EXHIBIT 10.3
AMENDED AND RESTATED
RIGHT OF FIRST REFUSAL AGREEMENT
This amended and restated right of first refusal agreement (the
"Agreement") is entered into as of May 1, 1998 by and among Einstein/Noah Bagel
Corp., a Delaware corporation ("ENBC"), Xxxxxx Bakeries, Inc., an Indiana
corporation ("Xxxxxx"), Xxx X. Xxxxxx, Xxxx X. Xxxxxx and Xxxx X. Xxxxxx
(collectively, the "Harlans").
RECITALS
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The Harlans own all of the outstanding capital stock of Xxxxxx. Xxxxxx has
constructed a new production facility (the "Production Facility") adjacent to
its existing production facility in Avon, Indiana, and Xxxxxx Bagel Supply
Company, LLC, an Indiana limited liability company (the "Supplier"), ENBC,
Xxxxxx and the Harlans have previously entered into a project and approved
supplier agreement dated as of May 24, 1996, as amended (the "Prior Approved
Supplier Agreement"), pursuant to which the Supplier has agreed to supply raw
frozen bagel dough products to ENBC and other approved purchasers, and
concurrent with the execution and delivery of this agreement they are entering
into an Amended and Restated Project and Approved Supplier Agreement (the
"Approved Supplier Agreement").
ENBC, Xxxxxx and the Harlans have previously entered into a right of first
refusal agreement, pursuant to which ENBC has a right of first refusal to obtain
the shares of capital stock or assets of Xxxxxx (the "Prior Right of First
Refusal Agreement"). In order to reflect the parties' understanding with respect
to the option, and to amend, restate, replace and substitute in full under the
prior Right of First Refusal Agreement, the parties desire to enter into this
Agreement.
COVENANTS
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In consideration of the premises and the mutual covenants and agreements
herein contained, the parties hereto agree as follows:
1. RESTRICTIONS ON TRANSFER. Subject to the provisions of Section 7
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hereof, each of the Harlans agrees that he shall not, at any time prior to the
Termination Date (as hereinafter defined), sell, assign, transfer, pledge or
otherwise dispose of any shares of capital stock of Xxxxxx ("Shares") owned by
him, except in accordance with the provisions of Section 2 hereof or in a
Permitted Transfer (as hereinafter defined). All certificates representing
Shares owned or hereafter acquired by the Harlans, or any transferee of the
Harlans bound by this Agreement shall have affixed thereto a legend
substantially in the following form:
"The sale or other disposition of any of the shares
represented by this certificate is restricted by a Right
of First Refusal Agreement among the registered owner
of this certificate, ENBC and the other shareholders of
the Company, a copy of which is available for inspection
at the offices of the Company."
2. RIGHT OF FIRST REFUSAL TO PURCHASE SHARES OF CAPITAL STOCK.
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Subject to the provisions of Sections 7 and 8 hereof, in the event Xxxxxx or any
of the Harlans (the "Seller") desires to sell any Shares, at any time prior to
the Termination Date, except in a Permitted Transfer, the Seller shall first
give written notice (a "Share Sale Notice") to ENBC of any such proposed sale,
which Notice shall state the name and address of the proposed purchaser, the
number of Shares to be sold and the price, terms of payment and conditions of
such proposed sale. ENBC shall thereupon have the right, for a period of 45
days from the date of the Share Sale Notice, to purchase such Shares at the
price and, except as provided herein as to the medium of payment, on the terms
and conditions stated in the Share Sale Notice. ENBC may exercise such right by
giving a notice of exercise to the Seller, which notice shall specify a place of
closing, a closing date, which shall not be later than 30 days following the
date of such notice of exercise, (or, if later, two business days after the
expiration or termination of any waiting period under the HSR Act (as
hereinafter defined)) and the consideration which ENBC elects to deliver upon
the closing, which may consist of the medium of payment provided for in the
Share Sale Notice, shares of common stock of ENBC ("ENBC Stock"), shares of
common stock ("BCI Stock") of Boston Chicken, Inc. ("BCI"), cash, or any
combination of the foregoing, provided, however, that such consideration may
consist of ENBC Stock or BCI Stock (the issuer of such stock being referred to
herein as the "Issuer") only if (a) the average closing sales price per share of
such stock of the Issuer as quoted on the NASDAQ National Market, as reported in
the Wall Street Journal (Western Edition), or as quoted on such other market or
exchange on which such shares are traded, for the ten consecutive trading days
ending on the second business day prior to the Closing Date (as hereinafter
defined) (the "Share Price") is at least $10, and (b) the value of the Issuer
(defined as the product of the Share Price and the total number of outstanding
shares of such stock of the Issuer) is at least $300 million. In the event ENBC
elects to deliver upon closing shares of ENBC Stock or shares of BCI Stock, such
shares shall be registered under the Securities Act of 1933, as amended (the
"1933 Act"), and shall be accompanied by a written undertaking of ENBC to pay to
the Seller in cash the excess, if any, of the value of the shares so delivered,
determined in the manner provided in Section 6 hereof, over the proceeds (net of
commissions) from the sale of the shares, assuming all shares are sold in
accordance with such reasonable conditions on the timing, daily volume and
manner of sale as may be set forth in such undertaking. At the closing, ENBC
shall pay the purchase price for the Shares and the Seller shall deliver to ENBC
certificates evidencing the Shares accompanied, in the case of a sale of Shares
by any of the Harlans, by duly executed stock powers together with a certificate
signed by the Seller stating that the Shares are being sold free and clear of
all liens, claims, encumbrances, charges and restrictions or transfer, except
for restrictions on transfer imposed by federal and state securities laws
("Encumbrances"). In the event ENBC does not elect to purchase the Shares as
provided in this Section 2 the Seller may sell such Shares to the proposed third
party purchaser on the terms and conditions stated in the Share Sale Notice, but
only if such sale is consummated within 60 days after the expiration of the 45-
day period referred to above.
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3. PERMITTED TRANSFERS. The provisions of Section 2 hereof shall not
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apply to (i) sales of shares by Xxxxxx or the Harlans in an initial public
offering, (ii) sales of shares by Xxxxxx in a private placement (other than to
Permitted Transferees), provided that the Harlans own at least 51% by vote and
by value of the outstanding capital stock of Xxxxxx after any such offering and
provided further that Xxxxxx has first offered to ENBC the opportunity to
purchase the shares so offered on terms no less favorable to ENBC than the terms
offered in such private placement, and (iii) transfers of Shares by any of the
Harlans among themselves or to any of their spouses or descendants, any trust
solely for the benefit of one or more of the Harlans, their spouses or
descendants, or any corporation, partnership or limited liability company all of
the stockholders, partners or members of which consist solely of one or more
such persons or trusts ("Permitted Transferees"), provided that the transferee
in any such transfer agrees in writing to be bound by the provisions of this
Agreement ("Permitted Transfers").
4. RIGHT OF FIRST REFUSAL TO PURCHASE ASSETS. Subject to the
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provisions of Sections 7 and 8 hereof, in the event Xxxxxx desires to sell all
or substantially all of its assets, then Xxxxxx shall first given written notice
(the "Asset Sale Notice") to ENBC of any such proposed sale, which Asset Sale
Notice shall state the name and address of the proposed purchaser, the assets to
be sold and the price, terms of payment and conditions of such proposed sale.
ENBC shall thereupon have the right, for a period of 45 days from the date of
the Asset Sale Notice, to purchase such assets at the price and, except as
provided herein as to the medium of payment, on the terms and conditions stated
in the Asset Sale Notice. ENBC may exercise such right by giving a notice of
exercise to Xxxxxx, which notice shall specify a place of closing and a closing
date which shall not be later than 30 days following the date of such notice of
exercise (or, if later, two business days after the expiration or termination of
any waiting period under the HSR Act (as hereinafter defined)), and the
consideration which ENBC elects to deliver upon the closing, which may consist
of the medium of payment provided for in the Asset Sale Notice, shares of ENBC
Stock, shares of BCI Stock, cash, or any combination of the foregoing, provided,
however, that such consideration may consist of ENBC Stock or BCI Stock (the
issuer of such stock being referred to herein as the "Issuer") only if (a) the
average closing sales price per share of such stock of the Issuer as quoted on
the NASDAQ National Market, as reported in the Wall Street Journal (Western
Edition), or as quoted on such other market or exchange on which such shares are
traded, for the ten consecutive trading days ending on the second business day
prior to the Closing Date (as hereinafter defined) (the "Share Price") is at
least $10, and (b) the value of the Issuer (defined as the product of the Share
Price and the total number of outstanding shares of such stock of the Issuer) is
at least $300 million. In the event ENBC elects to deliver upon closing shares
of ENBC Stock or shares of BCI Stock, such shares shall be registered under the
1933 Act, and shall be accompanied by a written undertaking of ENBC to pay to
Xxxxxx in cash the excess, if any, of the value of the shares so delivered,
determined in the manner provided in Section 6 hereof, over the proceeds (net of
commissions) from the sale of the shares, assuming all shares are sold in
accordance with such reasonable conditions on the timing, daily volume and
manner of sale as may be set forth in such undertaking. Such undertaking shall
be assignable by Xxxxxx to its shareholders to the extent any such shares are
assigned to such shareholders. At the closing, ENBC shall pay the purchase
price for the assets and Xxxxxx shall execute and deliver to ENBC instruments of
transfer sufficient to convey to ENBC all right, title and interest in and to
the assets, free and clear of all Encumbrances, except as may be specified
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in the Asset Sale Notice. In the event ENBC does not elect to purchase the
assets as provided in this Section 4 Xxxxxx may sell such assets to the proposed
third party purchaser on the terms and conditions stated in the Notice, but only
if such sale is consummated within 60 days after the expiration of the 45-day
period referred to above.
5. REGULATORY COMPLIANCE. Upon the exercise by ENBC of its right to
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purchase Shares or its right to purchase assets of Xxxxxx the parties shall
promptly prepare and file with the Federal Trade Commission ("FTC") and the
United States Department of Justice ("Justice Department") any notification
required to be filed with respect to the transactions contemplated hereby under
the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended, or any
rules or regulations thereunder (the "HSR Act"). Each party represents and
warrants to the other parties hereto that any such filing made by it shall be
true and accurate in all material respects and shall conform to the requirements
of the HSR Act. Each party shall promptly complete and file any required
responses to requests by the FTC or the Justice Department for additional data
and information. Each party shall also make available to the other parties
hereto such information relative to its business, assets and property as may be
required for the preparation of such notifications and reports.
6. VALUATION OF ENBC STOCK OR BCI STOCK. ENBC Stock or BCI Stock
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delivered upon the closing of any transaction contemplated hereby shall be
deemed to have a value equal to the average closing sales price per share of
such stock as quoted on the NASDAQ National Market, as reported in the Wall
Street Journal (Western Edition), or as quoted on such other market or exchange
on which such shares are traded, for the ten consecutive trading days ending on
the second business day prior to the date of closing.
7. TERMINATION. This Agreement shall terminate upon the later of the
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expiration of the Approved Supplier Agreement or the expiration of the Lease (as
defined in the Approved Supplier Agreement) (the "Termination Date"), provided,
however, that if the Approved Supplier Agreement expires prior to the expiration
of the Lease, then after the expiration of the Approved Supplier Agreement,
ENBC shall thereafter, until expiration of the Lease, have only a right of first
refusal to purchase the land and buildings owned by Xxxxxx that consist of the
Production Facility, the adjacent building and the land on which they are
situated.
8. CERTAIN CONDITIONS FOR EXERCISE. The exercise by ENBC of its
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rights under Sections 2 and 4 hereof shall be subject to the condition that ENBC
shall have paid all amounts owed by it pursuant to the Approved Supplier
Agreement. In the event of a disagreement regarding any amounts payable under
such agreement, the time periods for ENBC's exercise of such rights provided for
in Sections 2 and 4 shall not begin to run until such disagreement has been
resolved by the entry of a final nonappealable order of a court (or other
decision of an arbitrator or other adjudicator that is final and binding on the
parties to such agreement) or the execution and delivery of a written settlement
agreement by the parties to such agreement.
9. AMENDMENTS. The parties hereto may amend, modify and supplement
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this Agreement in such manner as may be agreed upon by them in writing.
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10. EXPENSES. Each party to this Agreement shall pay all of the
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expenses incurred by such party in connection with this Agreement and the
transactions contemplated hereby, including without limitation legal and
accounting fees and expenses, and the commissions, fees and expenses of any
person employed or retained by such party to bring about, or to represent it in,
the transactions contemplated hereby.
11. BINDING AGREEMENT. This Agreement shall be binding upon and
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inure to the benefit of the parties hereto and their respective successors and
assigns.
12. ENTIRE AGREEMENT. This instrument contains the entire agreement
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of the parties hereto with respect to the subject matter hereof and supersedes
all prior understandings and agreements of the parties with respect to the
subject matter hereof.
13. HEADINGS. The descriptive headings in this Agreement are
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inserted for convenience only and do not constitute a part of this Agreement.
14. COUNTERPARTS. This Agreement may be executed in any number of
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counterparts, each of which shall be deemed an original.
15. NOTICES. Any notice, request, information or other document to
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be given hereunder shall be in writing. Any notice, request, information or the
document shall be deemed duly given three business days after it is sent by
registered or certified mail, postage prepaid, to the intended recipient,
addressed as follows:
If to Xxxxxx, or any of the Harlans, addressed to such party at the
following address:
0000 Xxxx X.X. Xxxxxxx 00
Xxxx, Xxxxxxx 00000-0000
with a copy to such party at the following address:
Xxxxxx Xxxxxxx Dawley, Inc.
X.X. Xxx 00000
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: Xxx X. Xxxxxx
and a copy to:
Xxxxxxxxx, Daily, Xxxxxxx & XxXxx
0000 Xxx Xxxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
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If to Einstein Bros., addressed as follows:
Einstein/Noah Bagel Corp.
00000 Xxxxxx Xxxx Xxxxxxx
Xxxxxx, Xxxxxxxx
Attention: Senior Vice President - Supply Chain
with a copy to:
Einstein/Noah Bagel Corp.
00000 Xxxxxx Xxxx Xxxxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Any party may send any notice, request, information or other document to be
given hereunder using any other means (including personal delivery, courier,
messenger service, fax or ordinary mail), but no such notice, request,
information or other document shall be deemed duly given unless and until it is
actually received by the party for whom it is intended. Any party may change
the address to which notices hereunder are to be sent to it by giving written
notice of such change of address in the manner herein provided for giving
notice.
16. GOVERNING LAW. This Agreement shall be governed by and construed
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in accordance with the laws of the State of Colorado applicable to contracts
made and to be performed wholly therein.
17. INJUNCTIVE RELIEF. In the event of a breach or threatened breach
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of any of the provisions of this Agreement, the parties acknowledge and agree
that the non-breaching party will not have an adequate remedy at law and
therefore will be entitled to enforce any such provision by temporary or
permanent injunctive or mandatory relief as a remedy for any such breach, and
that such remedy shall not be deemed to be the exclusive remedy for any such
breach but shall be in addition to all other remedies.
18. PUBLICITY. No press release or other public or trade
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announcement or statement related to this Agreement or the transactions
contemplated hereby (or the existence of any discussions or negotiations between
the parties regarding any other possible transactions) will be issued, and no
disclosure of this Agreement or the terms hereof will be made, by Xxxxxx or any
of the Harlans without the prior approval of ENBC. ENBC agrees to use reasonable
best efforts to consult with Xxxxxx and the Harlans prior to issuing any press
release or public or trade announcement or statement relating to this Agreement
or the transactions contemplated hereby.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
EINSTEIN/NOAH BAGEL CORP.
By /s/ Xxxx A Srasen
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Senoir Invice President
XXXXXX BAKERIES, INC.
By /s/ Xxxx X. Xxxxxx
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/s/ Xxx X. Xxxxxx
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Xxx X. Xxxxxx
/s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx
/s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx
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