Document:

exv10w16

 

Exhibit 10.16

Base Salaries for Named Executive Officers

The following are the annual base salaries for the named executive officers of Fauquier Bankshares,
Inc., effective January 1, 2005:

	 	 	 	 	 
	C. Hunton Tiffany

	 	$	82,618	 
	Randy K. Ferrell

	 	$	206,000	 
	Eric P. Graap

	 	$	126,930exv10w17

 

Exhibit 10.17

DIRECTORS’
COMPENSATION (in effect for 2005)

EMPLOYEE DIRECTORS. Directors who are employed by Bankshares or TFB do not receive additional
compensation from Bankshares or TFB for their service as directors.

RETAINER. Non-employee directors of Bankshares receive a $5,000 retainer for board service.

MEETING FEES. Non-employee directors of the Bankshares receive a fee of $200 for each Board and
committee meeting attended. Non-employee directors of TFB receive a fee of $500 for each TFB Board
meeting and $200 for each TFB committee meeting attended. However, no director receives fees for
more than two meetings held in any one day.

DIRECTOR DEFERRED COMPENSATION PLAN. Bankshares has a Director Deferred Compensation Plan (the
“Deferred Compensation Plan”), pursuant to which any non-employee director of Bankshares or TFB may
elect to defer receipt of all or any portion of his or her compensation as a director. A
participating director may elect to have amounts deferred under the Deferred Compensation Plan held
in a deferred cash account credited on a quarterly basis with interest equal to the highest rate
offered by TFB at the end of the preceding quarter. Alternatively, a participant may elect to have
a deferred stock account in which deferred amounts are treated as if invested in Bankshares’ common
stock at the fair market value on the date of deferral. The value of a stock account will increase
and decrease based upon the fair market value of an equivalent number of shares of common stock. In
addition, the deferred amounts deemed invested in common stock will be credited with dividends on
an equivalent number of shares. Amounts considered invested in Bankshares’ common stock are paid,
at the election of the director, either in cash or in whole shares of common stock and cash in lieu
of fractional shares. Directors may elect to receive amounts contributed to their respective
accounts through up to five installment payments. Bankshares may establish a trust to hold amounts
deferred and which accumulate under the plan. The purpose of the Deferred Compensation Plan is to
give the non-employee directors the option of deferring current taxation on directors’ fee income.

NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN. Bankshares had a Non-Employee Director Stock Option Plan
(the “Option Plan”), which was adopted in 1995 and expired in 1999. Under the Option Plan each
director who was not an employee of Bankshares or TFB received an option grant covering 2,240
shares of Bankshares common stock on April 1 of each year during the five-year term of the Option
Plan. The first grant under the Option Plan was made on May 1, 1995. The exercise price of awards
was fixed at the fair market value of the shares on the date the option was granted. During the
term of the Option Plan, a total of 123,200 shares of common stock could be granted and 120,960
shares of common stock were granted under the Option Plan. There are 96,820 options under the
Option Plan remaining available to be exercised. The options granted under the Option Plan became
exercisable six months from the date of grant except in the case of death or disability. Options
that are not exercisable at the time a director’s services on the Board terminate for reasons other
than death, disability or retirement in accordance with the Bankshares’ policy are forfeited. The
purpose of the Option Plan was to promote a greater identity of interest between non-employee
directors and Bankshares’ shareholders by increasing each participant’s proprietary interest in the
Bankshares through the award of options to purchase Bankshares common stock.

OMNIBUS STOCK OWNERSHIP AND LONG TERM INCENTIVE PLAN. Bankshares has a an Omnibus Stock Ownership
and Long Term Incentive Plan (the “Omnibus Plan”) which was established in 1998 for employees and
was amended and restated in 2000 to include non-employee directors. 180,000 shares of stock are
reserved for non-employees during the term of the plan which expires in 2008. The first grant to
non-employee directors under the Omnibus Plan was made on May 23, 2000. Under the Omnibus Plan,
non-qualified options to acquire shares of Bankshares common stock, restricted stock, stock
appreciation rights, and/or units may be granted from time to time to non-employee directors of
Bankshares and of any of its subsidiaries. Under the Omnibus Plan, 28,694 options were granted to
non-employee directors at an exercise price of $8.13 in 2000, 28,214 options were granted to
non-employee directors at an exercise price of $8.07 in 2001, and 25,732 options were granted to non-employee directors at an
exercise price of $13.00 in 2002. No grants were made under the Omnibus Plan in 2003. All option
amounts have been adjusted to reflect the effect of stock splits.
During 2004, 299 shares of
restricted stock were granted to each non-employee director under the Omnibus Plan, and during
2005, 282 shares of restricted stock were awarded to each non-employee director under the Omnibus
Plan.exv10w18

 

Exhibit 10.18

DESCRIPTION OF MANAGEMENT INCENTIVE PLAN. The Management Incentive Plan is an annual cash
bonus incentive plan that is recommended by the TFB’s Compensation Committee and approved by the
TFB’s Board of Directors. TFB’s Compensation Committee determines the Chief Executive Officer’s and
other executive officers’ incentive compensation based on each executive officer’s achievement of
his or her individual performance objectives established at the beginning of each fiscal year, as
well as the TFB’s performance as measured by the corporate objectives also established at the
beginning of each fiscal year. These objectives reflect a commitment to maintaining a strong
incentive compensation plan that is directly related to maximizing long-term shareholder value, and
are generally tied to measurements directly relating to corporate strategic objectives (eg. net
income and satisfactory regulatory examination results). Following each year-end, TFB’s
Compensation Committee evaluates each executive officer’s performance during that year with respect
to the individual performance objectives and the corporate objectives. TFB pays the cash incentive
compensation awards in the January of the year following the year of evaluation.exv10w19

 

Exhibit 10.19

DESCRIPTION OF EMPLOYMENT AGREEMENT WITH C. HUNTON TIFFANY

In connection with his retirement from full-time employment with Bankshares as Chief Executive
Officer, effective June 30, 2004, Mr. Tiffany agreed to serve as the non-executive Chairman of the
Boards of Directors of both Bankshares and TFB, and to perform specific duties for Bankshares and
TFB on a part-time basis. In connection with Mr. Tiffany’s part-time work for Bankshares and TFB,
Mr. Tiffany receives an annual base salary of $82,618. Mr. Tiffany does not receive any additional
cash compensation for his Bankshares and TFB director duties, but does participate in the
non-executive directors’ stock compensation plan. Mr. Tiffany also receives certain welfare
benefits that are generally available to other part-time employees of TFB. Mr. Tiffany’s duties
under this part-time employment include: overseeing the corporate governance and board development
function and serve as the Chair of the Corporate Governance Committee of Bankshares and TFB;
overseeing the development of Bankshares’ and TFB’s strategic planning processes; representing
Bankshares and TFB to customers, shareholders, community organizations and local government; and
sitting on Bankshares’ Executive Committee and TFB’s Executive Committee, Trust Committee, and
Investment/ALCO Committee. This part-time arrangement is not based on any formal written
contract, but Bankshares and TFB anticipate that this specific arrangement (and general annual
salary amount) will continue through May 2007.exv10w20

 

Exhibit 10.20

DESCRIPTION OF EMPLOYMENT AGREEMENT WITH C. H. LAWRENCE, JR.

Pursuant to an oral agreement, Mr. Lawrence performs specific duties for TFB on a part-time basis
in addition to his duties as a director of Bankshares. These duties include business development
and one-on-one customer calling, and planning and conducting various sales training classes for
TFB employees such as “Establishing Customer Relationships for Managers and Customer Sales
Representatives,” “Building a Winning Sales Team,” and “Developing Teller Excellence.” Mr.
Lawrence’s compensation for these part-time services is $100 per hour.exv4w2

 

Exhibit 4.2

	 	 	 
	 
	

	 	 

STOCKHOLDERS AGREEMENT

DEAN SPECIALTY FOODS HOLDINGS, INC.

Dated as of January 27, 2005

	 	 	 
	 
	

	 	 

 

 

Table of Contents

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page
	 	1.	 	 	Stock Acquisitions

	 	 	1	 
	 	 	 	 	 
	 	 	 	 
	 	2.	 	 	Board of Directors; Management Structure

	 	 	1	 
	 	 	 	 	2.1 Board of Directors

	 	 	1	 
	 	 	 	 	2.2 Management Structure

	 	 	2	 
	 	 	 	 	 
	 	 	 	 
	 	3.	 	 	Assets and Liabilities of the Company

	 	 	3	 
	 	 	 	 	 
	 	 	 	 
	 	4.	 	 	Spin-Off from Dean

	 	 	4	 
	 	 	 	 	4.1 In General

	 	 	4	 
	 	 	 	 	4.2 Conditions Precedent

	 	 	5	 
	 	 	 	 	4.3 Certain Covenants and Acknowledgements Relating to the Spin Off

	 	 	6	 
	 	 	 	 	4.4 Alternative Proposals

	 	 	7	 
	 	 	 	 	 
	 	 	 	 
	 	5.	 	 	Fees and Expenses

	 	 	8	 
	 	 	 	 	 
	 	 	 	 
	 	6.	 	 	Restrictions on Transfer of Common Stock

	 	 	9	 
	 	 	 	 	6.1 In General

	 	 	9	 
	 	 	 	 	6.2 Estate Planning Transfers

	 	 	9	 
	 	 	 	 	 
	 	 	 	 
	 	7.	 	 	Purchase by Dean from the TreeHouse Investors (“Dean Call Right”)

	 	 	10	 
	 	 	 	 	7.1 Right to Purchase

	 	 	10	 
	 	 	 	 	7.2 Notice

	 	 	10	 
	 	 	 	 	7.3 Payment

	 	 	11	 
	 	 	 	 	 
	 	 	 	 
	 	8.	 	 	Sale by TreeHouse Investors to Dean (“TreeHouse Investors Put Right”)

	 	 	11	 
	 	 	 	 	8.1 Right to Sell

	 	 	11	 
	 	 	 	 	8.2 Notice

	 	 	11	 
	 	 	 	 	8.3 Payment

	 	 	11	 
	 	 	 	 	8.4 Right to Sell in the Event of Death or Disability

	 	 	11	 
	 	 	 	 	 
	 	 	 	 
	 	9.	 	 	Sales to Third Parties

	 	 	12	 
	 	 	 	 	9.1 Sales by TreeHouse Investors

	 	 	12	 
	 	 	 	 	9.2 Involuntary Transfers

	 	 	12	 
	 	 	 	 	 
	 	 	 	 
	 	10.	 	 	Stock Certificate Legend

	 	 	13	 
	 	 	 	 	 
	 	 	 	 
	 	11.	 	 	Covenants; Representations and Warranties

	 	 	14	 
	 	 	 	 	11.1 New TreeHouse Investors

	 	 	14	 
	 	 	 	 	11.2 No Other Arrangements or Agreements

	 	 	14	 
	 	 	 	 	11.3 Additional Representations and Warranties

	 	 	14	 
	 	 	 	 	 
	 	 	 	 
	 	12.	 	 	Amendment and Modification

	 	 	15	 

i 

 

Table of Contents
(continued)

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page
	 	13.	 	 	Parties

	 	 	15	 
	 	 	 	 	13.1 Assignment Generally

	 	 	15	 
	 	 	 	 	13.2 Termination

	 	 	15	 
	 	 	 	 	13.3 Agreements to Be Bound

	 	 	16	 
	 	 	 	 	 
	 	 	 	 
	 	14.	 	 	Recapitalizations, Exchanges, etc

	 	 	16	 
	 	 	 	 	 
	 	 	 	 
	 	15.	 	 	No Third Party Beneficiaries

	 	 	16	 
	 	 	 	 	 
	 	 	 	 
	 	16.	 	 	Further Assurances

	 	 	17	 
	 	 	 	 	 
	 	 	 	 
	 	17.	 	 	Governing Law

	 	 	17	 
	 	 	 	 	 
	 	 	 	 
	 	18.	 	 	Invalidity of Provision

	 	 	17	 
	 	 	 	 	 
	 	 	 	 
	 	19.	 	 	Waiver

	 	 	17	 
	 	 	 	 	 
	 	 	 	 
	 	20.	 	 	Notices

	 	 	17	 
	 	 	 	 	 
	 	 	 	 
	 	21.	 	 	Headings

	 	 	18	 
	 	 	 	 	 
	 	 	 	 
	 	22.	 	 	Counterparts

	 	 	18	 
	 	 	 	 	 
	 	 	 	 
	 	23.	 	 	Entire Agreement

	 	 	18	 
	 	 	 	 	 
	 	 	 	 
	 	24.	 	 	Injunctive Relief

	 	 	19	 
	 	 	 	 	 
	 	 	 	 
	 	25.	 	 	Defined Terms

	 	 	19	 

ii 

 

STOCKHOLDERS AGREEMENT

          STOCKHOLDERS AGREEMENT, dated as of January 27, 2005 (this “Agreement”), among Dean
Specialty Foods Holdings, Inc., a Delaware corporation (the “Company”), Dean Foods Company,
a Delaware corporation (“Dean”), Sam K. Reed, David B. Vermylen, E. Nichol McCully, Thomas
E. O’Neill, and Harry J. Walsh (collectively, the “Initial TreeHouse Management”), and each
other person or entity who becomes a party to this Agreement (together with the Initial TreeHouse
Management, the “TreeHouse Investors” and the TreeHouse Investors, together with Dean, the
“Stockholders”). Capitalized terms used herein without definition are defined in Section
25.

          The parties hereto agree as follows:

          1. Stock Acquisitions. Simultaneously with the execution of this Agreement, each of
the TreeHouse Investors is entering into a stock subscription agreement with the Company
(collectively, the “Subscription Agreements”) to purchase shares of common stock, par value
$.01 per share, of the Company (“Common Stock”) having a value of $10.0 million in the
aggregate for all TreeHouse Investors. The purchase price per share for such Common Stock shall be
set forth in the Subscription Agreements. Such purchase price has been determined based on the
value of the Company taking into account the contributions of assets to be made by Dean as set
forth in Section 3 below (but such purchase price and value are subject to adjustment as provided
in Section 4.3(b)). As a condition to the closing of the purchase contemplated by the Subscription
Agreements, each such TreeHouse Investor must become a party to this Agreement. Except as provided
for in the Subscription Agreements, and as may occur pursuant to a stock dividend, stock split,
recapitalization or other similar corporate transaction affected on a pro-rata basis so that the
percentage of the Common Stock held by each stockholder immediately prior thereto is not affected,
the Company shall issue no additional shares of Common Stock prior to the earlier to occur of
(i) the date the registration statement or statements relating to the Spin-Off shall have
become effective and trading of Common Stock on a registered national securities exchange or
automated quotation system (including, but not limited to, NASDAQ) shall have commenced (such date,
the “Registration Date”) and (ii) the date that no TreeHouse Investor holds any
shares of Common Stock by reason of the exercise of the rights set forth in either Section 7 or
Section 8.

          2. Board of Directors; Management Structure.

          2.1 Board of Directors. Each Stockholder shall vote all of his, her or its shares of
Common Stock and any other voting securities of the Company over which such Stockholder has voting
control, and shall take all other necessary or desirable

1

 

actions within such Stockholder’s control (whether in such Stockholder’s capacity as a
stockholder, director, member of a board committee or officer of the Company or otherwise, and
including, without limitation, attendance at meetings in person or by proxy for purposes of
obtaining a quorum, execution of written consents in lieu of meetings and approval of amendments
and/or restatements of the Company’s certificate of incorporation or by-laws), and the Company
shall take all necessary and desirable actions within its control (including, without limitation,
calling special board, committee, stockholder meetings and approval of amendments and/or
restatements of the Company’s certificate of incorporation or by-laws), so that, at the date of
distribution of the Common Stock to the stockholders of Dean in connection with the Spin-Off (the
“Distribution Date”):

          (a) the Board of Directors of the Company (the “Board”) shall consist of 7 members;

          (b) Sam K. Reed shall be a member of the Board and shall serve as the Board’s Chairman;

          (c) Dean’s Chief Executive Officer in office at such date shall be a member of the Board;

          (d) five individuals mutually recommended and nominated by the Dean Representative and the
TreeHouse Representative shall be elected to the Board, subject to the approval of the Board of
Directors of Dean (the “Dean Board”), in its sole discretion, provided that three
of the five individuals shall not be affiliated in any way with Dean or any of the TreeHouse
Investors or any of their affiliates, shall have experience and expertise that qualifies such
person to serve on the Board and shall satisfy any and all applicable independence requirements for
persons who would serve as members of the Company’s audit or compensation committees of the Board;

          (e) the composition of the board of directors of each of the Company’s subsidiaries (a
“Subsidiary Board”) shall be determined by the Board; and

          (f) any committees of the Board or a Subsidiary Board shall be established by (or, in the case
of a Subsidiary Board, with the approval of the Board) the Board, provided that (i) the
initial membership of any such committees shall be proposed by the TreeHouse Representative after
consulting with the Dean Representative and (ii) such committees shall be operated in accordance
with the by-laws of the applicable company and applicable law.

          2.2 Management Structure. The Company shall have the following officers: Chief
Executive Officer, President & Chief Operating Officer, Chief Financial Officer, General Counsel &
Chief Administrative Officer, and Senior Vice President of

2

 

Operations. Each of these offices shall be filled by the Board, provided that the
person to whom such position is assigned in his or her employment agreement with the Company, dated
as of the date hereof (each, an “Employment Agreement”), shall serve in such office in
accordance with the terms of such Employment Agreement.

          3. Assets and Liabilities of the Company.

          (a) Transfer of Specialty Businesses. Immediately prior to the Distribution Date, the
assets of the Company shall consist, directly or indirectly, of Dean’s right, title and interest in
and to all properties, assets and rights of every nature, kind and description, tangible and
intangible (including goodwill), whether real, personal or mixed, whether accrued, contingent or
otherwise that primarily relate to, or are primarily held for use in connection with, the
Specialty, Mocha Mix, food service dressings, and Second Nature businesses of Dean (collectively,
the “Specialty Businesses”), including, but not limited to, working capital assets (but
excluding cash), fixed assets, intangible assets, capital leases, and other long-term assets, but
excluding the trade names Dean, Carb Conquest, and Fieldcrest (and any derivatives of any such
trade name) and associated logos. The liabilities of the Company shall consist of those
liabilities and obligations incurred in connection with the Specialty Businesses, including, but
not limited to, the fees and expenses specified in Section 5, any tax liability referenced in
Section 4.2(a) or in the tax matters agreement to be entered into by Dean, the Company and their
affiliates, working capital liabilities, pension and other post-retirement benefit obligations, and
other employee benefit liabilities, long-term liabilities, and off balance sheet commitments and
contingencies, provided that any such liabilities and obligations shall not consist of any
indebtedness for borrowed money (other than capital leases) to, or any guarantees for any such
indebtedness of, Dean, any of its affiliates (other than the Company) or any third party. Dean
covenants that it shall take all actions reasonably necessary so that the assets of the Company
immediately prior to the Distribution Date shall comprise all assets, properties and rights
required for the Company to conduct the Specialty Businesses on and after the Distribution Date in
all material respects in the manner in which such Specialty Businesses had been conducted
immediately prior to the Distribution Date.

          (b) Employment Agreements. Notwithstanding anything herein or therein to the
contrary, Dean guarantees the performance of the Company’s obligations arising prior to the
Registration Date with respect to each Employment Agreement between the Company and any member of
the Initial TreeHouse Management, including, without limitation, payment of any compensation or
severance or other termination benefits payable thereunder, provided, however, that
the Company shall not amend any such employment agreement to increase the amounts payable
thereunder in any material respect without Dean’s consent.

3

 

          4. Spin-Off from Dean.

          4.1 In General. Subject to Section 4.2, from and after the date hereof, the Company
and the Stockholders shall use their reasonable commercial effects to consummate the Spin-Off.
Such efforts shall include, but not be limited to:

          (a) IRS Ruling. Dean shall use its commercially reasonable efforts to obtain a
private letter ruling (the “Private Letter Ruling”) from the Internal Revenue Service to
the effect that (i) the transfer by Dean to the Company of the assets of the Specialty
Businesses, and the Company’s assumption of the liabilities held by Dean related to the Specialty
Businesses, followed by the distribution of Common Stock in connection with the Spin-Off to the
stockholders of Dean, will qualify as a reorganization under Sections 368(a)(1)(D) and 355 of the
Internal Revenue Code of 1986, as amended (the “Code”); (ii) no gain or loss will
be recognized for U.S. federal income tax purposes by Dean on its transfer of the assets relating
to the Specialty Businesses to the Company; (iii) no gain or loss will be recognized for
U.S. federal income tax purposes by the Company on its receipt of the assets relating to the
Specialty Businesses from Dean, and (iv) no gain or loss will be recognized for U.S.
federal income tax purposes by (and no amount will otherwise be included in the income of) the
stockholders of Dean upon their receipt of Common Stock pursuant to the Spin-Off;

          (b) Registration Statement. The Company and the Stockholders shall use their
commercially reasonable efforts to file a registration statement on Form 10 or on such other forms
as may be required or appropriate under the applicable Federal securities laws to register the
Common Stock to be distributed in connection with the Spin-Off pursuant to the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), and/or to register the distribution of the
Common Stock pursuant to the Securities Act of 1933, as amended (the “Securities Act”), as
applicable (any such registration statements or forms, collectively, the “Registration
Statements”), and such amendments or supplements thereto as may be necessary in order to cause
the Registration Statements to become and remain effective as required by law or the Securities and
Exchange Commission (the “Commission”). The Company and the Stockholders shall also
cooperate in preparing, filing with the Commission and causing to become effective registration
statements or amendments thereof under either the Securities Act or the Exchange Act that are
required to reflect the establishment of, amendments to, any employee benefit and other plans
necessary or appropriate in connection with the Spin-Off;

          (c) Blue Sky. The Company and the Stockholders shall use their commercially
reasonable efforts to take all such actions as may be necessary or appropriate to register or
qualify the Common Stock or other securities of the Company under the state securities or blue sky
laws of the United States (and any comparable laws under any foreign jurisdiction) in connection
with the Spin-Off; and

4

 

          (d) Stock Exchange/NASDAQ Listing. The Company and the Stockholders shall use their
commercially reasonable efforts to prepare, file and to make effective, an application for listing
of the Common Stock that will be distributed in connection with the Spin-Off on a registered
national securities exchange or automated quotation system (including, but not limited to, NASDAQ),
subject to official notice of issuance.

          4.2 Conditions Precedent. The obligations of the Company and the Stockholders to use
their commercially reasonable efforts to consummate any Spin-Off shall be conditioned on the
satisfaction of the following conditions (such conditions are for the sole benefit of Dean and
shall not give rise to or create any duty on the part of Dean or the Dean Board to waive or not to
waive such conditions):

          (a) IRS Ruling. Dean shall have obtained the Private Letter Ruling from the Internal
Revenue Service in form and substance reasonably satisfactory to Dean, and such ruling shall remain
in effect as of the effective date of the Spin-Off, and neither Dean nor any of its affiliates
shall be required to recognize gain or income by reason of any transactions (including, without
limitation, any intercompany transactions) effectuated in connection with the Spin-Off;
provided, however, if the Private Letter Ruling is obtained, but Dean or any of its
affiliates is required to recognize gain or income by reason of any transactions effectuated in
connection with the Spin-Off, Dean (i) shall waive this condition if such recognition of
gain or income is less than or equal to $20 million, and (ii) may waive this condition if
such recognition of gain or income is greater than $20 million, and, in each such case, the Company
shall reimburse Dean for any taxes incurred (subject to a maximum reimbursement of $20 million) as
a result of the recognition of such gain or income, in which case, the adjustment provisions of
Section 4.3(b) shall apply.

          (b) Governmental Approvals. Any material governmental approvals and consents
necessary to consummate the Spin-Off shall have been obtained and be in full force and effect;

          (c) Stock Exchange/NASDAQ Listing. The Common Stock to be distributed in connection
with the Spin-Off shall have been accepted for listing on a registered national securities exchange
or automated quotation system (including, but not limited to, NASDAQ), on official notice of
issuance;

          (d) No Legal Restraints. No order, injunction or decree issued by any court or agency
of competent jurisdiction or other legal restraint or prohibition preventing the consummation of
the Spin-Off shall be in effect and no other event outside the control of Dean shall have occurred
or failed to occur that prevents the consummation of the Spin-Off;

5

 

          (e) No Material Adverse Effect. No other event or developments shall have occurred
that, in the judgment of the Dean Board, would result in the Spin-Off having a material adverse
effect on Dean or on the stockholders of Dean;

          (f) Opinions. Dean or the Company, as the case may be, shall have received any and all legal
opinions, in a form reasonably satisfactory to the Board of Directors of the applicable entity, as
such Board of Directors shall determine in good faith to be reasonably necessary for it to
authorize the consummation of the Spin-Off; and

          (g) Other Actions. Such other reasonable and customary actions as Dean shall
determine to be reasonably necessary in order to assure the successful completion of the Spin-Off
shall have been taken.

          4.3 Certain Covenants and Acknowledgements Relating to the Spin Off.

          (a) In General. From and after the date hereof, Dean and the TreeHouse Investors
agree to act in good faith and diligently to pursue the Spin-Off. Notwithstanding anything to the
contrary contained in this Agreement, the Company and the Stockholders acknowledge and agree that
Dean shall, in consultation with the Tree House Representative, determine the date of the Spin-Off
and all terms of the Spin-Off, including, but not limited to, the form, structure and terms of any
transaction or transactions and/or distribution or distributions to effect the Spin-Off, and the
time of and conditions to the consummation of the Spin-Off. In addition, Dean may, in consultation
with the TreeHouse Investors, at any time and from time to time before the Spin-Off modify or
change the terms of the Spin-Off, including, but not limited to, by accelerating or delaying the
timing of all or part of the Spin-Off. Dean shall select any investment banker or bankers and
manager or managers whose services may be required or advantageous in connection with the Spin-Off,
as well as any financial printer, solicitation and/or exchange agent and outside counsel for Dean
and the Company.

          (b) Adjustment Provisions. In the event that the Company is required to reimburse
Dean for any taxes incurred by Dean as contemplated by Section 4.2(a) (the amount so reimbursed
hereafter called the “Tax Reimbursement Amount”), the Company will issue the TreeHouse
Investors that number of additional shares of Common Stock equal to the excess of (i) the
Required Common Stock Outstanding over (ii) the Current Common Stock Outstanding.
“Required Common Stock Outstanding” shall mean the number of shares of Common Stock equal
to the quotient of (i) the Dean Owned Shares divided by (ii) the excess of
(A) one over (B) the quotient of (x) $10 million divided by (y) the
Revised Valuation. “Dean Owned Shares” shall mean the number of shares of Common Stock
owned by Dean immediately prior to any adjustment pursuant to this Section 4.3(b). “Revised
Valuation” shall mean the excess of (i) $600 million over (ii) the product of
(A) .4464 and (B) the Tax Reimbursement Amount.

6

 

“Current Common Stock Outstanding” shall mean the total number of shares of the
Company’s Common Stock outstanding immediately prior to any adjustment pursuant to this Section
4.3(b).

          (c) Certain Dean Options. If the current Chief Executive Officer of Dean is a
director of the Company at the time specified in Section 2.1, then, in connection with the
Spin-Off, Dean shall adjust such officer’s vested options to purchase shares of Dean common stock
(the “Dean Options”), such that, following the Spin-Off, the Dean Options shall be
converted into the right to purchase shares of Dean common stock and Common Stock in the same
proportions as would have applied had such officer held the shares of common stock of Dean issuable
upon exercise of the Dean Options on the relevant record date with respect to the Spin-Off. The
exercise price of the options to purchase shares of Dean common stock and Common Stock following
such adjustment shall be determined using the principles set forth in section 424 of the Code,
subject to adjustment as is necessary to avoid accruing any compensation expense to the Company or
Dean under U.S. Generally Accepted Accounting Principles. The adjustment to the Dean Options shall
take place as soon as reasonably practicable following the Registration Date, but in no event more
than 30 days after such Registration Date.

          4.4 Alternative Proposals.

          (a) In General. In the event that, prior to the Registration Date, the Dean Board
determines not to proceed with the Spin-Off due to its receipt of an alternative proposal from an
unrelated third party for (i) the acquisition by such party through one transaction or a series of
transactions of (A) more than 50% of the combined voting power of the then outstanding
voting securities of the Company, or (B) all or substantially all of the assets of the
Company, (ii) the merger or consolidation of the Company (including, but not limited to, by
means of a “reverse Morris trust transaction”) as a result of which Dean does not, immediately
thereafter, own, directly or indirectly, more than 50% of the combined voting power entitled to
vote generally in the election of directors of the merged or consolidated company, or (iii)
the acquisition by such party through one transaction or a series of transactions of (A)
more than 50% of the combined voting power of the then outstanding voting securities of Dean, or
(B) all or substantially all of the assets of Dean (each, an “Alternative
Proposal”), then, upon and subject to consummation of the transaction described in the
Alternative Proposal, Dean shall pay the TreeHouse Investors, in the aggregate, a cash fee equal to
1% of the Total Enterprise Value (as determined pursuant to Section 4.4(c) below). In the event
that such fee becomes payable, the TreeHouse Representative shall inform Dean to whom such fee
shall be paid, and in what amounts, at least 5 business days before the consummation of the
transaction described in the Alternative Proposal.

          (b) Conditions to Payment. Notwithstanding Section 4.4(a), no fee shall become
payable (or be paid) to the TreeHouse Investors unless the TreeHouse

7

 

Management (i) continue to manage the Company until the earlier of (A) the
consummation of the transaction described in the Alternative Proposal and (B) 9 months from
the publication of the press release announcing such transaction, and (ii) shall have
assisted, to the extent reasonably requested by Dean, in Dean’s efforts to consummate such
transaction.

          (c) Determination of Enterprise Value. If the Alternative Proposal relates to a sale
of the stock of the Company or substantially all the assets of the Company, the Total Enterprise
Value will be determined based on the value of the consideration received (including any debt
assumed, other than trade debt incurred in the ordinary course of business, which shall be net of
any cash and cash equivalents) in connection with such sale. If the Alternative Proposal relates
to the acquisition of Dean stock or assets, the determination of the Total Enterprise Value shall
be $600 million (or, if any adjustment is made pursuant to Section 4.3(b), the amount of the
Revised Valuation).

          (d) Certain Covenants Relating to Alternative Proposals. Each of the Stockholder
Representatives agree to give the other Stockholders Representative written initial notice within 3
business days after becoming aware of any written or oral expression of interest or offer for all
or any portion of the stock or assets of the Company or the Specialty Businesses. Such notice
shall specify in reasonable detail such expression of interest or offer. In addition, following
the delivery of any such notice by either Stockholder Representative, Dean and the TreeHouse
Investors shall communicate with the other (through their respective Stockholder Representative) as
to the status and progress with respect to such possible transaction regarding the sale of the
Common Stock or the assets of the Company, such that each such Stockholder Representative is kept
promptly and continuously informed of all relevant developments in this regard. Dean agrees that
it shall also notify such unrelated third party, promptly following delivery of the initial notice
by either Stockholder Representative, that the TreeHouse Management shall not be available to
manage the Company after the consummation of any transaction with such unrelated third party. Dean
further agrees that it shall not pursue any transaction or enter into any agreement that involves
any form of contingency or otherwise directly or indirectly contemplates that any member of
TreeHouse Management will negotiate with or be employed by such unrelated third party after the
consummation of any transaction with such unrelated third party.

          5. Fees and Expenses. The Company shall reimburse the TreeHouse Management for their
reasonable professional costs and out-of-pocket travel costs associated with drafting, negotiating
and implementing this Agreement and the Employment Agreements, and any other arrangements between
the Company and the TreeHouse Investors referenced therein, within 30 days following the submission
of evidence, reasonably satisfactory to the Company, of the incurrence and purpose of each such
expense, provided that, unless and until the Registration Date occurs, the amount of

8

 

expenses subject to reimbursement shall not exceed $200,000. If the Registration Date occurs,
up to $12.5 million of the fees and expenses incurred by Dean and the Company in connection with
(i) drafting, negotiating and implementing this Agreement and the Employment Agreements,
and any other arrangements between the Company and the TreeHouse Investors referenced therein, and
(ii) planning, analysis and execution of the Spin-Off shall be borne by the Company.

          6. Restrictions on Transfer of Common Stock.

          6.1 In General.

          (a) TreeHouse Investors. Until the third anniversary of the date of this Agreement,
no shares of Common Stock acquired pursuant to Subscription Agreements or any shares of Common
Stock or other securities of the Company received in respect of such shares of Common Stock (the
“Restricted Shares”) may be, directly or indirectly, sold, assigned, mortgaged,
transferred, pledged, hypothecated or otherwise disposed of (each, a “Transfer”),
provided that shares of Common Stock may be Transferred before the expiration of such
period (i) pursuant to Section 6.2 (“Estate Planning Transfers”) or, in the case of
such TreeHouse Investor’s death, by will or by the laws of intestate succession, to executors,
administrators, testamentary trustees, legatees or beneficiaries, provided that the
transferee becomes a party to this Agreement in accordance with Section 13.3, (ii) pursuant
to Section 7 (“Dean Call Right”), (iii) pursuant to Section 8 (“TreeHouse
Investors Put Right”), (iv) in accordance with Section 9.2 or (v) to the
Company in consideration of the payment of the exercise price of any stock options held by such
TreeHouse Investor related to the Common Stock or of the taxes required to be withheld upon the
exercise of any such stock options, so long as such TreeHouse Investor agrees that the restrictions
contained in this Section 6.1(a) shall thereafter continue to apply to that number of shares of
Common Stock received upon exercise of such stock options as is equal to the number of shares so
surrendered.

          (b) Dean. Except for any transfer (i) to one or more of its direct or
indirect wholly-owned subsidiaries, (ii) to its stockholders in connection with the
Spin-Off or (iii) pursuant to an Alternative Proposal, Dean agrees that during the pendency
of this Agreement, it shall not Transfer any of the shares of Common Stock it holds.

          6.2 Estate Planning Transfers. Shares of Common Stock held by a TreeHouse Investor
who is an individual may be Transferred for estate-planning purposes to (a) a trust under
which the distribution of the shares of Common Stock may be made only to beneficiaries who are such
TreeHouse Investor, his or her spouse, his or her parents, members of his or her immediate family
or his or her lineal descendants, (b) a charitable remainder trust, the income from which
will be paid to such TreeHouse Investor during his or her life, (c) a corporation, the
stockholders of which are only such TreeHouse Investor, his or her spouse, his or her parents,
members of his or her

9

 

immediate family or his or her lineal descendants or (d) a partnership or limited
liability company, the partners or members of which are only such TreeHouse Investor, his or her
spouse, his or her parents, members of his or her immediate family or his or her lineal
descendants.

          7. Purchase by Dean from the TreeHouse Investors (“Dean Call Right”).

          7.1 Right to Purchase. Subject to this Section 7, if the Registration Date does not
occur by (a) October 31, 2005 (or such later date as the TreeHouse Representative and Dean
Representative may agree to in writing), or (b) if earlier, the earlier of the date (such
earlier date hereafter called the “Early Termination Date”) (i) the Company or Dean
receives notice from the Internal Revenue Service that it does not intend to issue the Private
Letter Ruling or (ii) Dean decides not to proceed with the Spin-Off because (x) the
Private Letter Ruling is unsatisfactory, (y) the issuance of such Private Letter Ruling
would be subject to conditions that Dean determines to be unacceptable or (z) any of the
other conditions to effecting the Spin-Off set forth in Section 4.2 hereof will not or cannot be
satisfied on commercially reasonable terms, then Dean shall have the right to purchase from the
TreeHouse Investors, and the TreeHouse Investors shall have the obligation to sell to Dean, all,
but not less than all, of the TreeHouse Investors’ shares of Common Stock. Dean shall give the
TreeHouse Representative notice promptly, but not later than 3 business days, after receiving any
notice from the Internal Revenue Service or making any determination referenced in subclauses (i)
or (ii) of subclause (b) of the immediately preceding sentence. If the reason that the Spin-Off is
not effected is other than due to a TreeHouse Default, the aggregate purchase price for all such
shares of Common Stock shall be $11.0 million. If the reason that the Spin-Off is not effected
is due to a TreeHouse Default, the aggregate purchase price for all such shares of Common Stock
shall equal the lesser of (I) $10.0 million, and (II) an amount equal to the
product of (a) the quotient of (x) the fair market value of the entire Common Stock
equity interest of the Company taken as a whole, without additional premiums for control or
discounts for minority interests or restrictions on transfer as established by an investment bank
agreed to by the Dean Representative and the TreeHouse Representative using the same methodology
that was used to determine the purchase price per share for the Common Stock specified in the
Subscription Agreements, divided by (y) the number of outstanding shares of Common Stock,
calculated on a fully-diluted basis, multiplied by (b) the number of outstanding shares of
Common Stock held by the TreeHouse Investors.

          7.2 Notice. If Dean desires to purchase shares of Common Stock pursuant to Section
7.1, it shall notify each of the TreeHouse Investors not more than 30 days after October 31, 2005
(or such earlier or later date as determined pursuant to Section 7.1).

10

 

          7.3 Payment. Payment for any shares of Common Stock to be purchased from the
TreeHouse Investors pursuant to Section 7.1 shall be made on the date specified by the Dean
Representative (but in no event more than 10 business days following the date of the receipt by the
TreeHouse Investors of Dean’s notice delivered pursuant to Section 7.2), and the aggregate purchase
price paid by Dean shall be allocated among the TreeHouse Investors based on the number of shares
of Common Stock then held by each such TreeHouse Investor.

          8. Sale by TreeHouse Investors to Dean (“TreeHouse Investors Put Right”).

          8.1 Right to Sell. Subject to this Section 8, if the Registration Date does not occur
for any reason other than a TreeHouse Default by (a) October 31, 2005 (or such later date
as the TreeHouse Representative and the Dean Representative may agree to in writing), or
(b) if earlier, the Early Termination Date, then the TreeHouse Investors shall have the
right to sell to Dean, and Dean shall have the obligation to purchase from the TreeHouse Investors,
all, but not less than all, of the TreeHouse Investors’ shares of Common Stock, at an aggregate
purchase price equal to $11.0 million.

          8.2 Notice. If the TreeHouse Investors desire to sell shares of Common Stock pursuant
to Section 8.1, the TreeHouse Representative shall notify Dean not more than 60 days after October
31, 2005 (or such earlier or later date as determined pursuant to Section 8.1). Such notice shall
specify the number of shares of Common Stock held by each TreeHouse Investor at the time notice is
given.

          8.3 Payment. Payment for any shares of Common Stock sold by the TreeHouse Investors
pursuant to Section 8.1 shall be made on the date that is 10 business days following the date of
the receipt by Dean of the TreeHouse Representative’s notice with respect to such shares pursuant
to Section 8.2, and the aggregate purchase price paid by Dean shall be allocated among the
TreeHouse Investors based on the number of shares of Common Stock then held by each such TreeHouse
Investor.

          8.4 Right to Sell in the Event of Death or Disability.

          (a) In General. Subject to this Section 8.4, if the employment of member of TreeHouse
Management terminates due to his death or pursuant to a Termination due to Disability (as defined
in the applicable Employment Agreement) prior to the Registration Date, then such member and any
other TreeHouse Investor who is affiliated with such member shall have the right to sell to Dean,
and Dean shall have the obligation to purchase from such TreeHouse Investors (or such TreeHouse
Investor’s estate), all, but not less than all, of such TreeHouse Investor’s shares of Common
Stock, at an aggregate purchase price equal to the aggregate purchase price paid by such TreeHouse
Investors for such shares of Common Stock.

11

 

          (b) Notice. If the TreeHouse Investor (or such TreeHouse Investor’s estate) desires
to sell shares of Common Stock pursuant to Section 8.4(a), the TreeHouse Investor (or such
TreeHouse Investor’s estate) shall notify Dean not more than 90 days after date of termination of
such TreeHouse Investor’s employment. Such notice shall specify the number of shares of Common
Stock held by such TreeHouse Investor at the time notice is given.

          (c) Payment. Payment for any shares of Common Stock sold by the TreeHouse Investor
(or termination estate) pursuant to Section 8.4(a) shall be made on the date that is 10 business
days (or the first business day thereafter if the 10th business day is not a business day)
following the date of the receipt by Dean of the TreeHouse Investor’s (or the TreeHouse Investors
estate’s) notice with respect to such shares pursuant to Section 8.4(b).

          9. Sales to Third Parties.

          9.1 Sales by TreeHouse Investors. At any time after the third anniversary of the date
hereof, any TreeHouse Investor may sell his, her or its Restricted Shares to a third party. Except
as provided in Section 6, at any time after the Registration Date, any TreeHouse Investor may sell
any shares of the Company’s Common Stock without restriction by reason of the terms of this
Agreement. Nothing in this Section 9.1 shall be construed to excuse any TreeHouse Investor from
compliance with any applicable rules on resales as may be imposed at law, including under the
Federal securities laws, or from complying with the terms of any other agreement that Executive is
now, or may hereafter become a party to.

          9.2 Involuntary Transfers. Prior to the Registration Date, any transfer of title or
beneficial ownership of shares of Common Stock (including any of the Restricted Shares) upon
default, foreclosure, forfeit, divorce, court order or otherwise than by a voluntary decision on
the part of a TreeHouse Investor (each, an “Involuntary Transfer”) shall be void unless the
TreeHouse Investor complies with this Section 9.2 and enables the Company to exercise in full its
rights hereunder. Upon any Involuntary Transfer, the Company shall have the right to purchase such
shares pursuant to this Section 9.2 and the person or entity to whom such shares have been
Transferred (the “Involuntary Transferee”) shall have the obligation to sell such shares in
accordance with this Section 9.2. Upon the Involuntary Transfer of any shares of Common Stock,
such TreeHouse Investor shall promptly (but in no event later than two days after such Involuntary
Transfer) furnish written notice to the Company indicating that the Involuntary Transfer has
occurred, specifying the name of the Involuntary Transferee, giving a detailed description of the
circumstances giving rise to, and stating the legal basis for, the Involuntary Transfer. Upon the
receipt of such notice, and for 60 days thereafter, the Company shall have the right to purchase,
and the Involuntary Transferee shall have the obligation to sell, all (but not less than all) of
the shares of Common Stock

12

 

acquired by the Involuntary Transferee for a purchase price equal to the lesser of (i)
the then fair market value of such shares of Common Stock as determined in accordance with Section
4.4(c), and (ii) the cost of such shares of Common Stock to the TreeHouse Investor who
originally acquired such shares, provided that the excess, if any, of the purchase price so
determined over the amount of such indebtedness or other liability that gave rise to the
Involuntary Transfer shall be paid directly to the TreeHouse Investor and not to the Involuntary
Transferee.

          10. Stock Certificate Legend. A copy of this Agreement shall be filed with the
Secretary of the Company and kept with the records of the Company. Each certificate representing
shares of Common Stock owned by the Stockholders shall bear upon its face the following (or
similar) legends, as appropriate:

	 	(a)  	“THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE BEEN ACQUIRED
FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “ACT”), AND MAY NOT BE OFFERED, SOLD, ASSIGNED, PLEDGED,
HYPOTHECATED, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS AND UNTIL REGISTERED
UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR UNLESS, IN THE
OPINION OF COUNSEL TO THE STOCKHOLDER, WHICH COUNSEL MUST BE, AND THE FORM AND
SUBSTANCE OF WHICH OPINION ARE, SATISFACTORY TO THE ISSUER, SUCH OFFER, SALE,
ASSIGNMENT, PLEDGE, HYPOTHECATION, TRANSFER OR OTHER DISPOSITION IS EXEMPT
FROM REGISTRATION OR IS OTHERWISE IN COMPLIANCE WITH THE ACT, SUCH LAWS AND
THE STOCKHOLDERS AGREEMENT OF THE ISSUER, DATED AS OF JANUARY 27, 2005 (THE
“STOCKHOLDERS AGREEMENT”).”
	 
	 	(b)  	“THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE ARE
SUBJECT TO RESTRICTIONS ON TRANSFER AND OTHER CONDITIONS, AS SPECIFIED IN THE
STOCKHOLDERS AGREEMENT, COPIES OF WHICH ARE ON FILE AT THE OFFICE OF THE
ISSUER AND WILL BE FURNISHED WITHOUT CHARGE TO THE HOLDER OF SUCH SHARES UPON
WRITTEN REQUEST.”

In addition, certificates representing shares of Common Stock owned by residents of certain states
shall bear any legends required by the laws of such states.

13

 

All Stockholders shall be bound by the requirements of all such legends. On the Registration Date,
the certificate representing the distributed shares shall be replaced, at the expense of the
Company, with certificates not bearing the legends required by clauses (a) and (b) of this Section
10.

          11. Covenants; Representations and Warranties.

          11.1 New TreeHouse Investors. Each of the Stockholders hereby agrees that any person
who is designated as a member of TreeHouse Management after the date of this Agreement and who is
offered shares of any class of Common Stock or holds stock options exercisable into shares of
Common Stock shall, as a condition precedent to the acquisition of such shares of Common Stock or
the exercise of such stock options, as the case may be, (a) become a party to this
Agreement by executing a signature page to the same and (b) if such person is a resident of
a state with a community or marital property system, cause his or her spouse to execute a Spousal
Waiver in the form of Exhibit A attached hereto, and deliver such executed signature page to this
Agreement and Spousal Waiver, if applicable, to the Company at its address specified in Section 20
hereof. Upon such execution and delivery, such employee shall be a TreeHouse Investor for all
purposes of this Agreement.

          11.2 No Other Arrangements or Agreements. Each Stockholder hereby represents and
warrants to the Company and to each other Stockholder that, except for this Agreement, the
Subscription Agreements, the Employment Agreements and any management stock option agreement of the
Company applicable to a member of TreeHouse Management, he, she or it has not entered into or
agreed to be bound by any other arrangements or agreements of any kind with any other party with
respect to the shares of Common Stock, including, but not limited to, arrangements or agreements
with respect to the acquisition or disposition of Common Stock or any interest therein or the
voting of shares of Common Stock (whether or not such agreements and arrangements are with the
Company or any of its subsidiaries, or other Stockholders) and each TreeHouse Investor agrees that,
except as expressly permitted under this Agreement, he, she or it will not enter into any such
other arrangements or agreements.

          11.3 Additional Representations and Warranties. Each Stockholder represents and
warrants to the Company and each other Stockholder that:

          (a) such Stockholder has the power, authority and capacity (or, in the case of any Stockholder
that is a corporation, trust, limited liability company or limited partnership, all corporate,
trust, limited liability company or limited partnership power and authority, as the case may be) to
execute, deliver and perform this Agreement;

          (b) in the case of a Stockholder that is a corporation, trust, limited liability company or
limited partnership, the execution, delivery and performance of this

14

 

Agreement by such Stockholder have been duly and validly authorized and approved by all
necessary corporate, trust, limited liability company or limited partnership action, as the case
may be;

          (c) this Agreement has been duly and validly executed and delivered by such Stockholder and
constitutes a valid and legally binding obligation of such Stockholder, enforceable in accordance
with its terms, subject to bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting or relating to creditors’ rights generally and general principles of equity; and

          (d) the execution, delivery and performance of this Agreement by such Stockholder does not and
will not violate the terms of, or result in the acceleration of, any obligation under (i)
any material contract, commitment or other material instrument to which such Stockholder is a party
or by which such Stockholder is bound or (ii) in the case of a Stockholder that is a
corporation, trust, limited liability company or limited partnership, the certificate of
incorporation and the by-laws, trust agreement, the certificate of formation and the limited
liability company agreement, or the certificate of limited partnership and the limited partnership
agreement, as the case may be.

          12. Amendment and Modification. This Agreement may not be amended, modified or
supplemented except by a written instrument signed by the Company, Dean and the TreeHouse
Representative. The Company shall notify all Stockholders promptly after any such amendment,
modification or supplement shall have taken effect.

          13. Parties.

          13.1 Assignment Generally. The provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective heirs, legal representatives,
successors and assigns, provided that neither the Company nor any TreeHouse Investor may
assign any of its rights or obligations hereunder without the consent of Dean unless, in the case
of a TreeHouse Investor, such assignment is in connection with a Transfer explicitly permitted by
this Agreement and, prior to such assignment, such assignee complies with the requirements of
Section 13.3.

          13.2 Termination. Any Stockholder who ceases to own shares of Common Stock or any
interest therein, shall cease to be a party to, or Person who is subject to, this Agreement and
thereafter shall have no rights or obligations hereunder, provided, however, that
(a) a Transfer of shares of Common Stock not explicitly permitted under this Agreement
shall not relieve a TreeHouse Investor of any of his, her or its obligations hereunder, and
(b) a Transfer of shares of Common Stock permitted under Section 6.2 shall not relieve any
TreeHouse Investor of any of his, her or its obligations hereunder. This Agreement shall
automatically terminate without any action

15

 

by any of the Company or any of the Stockholders, and shall be of no further force and effect,
upon the earlier of (i) the consummation of the Spin-Off, (ii) the closing of the
sale of Common Stock pursuant to Sections 7 and 8, and (iii) the closing of the transaction
described in any Alternative Proposal. Notwithstanding the foregoing,
(i) the provisions of
Section 6.1(a) pertaining to the Restricted Shares shall survive the termination of this Agreement
due to the consummation of the Spin-Off and, at or prior to the Registration Date, each TreeHouse
Investor agrees to execute any document that the Board may reasonably request to confirm the
continued effect of such Section 6.1(a) as to the Restricted
Shares and (ii) the termination of
this Agreement shall not relieve the parties from fulfilling their obligations under either Section
7 or 8.

          13.3 Agreements to Be Bound. Notwithstanding anything to the contrary contained in
this Agreement, any Transfer of shares by a TreeHouse Investor (the “Transferor”) (other
than pursuant to the Spin-Off or to Sections 7 or 8) shall be permitted under the terms of this
Agreement only if the transferee of such Transferor (the “Transferee”) shall agree in
writing to be bound by the terms and conditions of this Agreement pursuant to an instrument of
assumption satisfactory in substance and form to the Company, and in the case of a Transferee of a
Stockholder who resides in a state with a community property system, such Transferee causes his or
her spouse, if any, to execute a Spousal Waiver in the form of Exhibit A attached hereto. Upon the
execution of the instrument of assumption by such Transferee and, if applicable, the Spousal Waiver
by the spouse of such Transferee, such Transferee shall enjoy all of the rights and shall be
subject to all of the restrictions and obligations of the Transferor of such Transferee, including,
without limitation, if such Transferor was a Stockholder, the provisions of Sections 7 and 8 (which
shall continue to apply as though such Transferor were still the holder of such shares).

          14. Recapitalizations, Exchanges, etc. Except as otherwise provided herein, the
provisions of this Agreement shall apply to the full extent set forth herein with respect to
(a) the shares of Common Stock and (b) any and all shares of capital stock of the
Company or any successor or assign of the Company (whether by merger, consolidation, sale of assets
or otherwise) which may be issued in respect of, in exchange for, or in substitution for the shares
of Common Stock, by reason of any stock dividend, split, reverse split, combination,
recapitalization, reclassification, merger, consolidation or otherwise. All share numbers and
percentages shall be proportionately adjusted to reflect any stock split, stock dividend or other
subdivision or combination effected after the date hereof.

          15. No Third Party Beneficiaries. Except as otherwise provided herein, this Agreement
is not intended to confer upon any Person, except for the parties hereto or their permitted
transferees, any rights or remedies hereunder.

16

 

          16. Further Assurances. Each party hereto shall do and perform or cause to be done
and performed all such further acts and things and shall execute and deliver all such other
agreements, certificates, instruments and documents as any other party hereto or Person subject
hereto may reasonably request in order to carry out the intent and accomplish the purposes of this
Agreement and the consummation of the transactions contemplated hereby.

          17. Governing Law. This Agreement and the rights and obligations of the parties
hereunder and the Persons subject hereto shall be governed by, and construed and interpreted in
accordance with, the laws of the State of Delaware, without giving effect to the choice of law
principles thereof.

          18. Invalidity of Provision. The invalidity or unenforceability of any provision of
this Agreement in any jurisdiction shall not affect the validity or enforceability of the remainder
of this Agreement in that jurisdiction or the validity or enforceability of this Agreement,
including that provision, in any other jurisdiction.

          19. Waiver. Waiver by any party hereto of any breach or default by the other party of
any of the terms of this Agreement shall not operate as a waiver of any other breach or default,
whether similar to or different from the breach or default waived. No waiver of any provision of
this Agreement shall be implied from any course of dealing between the parties hereto or from any
failure by either party to assert its or his or her rights hereunder on any occasion or series of
occasions.

          20. Notices. All notices, requests, demands, waivers and other communications
required or permitted to be given under this Agreement shall be in writing and shall be deemed to
have been duly given if (a) delivered personally, (b) mailed, certified or
registered mail with postage prepaid, (c) sent by next-day or overnight mail or delivery or
(d) sent by fax, as follows (or to such other address as the party entitled to notice shall
hereafter designate in accordance with the terms hereof):

	 	(i)  	If to the Company:
	 
	 	   	857-897 School Place

P.O. Box 19057

Green Bay, WI 54307

Telephone: (920) 497-7131

Fax: (920) 497-4604

Attention: General Counsel
	 
	 	   	with, prior to the Registration Date, a copy to Dean at its address set forth below.
	 
	 	(ii)  	If to the TreeHouse Investors, to his or her attention at:

17

 

	 	   	the address identified in the Subscription Agreement executed by such TreeHouse Investor
	 
	 	   	With a copy to:
	 
	 	   	Vedder, Price, Kaufman & Kammholz, P.C.

222 N. LaSalle Street

Chicago, IL 60601

Telephone: (312) 609-7500

Fax: (312) 609-5005

Attention: Robert J. Stucker, Esq.

                                        Thomas P. Desmond, Esq.
	 
	 	(iii)  	If to Dean, to it at:
	 
	 	   	Dean Foods Company

2515 McKinney Avenue

Suite 1200

Dallas, Texas 75201

Telephone: (214) 303-3413

Fax: (214) 303-3853

Attention: General Counsel

All such notices, requests, demands, waivers and other communications shall be deemed to have been
received (w) if by personal delivery, on the day delivered, (x) if by certified or
registered mail, on the fifth business day after the mailing thereof, (y) if by next-day or
overnight mail or delivery, on the day delivered, or (z) if by fax, on the day delivered,
provided that such delivery is confirmed.

          21. Headings. The headings to sections in this Agreement are for the convenience of
the parties only and shall not control or affect the meaning or construction of any provision
hereof.

          22. Counterparts. This Agreement may be executed in any number of counterparts, each
of which shall be deemed an original but all of which together shall constitute one and the same
instrument.

          23. Entire Agreement. This Agreement, the Subscription Agreements and the Employment
Agreements constitute the entire agreement and understanding of the parties hereto with respect to
the matters referred to herein. This Agreement and the agreements referred to in the preceding
sentence supersede all prior agreements and understandings among the parties with respect to such
matters. There are no representations, warranties, promises, inducements, covenants or
undertakings relating to

18

 

the shares of Common Stock, other than those expressly set forth or referred to herein, in the
Subscription Agreements or the Employment Agreements.

          24. Injunctive Relief. The shares of Common Stock cannot readily be purchased or sold
in the open market, and for that reason, among others, the Company and the Stockholders will be
irreparably damaged in the event this Agreement is not specifically enforced. Each of the parties
therefore agrees that in the event of a breach of any provision of this Agreement, the aggrieved
party may elect to institute and prosecute proceedings in any court of competent jurisdiction to
enforce specific performance or to enjoin the continuing breach of this Agreement. Such remedies
shall, however, be cumulative and not exclusive, and shall be in addition to any other remedy which
the Company or any Stockholder may have. Each Stockholder hereby irrevocably submits to the
non-exclusive jurisdiction of the state and federal courts in Illinois for the purposes of any
suit, action or other proceeding arising out of or based upon this Agreement or the subject matter
hereof. Each Stockholder hereby consents to service of process made in accordance with Section 20.

          25. Defined Terms. As used in this Agreement, the following terms shall have the
meanings ascribed to them below:

          Affiliate: Person that directly, or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with, the Person specified.

          Dean Representative: the Chief Executive Officer of Dean, as in office at any time,
or such other officer of Dean as designated by the Chief Executive Officer of Dean.

          Person: an individual, corporation, partnership, limited liability company, joint
venture, association, trust or other entity or organization, including a government or political
subdivision or an agency or instrumentality thereof.

          Spin-Off: the distribution by Dean to the holders of shares of Dean common stock on
the date to be determined by the Dean Board in its sole and absolute discretion as the record date
for the Spin-Off of all of the shares of Common Stock held by Dean.

          Stockholder Representatives: the Dean Representative and the TreeHouse
Representative.

          TreeHouse Default: upon any cessation of services to the Company by (a) Sam
K. Reed for any reason other than due to any material breach of the applicable Employment Agreement
by Dean or the Company, unless Dean shall, it is sole discretion, have consented to such cessation
of services, or (b) any member of the Initial TreeHouse

19

 

Management for any reason other than due to any material breach of the applicable Employment
Agreement by Dean or the Company, unless (i) within 30 days of any such cessation, a
suitable replacement member is hired by the Company, the job responsibilities of the remaining
members of the Initial TreeHouse Management are adjusted in an manner that is appropriate under the
circumstances and that makes it unnecessary to hire a suitable replacement member, and/or such
other suitable cure is implemented, and (ii) Dean shall, in its sole discretion, have
consented to the actions described in clause (i), which consent shall not be unreasonably withheld.
Such consent by Dean shall be given in writing, and may be given on, before or after the date of
any such cessation of services (including, without limitation, following the death of any member of
TreeHouse Management).

          TreeHouse Management: the Initial TreeHouse Management and any other person hereafter
designated as a member of TreeHouse Management by the mutual agreement of the TreeHouse
Representative and the Dean Representative.

          TreeHouse Representative: Sam K. Reed or, if Reed’s employment with the Company
terminates for any reason, David B. Vermylen or, if Vermylen’s employment with the Company
terminates for any reason, any remaining member of TreeHouse Management selected by the majority in
interests of the TreeHouse Investors.

— Signature page follows –

20

 

          IN WITNESS WHEREOF this Agreement has been signed by each of the parties hereto, and shall be
effective as of the date first above written.

	 	 	 	 	 
	 	DEAN SPECIALTY FOODS HOLDINGS, INC.

 	 
	 	By:  	/s/
        Edward Fugger	 
	 	 	Name:  	Edward Fugger	 
	 	 	Title:  	Vice President—Corporate Development	 
	 

	 	 	 	 	 
	 	DEAN FOODS COMPANY

 	 
	 	By:  	/s/
        Edward Fugger	 
	 	 	Name:  	Edward Fugger	 
	 	 	Title:  	Vice President—Corporate Development	 
	 

	 	 	 	 	 
	 	 	INITIAL TREEHOUSE MANAGEMENT
	 
	 	 	 	/s/ S.K. Reed
	

	 	 	 	 
	

	 	 
	 	Sam K. Reed
	

	 	 	 	Address: 622 W. Maple, Hinsdale, IL 60521
	 
	 	 	 	/s/ D. Vermylen
	

	 	 	 	 
	

	 	 	 	David B. Vermylen
	

	 	 	 	Address: 1227 W. Kajer Lane, Lake Forest, IL 60045
	 
	 	 	 	/s/ E. Nichol McCully
	

	 	 	 	 
	

	 	 	 	E. Nichol McCully
	

	 	 	 	Address: 2023 Oakland Avenue, Piedmont, CA 94611
	 
	 	 	 	/s/ Thomas E. O’ Neill
	

	 	 	 	 
	

	 	 	 	Thomas E. O’Neill
	

	 	 	 	Address: 19 Indian Hill Road, Winnetka, IL 60093
	 
	 	 	 	/s/ H.J. Walsh
	

	 	 	 	 
	

	 	 	 	Harry J. Walsh
	

	 	 	 	Address: 901 Jeffrey Court, St. Charles, IL 60174

21

 

Exhibit A

SPOUSAL WAIVER

          [INSERT NAME] hereby waives and releases any and all equitable or legal claims and rights,
actual, inchoate or contingent, which she may acquire with respect to the disposition, voting or
control of the shares of Common Stock subject to the Stockholders Agreement of Dean Specialty Foods
Holdings, Inc., dated as of January 27, 2005, as the same shall be amended from time to time,
except for rights in respect of the proceeds of any disposition of such Common Stock.

                                                            

Name:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00081-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00081-of-00352.parquet"}], [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00081-of-00352.parquet"}], [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00081-of-00352.parquet"}], [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00081-of-00352.parquet"}], [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00081-of-00352.parquet"}]]