AGREEMENT
This Agreement (the "Agreement") made as of July 22, 1998 by and
between Brynwood III, L.P. ("Brynwood"), a corporation having its principal
office and place of business at Two Soundview Avenue, Greenwich, Connecticut
06830 and Steel Partners II, L.P. ("Steel"), a limited partnership having its
principal office and place of business at 000 Xxxx 00xx Xxxxxx, 00xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000.
WITNESSETH:
WHEREAS, Steel beneficially owns 608,099 shares (the "Steel Shares") of
common stock, $.01 par value per share ("Common Stock") of Lincoln Snacks
Company ("Lincoln"), representing approximately 9.6% of the outstanding shares
of Common Stock; and
WHEREAS, Steel has agreed to sell to Brynwood, and Brynwood has agreed
to purchase from Steel, the Steel Shares for a purchase price of $2-5/16 (TWO
DOLLARS AND FIVE-SIXTEENTHS) per share (the "Per Share Price"), or $1,406,228.94
(ONE MILLION FOUR HUNDRED SIX THOUSAND TWO HUNDRED AND TWENTY EIGHT DOLLARS AND
NINETY FOUR CENTS) in the aggregate;
WHEREAS, the sale of the Steel Shares to Brynwood is conditioned upon
the execution and performance of this Agreement;
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter set forth, and for other good and valuable consideration, receipt of
which is hereby acknowledged, the parties agree as follows:
1. In the event that a Sale Transaction (as defined below) shall close
on or prior to the first anniversary of the date hereof, Brynwood shall pay to
Steel, within three business days following the closing of such Sale
Transaction, the Sale Premium (as defined below). The Sale Premium shall be paid
to Steel by Brynwood in readily available funds at its address written above, or
at such other address as Steel shall direct. The payment of the Sale Premium
shall be accompanied by a statement certified by an executive officer of
Brynwood showing in reasonable detail the calculation of the Sale Premium.
As used herein, a Sale Transaction shall mean a transaction, or a
series of transactions, pursuant to which (i) Lincoln shall be sold, whether by
means of a sale, lease, transfer or other disposition of all or substantially
all of its assets, or grant of any option or other right to purchase, lease or
otherwise acquire all or substantially all of its assets, or a merger, or a
consolidation, (ii) all or substantially all of the Common Stock is purchased by
one or more existing stockholders of Lincoln (other than Brynwood) or by one or
more third parties, or (iii) Brynwood
shall make a tender offer or similar public offer for all or substantially all
of the remaining shares of Common Stock.
As used herein, the Sale Premium shall equal, in the event a Sale
Transaction occurs as described in clause (i) of the above definition, the
excess, if any, by which the average closing price of Lincoln's Common Stock on
the five business days prior to the closing of the Sale Transaction exceeds the
Per Share Price, multiplied by 608,099, or in the event a Sale Transaction
occurs as described in clauses (ii) or (iii) of the above definition, the
excess, if any, by which the average price per share for each share of Common
Stock so purchased exceeds the Per Share Price, multiplied by 608,099. Any
proceeds paid in connection with a Sale Transaction which are other than cash
shall be valued at their fair market value (as agreed between the parties, or if
not agreed as determined by a nationally-recognized accounting firm mutually
acceptable to the parties hereto).
2. This Agreement contains the entire agreement between the parties,
other than the agreement to sell the Steel Shares to Brynwood which shall be
pursuant to a broker's transaction (with any fees, commissions or any other
costs being the sole responsibility of Steel), and supersedes any prior
agreements, and shall not be modified except by a writing executed by all the
parties hereto.
3. This Agreement shall be binding upon, and shall inure to the benefit
of, the parties and their principals, affiliates, successors and assigns, as
well as any parent, subsidiary and related companies.
4. This Agreement shall be construed in accordance with the laws of the
State of New York.
5. This Agreement may be executed in any number of counterparts, each
of which shall constitute a duplicate original hereof.
6. For all purposes of this Agreement with regard to any Sale
Transaction, Brynwood shall be deemed to include any principals of Brynwood or
any of its affiliates, successors and assigns, as well as any partnerships,
subsidiaries or related companies.
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IN WITNESS WHEREOF, the parties have affixed their hand and seal the
day and year first written above.
BRYNWOOD III, L.P., on behalf of
itself and its principals
By:/s/
Name:
Title:
/s/ Xxxxxxx X. Xxxxxxx, Xx.
---------------------------
XXXXXXX X. XXXXXXX, XX.
/s/ Xxxx X. Xxxx
----------------------------
XXXX X. XXXX
STEEL PARTNERS II, L.P.
By: Steel Partners, L.L.C., General
Partner
By: /s/ Xxxxxx X. Xxxxxxxxxxxx
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Name: Xxxxxx X. Xxxxxxxxxxxx
Title: Chief Executive Officer
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