.
<PAGE>
SCHEDULE B
Name: Shares:
- ---- ------
Clark Street Associates 7,000
Roger D. Shaw Trust 11,000
U/A/D 7/28/33,
F/B/O Margaret W. Shaw
Margaret W. Shaw Trust 5,000
U/A/D 10/06/83
William W. Shaw Trust 2,000
U/A/D 12/28/63
<PAGE>
Exhibit 14
================================================================================
--------------------------------------
STOCK PURCHASE AGREEMENT
--------------------------------------
Between
CARL EVERHART,
ROBERT EVERHART,
NICOLE EVERHART
and
DANONE FOODS, INC.
Dated as of November 4, 1999
================================================================================
<PAGE>
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS
1.01. Certain Defined Terms...................................................1
ARTICLE II
PURCHASE AND SALE
2.01. Purchase and Sale of the Shares.........................................2
2.02. Purchase Price..........................................................2
2.03. Closing.................................................................3
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLER
3.01. Authorization...........................................................3
3.02. Ownership of Shares.....................................................3
3.03. No Conflict.............................................................4
3.04. Absence of Litigation...................................................4
3.05. Brokers.................................................................4
3.06. Disclosure; Access to Information.......................................4
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
4.01. Organization and Authority of the Purchaser.............................5
4.02. No Conflict.............................................................5
4.03. Investment Purpose......................................................5
4.04. Brokers.................................................................5
-i-
<PAGE>
Section Page
ARTICLE V
ADDITIONAL AGREEMENTS
5.01. Public Announcements....................................................6
5.02. Further Action..........................................................6
5.03. Investigation...........................................................6
ARTICLE VI
CONDITIONS TO CLOSING
6.01. Condition to Obligations of the Seller..................................7
6.02. Conditions to Obligations of the Purchaser..............................7
ARTICLE VII
TERMINATION
7.01. Termination.............................................................7
7.02. Effect of Termination...................................................8
ARTICLE VIII
GENERAL PROVISIONS
8.01. Waiver..................................................................8
8.02. Expenses................................................................8
8.03. Notices.................................................................8
8.04. Headings...............................................................10
8.05. Severability...........................................................10
8.06. Entire Agreement.......................................................10
8.07. Assignment.............................................................10
8.08. No Third Party Beneficiaries...........................................10
8.09. Amendment..............................................................10
8.10. Governing Law..........................................................10
8.11. Waiver of Jury Trial...................................................10
8.12. Counterparts...........................................................11
8.13. Specific Performance...................................................11
8.14. Survival of Representations and Warranties.............................11
-ii-
<PAGE>
STOCK PURCHASE AGREEMENT, dated as of November 4, 1999, between Carl
Everhart, Robert Everhart and Nicole Everhart, each of 5818 Dearborn Parkway,
Downers Grove, Illinois (each a "Seller", and collectively, the "Sellers") and
Danone Foods, Inc., a Delaware corporation (the "Purchaser").
W I T N E S S E T H:
WHEREAS, the Sellers own at least 9,050 shares of common stock, no par
value per share (the "Common Stock") of Lifeway Foods, Inc., an Illinois
corporation (the "Company"); and
WHEREAS, the Sellers wish to sell to the Purchaser, and the Purchaser
wishes to purchase from the Sellers, 9,050 shares of the Common Stock (such
shares to be sold pursuant to this Agreement being individually, a "Share" and,
collectively, the "Shares"), upon the terms and subject to the conditions set
forth herein.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements and covenants hereinafter set forth, the Purchaser and the Sellers
hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"Action" means any claim, action, suit, arbitration, inquiry,
proceeding or investigation by or before any Governmental Authority.
"Affiliate" means, with respect to any specified Person, any other
Person that directly, or indirectly through one or more intermediaries,
controls, is controlled by, or is under common control with, such specified
Person.
"Business" means the business of manufacturing, marketing and selling
cultured, probiotic and functional food products in the health food industry and
all other business which prior to the date hereof has been conducted by the
Company and the Subsidiaries.
"Closing" has the meaning specified in Section 2.03(a).
"Closing Date" has the meaning specified in Section 2.03(a).
"Common Stock" has the meaning specified in the recitals to this
Agreement.
<PAGE>
"control" (including the terms "controlled by" and "under common
control with"), with respect to the relationship between or among two or more
Persons, means the possession, directly or indirectly or as trustee or executor,
of the power to direct or cause the direction of the affairs or management of a
Person, whether through the ownership of voting securities, as trustee or
executor, by contract or otherwise, including, without limitation, the
ownership, directly or indirectly, of securities having the power to elect a
majority of the board of directors or similar body governing the affairs of such
Person.
"Encumbrance" means any security interest, pledge, mortgage, lien
(including, without limitation, environmental and tax liens), charge,
encumbrance, adverse claim, preferential arrangement or restriction of any kind,
including, without limitation, any restriction on the use, voting, transfer,
receipt of income or other exercise of any attributes of ownership.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Governmental Authority" means any United States federal, state, local,
supranational or any foreign government, governmental, regulatory or
administrative authority, agency or commission or any court, tribunal, or
judicial or arbitral body.
"Governmental Order" means any order, writ, judgment, injunction,
decree, stipulation, determination or award entered by or with any Governmental
Authority.
"Law" means any federal, state, local or foreign statute, law,
ordinance, regulation, rule, code, order, other requirement or rule of law.
"Person" means any individual, partnership, firm, corporation,
association, trust, unincorporated organization or other entity, as well as any
syndicate or group that would be deemed to be a person under Section 13(d)(3) of
the Securities Exchange Act of 1934, as amended.
"Purchase Price" has the meaning specified in Section 2.02.
ARTICLE II
PURCHASE AND SALE
SECTION 2.01. Purchase and Sale of the Shares. Upon the terms and
subject to the conditions contained in this Agreement, at the Closing, the
Sellers shall sell to the Purchaser, and the Purchaser shall purchase from the
Sellers, 9,050 Shares.
SECTION 2.02. Purchase Price. The purchase price shall be $10.00 per
Share (the "Purchase Price") payable as provided in Section 2.03(b).
2
<PAGE>
SECTION 2.03. Closing. (a) Subject to the terms and conditions of this
Agreement, the sale and purchase of the Shares contemplated by this Agreement
shall take place at a closing (the "Closing") to be held at the offices of
Shearman & Sterling at 10:00 A.M., New York time, on such date on or before
October 31, 1999 as the Purchaser may determine, or at such other place or at
such other time or on such other date as the Sellers and the Purchaser may
mutually agree upon in writing (the date on which the Closing takes place being
the "Closing Date").
(b) At the Closing, (i) the Sellers shall deliver or cause to be
delivered to the Purchaser stock certificates evidencing the Shares duly
endorsed in blank, or accompanied by stock powers duly executed in blank, in
form satisfactory to the Purchaser and (ii) the Purchaser shall, at the election
of the Sellers, (x) deliver to the Sellers a certified check in the amount of
$73,000, made payable to the order of Carl Everhart and a certified check in the
amount of $17,500, made payable to the order of Robert Everhart and Nicole
Everhart or (y) pay to the Sellers the amount of $90,500 by wire transfer of
immediately available funds to the bank accounts designated by the Sellers. The
Sellers agree to provide the Purchaser with notice of such election at least one
day prior to the Closing Date.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLER
As an inducement to the Purchaser to enter into this Agreement, each of
the Sellers hereby, severally but not jointly, represent and warrant to the
Purchaser as follows:
SECTION 3.01. Authorization. Each Seller, if it is an individual, has
all requisite right, power and authority and full legal capacity to execute and
deliver this Agreement, to perform his or her obligations hereunder and to
consummate the transactions contemplated hereby. Each Seller, if it is a
corporation or other legal entity, is duly organized, validly existing and in
good standing under the laws of its incorporation or formation and has all
requisite power and authority to enter into this Agreement, to carry out its
obligations hereunder and to consummate the transactions contemplated hereby.
The execution and delivery of this Agreement by such Seller, the performance by
such Seller of its obligations hereunder and the consummation by such Seller of
the transactions contemplated hereby have been duly authorized by all requisite
action on the part of such Seller. This Agreement has been duly and validly
executed and delivered by each Seller, and this Agreement constitutes a legal,
valid and binding obligation of such Seller enforceable against such Seller in
accordance with its terms.
SECTION 3.02. Ownership of Shares. Each Seller has good and marketable
title to, and is the record and beneficial owner of, the number of Shares set
forth next to such Seller's name in Schedule B to this Agreement, free and clear
of all Encumbrances. Upon delivery of the Shares by the Sellers to the Purchaser
at the Closing and payment of the Purchase Price for the
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<PAGE>
Shares, as herein provided, the Purchaser will receive good and marketable title
to the Shares, free and clear of all Encumbrances.
SECTION 3.03. No Conflict. Except as may result from any facts or
circumstances relating solely to the Purchaser, the execution, delivery and
performance of this Agreement by each Seller do not and will not (a) conflict
with or violate any Law or Governmental Order applicable to such Seller or (b)
conflict with, result in any breach of, constitute a default (or event which
with the giving of notice or lapse of time, or both, would become a default)
under, require any consent under, or give to others any rights of termination,
amendment, acceleration, suspension, revocation or cancellation of, or result in
the creation of any Encumbrance on any of the Shares pursuant to, any note,
bond, mortgage or indenture, contract, agreement, lease, sublease, license,
permit, franchise or other instrument, obligation or arrangement to which such
Seller is a party or by which any of the Shares are bound or affected or which
would have a material adverse effect on the ability of such Seller to consummate
the transactions contemplated by this Agreement.
SECTION 3.04. Absence of Litigation. There are no Actions by or against
any Seller pending before any Governmental Authority (or, to the best knowledge
of such Seller after due inquiry, threatened to be brought by or before any
Governmental Authority) relating to or affecting the Shares or which could
affect the legality, validity or enforceability of this Agreement or the
consummation of the transactions contemplated hereby. Each Seller is not subject
to any Governmental Order (nor, to the best knowledge of each Seller, are there
any such Governmental Orders threatened to be imposed by any Governmental
Authority) relating to or affecting the Shares or which would affect the
legality, validity or enforceability of this Agreement or the consummation of
the transactions contemplated hereby.
SECTION 3.05. Brokers. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement based upon arrangements
made by or on behalf of each Seller.
SECTION 3.06. Disclosure; Access to Information. Each Seller has
received and reviewed the materials listed in Schedule A to this Agreement, but
has not necessarily relied on all the information contained in such materials.
Each Seller acknowledges that the materials listed in Schedule A to this
Agreement contain certain material non-public information concerning the Company
and each Seller agrees to maintain, and to cause its Affiliates to maintain the
confidentiality of any and all such material non-public information furnished to
each Seller, except with the prior written consent of the Purchaser or as may be
required by any Governmental Order.
4
<PAGE>
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
As an inducement to the Sellers to enter into this Agreement, the
Purchaser hereby represents and warrants to the Sellers as follows:
SECTION 4.01. Organization and Authority of the Purchaser. The
Purchaser is a corporation duly organized, validly existing and in good standing
under the laws of Delaware. The Purchaser has all necessary corporate power and
authority to enter into this Agreement, to carry out its obligations hereunder
and to consummate the transactions contemplated hereby. The execution and
delivery of this Agreement by the Purchaser, the performance by the Purchaser of
its obligations hereunder and the consummation by the Purchaser of the
transactions contemplated hereby have been duly authorized by all requisite
action on the part of the Purchaser. This Agreement has been duly executed and
delivered by the Purchaser, and (assuming due authorization, execution and
delivery by the Sellers thereto) constitute legal, valid and binding obligations
of the Purchaser enforceable against the Purchaser in accordance with their
terms.
SECTION 4.02. No Conflict. Except as may result from any facts or
circumstances relating solely to any Seller, the execution, delivery and
performance of this Agreement by the Purchaser do not and will not (a) violate,
conflict with or result in the breach of any provision of the certificate of
incorporation, by-laws or other similar organizational documents of the
Purchaser, (b) conflict with or violate any Law or Governmental Order applicable
to the Purchaser or (c) conflict with, or result in any breach of, constitute a
default (or event which with the giving of notice or lapse or time, or both,
would become a default) under, require any consent under, or give to others any
rights of termination, amendment, acceleration, suspension, revocation, or
cancellation of, or result in the creation of any Encumbrance on any of the
assets or properties of the Purchaser pursuant to, any note, bond, mortgage or
indenture, contract, agreement, lease, sublease, license, permit, franchise or
other instrument or arrangement to which the Purchaser is a party or by which
any of such assets or properties are bound or affected which, with respect to
clauses (b) and (c) above would have a material adverse effect on the ability of
the Purchaser to consummate the transactions contemplated by this Agreement.
SECTION 4.03. Investment Purpose. The Purchaser is acquiring the Shares
solely for the purpose of investment and not with a view to, or for offer or
sale in connection with, any distribution thereof.
SECTION 4.04. Brokers. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement based upon arrangements
made by or on behalf of the Purchaser.
5
<PAGE>
ARTICLE V
ADDITIONAL AGREEMENTS
SECTION 5.01. Public Announcements. The Sellers shall not make, or
cause to be made, any press release or public announcement in respect of this
Agreement or the transactions contemplated hereby or otherwise communicate with
any news media without the prior written consent of the Purchaser, and the
Sellers shall cooperate with the Purchaser as to the timing and contents of any
such press release or public announcement.
SECTION 5.02. Further Action. Each of the parties hereto shall use all
reasonable efforts to take, or cause to be taken, all appropriate action, do or
cause to be done all things necessary, proper or advisable under applicable Law,
and execute and deliver such documents and other papers, as may be required to
carry out the provisions of this Agreement and consummate and make effective the
transactions contemplated hereby.
SECTION 5.03. Investigation. (a) Each Seller acknowledges and agrees
that it (i) has made its own inquiry and investigation into, and, based thereon,
has formed an independent judgment concerning, the Company, the Business and the
Shares, including with limitation, the value thereof, (ii) has been furnished
with or given adequate access to such information as it has requested about the
Company, the Business and the Shares and (iii) except as provided in this
Agreement, will not assert any claim against the Purchaser, the Company or any
of their respective directors, officers, employees, agents, stockholders,
Affiliates, consultants, investment bankers or representatives, or hold the
Purchaser, the Company or any such Persons liable, for any inaccuracies,
misstatements or omissions with respect to information furnished by the
Purchaser, the Company or such Persons concerning the Company, the Business or
the Shares.
(b) In connection with each Seller's investigation of the Company and
the Business, each Seller may receive from the Purchaser and the Company, or
their respective representatives, certain estimates, projections and other
forecasts for the Company and the Business. Each Seller acknowledges that there
are uncertainties inherent in attempting to make such estimates, projections,
forecasts, plans and budgets, that such Seller is familiar with such
uncertainties, that it is taking full responsibility for making its own
evaluation of, and neither the Purchaser nor the Company shall have any
responsibility with respect to, the adequacy and accuracy of any such estimates,
projections, forecasts, plans and budgets so furnished to it, and that such
Seller will not assert any claim against the Purchaser, the Company or any of
their respective directors, officers, employees, agents, stockholders,
Affiliates, consultants, investment bankers or representatives, or hold the
Purchaser, the Company or any such Persons liable with respect thereto.
6
<PAGE>
ARTICLE VI
CONDITIONS TO CLOSING
SECTION 6.01. Condition to Obligations of the Seller. The obligations
of each Seller to consummate the transactions contemplated by this Agreement
shall be subject to the fulfillment, at or prior to the Closing, of the
condition that the representations and warranties of the Purchaser contained in
this Agreement shall have been true and correct when made and shall be true and
correct in all material respects as of the Closing Date, with the same force and
effect as if made as of the Closing Date, and the covenants and agreements
contained in this Agreement to be complied with by the Purchaser at or prior to
the Closing shall have been complied with in all material respects.
SECTION 6.02. Conditions to Obligations of the Purchaser. The
obligations of the Purchaser to consummate the transactions contemplated by this
Agreement shall be subject to the fulfillment, at or prior the Closing, of the
condition that the representations and warranties of the Sellers contained in
this Agreement shall have been true and correct when made and shall be true and
correct in all material respects as of the Closing Date with the same force and
effect as if made as of the Closing Date, the covenants and agreements contained
in this Agreement to be complied with by the Sellers at or prior to the Closing
shall have been complied with in all material respects, and the Purchaser shall
have received a certificate signed by each Seller to such effect.
ARTICLE VII
TERMINATION
SECTION 7.01. Termination. This Agreement may be terminated at any time
prior to the Closing:
(a) by the mutual written consent of the Purchaser and the Sellers;
(b) by either the Purchaser or the Sellers if the Closing shall not
have occurred by December 31, 1999; provided, however, that the right to
terminate this Agreement under this Section 7.01(b) shall not be available
to any party whose failure to fulfill any obligation under this Agreement
shall have been the cause of, or shall have resulted in, the failure of the
Closing to occur on or prior to such date;
(c) by either the Purchaser or the Sellers in the event that any
Governmental Authority shall have issued an order, decree or ruling or taken
any other action restraining, enjoining or otherwise prohibiting the
transactions contemplated by this
7
<PAGE>
Agreement and such order, decree, ruling or other action shall have become
final and nonappealable; or
(d) by the Purchaser if, between the date hereof and the time
scheduled for the Closing, any Seller makes a general assignment for the
benefit of creditors, or any proceeding shall be instituted by or against
any Seller seeking to adjudicate it bankrupt or insolvent, or seeking
arrangement, adjustment, protection, relief or composition of its debts
under any Law relating to bankruptcy, insolvency or reorganization.
SECTION 7.02. Effect of Termination. In the event of termination of
this Agreement as provided in Section 7.01, this Agreement shall forthwith
become void and there shall be no liability on the part of any party hereto
except that nothing herein shall relieve any party from liability for any breach
of this Agreement.
ARTICLE VIII
GENERAL PROVISIONS
SECTION 8.01. Waiver. The Sellers and the Purchaser may (a) extend the
time for the performance of any of the obligations or other acts of the other
party, (b) waive any inaccuracies in the representations and warranties of the
other party contained herein or in any document delivered by the other party
pursuant hereto or (c) waive compliance with any of the agreements or conditions
of the other party contained herein. Any such extension or waiver shall be valid
only if set forth in an instrument in writing signed by the party to be bound
thereby. Any waiver of any term or condition shall not be construed as a waiver
of any subsequent breach or a subsequent waiver of the same term or condition,
or a waiver of any other term or condition, of this Agreement. The failure of
any party to assert any of its rights hereunder shall not constitute a waiver of
any of such rights.
SECTION 8.02. Expenses. (a) Except as otherwise specified in this
Agreement, all costs and expenses, including, without limitation, fees and
disbursements of counsel, financial advisors and accountants, incurred in
connection with this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such costs and expenses.
(b) The Sellers will pay any stamp duties, capital duties and taxes
payable upon the sale of the Shares.
SECTION 8.03. Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given or made (and
shall be deemed to have been duly given or made upon receipt) by delivery in
person, by courier service, by cable, by telecopy, by telegram, by telex or by
registered or certified mail (postage prepaid, return
8
<PAGE>
receipt requested) to the respective parties at the following addresses (or at
such other address for a party as shall be specified in a notice given in
accordance with this Section 8.03):
(a) if to the Sellers:
5818 Dearborn Parkway
Downers Grove, IL 60516
Fax: (630) 852-6423
Attention: Carl Everhart
Robert Everhart
(b) if to the Purchaser:
Danone Foods, Inc.
120 White Plains Road
Tarrytown, New York 10591
Fax: (914) 366-2865
Attention: General Counsel
with a copy to:
Groupe Danone
7 rue de Teheran
75381 Paris Cedex 08
Fax: 33-1-44-352-554
Attention: General Counsel
and a copy to:
Groupe Danone
7 rue de Teheran
75381 Paris Cedex 08
Fax: 33-1-44-352-097
Attention: Director of Corporate Development
and
Shearman & Sterling
599 Lexington Avenue
New York, NY 10022
Telecopy: 212-848-7179
Attention: John J. Madden, Esq.
9
<PAGE>
SECTION 8.04. Headings. The descriptive headings contained in this
Agreement are for convenience of reference only and shall not affect in any way
the meaning or interpretation of this Agreement.
SECTION 8.05. Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any Law or
public policy, all other terms and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in an acceptable manner in
order that the transactions contemplated hereby are consummated as originally
contemplated to the greatest extent possible.
SECTION 8.06. Entire Agreement. This Agreement constitutes the entire
agreement of the parties hereto with respect to the subject matter hereof and
thereof and supersedes all prior agreements and undertakings, both written and
oral, among the parties hereto with respect to the subject matter hereof and
thereof.
SECTION 8.07. Assignment. This Agreement may not be assigned by
operation of law or otherwise without the express written consent of the Sellers
and the Purchaser (which consent may be granted or withheld in the sole
discretion of the Sellers or the Purchaser); provided, however, that the
Purchaser may assign this Agreement to an Affiliate of the Purchaser without the
consent of the Sellers.
SECTION 8.08. No Third Party Beneficiaries. This Agreement shall be
binding upon and inure solely to the benefit of the parties hereto and their
permitted assigns and nothing herein, express or implied, is intended to or
shall confer upon any other Person any legal or equitable right, benefit or
remedy of any nature whatsoever under or by reason of this Agreement.
SECTION 8.09. Amendment. This Agreement may not be amended or modified
except (a) by an instrument in writing signed by, or on behalf of, the Sellers
and the Purchaser or (b) by a waiver in accordance with Section 8.01.
SECTION 8.10. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Illinois, without giving
effect to its principles or rules of conflict of laws to the extent such
principles or rules would require or permit the application of the laws of
another jurisdiction.
SECTION 8.11. Waiver of Jury Trial. Each of the parties hereto hereby
waives to the fullest extent permitted by applicable law, any right it may have
to a trial by jury in respect to any litigation directly or indirectly arising
out of, under or in connection with this Agreement.
10
<PAGE>
Each of the parties hereto (a) certifies that no representative, agent or
attorney of any other party has represented, expressly or otherwise, that such
other party would not, in the event of litigation, seek to enforce that
foregoing waiver and (b) acknowledges that it and the other parties hereto have
been induced to enter into this Agreement, by, among other things, the mutual
waivers and certifications in this Section 8.11.
SECTION 8.12. Counterparts. This Agreement may be executed in one or
more counterparts, and by the different parties hereto in separate counterparts,
each of which when executed shall be deemed to be an original but all of which
taken together shall constitute one and the same agreement.
SECTION 8.13. Specific Performance. The parties hereto agree that
irreparable damage would occur in the event any provision of this Agreement was
not performed in accordance with the terms hereof and that the parties shall be
entitled to specific performance of the terms hereof, in additional to any other
remedy at Law or equity.
SECTION 8.14. Survival of Representations and Warranties. The
representations and warranties of the parties hereto contained in Articles III
and IV shall survive the Closing until the second anniversary thereof.
11
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto have caused this
Agreement to be executed as of the date first written above by their respective
officers thereunto duly authorized.
By: /s/ Carl Everhart
-------------------------------------
Name: Carl Everhart
By: /s/ Robert Everhart
-------------------------------------
Name: Robert Everhart
By: /s/ Nicole Everhart
-------------------------------------
Name: Nicole Everhart
DANONE FOODS, INC.
By: /s/ Michael Harrison
-------------------------------------
Name: Michael Harrison
Title: Vice President
12
<PAGE>
SCHEDULE A
1. The "Company Profile and Representation" prepared by the Company and dated
June 7, 1999; and
2. The "Due Diligence Findings" Report (without attachments), dated June 2,
1999, prepared for and on behalf of the Purchaser.
<PAGE>
SCHEDULE B
Name: Shares:
- ---- ------
Carl Everhart 7,300
Robert Everhart and Nicole Everhart 1,750
<PAGE>
Exhibit 15
================================================================================
--------------------------------------
STOCK PURCHASE AGREEMENT
--------------------------------------
Among
POL SIKAR,
GALINA SIKAR,
MONTROSE GLASS & MIRROR CORPORATION
and
DANONE FOODS, INC.
Dated as of November 5, 1999
================================================================================
<PAGE>
TABLE OF CONTENTS
Section Page
- ------- ----
ARTICLE I
DEFINITIONS
1.01. Certain Defined Terms................................................1
ARTICLE II
PURCHASE AND SALE
2.01. Purchase and Sale of the Shares......................................2
2.02. Purchase Price.......................................................2
2.03. Closing..............................................................3
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLER
3.01. Authorization........................................................3
3.02. Ownership of Shares..................................................3
3.03. No Conflict..........................................................4
3.04. Absence of Litigation................................................4
3.05. Brokers..............................................................4
3.06. Disclosure; Access to Information....................................4
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
4.01. Organization and Authority of the Purchaser..........................5
4.02. No Conflict..........................................................5
4.03. Investment Purpose...................................................5
4.04. Brokers..............................................................5
-i-
<PAGE>
Section Page
- ------- ----
ARTICLE V
ADDITIONAL AGREEMENTS
5.01. Public Announcements.................................................6
5.02. Further Action.......................................................6
5.03. Investigation........................................................6
ARTICLE VI
CONDITIONS TO CLOSING
6.01. Condition to Obligations of the Seller...............................7
6.02. Conditions to Obligations of the Purchaser...........................7
ARTICLE VII
TERMINATION
7.01. Termination..........................................................7
7.02. Effect of Termination................................................8
ARTICLE VIII
GENERAL PROVISIONS
8.01. Waiver...............................................................8
8.02. Expenses.............................................................8
8.03. Notices..............................................................8
8.04. Headings............................................................10
8.05. Severability........................................................10
8.06. Entire Agreement....................................................10
8.07. Assignment..........................................................10
8.08. No Third Party Beneficiaries........................................10
8.09. Amendment...........................................................10
8.10. Governing Law.......................................................10
8.11. Waiver of Jury Trial................................................10
8.12. Counterparts........................................................11
8.13. Specific Performance................................................11
8.14. Survival of Representations and Warranties..........................11
-ii-
<PAGE>
STOCK PURCHASE AGREEMENT, dated as of November 5, 1999, among
Pol and Galina Sikar, both of 3907 Miller Drive, Glenview, Illinois, Montrose
Glass & Mirror Corporation, an Illinois corporation (each a "Seller", and
collectively, the "Sellers") and Danone Foods, Inc., a Delaware corporation (the
"Purchaser").
W I T N E S S E T H:
WHEREAS, the Sellers own at least 10,000 shares of common
stock, no par value per share (the "Common Stock") of Lifeway Foods, Inc., an
Illinois corporation (the "Company"); and
WHEREAS, the Sellers wish to sell to the Purchaser, and the
Purchaser wishes to purchase from the Sellers, 10,000 shares of the Common Stock
(such shares to be sold pursuant to this Agreement being individually, a "Share"
and, collectively, the "Shares"), upon the terms and subject to the conditions
set forth herein.
NOW, THEREFORE, in consideration of the premises and the
mutual agreements and covenants hereinafter set forth, the Purchaser and the
Sellers hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms. As used in this
Agreement, the following terms shall have the following meanings:
"Action" means any claim, action, suit, arbitration, inquiry,
proceeding or investigation by or before any Governmental Authority.
"Affiliate" means, with respect to any specified Person, any
other Person that directly, or indirectly through one or more intermediaries,
controls, is controlled by, or is under common control with, such specified
Person.
"Business" means the business of manufacturing, marketing and
selling cultured, probiotic and functional food products in the health food
industry and all other business which prior to the date hereof has been
conducted by the Company and the Subsidiaries.
"Closing" has the meaning specified in Section 2.03(a).
"Closing Date" has the meaning specified in Section 2.03(a).
"Common Stock" has the meaning specified in the recitals to
this Agreement.
<PAGE>
"control" (including the terms "controlled by" and "under
common control with"), with respect to the relationship between or among two or
more Persons, means the possession, directly or indirectly or as trustee or
executor, of the power to direct or cause the direction of the affairs or
management of a Person, whether through the ownership of voting securities, as
trustee or executor, by contract or otherwise, including, without limitation,
the ownership, directly or indirectly, of securities having the power to elect a
majority of the board of directors or similar body governing the affairs of such
Person.
"Encumbrance" means any security interest, pledge, mortgage,
lien (including, without limitation, environmental and tax liens), charge,
encumbrance, adverse claim, preferential arrangement or restriction of any kind,
including, without limitation, any restriction on the use, voting, transfer,
receipt of income or other exercise of any attributes of ownership.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Governmental Authority" means any United States federal,
state, local, supranational or any foreign government, governmental, regulatory
or administrative authority, agency or commission or any court, tribunal, or
judicial or arbitral body.
"Governmental Order" means any order, writ, judgment,
injunction, decree, stipulation, determination or award entered by or with any
Governmental Authority.
"Law" means any federal, state, local or foreign statute, law,
ordinance, regulation, rule, code, order, other requirement or rule of law.
"Person" means any individual, partnership, firm, corporation,
association, trust, unincorporated organization or other entity, as well as any
syndicate or group that would be deemed to be a person under Section 13(d)(3) of
the Securities Exchange Act of 1934, as amended.
"Purchase Price" has the meaning specified in Section 2.02.
ARTICLE II
PURCHASE AND SALE
SECTION 2.01. Purchase and Sale of the Shares. Upon the terms
and subject to the conditions contained in this Agreement, at the Closing, the
Sellers shall sell to the Purchaser, and the Purchaser shall purchase from the
Sellers, 10,000 Shares.
SECTION 2.02. Purchase Price. The purchase price shall be
$10.00 per Share (the "Purchase Price") payable as provided in Section 2.03(b).
2
<PAGE>
SECTION 2.03. Closing. (a) Subject to the terms and conditions
of this Agreement, the sale and purchase of the Shares contemplated by this
Agreement shall take place at a closing (the "Closing") to be held at the
offices of Shearman & Sterling at 10:00 A.M., New York time, on such date on or
before October 31, 1999 as the Purchaser may determine, or at such other place
or at such other time or on such other date as the Sellers and the Purchaser may
mutually agree upon in writing (the date on which the Closing takes place being
the "Closing Date").
(b) At the Closing, (i) the Sellers shall deliver or cause to
be delivered to the Purchaser stock certificates evidencing the Shares duly
endorsed in blank, or accompanied by stock powers duly executed in blank, in
form satisfactory to the Purchaser and (ii) the Purchaser shall, at the election
of the Sellers, (x) deliver to the Sellers a certified check in the amount of
$82,000, made payable to the order of Pol and Galina Sikar and a certified check
in the amount of $18,000, made payable to the order of Montrose Glass & Mirror
Corporation or (y) pay to the Sellers the amount of $100,000 by wire transfer of
immediately available funds to the bank accounts designated by the Sellers. The
Sellers agree to provide the Purchaser with notice of such election at least one
day prior to the Closing Date.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLER
As an inducement to the Purchaser to enter into this
Agreement, each of the Sellers hereby, severally but not jointly, represent and
warrant to the Purchaser as follows:
SECTION 3.01. Authorization. Each Seller, if it is an
individual, has all requisite right, power and authority and full legal capacity
to execute and deliver this Agreement, to perform his or her obligations
hereunder and to consummate the transactions contemplated hereby. Each Seller,
if it is a corporation or other legal entity, is duly organized, validly
existing and in good standing under the laws of its incorporation or formation
and has all requisite power and authority to enter into this Agreement, to carry
out its obligations hereunder and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement by such Seller, the
performance by such Seller of its obligations hereunder and the consummation by
such Seller of the transactions contemplated hereby have been duly authorized by
all requisite action on the part of such Seller. This Agreement has been duly
and validly executed and delivered by each Seller, and this Agreement
constitutes a legal, valid and binding obligation of such Seller enforceable
against such Seller in accordance with its terms.
SECTION 3.02. Ownership of Shares. Each Seller has good and
marketable title to, and is the record and beneficial owner of, the number of
Shares set forth next to such Seller's name in Schedule B to this Agreement,
free and clear of all Encumbrances. Upon delivery of the Shares by the Sellers
to the Purchaser at the Closing and payment of the Purchase Price for the
3
<PAGE>
Shares, as herein provided, the Purchaser will receive good and marketable title
to the Shares, free and clear of all Encumbrances.
SECTION 3.03. No Conflict. Except as may result from any facts
or circumstances relating solely to the Purchaser, the execution, delivery and
performance of this Agreement by each Seller do not and will not (a) conflict
with or violate any Law or Governmental Order applicable to such Seller or (b)
conflict with, result in any breach of, constitute a default (or event which
with the giving of notice or lapse of time, or both, would become a default)
under, require any consent under, or give to others any rights of termination,
amendment, acceleration, suspension, revocation or cancellation of, or result in
the creation of any Encumbrance on any of the Shares pursuant to, any note,
bond, mortgage or indenture, contract, agreement, lease, sublease, license,
permit, franchise or other instrument, obligation or arrangement to which such
Seller is a party or by which any of the Shares are bound or affected or which
would have a material adverse effect on the ability of such Seller to consummate
the transactions contemplated by this Agreement.
SECTION 3.04. Absence of Litigation. There are no Actions by
or against any Seller pending before any Governmental Authority (or, to the best
knowledge of such Seller after due inquiry, threatened to be brought by or
before any Governmental Authority) relating to or affecting the Shares or which
could affect the legality, validity or enforceability of this Agreement or the
consummation of the transactions contemplated hereby. Each Seller is not subject
to any Governmental Order (nor, to the best knowledge of each Seller, are there
any such Governmental Orders threatened to be imposed by any Governmental
Authority) relating to or affecting the Shares or which would affect the
legality, validity or enforceability of this Agreement or the consummation of
the transactions contemplated hereby.
SECTION 3.05. Brokers. No broker, finder or investment banker
is entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement based upon arrangements
made by or on behalf of each Seller.
SECTION 3.06. Disclosure; Access to Information. Each Seller
has received and reviewed the materials listed in Schedule A to this Agreement,
but has not necessarily relied on all the information contained in such
materials. Each Seller acknowledges that the materials listed in Schedule A to
this Agreement contain certain material non-public information concerning the
Company and each Seller agrees to maintain, and to cause its Affiliates to
maintain the confidentiality of any and all such material non-public information
furnished to each Seller, except with the prior written consent of the Purchaser
or as may be required by any Governmental Order.
4
<PAGE>
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
As an inducement to the Sellers to enter into this Agreement,
the Purchaser hereby represents and warrants to the Sellers as follows:
SECTION 4.01. Organization and Authority of the Purchaser. The
Purchaser is a corporation duly organized, validly existing and in good standing
under the laws of Delaware. The Purchaser has all necessary corporate power and
authority to enter into this Agreement, to carry out its obligations hereunder
and to consummate the transactions contemplated hereby. The execution and
delivery of this Agreement by the Purchaser, the performance by the Purchaser of
its obligations hereunder and the consummation by the Purchaser of the
transactions contemplated hereby have been duly authorized by all requisite
action on the part of the Purchaser. This Agreement has been duly executed and
delivered by the Purchaser, and (assuming due authorization, execution and
delivery by the Sellers thereto) constitute legal, valid and binding obligations
of the Purchaser enforceable against the Purchaser in accordance with their
terms.
SECTION 4.02. No Conflict. Except as may result from any facts
or circumstances relating solely to any Seller, the execution, delivery and
performance of this Agreement by the Purchaser do not and will not (a) violate,
conflict with or result in the breach of any provision of the certificate of
incorporation, by-laws or other similar organizational documents of the
Purchaser, (b) conflict with or violate any Law or Governmental Order applicable
to the Purchaser or (c) conflict with, or result in any breach of, constitute a
default (or event which with the giving of notice or lapse or time, or both,
would become a default) under, require any consent under, or give to others any
rights of termination, amendment, acceleration, suspension, revocation, or
cancellation of, or result in the creation of any Encumbrance on any of the
assets or properties of the Purchaser pursuant to, any note, bond, mortgage or
indenture, contract, agreement, lease, sublease, license, permit, franchise or
other instrument or arrangement to which the Purchaser is a party or by which
any of such assets or properties are bound or affected which, with respect to
clauses (b) and (c) above would have a material adverse effect on the ability of
the Purchaser to consummate the transactions contemplated by this Agreement.
SECTION 4.03. Investment Purpose. The Purchaser is acquiring
the Shares solely for the purpose of investment and not with a view to, or for
offer or sale in connection with, any distribution thereof.
SECTION 4.04. Brokers. No broker, finder or investment banker
is entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement based upon arrangements
made by or on behalf of the Purchaser.
5
<PAGE>
ARTICLE V
ADDITIONAL AGREEMENTS
SECTION 5.01. Public Announcements. The Sellers shall not
make, or cause to be made, any press release or public announcement in respect
of this Agreement or the transactions contemplated hereby or otherwise
communicate with any news media without the prior written consent of the
Purchaser, and the Sellers shall cooperate with the Purchaser as to the timing
and contents of any such press release or public announcement.
SECTION 5.02. Further Action. Each of the parties hereto shall
use all reasonable efforts to take, or cause to be taken, all appropriate
action, do or cause to be done all things necessary, proper or advisable under
applicable Law, and execute and deliver such documents and other papers, as may
be required to carry out the provisions of this Agreement and consummate and
make effective the transactions contemplated hereby.
SECTION 5.03. Investigation. (a) Each Seller acknowledges and
agrees that it (i) has made its own inquiry and investigation into, and, based
thereon, has formed an independent judgment concerning, the Company, the
Business and the Shares, including with limitation, the value thereof, (ii) has
been furnished with or given adequate access to such information as it has
requested about the Company, the Business and the Shares and (iii) except as
provided in this Agreement, will not assert any claim against the Purchaser, the
Company or any of their respective directors, officers, employees, agents,
stockholders, Affiliates, consultants, investment bankers or representatives, or
hold the Purchaser, the Company or any such Persons liable, for any
inaccuracies, misstatements or omissions with respect to information furnished
by the Purchaser, the Company or such Persons concerning the Company, the
Business or the Shares.
(b) In connection with each Seller's investigation of the
Company and the Business, each Seller may receive from the Purchaser and the
Company, or their respective representatives, certain estimates, projections and
other forecasts for the Company and the Business. Each Seller acknowledges that
there are uncertainties inherent in attempting to make such estimates,
projections, forecasts, plans and budgets, that such Seller is familiar with
such uncertainties, that it is taking full responsibility for making its own
evaluation of, and neither the Purchaser nor the Company shall have any
responsibility with respect to, the adequacy and accuracy of any such estimates,
projections, forecasts, plans and budgets so furnished to it, and that such
Seller will not assert any claim against the Purchaser, the Company or any of
their respective directors, officers, employees, agents, stockholders,
Affiliates, consultants, investment bankers or representatives, or hold the
Purchaser, the Company or any such Persons liable with respect thereto.
6
<PAGE>
ARTICLE VI
CONDITIONS TO CLOSING
SECTION 6.01. Condition to Obligations of the Seller. The
obligations of each Seller to consummate the transactions contemplated by this
Agreement shall be subject to the fulfillment, at or prior to the Closing, of
the condition that the representations and warranties of the Purchaser contained
in this Agreement shall have been true and correct when made and shall be true
and correct in all material respects as of the Closing Date, with the same force
and effect as if made as of the Closing Date, and the covenants and agreements
contained in this Agreement to be complied with by the Purchaser at or prior to
the Closing shall have been complied with in all material respects.
SECTION 6.02. Conditions to Obligations of the Purchaser. The
obligations of the Purchaser to consummate the transactions contemplated by this
Agreement shall be subject to the fulfillment, at or prior the Closing, of the
condition that the representations and warranties of the Sellers contained in
this Agreement shall have been true and correct when made and shall be true and
correct in all material respects as of the Closing Date with the same force and
effect as if made as of the Closing Date, the covenants and agreements contained
in this Agreement to be complied with by the Sellers at or prior to the Closing
shall have been complied with in all material respects, and the Purchaser shall
have received a certificate signed by each Seller to such effect.
ARTICLE VII
TERMINATION
SECTION 7.01. Termination. This Agreement may be terminated at
any time prior to the Closing:
(a) by the mutual written consent of the Purchaser and the
Sellers;
(b) by either the Purchaser or the Sellers if the Closing
shall not have occurred by December 31, 1999; provided, however, that
the right to terminate this Agreement under this Section 7.01(b) shall
not be available to any party whose failure to fulfill any obligation
under this Agreement shall have been the cause of, or shall have
resulted in, the failure of the Closing to occur on or prior to such
date;
(c) by either the Purchaser or the Sellers in the event that
any Governmental Authority shall have issued an order, decree or ruling
or taken any other action restraining, enjoining or otherwise
prohibiting the transactions contemplated by this
7
<PAGE>
Agreement and such order, decree, ruling or other action shall have
become final and nonappealable; or
(d) by the Purchaser if, between the date hereof and the time
scheduled for the Closing, any Seller makes a general assignment for
the benefit of creditors, or any proceeding shall be instituted by or
against any Seller seeking to adjudicate it bankrupt or insolvent, or
seeking arrangement, adjustment, protection, relief or composition of
its debts under any Law relating to bankruptcy, insolvency or
reorganization.
SECTION 7.02. Effect of Termination. In the event of
termination of this Agreement as provided in Section 7.01, this Agreement shall
forthwith become void and there shall be no liability on the part of any party
hereto except that nothing herein shall relieve any party from liability for any
breach of this Agreement.
ARTICLE VIII
GENERAL PROVISIONS
SECTION 8.01. Waiver. The Sellers and the Purchaser may (a)
extend the time for the performance of any of the obligations or other acts of
the other party, (b) waive any inaccuracies in the representations and
warranties of the other party contained herein or in any document delivered by
the other party pursuant hereto or (c) waive compliance with any of the
agreements or conditions of the other party contained herein. Any such extension
or waiver shall be valid only if set forth in an instrument in writing signed by
the party to be bound thereby. Any waiver of any term or condition shall not be
construed as a waiver of any subsequent breach or a subsequent waiver of the
same term or condition, or a waiver of any other term or condition, of this
Agreement. The failure of any party to assert any of its rights hereunder shall
not constitute a waiver of any of such rights.
SECTION 8.02. Expenses. (a) Except as otherwise specified in
this Agreement, all costs and expenses, including, without limitation, fees and
disbursements of counsel, financial advisors and accountants, incurred in
connection with this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such costs and expenses.
(b) The Sellers will pay any stamp duties, capital duties and
taxes payable upon the sale of the Shares.
SECTION 8.03. Notices. All notices, requests, claims, demands
and other communications hereunder shall be in writing and shall be given or
made (and shall be deemed to have been duly given or made upon receipt) by
delivery in person, by courier service, by cable, by telecopy, by telegram, by
telex or by registered or certified mail (postage prepaid, return
8
<PAGE>
receipt requested) to the respective parties at the following addresses (or at
such other address for a party as shall be specified in a notice given in
accordance with this Section 8.03):
(a) if to the Sellers:
3907 Miller Drive
Glenview, Illinois 60025
Fax: (847) 773-478-8880
Attention: Pol and Galina Sikar
Montrose Glass & Mirror Corporation
(b) if to the Purchaser:
Danone Foods, Inc.
120 White Plains Road
Tarrytown, New York 10591
Fax: (914) 366-2865
Attention: General Counsel
with a copy to:
Groupe Danone
7 rue de Teheran
75381 Paris Cedex 08
Fax: 33-1-44-352-554
Attention: General Counsel
and a copy to:
Groupe Danone
7 rue de Teheran
75381 Paris Cedex 08
Fax: 33-1-44-352-097
Attention: Director of Corporate Development
and
Shearman & Sterling
599 Lexington Avenue
New York, NY 10022
Telecopy: 212-848-7179
Attention: John J. Madden, Esq.
9
<PAGE>
SECTION 8.04. Headings. The descriptive headings contained in
this Agreement are for convenience of reference only and shall not affect in any
way the meaning or interpretation of this Agreement.
SECTION 8.05. Severability. If any term or other provision of
this Agreement is invalid, illegal or incapable of being enforced by any Law or
public policy, all other terms and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in an acceptable manner in
order that the transactions contemplated hereby are consummated as originally
contemplated to the greatest extent possible.
SECTION 8.06. Entire Agreement. This Agreement constitutes the
entire agreement of the parties hereto with respect to the subject matter hereof
and thereof and supersedes all prior agreements and undertakings, both written
and oral, among the parties hereto with respect to the subject matter hereof and
thereof.
SECTION 8.07. Assignment. This Agreement may not be assigned
by operation of law or otherwise without the express written consent of the
Sellers and the Purchaser (which consent may be granted or withheld in the sole
discretion of the Sellers or the Purchaser); provided, however, that the
Purchaser may assign this Agreement to an Affiliate of the Purchaser without the
consent of the Sellers.
SECTION 8.08. No Third Party Beneficiaries. This Agreement
shall be binding upon and inure solely to the benefit of the parties hereto and
their permitted assigns and nothing herein, express or implied, is intended to
or shall confer upon any other Person any legal or equitable right, benefit or
remedy of any nature whatsoever under or by reason of this Agreement.
SECTION 8.09. Amendment. This Agreement may not be amended or
modified except (a) by an instrument in writing signed by, or on behalf of, the
Sellers and the Purchaser or (b) by a waiver in accordance with Section 8.01.
SECTION 8.10. Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of Illinois, without
giving effect to its principles or rules of conflict of laws to the extent such
principles or rules would require or permit the application of the laws of
another jurisdiction.
SECTION 8.11. Waiver of Jury Trial. Each of the parties hereto
hereby waives to the fullest extent permitted by applicable law, any right it
may have to a trial by jury in respect to any litigation directly or indirectly
arising out of, under or in connection with this Agreement.
10
<PAGE>
Each of the parties hereto (a) certifies that no representative, agent or
attorney of any other party has represented, expressly or otherwise, that such
other party would not, in the event of litigation, seek to enforce that
foregoing waiver and (b) acknowledges that it and the other parties hereto have
been induced to enter into this Agreement, by, among other things, the mutual
waivers and certifications in this Section 8.11.
SECTION 8.12. Counterparts. This Agreement may be executed in
one or more counterparts, and by the different parties hereto in separate
counterparts, each of which when executed shall be deemed to be an original but
all of which taken together shall constitute one and the same agreement.
SECTION 8.13. Specific Performance. The parties hereto agree
that irreparable damage would occur in the event any provision of this Agreement
was not performed in accordance with the terms hereof and that the parties shall
be entitled to specific performance of the terms hereof, in additional to any
other remedy at Law or equity.
SECTION 8.14. Survival of Representations and Warranties. The
representations and warranties of the parties hereto contained in Articles III
and IV shall survive the Closing until the second anniversary thereof.
11
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto have caused
this Agreement to be executed as of the date first written above by their
respective officers thereunto duly authorized.
By: /s/ Pol Sikar
---------------------------------
Name: Pol Sikar
By: /s/ Galina Sikar
---------------------------------
Name: Galina Sikar
MONTROSE GLASS & MIRROR
CORPORATION
By: /s/ Pol Sikar
---------------------------------
Name: Pol Sikar
Title: President
DANONE FOODS, INC.
By: /s/ Michael Harrison
---------------------------------
Name: Michael Harrison
Title: Vice President
12
<PAGE>
SCHEDULE A
1. The "Company Profile and Representation" prepared by the Company and dated
June 7, 1999; and
2. The "Due Diligence Findings" Report (without attachments), dated June 2,
1999, prepared for and on behalf of the Purchaser.
13
<PAGE>
SCHEDULE B
Name: Shares:
- ---- -------
Pol and Galina Sikar 8,200
Montrose Glass & Mirror Corporation 1,800
14
<PAGE>
Exhibit 16
================================================================================
--------------------------------------
STOCK PURCHASE AGREEMENT
--------------------------------------
Between
KIRGAM INTERNATIONAL INC.
and
DANONE FOODS, INC.
Dated as of November 9, 1999
<PAGE>
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS
1.01. Certain Defined Terms...................................................1
ARTICLE II
PURCHASE AND SALE
2.01. Purchase and Sale of the Shares.........................................2
2.02. Purchase Price..........................................................2
2.03. Closing.................................................................3
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLER
3.01. Authorization...........................................................3
3.02. Ownership of Shares.....................................................3
3.03. No Conflict.............................................................4
3.04. Absence of Litigation...................................................4
3.05. Brokers.................................................................4
3.06. Disclosure; Access to Information.......................................4
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
4.01. Organization and Authority of the Purchaser.............................5
4.02. No Conflict.............................................................5
4.03. Investment Purpose......................................................5
4.04. Brokers.................................................................5
-i-
<PAGE>
Section Page
ARTICLE V
ADDITIONAL AGREEMENTS
5.01. Public Announcements....................................................6
5.02. Further Action..........................................................6
5.03. Investigation...........................................................6
ARTICLE VI
CONDITIONS TO CLOSING
6.01. Condition to Obligations of the Seller..................................7
6.02. Conditions to Obligations of the Purchaser..............................7
ARTICLE VII
TERMINATION
7.01. Termination.............................................................7
7.02. Effect of Termination...................................................8
ARTICLE VIII
GENERAL PROVISIONS
8.01. Waiver..................................................................8
8.02. Expenses................................................................8
8.03. Notices.................................................................8
8.04. Headings...............................................................10
8.05. Severability...........................................................10
8.06. Entire Agreement.......................................................10
8.07. Assignment.............................................................10
8.08. No Third Party Beneficiaries...........................................10
8.09. Amendment..............................................................10
8.10. Governing Law..........................................................10
8.11. Waiver of Jury Trial...................................................10
8.12. Counterparts...........................................................11
8.13. Specific Performance...................................................11
8.14. Survival of Representations and Warranties.............................11
-ii-
<PAGE>
STOCK PURCHASE AGREEMENT, dated as of November 9, 1999, between Kirgam
International Inc., an Illinois corporation (the "Seller") and Danone Foods,
Inc., a Delaware corporation (the "Purchaser").
W I T N E S S E T H:
WHEREAS, the Seller owns at least 13,610 shares of common stock, no par
value per share (the "Common Stock") of Lifeway Foods, Inc., an Illinois
corporation (the "Company"); and
WHEREAS, the Seller wishes to sell to the Purchaser, and the Purchaser
wishes to purchase from the Seller, 13,600 shares of the Common Stock (such
shares to be sold pursuant to this Agreement being individually, a "Share" and,
collectively, the "Shares"), upon the terms and subject to the conditions set
forth herein.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements and covenants hereinafter set forth, the Purchaser and the Seller
hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"Action" means any claim, action, suit, arbitration, inquiry,
proceeding or investigation by or before any Governmental Authority.
"Affiliate" means, with respect to any specified Person, any other
Person that directly, or indirectly through one or more intermediaries,
controls, is controlled by, or is under common control with, such specified
Person.
"Business" means the business of manufacturing, marketing and selling
cultured, probiotic and functional food products in the health food industry and
all other business which prior to the date hereof has been conducted by the
Company and the Subsidiaries.
"Closing" has the meaning specified in Section 2.03(a).
"Closing Date" has the meaning specified in Section 2.03(a).
"Common Stock" has the meaning specified in the recitals to this
Agreement.
<PAGE>
"control" (including the terms "controlled by" and "under common
control with"), with respect to the relationship between or among two or more
Persons, means the possession, directly or indirectly or as trustee or executor,
of the power to direct or cause the direction of the affairs or management of a
Person, whether through the ownership of voting securities, as trustee or
executor, by contract or otherwise, including, without limitation, the
ownership, directly or indirectly, of securities having the power to elect a
majority of the board of directors or similar body governing the affairs of such
Person.
"Encumbrance" means any security interest, pledge, mortgage, lien
(including, without limitation, environmental and tax liens), charge,
encumbrance, adverse claim, preferential arrangement or restriction of any kind,
including, without limitation, any restriction on the use, voting, transfer,
receipt of income or other exercise of any attributes of ownership.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Governmental Authority" means any United States federal, state, local,
supranational or any foreign government, governmental, regulatory or
administrative authority, agency or commission or any court, tribunal, or
judicial or arbitral body.
"Governmental Order" means any order, writ, judgment, injunction,
decree, stipulation, determination or award entered by or with any Governmental
Authority.
"Law" means any federal, state, local or foreign statute, law,
ordinance, regulation, rule, code, order, other requirement or rule of law.
"Person" means any individual, partnership, firm, corporation,
association, trust, unincorporated organization or other entity, as well as any
syndicate or group that would be deemed to be a person under Section 13(d)(3) of
the Securities Exchange Act of 1934, as amended.
"Purchase Price" has the meaning specified in Section 2.02.
ARTICLE II
PURCHASE AND SALE
SECTION 2.01. Purchase and Sale of the Shares. Upon the terms and
subject to the conditions contained in this Agreement, at the Closing, the
Seller shall sell to the Purchaser, and the Purchaser shall purchase from the
Seller, 13,610 Shares.
SECTION 2.02. Purchase Price. The purchase price shall be $10.00 per
Share (the "Purchase Price") payable as provided in Section 2.03(b).
2
<PAGE>
SECTION 2.03. Closing. (a) Subject to the terms and conditions of this
Agreement, the sale and purchase of the Shares contemplated by this Agreement
shall take place at a closing (the "Closing") to be held at the offices of
Shearman & Sterling at 10:00 A.M., New York time, on such date on or before
October 31, 1999 as the Purchaser may determine, or at such other place or at
such other time or on such other date as the Seller and the Purchaser may
mutually agree upon in writing (the date on which the Closing takes place being
the "Closing Date").
(b) At the Closing, (i) the Seller shall deliver or cause to be
delivered to the Purchaser stock certificates evidencing the Shares duly
endorsed in blank, or accompanied by stock powers duly executed in blank, in
form satisfactory to the Purchaser and (ii) the Purchaser shall, at the election
of the Seller, (x) deliver to the Seller a certified check in the amount of
$136,100, made payable to the order of the Seller or (y) pay to the Seller the
amount of $136,100 by wire transfer of immediately available funds to the bank
account designated by the Seller. The Seller agrees to provide the Purchaser
with notice of such election at least one day prior to the Closing Date.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLER
As an inducement to the Purchaser to enter into this Agreement, the
Seller hereby represents and warrants to the Purchaser as follows:
SECTION 3.01. Authorization. The Seller, if it is an individual, has
all requisite right, power and authority and full legal capacity to execute and
deliver this Agreement, to perform his or her obligations hereunder and to
consummate the transactions contemplated hereby. The Seller, if it is a
corporation or other legal entity, is duly organized, validly existing and in
good standing under the laws of its incorporation or formation and has all
requisite power and authority to enter into this Agreement, to carry out its
obligations hereunder and to consummate the transactions contemplated hereby.
The execution and delivery of this Agreement by the Seller, the performance by
the Seller of its obligations hereunder and the consummation by the Seller of
the transactions contemplated hereby have been duly authorized by all requisite
action on the part of the Seller. This Agreement has been duly and validly
executed and delivered by the Seller, and this Agreement constitutes a legal,
valid and binding obligation of the Seller enforceable against the Seller in
accordance with its terms.
SECTION 3.02. Ownership of Shares. The Seller has good and marketable
title to, and is the record and beneficial owner of, the Shares, free and clear
of all Encumbrances. Upon delivery of the Shares by the Seller to the Purchaser
at the Closing and payment of the Purchase Price for the Shares, as herein
provided, the Purchaser will receive good and marketable title to the Shares,
free and clear of all Encumbrances.
3
<PAGE>
SECTION 3.03. No Conflict. Except as may result from any facts or
circumstances relating solely to the Purchaser, the execution, delivery and
performance of this Agreement by the Seller do not and will not (a) conflict
with or violate any Law or Governmental Order applicable to the Seller or (b)
conflict with, result in any breach of, constitute a default (or event which
with the giving of notice or lapse of time, or both, would become a default)
under, require any consent under, or give to others any rights of termination,
amendment, acceleration, suspension, revocation or cancellation of, or result in
the creation of any Encumbrance on any of the Shares pursuant to, any note,
bond, mortgage or indenture, contract, agreement, lease, sublease, license,
permit, franchise or other instrument, obligation or arrangement to which the
Seller is a party or by which any of the Shares are bound or affected or which
would have a material adverse effect on the ability of the Seller to consummate
the transactions contemplated by this Agreement.
SECTION 3.04. Absence of Litigation. There are no Actions by or against
the Seller pending before any Governmental Authority (or, to the best knowledge
of the Seller after due inquiry, threatened to be brought by or before any
Governmental Authority) relating to or affecting the Shares or which could
affect the legality, validity or enforceability of this Agreement or the
consummation of the transactions contemplated hereby. The Seller is not subject
to any Governmental Order (nor, to the best knowledge of the Seller, are there
any such Governmental Orders threatened to be imposed by any Governmental
Authority) relating to or affecting the Shares or which would affect the
legality, validity or enforceability of this Agreement or the consummation of
the transactions contemplated hereby.
SECTION 3.05. Brokers. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement based upon arrangements
made by or on behalf of the Seller.
SECTION 3.06. Disclosure; Access to Information. The Seller has
received and reviewed the materials listed in Schedule A to this Agreement, but
has not necessarily relied on all the information contained in such materials.
The Seller acknowledges that the materials listed in Schedule A to this
Agreement contain certain information concerning the Company and the Seller
agrees to maintain, and to cause its Affiliates to maintain the confidentiality
of any and all such information furnished to the Seller, except with the prior
written consent of the Purchaser or as may be required by any Governmental
Order.
4
<PAGE>
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
As an inducement to the Seller to enter into this Agreement,
the Purchaser hereby represents and warrants to the Seller as follows:
SECTION 4.01. Organization and Authority of the Purchaser. The
Purchaser is a corporation duly organized, validly existing and in good standing
under the laws of Delaware. The Purchaser has all necessary corporate power and
authority to enter into this Agreement, to carry out its obligations hereunder
and to consummate the transactions contemplated hereby. The execution and
delivery of this Agreement by the Purchaser, the performance by the Purchaser of
its obligations hereunder and the consummation by the Purchaser of the
transactions contemplated hereby have been duly authorized by all requisite
action on the part of the Purchaser. This Agreement has been duly executed and
delivered by the Purchaser, and (assuming due authorization, execution and
delivery by the Seller party thereto) constitute legal, valid and binding
obligations of the Purchaser enforceable against the Purchaser in accordance
with their terms.
SECTION 4.02. No Conflict. Except as may result from any facts or
circumstances relating solely to the Seller, the execution, delivery and
performance of this Agreement by the Purchaser do not and will not (a) violate,
conflict with or result in the breach of any provision of the certificate of
incorporation, by-laws or other similar organizational documents of the
Purchaser, (b) conflict with or violate any Law or Governmental Order applicable
to the Purchaser or (c) conflict with, or result in any breach of, constitute a
default (or event which with the giving of notice or lapse or time, or both,
would become a default) under, require any consent under, or give to others any
rights of termination, amendment, acceleration, suspension, revocation, or
cancellation of, or result in the creation of any Encumbrance on any of the
assets or properties of the Purchaser pursuant to, any note, bond, mortgage or
indenture, contract, agreement, lease, sublease, license, permit, franchise or
other instrument or arrangement to which the Purchaser is a party or by which
any of such assets or properties are bound or affected which, with respect to
clauses (b) and (c) above would have a material adverse effect on the ability of
the Purchaser to consummate the transactions contemplated by this Agreement.
SECTION 4.03. Investment Purpose. The Purchaser is acquiring the Shares
solely for the purpose of investment and not with a view to, or for offer or
sale in connection with, any distribution thereof.
SECTION 4.04. Brokers. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement based upon arrangements
made by or on behalf of the Purchaser.
5
<PAGE>
ARTICLE V
ADDITIONAL AGREEMENTS
SECTION 5.01. Public Announcements. The Seller shall not make, or cause
to be made, any press release or public announcement in respect of this
Agreement or the transactions contemplated hereby or otherwise communicate with
any news media without the prior written consent of the Purchaser, and the
Seller shall cooperate with the Purchaser as to the timing and contents of any
such press release or public announcement.
SECTION 5.02. Further Action. Each of the parties hereto shall use all
reasonable efforts to take, or cause to be taken, all appropriate action, do or
cause to be done all things necessary, proper or advisable under applicable Law,
and execute and deliver such documents and other papers, as may be required to
carry out the provisions of this Agreement and consummate and make effective the
transactions contemplated hereby.
SECTION 5.03. Investigation. (a) The Seller acknowledges and agrees
that it (i) has made its own inquiry and investigation into, and, based thereon,
has formed an independent judgment concerning, the Company, the Business and the
Shares, including with limitation, the value thereof, (ii) has been furnished
with or given adequate access to such information as it has requested about the
Company, the Business and the Shares and (iii) except as provided in this
Agreement, will not assert any claim against the Purchaser, the Company or any
of their respective directors, officers, employees, agents, stockholders,
Affiliates, consultants, investment bankers or representatives, or hold the
Purchaser, the Company or any such Persons liable, for any inaccuracies,
misstatements or omissions with respect to information furnished by the
Purchaser, the Company or such Persons concerning the Company, the Business or
the Shares.
(b) In connection with the Seller's investigation of the Company and
the Business, the Seller may receive from the Purchaser and the Company, or
their respective representatives, certain estimates, projections and other
forecasts for the Company and the Business. The Seller acknowledges that there
are uncertainties inherent in attempting to make such estimates, projections,
forecasts, plans and budgets, that the Seller is familiar with such
uncertainties, that it is taking full responsibility for making its own
evaluation of, and neither the Purchaser nor the Company shall have any
responsibility with respect to, the adequacy and accuracy of any such estimates,
projections, forecasts, plans and budgets so furnished to it, and that the
Seller will not assert any claim against the Purchaser, the Company or any of
their respective directors, officers, employees, agents, stockholders,
Affiliates, consultants, investment bankers or representatives, or hold the
Purchaser, the Company or any such Persons liable with respect thereto.
6
<PAGE>
ARTICLE VI
CONDITIONS TO CLOSING
SECTION 6.01. Condition to Obligations of the Seller. The obligations
of the Seller to consummate the transactions contemplated by this Agreement
shall be subject to the fulfillment, at or prior to the Closing, of the
condition that the representations and warranties of the Purchaser contained in
this Agreement shall have been true and correct when made and shall be true and
correct in all material respects as of the Closing Date, with the same force and
effect as if made as of the Closing Date, and the covenants and agreements
contained in this Agreement to be complied with by the Purchaser at or prior to
the Closing shall have been complied with in all material respects.
SECTION 6.02. Conditions to Obligations of the Purchaser. The
obligations of the Purchaser to consummate the transactions contemplated by this
Agreement shall be subject to the fulfillment, at or prior the Closing, of the
condition that the representations and warranties of the Seller contained in
this Agreement shall have been true and correct when made and shall be true and
correct in all material respects as of the Closing Date with the same force and
effect as if made as of the Closing Date, the covenants and agreements contained
in this Agreement to be complied with by the Seller at or prior to the Closing
shall have been complied with in all material respects, and the Purchaser shall
have received a certificate signed by the Seller to such effect.
ARTICLE VII
TERMINATION
SECTION 7.01. Termination. This Agreement may be terminated at any time
prior to the Closing:
(a) by the mutual written consent of the Purchaser and the Seller;
(b) by either the Purchaser or the Seller if the Closing shall not have
occurred by December 31, 1999; provided, however, that the right to
terminate this Agreement under this Section 7.01(b) shall not be available
to any party whose failure to fulfill any obligation under this Agreement
shall have been the cause of, or shall have resulted in, the failure of the
Closing to occur on or prior to such date;
(c) by either the Purchaser or the Seller in the event that any
Governmental Authority shall have issued an order, decree or ruling or taken
any other action restraining, enjoining or otherwise prohibiting the
transactions contemplated by this
7
<PAGE>
Agreement and such order, decree, ruling or other action shall have become
final and nonappealable; or
(d) by the Purchaser if, between the date hereof and the time scheduled
for the Closing, the Seller makes a general assignment for the benefit of
creditors, or any proceeding shall be instituted by or against the Seller
seeking to adjudicate it bankrupt or insolvent, or seeking arrangement,
adjustment, protection, relief or composition of its debts under any Law
relating to bankruptcy, insolvency or reorganization.
SECTION 7.02. Effect of Termination. In the event of termination of
this Agreement as provided in Section 7.01, this Agreement shall forthwith
become void and there shall be no liability on the part of any party hereto
except that nothing herein shall relieve any party from liability for any breach
of this Agreement.
ARTICLE VIII
GENERAL PROVISIONS
SECTION 8.01. Waiver. The Seller and the Purchaser may (a) extend the
time for the performance of any of the obligations or other acts of the other
party, (b) waive any inaccuracies in the representations and warranties of the
other party contained herein or in any document delivered by the other party
pursuant hereto or (c) waive compliance with any of the agreements or conditions
of the other party contained herein. Any such extension or waiver shall be valid
only if set forth in an instrument in writing signed by the party to be bound
thereby. Any waiver of any term or condition shall not be construed as a waiver
of any subsequent breach or a subsequent waiver of the same term or condition,
or a waiver of any other term or condition, of this Agreement. The failure of
any party to assert any of its rights hereunder shall not constitute a waiver of
any of such rights.
SECTION 8.02. Expenses. (a) Except as otherwise specified in this
Agreement, all costs and expenses, including, without limitation, fees and
disbursements of counsel, financial advisors and accountants, incurred in
connection with this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such costs and expenses.
(b) The Seller will pay any stamp duties, capital duties and taxes
payable upon the sale of the Shares.
SECTION 8.03. Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given or made (and
shall be deemed to have been duly given or made upon receipt) by delivery in
person, by courier service, by cable, by telecopy, by telegram, by telex or by
registered or certified mail (postage prepaid, return
8
<PAGE>
receipt requested) to the respective parties at the following addresses (or at
such other address for a party as shall be specified in a notice given in
accordance with this Section 8.03):
(a) if to the Seller:
543 Greenwood Road
Northbrook, IL 60062
Fax: (847) 564-9549
Attention: Boris Mankovsky
(b) if to the Purchaser:
Danone Foods, Inc.
120 White Plains Road
Tarrytown, New York 10591
Fax: (914) 366-2865
Attention: General Counsel
with a copy to:
Groupe Danone
7 rue de Teheran
75381 Paris Cedex 08
Fax: 33-1-44-352-554
Attention: General Counsel
and a copy to:
Groupe Danone
7 rue de Teheran
75381 Paris Cedex 08
Fax: 33-1-44-352-097
Attention: Director of Corporate Development
and
Shearman & Sterling
599 Lexington Avenue
New York, NY 10022
Telecopy: 212-848-7179
Attention: John J. Madden, Esq.
9
<PAGE>
SECTION 8.04. Headings. The descriptive headings contained in this
Agreement are for convenience of reference only and shall not affect in any way
the meaning or interpretation of this Agreement.
SECTION 8.05. Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any Law or
public policy, all other terms and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in an acceptable manner in
order that the transactions contemplated hereby are consummated as originally
contemplated to the greatest extent possible.
SECTION 8.06. Entire Agreement. This Agreement constitutes the entire
agreement of the parties hereto with respect to the subject matter hereof and
thereof and supersedes all prior agreements and undertakings, both written and
oral, among the parties hereto with respect to the subject matter hereof and
thereof.
SECTION 8.07. Assignment. This Agreement may not be assigned by
operation of law or otherwise without the express written consent of the Seller
and the Purchaser (which consent may be granted or withheld in the sole
discretion of the Seller or the Purchaser); provided, however, that the
Purchaser may assign this Agreement to an Affiliate of the Purchaser without the
consent of the Seller.
SECTION 8.08. No Third Party Beneficiaries. This Agreement shall be
binding upon and inure solely to the benefit of the parties hereto and their
permitted assigns and nothing herein, express or implied, is intended to or
shall confer upon any other Person any legal or equitable right, benefit or
remedy of any nature whatsoever under or by reason of this Agreement.
SECTION 8.09. Amendment. This Agreement may not be amended or modified
except (a) by an instrument in writing signed by, or on behalf of, the Seller
and the Purchaser or (b) by a waiver in accordance with Section 8.01.
SECTION 8.10. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Illinois, without giving
effect to its principles or rules of conflict of laws to the extent such
principles or rules would require or permit the application of the laws of
another jurisdiction.
SECTION 8.11. Waiver of Jury Trial. Each of the parties hereto hereby
waives to the fullest extent permitted by applicable law, any right it may have
to a trial by jury in respect to any litigation directly or indirectly arising
out of, under or in connection with this Agreement. Each of the parties hereto
(a) certifies that no representative, agent or attorney of any other party
10
<PAGE>
has represented, expressly or otherwise, that such other party would not, in the
event of litigation, seek to enforce that foregoing waiver and (b) acknowledges
that it and the other parties hereto have been induced to enter into this
Agreement, by, among other things, the mutual waivers and certifications in this
Section 8.11.
SECTION 8.12. Counterparts. This Agreement may be executed in one or
more counterparts, and by the different parties hereto in separate counterparts,
each of which when executed shall be deemed to be an original but all of which
taken together shall constitute one and the same agreement.
SECTION 8.13. Specific Performance. The parties hereto agree that
irreparable damage would occur in the event any provision of this Agreement was
not performed in accordance with the terms hereof and that the parties shall be
entitled to specific performance of the terms hereof, in additional to any other
remedy at Law or equity.
SECTION 8.14. Survival of Representations and Warranties. The
representations and warranties of the parties hereto contained in Articles III
and IV shall survive the Closing until the second anniversary thereof.
11
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto have caused this
Agreement to be executed as of the date first written above by their respective
officers thereunto duly authorized.
KIRGAM INTERNATIONAL INC.
By: /s/ Boris Mankovsky
-----------------------------------
Name: Boris Mankovsky
Title: President
DANONE FOODS, INC.
By: /s/ Michael Harrison
-----------------------------------
Name: Michael Harrison
Title: Vice President
12
<PAGE>
SCHEDULE A
1. The "Company Profile and Representation" prepared by the Company and dated
June 7, 1999; and
2. The "Due Diligence Findings" Report (without attachments), dated June 2,
1999, prepared for and on behalf of the Purchaser.
<PAGE>
Exhibit 17
================================================================================
--------------------------------------
STOCK PURCHASE AGREEMENT
--------------------------------------
Between
PATRICK W. SHAW,
THE ROGER D. SHAW TRUST U/A/D 7/28/33
F/B/O MARGARET W. SHAW,
THE WILLIAM W. SHAW TRUST U/A/D 12/28/63
and
DANONE FOODS, INC.
Dated as of November 10, 1999
================================================================================
<PAGE>
TABLE OF CONTENTS
Section Page
- ------- ----
ARTICLE I
DEFINITIONS
1.01. Certain Defined Terms...............................................1
ARTICLE II
PURCHASE AND SALE
2.01. Purchase and Sale of the Shares.....................................2
2.02. Purchase Price......................................................2
2.03. Closing.............................................................3
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLER
3.01. Authorization.......................................................3
3.02. Ownership of Shares.................................................4
3.03. No Conflict.........................................................4
3.04. Absence of Litigation...............................................4
3.05. Brokers.............................................................4
3.06. Disclosure; Access to Information...................................4
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
4.01. Organization and Authority of the Purchaser.........................5
4.02. No Conflict.........................................................5
4.03. Investment Purpose..................................................5
4.04. Brokers.............................................................5
-i-
<PAGE>
Section Page
- ------- ----
ARTICLE V
ADDITIONAL AGREEMENTS
5.01. Public Announcements................................................6
5.02. Further Action......................................................6
5.03. Investigation.......................................................6
ARTICLE VI
CONDITIONS TO CLOSING
6.01. Condition to Obligations of the Seller..............................7
6.02. Conditions to Obligations of the Purchaser..........................7
ARTICLE VII
TERMINATION
7.01. Termination.........................................................7
7.02. Effect of Termination...............................................8
ARTICLE VIII
GENERAL PROVISIONS
8.01. Waiver..............................................................8
8.02. Expenses............................................................8
8.03. Notices.............................................................8
8.04. Headings...........................................................10
8.05. Severability.......................................................10
8.06. Entire Agreement...................................................10
8.07. Assignment.........................................................10
8.08. No Third Party Beneficiaries.......................................10
8.09. Amendment..........................................................10
8.10. Governing Law......................................................10
8.11. Waiver of Jury Trial...............................................10
8.12. Counterparts.......................................................11
8.13. Specific Performance...............................................11
8.14. Survival of Representations and Warranties.........................11
-ii-
<PAGE>
STOCK PURCHASE AGREEMENT, dated as of November 10, 1999,
between Patrick W. Shaw, the Roger D. Shaw Trust U/A/D 7/28/33 F/B/O Margaret W.
Shaw and the William W. Shaw Trust U/A/D 12/28/63 (each a "Seller", and
collectively, the "Sellers") and Danone Foods, Inc., a Delaware corporation (the
"Purchaser").
W I T N E S S E T H:
WHEREAS, the Sellers own at least 5,000 shares of common
stock, no par value per share (the "Common Stock") of Lifeway Foods, Inc., an
Illinois corporation (the "Company"); and
WHEREAS, the Sellers wish to sell to the Purchaser, and the
Purchaser wishes to purchase from the Sellers, 5,000 shares of the Common Stock
(such shares to be sold pursuant to this Agreement being individually, a "Share"
and, collectively, the "Shares"), upon the terms and subject to the conditions
set forth herein.
NOW, THEREFORE, in consideration of the premises and the
mutual agreements and covenants hereinafter set forth, the Purchaser and the
Sellers hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms. As used in this
Agreement, the following terms shall have the following meanings:
"Action" means any claim, action, suit, arbitration, inquiry,
proceeding or investigation by or before any Governmental Authority.
"Affiliate" means, with respect to any specified Person, any
other Person that directly, or indirectly through one or more intermediaries,
controls, is controlled by, or is under common control with, such specified
Person.
"Business" means the business of manufacturing, marketing and
selling cultured, probiotic and functional food products in the health food
industry and all other business which prior to the date hereof has been
conducted by the Company and the Subsidiaries.
"Closing" has the meaning specified in Section 2.03(a).
"Closing Date" has the meaning specified in Section 2.03(a).
"Common Stock" has the meaning specified in the recitals to
this Agreement.
<PAGE>
"control" (including the terms "controlled by" and "under
common control with"), with respect to the relationship between or among two or
more Persons, means the possession, directly or indirectly or as trustee or
executor, of the power to direct or cause the direction of the affairs or
management of a Person, whether through the ownership of voting securities, as
trustee or executor, by contract or otherwise, including, without limitation,
the ownership, directly or indirectly, of securities having the power to elect a
majority of the board of directors or similar body governing the affairs of such
Person.
"Encumbrance" means any security interest, pledge, mortgage,
lien (including, without limitation, environmental and tax liens), charge,
encumbrance, adverse claim, preferential arrangement or restriction of any kind,
including, without limitation, any restriction on the use, voting, transfer,
receipt of income or other exercise of any attributes of ownership.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Governmental Authority" means any United States federal,
state, local, supranational or any foreign government, governmental, regulatory
or administrative authority, agency or commission or any court, tribunal, or
judicial or arbitral body.
"Governmental Order" means any order, writ, judgment,
injunction, decree, stipulation, determination or award entered by or with any
Governmental Authority.
"Law" means any federal, state, local or foreign statute, law,
ordinance, regulation, rule, code, order, other requirement or rule of law.
"Person" means any individual, partnership, firm, corporation,
association, trust, unincorporated organization or other entity, as well as any
syndicate or group that would be deemed to be a person under Section 13(d)(3) of
the Securities Exchange Act of 1934, as amended.
"Purchase Price" has the meaning specified in Section 2.02.
ARTICLE II
PURCHASE AND SALE
SECTION 2.01. Purchase and Sale of the Shares. Upon the terms
and subject to the conditions contained in this Agreement, at the Closing, the
Sellers shall sell to the Purchaser, and the Purchaser shall purchase from the
Sellers, 5,000 Shares.
SECTION 2.02. Purchase Price. The purchase price shall be
$10.00 per Share (the "Purchase Price") payable as provided in Section 2.03(b).
2
<PAGE>
SECTION 2.03. Closing. (a) Subject to the terms and conditions
of this Agreement, the sale and purchase of the Shares contemplated by this
Agreement shall take place at a closing (the "Closing") to be held at the
offices of Shearman & Sterling at 10:00 A.M., New York time, on such date on or
before November 30, 1999 as the Purchaser may determine, or at such other place
or at such other time or on such other date as the Sellers and the Purchaser may
mutually agree upon in writing (the date on which the Closing takes place being
the "Closing Date").
(b) At the Closing, (i) the Sellers shall deliver or
cause to be delivered to the Purchaser stock certificates evidencing the Shares
duly endorsed in blank, or accompanied by stock powers duly executed in blank,
in form satisfactory to the Purchaser and (ii) the Purchaser shall, at the
election of the Sellers, (x) deliver to the Sellers a certified check in the
amount of $20,000, made payable to the order of Patrick W. Shaw, a certified
check in the amount of $10,000, made payable to the order of Roger D. Shaw Trust
U/A/D 7/28/33 F/B/O Margaret W. Shaw, a certified check in the amount of
$20,000, made payable to the order of William W. Shaw Trust U/A/D 12/28/63 or
(y) pay to the Sellers the amount of $50,000 by wire transfer of immediately
available funds to the bank accounts designated by the Sellers. The Sellers
agree to provide the Purchaser with notice of such election at least one day
prior to the Closing Date.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLER
As an inducement to the Purchaser to enter into this
Agreement, each of the Sellers hereby, severally but not jointly, represent and
warrant to the Purchaser as follows:
SECTION 3.01. Authorization. Each Seller, if it is an
individual, has all requisite right, power and authority and full legal capacity
to execute and deliver this Agreement, to perform his or her obligations
hereunder and to consummate the transactions contemplated hereby. Each Seller,
if it is a corporation or other legal entity, is duly organized, validly
existing and in good standing under the laws of its incorporation or formation
and has all requisite power and authority to enter into this Agreement, to carry
out its obligations hereunder and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement by such Seller, the
performance by such Seller of its obligations hereunder and the consummation by
such Seller of the transactions contemplated hereby have been duly authorized by
all requisite action on the part of such Seller. This Agreement has been duly
and validly executed and delivered by each Seller, and this Agreement
constitutes a legal, valid and binding obligation of such Seller enforceable
against such Seller in accordance with its terms.
3
<PAGE>
SECTION 3.02. Ownership of Shares. Each Seller has good and
marketable title to, and is the record and beneficial owner of, the number of
Shares set forth next to such Seller's name in Schedule B to this Agreement,
free and clear of all Encumbrances. Upon delivery of the Shares by the Sellers
to the Purchaser at the Closing and payment of the Purchase Price for the
Shares, as herein provided, the Purchaser will receive good and marketable title
to the Shares, free and clear of all Encumbrances.
SECTION 3.03. No Conflict. Except as may result from any facts
or circumstances relating solely to the Purchaser, the execution, delivery and
performance of this Agreement by each Seller do not and will not (a) conflict
with or violate any Law or Governmental Order applicable to such Seller or (b)
conflict with, result in any breach of, constitute a default (or event which
with the giving of notice or lapse of time, or both, would become a default)
under, require any consent under, or give to others any rights of termination,
amendment, acceleration, suspension, revocation or cancellation of, or result in
the creation of any Encumbrance on any of the Shares pursuant to, any note,
bond, mortgage or indenture, contract, agreement, lease, sublease, license,
permit, franchise or other instrument, obligation or arrangement to which such
Seller is a party or by which any of the Shares are bound or affected or which
would have a material adverse effect on the ability of such Seller to consummate
the transactions contemplated by this Agreement.
SECTION 3.04. Absence of Litigation. There are no Actions by
or against any Seller pending before any Governmental Authority (or, to the best
knowledge of such Seller after due inquiry, threatened to be brought by or
before any Governmental Authority) relating to or affecting the Shares or which
could affect the legality, validity or enforceability of this Agreement or the
consummation of the transactions contemplated hereby. Each Seller is not subject
to any Governmental Order (nor, to the best knowledge of each Seller, are there
any such Governmental Orders threatened to be imposed by any Governmental
Authority) relating to or affecting the Shares or which would affect the
legality, validity or enforceability of this Agreement or the consummation of
the transactions contemplated hereby.
SECTION 3.05. Brokers. No broker, finder or investment banker
is entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement based upon arrangements
made by or on behalf of each Seller.
SECTION 3.06. Disclosure; Access to Information. Each Seller
has received and reviewed the materials listed in Schedule A to this Agreement,
but has not necessarily relied on all the information contained in such
materials. Each Seller acknowledges that the materials listed in Schedule A to
this Agreement contain certain information concerning the Company and each
Seller agrees to maintain, and to cause its Affiliates to maintain the
confidentiality of any and all such information furnished to each Seller, except
with the prior written consent of the Purchaser or as may be required by any
Governmental Order or judicial proceeding.
4
<PAGE>
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
As an inducement to the Sellers to enter into this Agreement,
the Purchaser hereby represents and warrants to the Sellers as follows:
SECTION 4.01. Organization and Authority of the Purchaser. The
Purchaser is a corporation duly organized, validly existing and in good standing
under the laws of Delaware. The Purchaser has all necessary corporate power and
authority to enter into this Agreement, to carry out its obligations hereunder
and to consummate the transactions contemplated hereby. The execution and
delivery of this Agreement by the Purchaser, the performance by the Purchaser of
its obligations hereunder and the consummation by the Purchaser of the
transactions contemplated hereby have been duly authorized by all requisite
action on the part of the Purchaser. This Agreement has been duly executed and
delivered by the Purchaser, and (assuming due authorization, execution and
delivery by the Sellers thereto) constitute legal, valid and binding obligations
of the Purchaser enforceable against the Purchaser in accordance with their
terms.
SECTION 4.02. No Conflict. Except as may result from any facts
or circumstances relating solely to any Seller, the execution, delivery and
performance of this Agreement by the Purchaser do not and will not (a) violate,
conflict with or result in the breach of any provision of the certificate of
incorporation, by-laws or other similar organizational documents of the
Purchaser, (b) conflict with or violate any Law or Governmental Order applicable
to the Purchaser or (c) conflict with, or result in any breach of, constitute a
default (or event which with the giving of notice or lapse or time, or both,
would become a default) under, require any consent under, or give to others any
rights of termination, amendment, acceleration, suspension, revocation, or
cancellation of, or result in the creation of any Encumbrance on any of the
assets or properties of the Purchaser pursuant to, any note, bond, mortgage or
indenture, contract, agreement, lease, sublease, license, permit, franchise or
other instrument or arrangement to which the Purchaser is a party or by which
any of such assets or properties are bound or affected which, with respect to
clauses (b) and (c) above would have a material adverse effect on the ability of
the Purchaser to consummate the transactions contemplated by this Agreement.
SECTION 4.03. Investment Purpose. The Purchaser is acquiring
the Shares solely for the purpose of investment and not with a view to, or for
offer or sale in connection with, any distribution thereof.
SECTION 4.04. Brokers. No broker, finder or investment banker
is entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement based upon arrangements
made by or on behalf of the Purchaser.
5
<PAGE>
ARTICLE V
ADDITIONAL AGREEMENTS
SECTION 5.01. Public Announcements. The Sellers shall not
make, or cause to be made, any press release or public announcement in respect
of this Agreement or the transactions contemplated hereby or otherwise
communicate with any news media without the prior written consent of the
Purchaser, and the Sellers shall cooperate with the Purchaser as to the timing
and contents of any such press release or public announcement.
SECTION 5.02. Further Action. Each of the parties hereto shall
use all reasonable efforts to take, or cause to be taken, all appropriate
action, do or cause to be done all things necessary, proper or advisable under
applicable Law, and execute and deliver such documents and other papers, as may
be required to carry out the provisions of this Agreement and consummate and
make effective the transactions contemplated hereby.
SECTION 5.03. Investigation. (a) Each Seller acknowledges and
agrees that it (i) has made its own inquiry and investigation into, and, based
thereon, has formed an independent judgment concerning, the Company, the
Business and the Shares, including with limitation, the value thereof, (ii) has
been furnished with or given adequate access to such information as it has
requested about the Company, the Business and the Shares and (iii) except as
provided in this Agreement, will not assert any claim against the Purchaser, the
Company or any of their respective directors, officers, employees, agents,
stockholders, Affiliates, consultants, investment bankers or representatives, or
hold the Purchaser, the Company or any such Persons liable, for any
inaccuracies, misstatements or omissions with respect to information furnished
by the Purchaser, the Company or such Persons concerning the Company, the
Business or the Shares.
(b) In connection with each Seller's investigation of
the Company and the Business, each Seller may receive from the Purchaser and the
Company, or their respective representatives, certain estimates, projections and
other forecasts for the Company and the Business. Each Seller acknowledges that
there are uncertainties inherent in attempting to make such estimates,
projections, forecasts, plans and budgets, that such Seller is familiar with
such uncertainties, that it is taking full responsibility for making its own
evaluation of, and neither the Purchaser nor the Company shall have any
responsibility with respect to, the adequacy and accuracy of any such estimates,
projections, forecasts, plans and budgets so furnished to it, and that such
Seller will not assert any claim against the Purchaser, the Company or any of
their respective directors, officers, employees, agents, stockholders,
Affiliates, consultants, investment bankers or representatives, or hold the
Purchaser, the Company or any such Persons liable with respect thereto.
6
<PAGE>
ARTICLE VI
CONDITIONS TO CLOSING
SECTION 6.01. Condition to Obligations of the Seller. The
obligations of each Seller to consummate the transactions contemplated by this
Agreement shall be subject to the fulfillment, at or prior to the Closing, of
the condition that the representations and warranties of the Purchaser contained
in this Agreement shall have been true and correct when made and shall be true
and correct in all material respects as of the Closing Date, with the same force
and effect as if made as of the Closing Date, and the covenants and agreements
contained in this Agreement to be complied with by the Purchaser at or prior to
the Closing shall have been complied with in all material respects.
SECTION 6.02. Conditions to Obligations of the Purchaser. The
obligations of the Purchaser to consummate the transactions contemplated by this
Agreement shall be subject to the fulfillment, at or prior the Closing, of the
condition that the representations and warranties of the Sellers contained in
this Agreement shall have been true and correct when made and shall be true and
correct in all material respects as of the Closing Date with the same force and
effect as if made as of the Closing Date, the covenants and agreements contained
in this Agreement to be complied with by the Sellers at or prior to the Closing
shall have been complied with in all material respects, and the Purchaser shall
have received a certificate signed by each Seller to such effect.
ARTICLE VII
TERMINATION
SECTION 7.01. Termination. This Agreement may be terminated at
any time prior to the Closing:
(a) by the mutual written consent of the Purchaser and the
Sellers;
(b) by either the Purchaser or the Sellers if the
Closing shall not have occurred by December 31, 1999; provided,
however, that the right to terminate this Agreement under this Section
7.01(b) shall not be available to any party whose failure to fulfill
any obligation under this Agreement shall have been the cause of, or
shall have resulted in, the failure of the Closing to occur on or prior
to such date;
(c) by either the Purchaser or the Sellers in the event
that any Governmental Authority shall have issued an order, decree or
ruling or taken any other action restraining, enjoining or otherwise
prohibiting the transactions contemplated by this
7
<PAGE>
Agreement and such order, decree, ruling or other action shall have
become final and nonappealable; or
(d) by the Purchaser if, between the date hereof and
the time scheduled for the Closing, any Seller makes a general
assignment for the benefit of creditors, or any proceeding shall be
instituted by or against any Seller seeking to adjudicate it bankrupt
or insolvent, or seeking arrangement, adjustment, protection, relief or
composition of its debts under any Law relating to bankruptcy,
insolvency or reorganization.
SECTION 7.02. Effect of Termination. In the event of
termination of this Agreement as provided in Section 7.01, this Agreement shall
forthwith become void and there shall be no liability on the part of any party
hereto except that nothing herein shall relieve any party from liability for any
breach of this Agreement.
ARTICLE VIII
GENERAL PROVISIONS
SECTION 8.01. Waiver. The Sellers and the Purchaser may (a)
extend the time for the performance of any of the obligations or other acts of
the other party, (b) waive any inaccuracies in the representations and
warranties of the other party contained herein or in any document delivered by
the other party pursuant hereto or (c) waive compliance with any of the
agreements or conditions of the other party contained herein. Any such extension
or waiver shall be valid only if set forth in an instrument in writing signed by
the party to be bound thereby. Any waiver of any term or condition shall not be
construed as a waiver of any subsequent breach or a subsequent waiver of the
same term or condition, or a waiver of any other term or condition, of this
Agreement. The failure of any party to assert any of its rights hereunder shall
not constitute a waiver of any of such rights.
SECTION 8.02. Expenses. (a) Except as otherwise specified in
this Agreement, all costs and expenses, including, without limitation, fees and
disbursements of counsel, financial advisors and accountants, incurred in
connection with this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such costs and expenses.
(b) The Sellers will pay any stamp duties, capital duties and
taxes payable upon the sale of the Shares.
SECTION 8.03. Notices. All notices, requests, claims, demands
and other communications hereunder shall be in writing and shall be given or
made (and shall be deemed to have been duly given or made upon receipt) by
delivery in person, by courier service, by cable, by telecopy, by telegram, by
telex or by registered or certified mail (postage prepaid, return
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receipt requested) to the respective parties at the following addresses (or at
such other address for a party as shall be specified in a notice given in
accordance with this Section 8.03):
(a) if to the Sellers:
Thomasville Route Box 60B
Birch Tree, MO 65438
Fax: (417) 764-3706
Attention: William W. Shaw
(b) if to the Purchaser:
Danone Foods, Inc.
120 White Plains Road
Tarrytown, New York 10591
Fax: (914) 366-2865
Attention: General Counsel
with a copy to:
Groupe Danone
7 rue de Teheran
75381 Paris Cedex 08
Fax: 33-1-44-352-554
Attention: General Counsel
and a copy to:
Groupe Danone
7 rue de Teheran
75381 Paris Cedex 08
Fax: 33-1-44-352-097
Attention: Director of Corporate Development
and
Shearman & Sterling
599 Lexington Avenue
New York, NY 10022
Telecopy: 212-848-7179
Attention: John J. Madden, Esq.
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SECTION 8.04. Headings. The descriptive headings contained in
this Agreement are for convenience of reference only and shall not affect in any
way the meaning or interpretation of this Agreement.
SECTION 8.05. Severability. If any term or other provision of
this Agreement is invalid, illegal or incapable of being enforced by any Law or
public policy, all other terms and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in an acceptable manner in
order that the transactions contemplated hereby are consummated as originally
contemplated to the greatest extent possible.
SECTION 8.06. Entire Agreement. This Agreement constitutes the
entire agreement of the parties hereto with respect to the subject matter hereof
and thereof and supersedes all prior agreements and undertakings, both written
and oral, among the parties hereto with respect to the subject matter hereof and
thereof.
SECTION 8.07. Assignment. This Agreement may not be assigned
by operation of law or otherwise without the express written consent of the
Sellers and the Purchaser (which consent may be granted or withheld in the sole
discretion of the Sellers or the Purchaser); provided, however, that the
Purchaser may assign this Agreement to an Affiliate of the Purchaser without the
consent of the Sellers.
SECTION 8.08. No Third Party Beneficiaries. This Agreement
shall be binding upon and inure solely to the benefit of the parties hereto and
their permitted assigns and nothing herein, express or implied, is intended to
or shall confer upon any other Person any legal or equitable right, benefit or
remedy of any nature whatsoever under or by reason of this Agreement.
SECTION 8.09. Amendment. This Agreement may not be amended or
modified except (a) by an instrument in writing signed by, or on behalf of, the
Sellers and the Purchaser or (b) by a waiver in accordance with Section 8.01.
SECTION 8.10. Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of Illinois, without
giving effect to its principles or rules of conflict of laws to the extent such
principles or rules would require or permit the application of the laws of
another jurisdiction.
SECTION 8.11. Waiver of Jury Trial. Each of the parties hereto
hereby waives to the fullest extent permitted by applicable law, any right it
may have to a trial by jury in respect to any litigation directly or indirectly
arising out of, under or in connection with this Agreement.
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Each of the parties hereto (a) certifies that no representative, agent or
attorney of any other party has represented, expressly or otherwise, that such
other party would not, in the event of litigation, seek to enforce that
foregoing waiver and (b) acknowledges that it and the other parties hereto have
been induced to enter into this Agreement, by, among other things, the mutual
waivers and certifications in this Section 8.11.
SECTION 8.12. Counterparts. This Agreement may be executed in
one or more counterparts, and by the different parties hereto in separate
counterparts, each of which when executed shall be deemed to be an original but
all of which taken together shall constitute one and the same agreement.
SECTION 8.13. Specific Performance. The parties hereto agree
that irreparable damage would occur in the event any provision of this Agreement
was not performed in accordance with the terms hereof and that the parties shall
be entitled to specific performance of the terms hereof, in additional to any
other remedy at Law or equity.
SECTION 8.14. Survival of Representations and Warranties. The
representations and warranties of the parties hereto contained in Articles III
and IV shall survive the Closing until the second anniversary thereof.
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IN WITNESS WHEREOF, each of the parties hereto have caused
this Agreement to be executed as of the date first written above by their
respective officers thereunto duly authorized.
PATRICK W. SHAW
By: /s/ Patrick W. Shaw
---------------------------------
Name: Patrick W. Shaw
Title: Owner
ROGER D. SHAW TRUST U/A/D 7/28/33
F/B/O MARGARET W. SHAW
By: /s/ William W. Shaw
---------------------------------
Name: William W. Shaw
Title: Trustee
WILLIAM W. SHAW TRUST
U/A/D 12/28/63
By: /s/ Roger D. Shaw Jr.
---------------------------------
Name: Roger D. Shaw Jr
Title: Trustee
DANONE FOODS, INC.
By: /s/ Michael Harrison
---------------------------------
Name: Michael Harrison
Title: Vice President
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SCHEDULE A
1. The "Company Profile and Representation" prepared by the Company and dated
June 7, 1999; and
2. The "Due Diligence Findings" Report (without attachments), dated June 2,
1999, prepared for and on behalf of the Purchaser.
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SCHEDULE B
Name: Shares:
- ----- -------
Patrick W. Shaw 2,000
Roger D. Shaw Trust 1,000
U/A/D 7/28/33
F/B/O Margaret W. Shaw
William W. Shaw Trust 2,000
U/A/D 12/28/63
14
