Exhibit 99.2
PURCHASE AND STANDSTILL AGREEMENT
This PURCHASE AND STANDSTILL AGREEMENT ("Agreement") is made as of
April 26, 1996 by and among GIANT GROUP, LTD., a Delaware corporation ("GIANT"),
Fidelity National Financial, Inc., a Delaware corporation ("Fidelity"), and CKE
Restaurants Inc., a Delaware corporation ("CKE").
R E C I T A L S
- - - - - - - -
This Agreement is made with reference to the following facts and
objectives:
A. GIANT, Fidelity, CKE and certain other persons are parties to that
certain action entitled GIANT GROUP, LTD. v. William P. Foley, II; CKE
----------------------------------------------
Restaurants, Inc.; Fidelity National Financial, Inc.; William Davenport and
- ---------------------------------------------------------------------------
Robert Martyn (and related counterclaims), currently pending in the United
- -------------
States District Court for the Central District of California (Case No. SACV 95-
1095 LHM (EEx)) (the "Civil Action").
B. GIANT and its wholly owned subsidiary KCC Delaware Company, a
Delaware corporation ("KCC"), are the owners of an aggregate of 7,430,302 shares
of the outstanding common stock, par value $.10 per share (the "Rally's Stock"),
of Rally's Hamburgers, Inc., a Delaware corporation ("Rally's").
C. Fidelity is the beneficial owner of 705,489 shares of the
outstanding common stock, par value $.01 per share (the "GIANT Stock"), of
GIANT.
D. GIANT, Fidelity and CKE are parties to a Settlement Agreement and
Release (the "Settlement Agreement") pursuant to which the Civil Action will be
dismissed.
E. The obligations of the parties to the Settlement Agreement are
conditioned upon the execution by GIANT, Fidelity and CKE of this Agreement.
A G R E E M E N T
- - - - - - - - -
NOW, THEREFORE, in consideration of the foregoing, and the
representations, warranties, covenants and agreements contained herein, the
parties agree as follows:
1. Sale of Stock.
--------------
a. Fidelity hereby agrees to sell to GIANT, and GIANT hereby
agrees to purchase from Fidelity, 705,489 shares of GIANT Stock for a purchase
price of $8.625 per share, payable in cash.
1
b. GIANT hereby agrees to sell, or cause KCC to sell, to CKE, and CKE
hereby agrees to purchase from GIANT or KCC, as applicable, 2,350,432 shares of
Rally's Stock for a price of $1.75 per share, payable in cash.
c. GIANT hereby agrees to sell, or cause KCC to sell, to Fidelity,
and Fidelity hereby agrees to purchase from GIANT or KCC, as applicable, 767,807
shares of Rally's Stock for an aggregate purchase price of $638,172.38, payable
in cash.
2. Closing.
-------
a. The closing of the purchase and sale of the Rally's Stock (the
"Closing") shall take place on May 3, 1996 at 5:00 p.m., Los Angeles time, at
the offices of Christensen, White, Miller, Fink, Jacobs, Glaser & Shapiro, LLP
("Christensen, White"), 2121 Avenue of the Stars, 18th Floor, Los Angeles,
California 90067, provided, however, that GIANT may in its sole discretion elect
to have the Closing take place on May 6, 1996 at 10:00 a.m., Los Angeles time,
at the offices of Christensen, White.
b. At the Closing: (i) Fidelity shall deliver to GIANT stock
certificate(s), duly endorsed for transfer or accompanied by separate stock
transfer powers, representing an aggregate of 705,489 shares of GIANT Stock and
$638,172.38 in cash; and (ii) GIANT shall deliver to Fidelity stock
certificate(s) duly endorsed for transfer or accompanied by separate stock
transfer powers, representing an aggregate of 767,807 shares of Rally's Stock
and $6,084,842.63 in cash.
c. At the Closing, GIANT shall deliver to CKE stock certificate(s),
duly endorsed for transfer or accompanied by separate stock transfer powers,
representing an aggregate of 2,350,432 shares of Rally's Stock and CKE shall
deliver to GIANT $4,113,256.00 in cash.
3. Grant of Options.
----------------
a. Subject to paragraph c. of this Section 3, GIANT hereby grants to
(i) Fidelity an irrevocable option (the "Fidelity First Option") to purchase
from GIANT, on the terms and conditions set forth herein, 587,607 shares of
Rally's Stock for an exercise price of $3.00 per share and (ii) CKE an
irrevocable option (the "CKE First Option" and together with the Fidelity First
Option, the "First Options") to purchase from GIANT, on the terms and conditions
set forth herein 587,607 shares of Rally's Stock for an exercise price of $3.00
per share.
b. Subject to paragraph c. of this Section 3, GIANT hereby grants to
(i) Fidelity an irrevocable option (the "Fidelity Second Option") to purchase
from GIANT, on the terms and conditions set forth herein, 587,607 shares of
Rally's Stock for an exercise price of $4.00 per share and (ii) CKE an
irrevocable option (the "CKE Second Option" and together with the Fidelity
Second Option, the "Second Options") to
- 2 -
purchase from GIANT, on the terms and conditions set forth herein 587,607 shares
of Rally's Stock for an exercise price of $4.00 per share.
c. In the event of any change in the Rally's Stock by reason of any
stock dividend, recapitalization, reorganization, merger, consolidation, split-
up, combination, or exchange of shares, or of any similar change affecting the
Rally's Stock (a "Recapitalization Event"), the number and class of shares or
other consideration which thereafter may be acquired upon exercise of the First
Options and the Second Options and the exercise price of such options following
the Recapitalization Event, shall be appropriately adjusted consistent with such
change such that Fidelity and CKE shall upon exercise of the First Options and
Second Options after such Recapitalization Event, to the extent such options are
exercisable, receive the same securities and other consideration as they would
have received had they exercised the First Options and Second Options
immediately prior to the Recapitalization Event.
d. In the event that Fidelity or CKE shall not purchase the Rally's
Stock pursuant to Section 7 hereof, then the First Options and the Second
Options shall be void.
4. Exercise of the Options.
-----------------------
a. Unless earlier terminated pursuant to Section 5 hereof and subject
to the requirements of Section 9 hereof, the Fidelity First Option and the CKE
First Option may be exercised by Fidelity and CKE, respectively, in whole or in
part at any time after the date hereof until 5:00 p.m., Los Angeles time, on the
first anniversary of the date hereof, provided, however, that if CKE shall not
have exercised the CKE First Option on or before April 21, 1997 then thereafter
until the first anniversary of the date hereof either Fidelity or CKE may
exercise the CKE First Option (but GIANT shall not be obligated to sell more
than 587,607 shares of Rally's Stock pursuant to the CKE First Option).
Thereafter the First Options may not be exercised.
b. Unless earlier terminated pursuant to Section 5 hereof and subject
to the requirements of Section 9 hereof, the Fidelity Second Option and the CKE
Second Option may be exercised by Fidelity and CKE, respectively, in whole or in
part at any time after the date hereof until 5:00 p.m., Los Angeles time, on the
second anniversary of the date hereof, provided, however, that if CKE shall not
have exercised the CKE Second Option on or before April 20, 1998 then thereafter
until the second anniversary of the date hereof either Fidelity or CKE may
exercise the CKE Second Option (but GIANT shall not be obligated to sell more
than 587,607 shares of Rally's Stock pursuant to the CKE Second Option).
Thereafter the Second Options may not be exercised.
c. Fidelity and CKE may exercise the First Options and/or the Second
Options, as applicable, by delivering written notice (the "Exercise Notice") to
GIANT at
- 3 -
the address set forth in Section 15 hereof. The Exercise Notice shall set forth
which of the options are being exercised and the number of Rally's Shares to be
purchased.
d. The closing of the purchase and sale of the Rally's Stock pursuant
to the First Options and/or the Second Options (a "First Option Closing" and a
"Second Option Closing," respectively) shall occur three (3) business days
following receipt by GIANT of the applicable Exercise Notice.
e. At each First Option Closing and Second Option Closing, if the
First Options and the Second Options, respectively, are exercised GIANT will
deliver to Fidelity and/or CKE, as applicable, stock certificate(s), duly
endorsed for transfer or accompanied by separate stock transfer powers,
representing the number of shares of Rally's Stock to be purchased and Fidelity
and/or CKE, as applicable, shall deliver to GIANT the purchase price for the
Rally's Stock to be purchased. Such purchase price shall be paid in cash.
5. Rights of First Refusal on Sales of Rally's Stock by Fidelity or CKE.
--------------------------------------------------------------------
a. If, prior to the tenth (10th) anniversary of the date hereof,
Fidelity or CKE proposes to sell shares of Rally's Stock, Fidelity or CKE, as
applicable, shall give notice to GIANT (the "Fidelity/CKE Sale Notice") of their
intent to sell such shares of Rally's Stock. A Fidelity/CKE Sale Notice shall
set forth the number of shares of Rally's Stock proposed to be sold and the
proposed sales price of such shares. A Fidelity/CKE Sale Notice shall
constitute an offer by Fidelity or CKE, as applicable, to sell the Rally's Stock
described therein to GIANT for the price set forth in the Fidelity/CKE Sale
Notice.
b. If GIANT elects to purchase the shares of Rally's Stock described
in the Fidelity/CKE Sale Notice: (i) GIANT shall give written notice to
Fidelity or CKE, as applicable, of such election within four (4) business days
after receipt of the Fidelity/CKE Sale Notice; and (ii) the closing of such
purchase shall take place at 10:00 a.m., Los Angeles time, on the sixth (6th)
business day following receipt by GIANT of the Fidelity/CKE Sale Notice at the
offices of Christensen, White, 2121 Avenue of the Stars, 18th Floor, Los
Angeles, California 90067. If GIANT elects not to purchase the Rally's Stock
described in the Fidelity/CKE Sale Notice or shall not respond to the
Fidelity/CKE Sale Notice within the time specified herein, Fidelity or CKE, as
applicable, shall be entitled to sell the Rally's Stock described in the
Fidelity/CKE Sale Notice for a price per share no less than that specified in
the Fidelity/CKE Sale Notice, provided however, that if such sale is not
consummated within thirty (30) days of the date of the Fidelity/CKE Sale Notice
then Fidelity and CKE may not sell such shares without renewed compliance with
the provisions of this Section 5.
- 4 -
6. Early Termination of Options; Rights of First Refusal on Sales of
-----------------------------------------------------------------
Rally's Stock by GIANT.
----------------------
a. If, prior to the tenth (10th) anniversary of the date hereof,
GIANT proposes to sell shares of Rally's Stock, GIANT shall give notice to
Fidelity and CKE (the "GIANT Sale Notice") of its intent to sell such shares of
Rally's Stock. A GIANT Sale Notice shall set forth the number of shares of
Rally's Stock proposed to be sold and the proposed sales price of such shares.
b. A GIANT Sale Notice delivered on or prior to December 31, 1996 or
after the period the First Options and Second Options are exercisable, shall
constitute an offer to Fidelity and CKE to sell the Rally's Stock described in
the GIANT Sale Notice to them (in equal amounts unless otherwise agreed between
them) for the price set forth in the GIANT Sale Notice.
c. A GIANT Sale Notice delivered after December 31, 1996 and during
the period the First Options and the Second Options are exercisable shall
constitute an offer to Fidelity and CKE to sell the Rally's Stock described in
the GIANT Sale Notice for the lower of (i) the price set forth in the GIANT Sale
Notice and (ii) the exercise price of the First Options to the extent
exercisable or the Second Options to the extent exercisable. In the event that
following such sale GIANT would not own a sufficient number of shares of Rally's
Stock to permit the exercise in full of the First Options and the Second
Options, the number of shares of Rally's Stock subject to the First Options and
Second Options shall be reduced by the number of shares of Rally's Stock which
are subject to a GIANT Sale Notice delivered after December 31, 1996 and during
the period the First Options and the Second Options are exercisable and only to
the extent the Rally's Stock GIANT owns following such sale is below the amount
needed to satisfy GIANT's obligations under the First Options and the Second
Options, whether or not such shares are purchased by Fidelity and/or CKE. Such
reduction shall apply first equally to the First Options until no shares of
Rally's Stock are subject to the First Options and then equally to the Second
Options.
d. If Fidelity and/or CKE elects to purchase the shares of Rally's
Stock described in a GIANT Sale Notice: (i) Fidelity and/or CKE, as applicable,
shall give written notice to GIANT of such election within three (3) business
days after receipt of the Sale Notice, provided, however, that if CKE shall not
elect to purchase the shares of Rally's Stock within such time period, then
Fidelity may elect to purchase such shares by giving written notice to GIANT of
such election within four (4) business days after receipt of the GIANT Sale
Notice; and (ii) the closing of such purchase shall take place at 10:00 a.m.,
Los Angeles time, on the sixth (6th) business day following receipt by Fidelity
and CKE of the GIANT Sale Notice at the offices of Christensen, White, 2121
Avenue of the Stars, 18th Floor, Los Angeles, California 90067. If Fidelity and
CKE elect not to purchase the Rally's Stock described in the GIANT Sale Notice
or shall not respond to the GIANT Sale Notice within the time specified herein,
GIANT shall be
- 5 -
entitled to sell the Rally's Stock described in the GIANT Sale Notice, for a
price per share no less than that specified in the GIANT Sale Notice, provided
however, that if such sale is not consummated within thirty (30) days of the
date of the GIANT Sale Notice then GIANT may not sell such shares without
renewed compliance with the provisions of this Section 6.
7. Due Diligence. From the date hereof through 11:00 a.m. Los Angeles
-------------
time on May 3, 1996, CKE and Fidelity may conduct such due diligence
investigation of the operations, books and records of Rally's as they determine
to be advisable. At any time through and including 11:00 a.m. Los Angeles time,
on May 3, 1996, Fidelity and/or CKE may notify GIANT of its intent not to
purchase the Rally's Stock as provided in Sections 1.b. and 1.c. hereof, in
which case they shall not be obligated to purchase such shares.
8. Standstill Provisions.
---------------------
a. From the date hereof through and including the tenth (10th)
anniversary of the date hereof Fidelity agrees that, without GIANT's prior
written consent, Fidelity will not:
(i) acquire, announce an intention to acquire, offer or propose
to acquire, or agree to acquire, directly or indirectly, by purchase or
otherwise beneficial ownership of any GIANT Stock or other voting
securities of GIANT (collectively with the GIANT Stock, the "Voting
Securities") or direct or indirect rights or options to acquire (through
purchase, exchange, conversion or otherwise) any Voting Securities if
immediately after such acquisition, Fidelity would own Voting Securities
representing more than 0.5% of the total voting power of all outstanding
Voting Securities (after giving effect to the transactions provided for in
Section 1.a.);
(ii) make, or in any way participate, directly or indirectly, in
any "solicitation" of "proxies" (as such terms are defined in Rule 14a-1
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"))
to vote any Voting Securities, seek to advise, encourage or influence any
person or entity with respect to the voting of any Voting Securities,
initiate or propose any shareholder proposal or induce or attempt to induce
any other person to initiate any shareholder proposal;
(iii) make any statement or proposal, whether written or oral,
to the Board of Directors of GIANT, or to any director, officer or agent of
GIANT, or make any public announcement or proposal whatsoever with respect
to a merger or other business combination, sale or transfer of assets,
recapitalization, dividend, share repurchase, liquidation or other
extraordinary corporate transaction with GIANT or any other transaction
which could result in a change
- 6 -
of control, or solicit or encourage any other person to make such statement
or proposal;
(iv) after consummation of the transactions described in
Sections 1.a. and 1.b. hereof, form, join or in any way participate in a
"group" (within the meaning of Section 13(d)(3) of the Exchange Act) with
respect to any securities of GIANT;
(v) otherwise act, alone or in concert with others, to seek to
exercise any control over the management, Board of Directors or policies of
GIANT;
(vi) make a public request to GIANT (or its directors, officers,
shareholder's employees or agents) to amend or waive any provisions of this
Agreement, the Certificate of Incorporation or By-Laws of GIANT, the GIANT
Stockholders Rights Plan or Rights issued pursuant thereto, including
without limitation any public request to permit Fidelity or any other
person to take any action not permitted by this Section 8.a.;
(vii) take any action which might require GIANT to make a public
announcement regarding the possibility of any transaction referred to in
paragraph (iii) above or similar transaction or, advise, assist or
encourage any other persons in connection with the foregoing; or
(viii) disclose any intention, plan or arrangement inconsistent
with the foregoing.
b. For purposes of this Section 8 the term "Fidelity" shall include
Fidelity, its officers, directors, affiliates and associates and their
respective family members.
9. Future Acquisitions of Rally's Stock by Fidelity and CKE. For so long
--------------------------------------------------------
as the 9 7/8% Senior Notes (the "Senior Notes") issued by Rally's are
outstanding, Fidelity and CKE each agree that neither they nor their affiliates
will, individually or as part of a group of persons, take any action that would
cause them to become the beneficial owner (within the meaning of Rule 13d-3 of
the Exchange Act), whether pursuant to the exercise of the First Options or the
Second Options or otherwise, of 35% or more of the combined voting power of the
then outstanding voting stock of Rally's without first obtaining (i) approval of
the Board of Directors of Rally's, and (ii) a waiver from the holders of the
Senior Notes of the provisions of Section 4.14 of the Indenture pursuant to
which the Senior Notes were issued.
- 7 -
10. Future Acquisitions of Rally's Stock by GIANT
---------------------------------------------
a. In the event that GIANT or its affiliates (other than Rally's)
shall purchase additional shares of Rally's Stock (other than on exercise of a
first refusal right pursuant to Section 5 hereof), GIANT shall give notice to
Fidelity and CKE (the "Purchase Notice") of such purchase. The Purchase Notice
shall set forth the number of shares of Rally's Stock purchased and the average
purchase price of such shares. Fidelity and CKE may, upon written request to
GIANT received within three (3) business days after receipt of the Purchase
Notice, purchase from GIANT, for the same average price set forth in the
Purchase Notice, a portion of the shares of Rally's Stock described in the
Purchase Notice such that following such purchases the proportional ownership of
Rally's Stock among GIANT, Fidelity and CKE shall be the same as immediately
prior to such purchases (without giving effect to the First Options and Second
Options to the extent not exercised); provided, however, that if Fidelity or CKE
shall not elect to purchase shares of Rally's Stock pursuant to a Purchase
Notice, the other party may purchase all the shares of Rally's Stock described
in the Purchase Notice.. If Fidelity and/or CKE elects to purchase the shares
of Rally's Stock described in the Purchase Notice the closing of such purchase
shall take place at 10:00 a.m. on the sixth (6th) business day following receipt
by Fidelity and CKE of the Purchase Notice at the offices of Christensen, White,
2121 Avenue of the Stars, 18th Floor, Los Angeles, California 90067.
b. GIANT agrees that neither it nor its affiliates will individually
or as part of a group of persons, become the beneficial owner (within the
meaning of Rule 13d-3 of the Exchange Act) of 35%, or more of the combined
voting power of Rally's without the consent of Fidelity and CKE.
c. In the event that GIANT on the one hand, and Fidelity and CKE on
the other hand, shall each own at least 34.0% of the outstanding Rally's Stock
(without giving effect to the First Options and Second Options to the extent not
exercised), the parties agree that at each election of directors of Rally's,
GIANT may nominate up to one-half of the number of directors to be elected and
Fidelity and CKE may nominate up to one-half of the number of directors to be
elected. The parties further agree that they will vote all shares of Rally's
Stock owned by them in favor of the election of the nominees of the other
parties. In addition, if one, but not both, of GIANT on the one hand, and
Fidelity and CKE on the other hand, own at least 34.0% of the outstanding
Rally's Stock (without giving effect to the First Options and Second Options to
the extent not exercised), the parties agree that at each election of directors
the party(ies) owning at least 34.0% of the outstanding Rally's Stock may
nominate up to one-half of the number of directors to be elected and the other
party(ies) will vote all shares of Rally's Stock owned by them in favor of such
nominees.
d. The provisions of this Section 10 shall expire and be of no
further force or effect on the tenth (10th) anniversary of the date hereof.
- 8 -
e. In the event that Fidelity or CKE shall elect not to purchase the
Rally's Stock pursuant to Section 7 hereof, then this Section 10 shall be of no
force or effect.
11. Conditions to CKE's Obligation to Purchase Rally's Stock. The
--------------------------------------------------------
obligation of CKE to purchase the Rally's Stock shall be conditioned upon, in
addition to any other conditions contained herein, (i) the approval by the Board
of Directors of Rally's of CKE as an Interested Stockholder (as defined in
Section 203 of the General Corporation Law of the State of Delaware) (ii) the
election of two (2) persons designated by CKE to the Board of Directors of
Rally's conditioned upon the occurrence of the Closing, and (iii) CKE shall not
have notified GIANT in accordance with Section 7 hereof of CKE's election not to
purchase the Rally's Stock.
12. Representation and Warranties of Fidelity and CKE. Fidelity and CKE,
-------------------------------------------------
severally and not jointly, hereby represent and warrant to GIANT as follows:
a. Fidelity and CKE are each purchasing the Rally's Stock (including
the Rally's Stock to be purchased upon exercise of the First Option and the
Second Option) for their own account for the purpose of investment and not with
a view to or for sale in connection with any distribution thereof. Fidelity and
CKE acknowledge that the Rally's Stock acquired from GIANT will be "restricted
securities" under the Securities Act of 1933, as amended. Fidelity and CKE
further acknowledge that the certificates representing the Rally's Stock
acquired by them from GIANT will contain appropriate legends to indicate that
such Rally's Stock are "restricted securities." Fidelity and CKE agree that
they will not, directly or indirectly, offer, transfer, sell, pledge,
hypothecate or otherwise dispose of any of the Rally's Stock in violation of
applicable securities laws.
b. Fidelity and CKE each has such knowledge and experience in
financial and business matters that they are capable of evaluating the merits
and risks of the investment in the Rally's Stock.
c. This Agreement has been duly and validly authorized, executed and
delivered by Fidelity and CKE, and constitutes a valid and binding agreement of
each of them, enforceable against them in accordance with its terms.
d. Fidelity and its wholly owned subsidiary Fidelity National Title
Insurance Company of Pennsylvania are the sole record and beneficial owners of
the shares of GIANT Stock to be sold to GIANT pursuant to this Agreement and
upon payment therefor and delivery thereof at the Closing as provided herein,
GIANT will own the shares of GIANT Stock purchased free and clear of all claims,
liens and encumbrances other than those created by GIANT.
- 9 -
e. The execution and delivery of this Agreement by Fidelity and CKE
do not, and the performance by them of their obligations hereunder will not,
violate, conflict with or result in a breach of any agreement to which Fidelity
or CKE is a party which would cause a material adverse effect on the business or
assets of Fidelity or CKE.
13. Representations and Warranties of GIANT. GIANT hereby represents,
---------------------------------------
warrants and covenants to Fidelity and CKE as follows:
a. GIANT and KCC are the sole record and beneficial owners of the
shares of Rally's Stock to be sold to Fidelity and CKE pursuant to this
Agreement and upon payment therefor and delivery thereof at the Closing, the
First Option Closing and/or the Second Option Closing, as applicable, Fidelity
and CKE will own the shares of Rally's Stock purchased free and clear of all
claims, liens and encumbrances other than those created by GIANT.
b. This Agreement has been duly and validly authorized, executed and
delivered by GIANT and constitutes a valid and binding agreement of it,
enforceable against it in accordance with its terms.
c. The Form 10-K of Rally's for the year ended December 31, 1995
(the "Form 10-K") and any filings made by Rally's with the Securities and
Exchange Commission since December 31, 1995 comply in all material respects with
applicable securities laws and regulations. None of such filings contain any
misstatements of material fact or fail to state all material facts necessary to
make the statements therein not misleading. The capitalization of Rally's is as
set forth in the Form 10-K.
d. GIANT agrees that until the tenth (10th) anniversary of the date
hereof it shall not, without the consent of Fidelity and CKE, take any action to
increase the size of the Board of Directors of Rally's and shall vote its shares
in favor of the two persons designated by CKE pursuant to Section 11 hereof (and
their successors).
e. The execution and delivery of this Agreement by GIANT does not,
and the performance by it of its obligations hereunder will not, violate,
conflict with or result in a breach of any agreement to which GIANT or Rally's
is a party which would cause a material adverse effect on the business or assets
of GIANT or Rally's.
14. Entire Agreement. This Agreement, together with the Settlement
----------------
Agreement and any exhibits attached hereto and thereto shall be deemed to be the
complete and entire agreement among the parties hereto with respect to the
subject matter hereof and supersedes any and all prior negotiations,
correspondence, understandings or other agreements or statements between the
parties and/or their representatives.
- 10 -
15. Notices. Any and all notices and demands by any party hereto to any
-------
other party, required or desired to be given hereunder, shall be in writing and
shall be validly given or made only if (i) sent by United States mail, express,
certified or registered, postage prepaid, return receipt requested, (ii) made by
Federal Express or other similar delivery service keeping records of deliveries
and attempted deliveries, or (iii) sent by telecopy. The parties may change
their address for the purpose of receiving notices or demands as herein provided
by a written notice given in the manner aforesaid to the other. Notices sent by
United States mail, express, certified or registered or by Federal Express or
other similar delivery service shall be deemed received upon receipt or
attempted delivery. Notices sent by telecopy shall be deemed received upon
electronic confirmation of transmission. Notices shall be sent to the parties
as follows:
To GIANT: GIANT GROUP, LTD.
150 El Camino Drive, Suite 303
Beverly Hills, California 90212
Attention: Chief Executive Officer
Fax: (310) 273-5249
with a copy to: Gary N. Jacobs, Esq.
Christensen, White, Miller, Fink, Jacobs, Glaser &
Shapiro, LLP
2121 Avenue of the Stars, 18th Floor
Los Angeles, California 90067
Fax: (310) 556-2920
To Fidelity: Fidelity National Financial, Inc.
17911 Von Karman Avenue, Suite 500
Irvine, California 92714
Attention: Andrew Puzder, Esq.
Fax: (714) 622-4116
with a copy to: Lawrence Lederman, Esq.
Milbank, Tweed, Hadley & McCloy
One Chase Manhattan Plaza
New York, New York 10005
Fax: (212) 530-5219
To CKE: CKE Restaurants, Inc.
1200 N. Harbor
Anaheim, California 92801
Attention: Chief Executive Officer
Fax: (714) 490-3965
with a copy to: Richard Goodman, Esq.
- 11 -
Stradling Yocca, Carlson & Rauth
660 Newport Center Drive, Suite 1600
Newport Beach, California 92660
Fax: (714) 725-4100
16. Governing Law. This Agreement shall be governed by and construed in
-------------
accordance with the laws of the State of California, without regard to conflicts
of laws principles. The parties agree that the sole forum for any action
relating to this Agreement shall be the appropriate state or federal court in
Los Angeles County, California. Each party hereto consents to personal
jurisdiction in such courts and waives all rights to contest the venue of any
action brought in such courts relating to this Agreement.
17. Specific Performance. The parties hereto acknowledge and agree that
--------------------
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached. Accordingly, it is agreed that, in addition to any other
remedies which they may have, the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions hereof in any court of competent jurisdiction.
18. Further Assurances. Each party to this Agreement shall execute all
------------------
instruments and documents and take all actions as may reasonably be necessary in
order to effectuate this Agreement.
19. Amendments. This Agreement may be amended or modified only in a
----------
writing executed by the party(ies) to this Agreement against whom enforcement of
such amendment or modification is sought.
20. Construction. Each party to this Agreement and its counsel have
------------
reviewed and revised this Agreement. The rule of construction that any
ambiguity shall be resolved against the drafting party shall not be employed in
the interpretation of this Agreement.
21. Survival. All representations, warranties and agreements contained
--------
herein shall survive the execution of this Agreement and the closing of the
transactions contemplated hereby.
22. Successors and Assigns; Assignment. All of the terms, covenants and
-----------------------------------
conditions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns. No party hereto
shall be permitted to assign its rights under this Agreement other than to a
wholly-owned subsidiary. No assignment or transfer permitted hereunder shall
relieve any such assignor or transferor of any of its obligations hereunder and
any assignee or transferee
- 12 -
shall assume in writing all of the undertakings of assignor or transferor under
this Agreement.
23. Attorneys' Fees. Should an action be instituted by either of the
---------------
parties hereto in any court of law or equity pertaining to the enforcement of
any of the provisions of this Agreement, the prevailing party shall be entitled
to recover, in addition to any judgment or decree rendered therein, all court
costs and reasonable attorneys' fees and expenses.
24. Headings. All of the section headings herein are inserted for
--------
convenience only and shall have no meaning for purposes of this Agreement.
25. Counterparts. This Agreement may be executed in any number of
------------
counterparts, which when so executed and delivered shall be deemed an original,
and such counterparts shall constitute one and the same Agreement.
[remainder of page intentionally left blank]
- 13 -
IN WITNESS WHEREOF, the parties hereto have entered into this Agreement as
of the date first above written.
GIANT GROUP, LTD., a Delaware corporation
by: _______________________________
name: Burt Sugarman
title: Chief Executive Officer
Fidelity National Financial, Inc.,
a Delaware corporation
by: _______________________________
name: William P. Foley, III
title: Chief Executive Officer and
Chairman
CKE Restaurants, Inc., a Delaware
corporation
by: _______________________________
name: William P. Foley, II
title: Chief Executive Officer and
Chairman
- 14 -