AMENDMENT TO STOCK PURCHASE AGREEMENT
THIS AMENDMENT TO STOCK PURCHASE AGREEMENT (the "Amendment") is
made on this 10th day of November, 1995, by and between LEVMARK CAPITAL
CORPORATION, a New York corporation having its principal executive offices
at 175 Memorial Highway, New Rochelle, New York 10801 ("Buyer"), and
SHONEY'S, INC., a Tennessee corporation having its principal executive
offices at 1727 Elm Hill Pike, Nashville, Tennessee 37210 ("Seller"), and
amends the Stock Purchase Agreement, dated August 3, 1995 (the
"Agreement"), by and between Buyer and Seller (the Agreement, as amended
hereby, is hereinafter referred to as the "Amended Agreement").
W I T N E S S E T H:
WHEREAS, Buyer and Seller previously entered into the Agreement
pursuant to which Buyer agreed to purchase, and Seller agreed to sell, all
of the issued and outstanding capital stock of Mike Rose Foods, Inc., a
Tennessee corporation (the "Company"), on the terms set forth therein; and
WHEREAS, Buyer and Seller now wish to amend and modify the terms
of the Agreement as set forth in this Amendment;
NOW, THEREFORE, for and in consideration of the premises and of
the mutual agreements, provisions, covenants and grants contained in this
Amendment and the Agreement, the parties hereto hereby agree as follows:
1. Schedule 1.A. to the Agreement is hereby amended by
revising Item 2 thereon to read as follows:
2. Existence and removal of and spillage (if any)
from the underground storage tank that was
located on the Site and removed on September 22,
1995 by Resource Consultants, Inc. and Specialty
Services (RCI Project No. 3-4638.00).
2. Schedule 1.A. to the Agreement is hereby further amended
by adding the following as Item 10:
10. On September 15, 1995 a limited amount of wastewater from
the wastewater treatment plant on the eastern side of the
Site was accidentally discharged into a ditch and local
surface water drainage. The discharge was treated and
remediated under the direction of the Tennessee
Department of Environment and Conservation, Division of
Water Pollution Control. The Company received no
citation, fines, or penalty for the
discharge, and expects no enforcement action.
3. The phrase "Fifty-four Million Eight Hundred Fifty
Thousand Dollars ($54,850,000.00)" appearing in Section 3.A. of the
Agreement on page 5 of the Agreement is hereby deleted and the following
phrase is inserted in lieu therefor: "Fifty-five Million Dollars
($55,000,000.00)".
4. Schedule 7.V.(5) to the Agreement is hereby amended to
read in its entirety as follows:
STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 3, 1995
BETWEEN
LEVMARK CAPITAL CORPORATION
AND
SHONEY'S, INC.
Buyer has been made aware of certain deficiencies in a
"tube-in-tube" cooking system utilized by Company.
Seller makes no warranties or representations with
respect to such system.
5. The phrase "2,500.00 per month" appearing in Section 21
of the Agreement on page 56 of the Agreement is hereby deleted and the
following is inserted in lieu therefor: "the Monthly Computer Payment (as
hereinafter defined)".
6. The following three sentences are hereby added at the end
of Section 21 of the Agreement on page 56 of the Agreement: "For purposes
of this Section 21, the term "Monthly Computer Payment" shall mean a
monthly charge to Buyer for Buyer's usage of and access to Seller's
computer network and MIS personnel pursuant to this Agreement. For each
of the first six (6) months of such access and usage, the Monthly Computer
Payment shall equal $2,500 per month. Commencing with the seventh month
of Buyer's access to and usage of Seller's computer network and MIS
personnel, the Monthly Computer Payment shall increase every three (3)
months by the amount of $2,500 per month (e.g., the Monthly Computer
Payment commencing in the seventh month shall equal $5,000 per month, the
Monthly Computer Payment commencing in the tenth month shall equal $7,500,
etc.)."
7. The last sentence of Section 5.D. of the Agreement on
page 7 of the Agreement is hereby deleted and the following is inserted
in lieu therefor: "The parties further agree that if Audited Working
Capital exceeds the Benchmark Amount, Seller shall be entitled to deduct
from accounts payable obligations of Seller pursuant to the Supply
Agreement an amount equal to the amount by which the Audited Working
Capital exceeds the Benchmark Amount."
8. The phrase "except for those set forth on Schedule
7.U.(2)" appearing in Section 7.L.(1)(iii) of the Agreement on page 12 of
the Agreement is hereby deleted and the following
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is inserted in lieu therefor: "except for those set forth on Schedule
7.U.(2) and for the right of Seller, pursuant to Section 5.D. hereof, to
deduct from accounts payable obligations of Seller pursuant to the Supply
Agreement an amount equal to any amount by which the Audited Working
Capital exceeds the Benchmark Amount".
9. Item (iv) of Section 7.L.(1) of the Agreement on page 12
of the Agreement, which provides
"(iv) as of the Closing Date, shall include all Accounts
Receivable generated from sales of products from Company
to Seller and its Affiliates during the 28-day period
prior to the Closing Date (which amount of Accounts
Receivable owed by Seller and its Affiliates during such
28-day period shall not in any case be less than One
Million Seven Hundred Fifty Thousand Dollars
($1,750,000.00) and all of which Accounts Receivable are
payable on 30-day terms from the date of delivery)"
is hereby deleted and the following is inserted in lieu therefor:
"(iv) as of the Closing Date, shall include an amount of
Accounts Receivable generated from sales of products from
Company to Seller and its Affiliates sufficient to cause
Working Capital of Company to be not less than the
Benchmark Amount".
10. The letter agreement between Buyer and Seller dated
August 2, 1995 relating to Buyer's rights to terminate the Agreement is
hereby terminated and shall be of no further force or effect.
11. The definition of "Termination Date" appearing on page 4
of the Agreement is hereby amended by changing "October 15, 1995" to
"November 10, 1995".
12. Section 13.B. of the Agreement is hereby amended by
adding the following. "Notwithstanding the foregoing, in the event the
Closing does not occur on or before the Termination Date, Buyer may
propose that the Termination Date be further amended to a date not later
than November 24, 1995 (any such date being an "Alternative Termination
Date"). If Seller, at its option, desires to accept such proposed
amendment, Seller shall so notify Buyer, in which case Buyer, within
twenty-four hours of such notice by Seller, shall pay to Seller by wire
transfer a non-refundable earnest money cash deposit (the "Deposit") in
an amount to be agreed upon by Seller and Buyer. The Deposit shall be
credited against the Purchase Price due pursuant to the Amended Agreement
only in the event the Closing occurs on or before the Alternative
Termination Date. If the Closing does not occur on or before the
Alternative Termination Date, the Deposit shall be retained by Seller as
liquidated and agreed damages, the parties acknowledging that Seller has
suffered damages resulting from the failure of the Closing to occur prior
to the Termination Date, but that such damages are difficult to ascertain.
Buyer hereby specifically acknowledges and agrees that the Deposit is not
refundable to Buyer for any
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reason."
13. Buyer acknowledges and agrees that, after November 10,
1995, there is no limitation on Seller's right to terminate the Amended
Agreement pursuant to Section 13.B. of the Agreement notwithstanding
Buyer's compliance with the terms of the Amended Agreement, unless an
Alternative Termination Date is agreed upon as provided in Section 10 of
this Amendment. In the event that an Alternative Termination Date is
agreed upon as provided in Section 10 of this Amendment, Buyer
acknowledges and agrees that, after the Alternative Termination Date,
there is no limitation on Seller's right to terminate the Amended
Agreement pursuant to Section 13.B. of the Agreement notwithstanding
Buyer's compliance with the terms of the Amended Agreement. Buyer and
Seller acknowledge and agree that Seller is not waiving any rights of
Seller pursuant to the Amended Agreement.
14. Except as amended hereby, the terms and provisions of the
Agreement remain in full force and effect and are incorporated herein by
reference. Capitalized terms not otherwise defined in this Amendment
shall have the meanings ascribed thereto in the Agreement. This Amendment
may be executed in any number of counterparts, each of which shall for all
purposes be deemed an original and all of which together shall constitute
but one and the same instrument and shall become effective only upon
execution of one or more of such counterparts by each of the parties.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be duly executed the day and year first above written.
SELLER:
SHONEY'S, INC.
By: /s/ W. Craig Barber
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Title: EVP & CFO
BUYER:
LEVMARK CAPITAL CORPORATION
By: /s/ William J. Solomon
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Title: Vice President
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