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EXHIBIT 10.03
STOCKHOLDERS AGREEMENT
by and among
FS EQUITY PARTNERS III, L.P.
FS EQUITY PARTNERS INTERNATIONAL, L.P.,
THE NEW STOCKHOLDERS IDENTIFIED HEREIN,
AND
AFC ENTERPRISES, INC.
March 18, 1998
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TABLE OF CONTENTS
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1. Definitions.................................................... 1
2. Transfer of Shares by FS Stockholder; Rights of Inclusion...... 3
2.1 Right of Inclusion............................................. 3
2.2 Third-Party Offer.............................................. 3
2.3 Allocation of Included Shares.................................. 4
2.4 Consummation................................................... 5
2.5 Termination and Assignment..................................... 5
3. Obligation to Sell Securiti es................................. 6
3.1 Sale Obligation................................................ 6
3.2 Termination and Assignment..................................... 7
4. Restrictions on Transfers of Securities; Right of First Offer.. 7
4.1 Transfer Restrictions.......................................... 7
4.2 Right of First Offer by New Stockholders....................... 8
4.3 Termination and Assignment.....................................10
5. Registration Rights............................................10
6. Other Agreements...............................................10
7. Copy of Agreement..............................................10
8. Governing Law..................................................10
9. Representations and Warranties.................................11
10. Merger Tax Treatment...........................................11
11. Amendment and Waiver Successors................................11
12. Interpretation.................................................12
13. Notices........................................................12
14. Legends........................................................12
15. Further Assurances.............................................12
16. Injunctive Relief; Disputes....................................13
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17. Severability...................................................13
18. Entire Agreement...............................................13
19. Counterparts...................................................13
SCHEDULE 1 New Stockholders.......................................S-1
SCHEDULE 2 Ownership of Company Common Stockby FS Stockholder
and New Stockholders...................................S-2
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STOCKHOLDERS AGREEMENT
THIS STOCKHOLDERS AGREEMENT (this "Agreement") is made and entered into as
of March 18, 1998 by and among AFC Enterprises, Inc., a Minnesota corporation
(the "Company"), FS Equity Partners III, L.P., a Delaware limited partnership
("FSEP III"), FS Equity Partners International, L.P., a Delaware limited
partnership ("FSEP International," and collectively with FSEP III, the "FS
Stockholder"), and the new stockholders of the Company, as listed on Schedule 1
attached hereto (the "New Stockholders").
RECITALS
A. On January 23, 1998, the Company, Seattle Coffee Company, a Washington
corporation ("SCC"), and the principal shareholders of SCC entered into an
Agreement and Plan of Merger (as amended, the "Merger Agreement") in which the
Company would acquire from the New Stockholders all of the capital stock of SCC
in exchange for a combination of cash and shares of common stock ("Common
Stock") of the Company and a wholly-owned subsidiary of the Company will merge
with SCC (the "Merger");
B. Pursuant to the terms of the Merger Agreement, each shareholder of SCC
may elect to receive the merger consideration in either cash or Common Stock;
C. The shareholders of SCC that intend to receive some or all of their
consideration in Common Stock, the FS Stockholder and the Company wish to enter
into the Agreement with respect to certain rights, obligations and restrictions
relating to the securities of the Company.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing, the mutual covenants
contained herein and for other good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the parties hereto agree as follows:
1. Definitions. As used in this Agreement, the following
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capitalized terms shall have the following meanings:
Affiliate or Associate: Such terms shall have the meanings given them
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pursuant to Rule 12b-2 of the General Rules and Regulations promulgated under
the Securities Exchange Act of 1934, as amended.
Board: The Board of Directors of the Company.
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Common Stock: The Common Stock, par value $.01 per share, of the
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Company.
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Initial Shares: Shall mean the 20,970,814 shares of Common Stock
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issued and outstanding on the date hereof and held beneficially and of record by
the Stockholders as follows:
INITIAL SHARES OF
STOCKHOLDER COMMON STOCK
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FS Equity Partners III, L.P. 18,259,483
FS Equity Partners International, L.P. 733,583
New Stockholders listed on Schedule 1 See Schedule 1
New Stockholders: The former shareholders of SCC listed on Schedule 1
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attached hereto who shall become stockholders of the Company pursuant to the
closing of the transactions contemplated in the SCC Merger Agreement.
Permitted Transferee: Subject to Section 4.1, Permitted Transferee
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shall mean an Affiliate of a Stockholder or, with respect to any Stockholder who
is an individual, (i) such Stockholder's spouse or issue, (ii) a trust for their
or the Stockholder's benefit or, (iii) provided that the requirements of Section
4.3 are satisfied, a charitable remainder trust ("CRT") in which the sole
trustee is the Stockholder or Stockholder's spouse or issue, and the beneficiary
is an organization that qualifies for income, gift or estate tax charitable
deduction ("Charitable Organization") under the Internal Revenue Code of 1986,
as amended.
Person: Any individual, corporation, entity, partnership, joint
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venture, association, joint-stock company, trust, unincorporated organization or
other entity.
Public Offering: A public offering of shares of Voting Securities of
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the Company registered under the Securities Act, but shall not include an
offering registered on Form S-4 or Form S-8 (or any substitute form that is
adopted by the SEC), or an offering of Voting Securities in connection with a
sale of debt securities of the Company. The term "Initial Public Offering"
shall mean an underwritten Public Offering of Voting Securities which results in
gross proceeds to the Company in excess of $25 million from the sale of Voting
Securities.
SEC: The Securities and Exchange Commission.
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Securities: Shall mean (i) Voting Securities, (ii) all rights,
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options, warrants to purchase such Voting Securities or the securities described
in the following clause and (iii) all other securities or capital stock of any
type whatsoever, including, without limitation, (A) preferred stock, debt
securities and securities that are, or may become, convertible into or
exchangeable for, or that entitle the holder to purchase, Voting Securities, (B)
preferred stock and (C) debt securities. The term Securities shall include all
Securities now owned or hereafter acquired by any of the Stockholders.
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Securities Act: The Securities Act of 1933, as amended.
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Stockholders: The FS Stockholder and the New Stockholders.
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Subsidiary: With respect to any Person, a corporation or other entity
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of which shares of stock or other ownership interests having ordinary voting
power to elect a majority of the directors of such corporation, or other Persons
performing similar functions for such entity, are owned, directly or indirectly,
by such Person.
Voting Securities: All Securities of the Company which possess
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general voting power to elect members of the Board; provided that Voting
Securities shall not include any options or warrants to purchase Voting
Securities.
2. Transfer of Shares by FS Stockholder; Rights of Inclusion.
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2.1 Right of Inclusion. The FS Stockholder agrees not to sell
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all or any portion of the shares of Common Stock it holds to any Person
(individually, a "Third Party" and, collectively, "Third Parties") unless each
of the New Stockholders is given an opportunity to sell to the Third Party such
number of shares of Common Stock owned by such New Stockholder as is determined
in accordance with Subsection 2.3 of this Section 2; provided, however, that the
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New Stockholders shall have no rights pursuant to this Section 2 with respect to
sales or other transfers by the FS Stockholder of Common Stock to any Permitted
Transferee of the FS Stockholder; and provided further, that the rights of such
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New Stockholders pursuant to this Section 2 are subject to Section 10 of this
Agreement.
2.2 Third-Party Offer. Prior to the consummation of any sale of
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all or any portion of the shares of Common Stock held by the FS Stockholder to a
Third Party, the FS Stockholder shall cause each bona fide offer from such Third
Party to purchase such shares from the FS Stockholder (a "Third-Party Offer") to
be reduced to writing and shall send written notice of such Third-Party Offer
(the "Initial Offer Notice") to each of the New Stockholders. Each Third-Party
Offer shall include an offer to purchase shares of Common Stock from the New
Stockholders in the amounts determined in accordance with Subsection 2.3 of this
Section 2, at the same time, at the same price and on the same terms as the sale
by the FS Stockholder to the Third Party, and according to the terms and
conditions of this Agreement. The Initial Offer Notice shall be accompanied by
a true copy of the Third-Party Offer. If such New Stockholder desires to accept
the offer contained in the Initial Offer Notice, such New Stockholder shall
furnish written notice to the FS Stockholder, within 20 days after its receipt
of the Initial Offer Notice, indicating such New Stockholder's irrevocable
acceptance of the offer included in the Initial Offer Notice and setting forth
the maximum number of shares of Common Stock such New Stockholder agrees to sell
to the Third Party (the "Acceptance Notice"). If such New Stockholder does not
furnish an Acceptance Notice to the FS Stockholder in accordance with these
provisions by the end of such 20-day period, such New Stockholder shall be
deemed to have irrevocably rejected the offer contained in the Initial Offer
Notice. All shares of Common Stock set
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forth in the Acceptance Notices of the New Stockholders together with the shares
of Common Stock proposed to be sold by the FS Stockholder to the Third Party are
referred to collectively as "All Offered Shares." Within three days after the
date on which the Third Party informs the FS Stockholder of the total number of
shares of Common Stock which such Third Party has agreed to purchase in
accordance with the terms specified in the Initial Offer Notice, the FS
Stockholder shall send written notice (the "Final Notice") to the participating
New Stockholders setting forth the number of shares of Common Stock each New
Stockholder shall sell to the Third Party as determined in accordance with
Subsection 2.3 of this Section 2, which number shall not exceed the maximum
number specified by such New Stockholder in its Acceptance Notice. Within five
days after the date of the Final Notice (or such shorter period as may
reasonably be requested by the FS Stockholder to facilitate the sale), each
participating New Stockholder shall furnish to the FS Stockholder (i) a written
undertaking to deliver, upon the consummation of the sale of Common Stock to the
Third Party as indicated in the Final Notice, the certificates representing the
shares of Common Stock held by such New Stockholder which will be transferred
pursuant to such Third-Party Offer (such shares shall be referred to herein as
the "Included Shares") and (ii) a limited power-of-attorney authorizing the FS
Stockholder to transfer the Included Shares pursuant to the terms of such Third-
Party Offer. Each New Stockholder shall be required to make representations and
warranties in connection with such transfer only with respect to its own
authority to transfer and its title to the shares of Common Stock transferred.
In any such transaction the Company will cooperate with all Stockholders to
facilitate the transaction.
2.3 Allocation of Included Shares. The maximum number of shares
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of Common Stock that may be sold by FSEP III, FSEP International and each New
Stockholder and all other holders of Common Stock who have rights to participate
in sales of Common Stock by the FS Stockholder pursuant to written agreements by
and between the FS Stockholder and any such holder (the "Other Tag-Along Rights
Holders") in any sale governed by this Section 2 shall be (i) All Offered Shares
in the event the Third Party has agreed to purchase All Offered Shares and all
shares of Common Stock that the Other Tag-Along Rights Holders who have elected
to participate in such sale seek to include in such sale or (ii) such number of
shares of Common Stock equal to the product of (a) the total number of shares of
Common Stock which the Third Party has agreed to purchase times (b) a fraction,
the numerator of which is the total number of shares of Common Stock owned by
FSEP III, FSEP International, a New Stockholder or each Other Tag-Along Rights
Holder who has elected to participate in such sale, as the case may be, on the
date of the Final Notice and the denominator of which is the total number of
shares of Common Stock owned on the date of the Final Notice by FSEP III, FSEP
International, the New Stockholders and the Other Tag-Along Rights Holders who
have elected to participate in such sale; provided, however, that, in the event
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FSEP III, FSEP International, the New Stockholders or any Other Tag-Along Rights
Holder elects to sell a number of shares of Common Stock which is less than the
number of shares such holder could sell pursuant to clause (ii) above, the
shares of Common Stock that the others of such holders can sell in such
transaction shall be increased by an aggregate amount equal to the number
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of shares which any of FSEP III, FSEP International, the New Stockholders or any
Other Tag-Along Rights Holder could have sold in such transaction but chose not
to sell, and any such increase shall be allocated among such other holders on a
pro rata basis based upon the total number of shares of Common Stock owned on
the date of the Final Notice by such other holders.
2.4 Consummation. The FS Stockholder shall have 180 days from
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the date of the Final Notice in which to sell to the Third Party the shares of
Common Stock owned by the FS Stockholder and the Included Shares of the New
Stockholders on terms which are not materially less favorable to the sellers of
shares of Common Stock than those specified in the applicable Initial Offer
Notice; provided, however, that in the event there is a decrease in the price to
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be paid by the Third Party for the shares of Common Stock to be sold from the
price set forth in the Initial Offer Notice, which decrease is acceptable to the
FS Stockholder, or other material change in terms which are less favorable to
the FS Stockholder, but which are acceptable to the FS Stockholder, the FS
Stockholder shall notify the participating New Stockholders of such decrease or
change in terms, and each of the participating New Stockholders shall have five
business days from the date of receipt of the notice of such decrease or change
in terms to reduce the number of shares of Common Stock it will sell to such
Third Party as previously indicated in the applicable Acceptance Notice and the
number of shares that all other participating stockholders (including Other Tag-
Along Rights Holders) may transfer shall be increased in accordance with the
provisions of Section 2.3. The FS Stockholder shall act as agent for the New
Stockholders in connection with such sale and shall cause to be remitted to each
New Stockholder the total sales price of the Included Shares of such New
Stockholder sold pursuant thereto, which consideration shall be in the same form
as the consideration received by the FS Stockholder and as specified in the
applicable Initial Offer Notice, net of the New Stockholder's respective pro
rata portion (based on the number of shares of Common Stock sold) of the
reasonable, out-of-pocket expenses incurred by the FS Stockholder in connection
with such sale (not including, however, any transaction fee charged by the FS
Stockholder or its Affiliates). The FS Stockholder shall furnish, or shall
cause to be furnished, such other evidence of the completion and time of
completion of such sale and the terms thereof as may be reasonably requested by
the New Stockholder including, without limitation, evidence of the expenses
incurred by the FS Stockholder in connection with such sale. If and to the
extent that, at the end of 180 days following the date of the Final Notice, the
FS Stockholder has not completed the sale contemplated thereby, the FS
Stockholder shall return to each participating New Stockholder all certificates
representing the Included Shares and all powers-of-attorney which a New
Stockholder may have transmitted pursuant to the terms hereof.
2.5 Termination and Assignment. The obligations of the FS
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Stockholder pursuant to the provisions of this Section 2 shall terminate upon
the consummation of an Initial Public Offering. The rights granted to the New
Stockholders under this Section 2 shall not be assignable except to a Permitted
Transferee in accordance with Section 4.1, provided that the Permitted
Transferee executes a written undertaking to be and become bound by this
Agreement in the same manner and to the
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same extent as such New Stockholder.
3. Obligation to Sell Securities.
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3.1 Sale Obligation. If the FS Stockholder finds a buyer for
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all of the shares of Common Stock held by the FS Stockholder (whether such sale
is by way of purchase, merger or other form of transaction), upon the request of
the FS Stockholder, each of the New Stockholders shall sell all or any portion
of the Securities beneficially owned by such New Stockholder to such third-party
buyer pursuant to the terms and conditions negotiated by the FS Stockholder.
All holders of each class of Securities shall receive the same form and amount
of consideration for such Securities. Any Security that is convertible into
Common Stock shall be purchased on an "as converted" basis. Any series of
preferred stock that is not convertible into Common Stock shall be purchased for
its stated liquidation preference plus accrued and unpaid dividends. Any debt
Security which is not convertible into Common Stock shall be purchased at its
outstanding principal amount plus accrued and unpaid interest, plus any
prepayment or redemption premium set forth in the instruments governing such
Security. The exercise price (if any) of a Security shall be deducted from the
consideration to be received; provided however that if the exercise price of
such Security is greater than the consideration to be received, such Security
shall be canceled without any payment to its holder. Each of the New
Stockholders agrees to such sale and to execute such agreements, powers of
attorney, voting proxies or other documents and instruments as may be necessary
to consummate such sale; provided that no New Stockholder shall be obligated to
make any representations and warranties with respect to such sale other than
with respect to its own authority to transfer and its title to the Securities
transferred. Each of the New Stockholders further agrees to timely take such
other actions as the FS Stockholder may reasonably request to enforce its
obligation to sell its Securities, and otherwise as necessary in connection with
the approval of the consummation of such sale, including voting all Securities
in favor of such sale. Each New Stockholder shall pay its pro rata portion
(based on the total value of the consideration received by such New Stockholder
compared to the aggregate consideration received by all New Stockholders in the
transaction) of the reasonable out-of-pocket expenses incurred by the FS
Stockholder in connection with a sale consummated pursuant to this Section 3
(not including, however any transaction fee charged by the FS Stockholder or its
Affiliates). Notwithstanding the foregoing provisions of this Section 3, no New
Stockholder shall have any obligation to sell Securities in connection with any
sale by the FS Stockholder of all of its shares of Common Stock unless, prior to
the consummation of such sale, (i) the Board determines that the consideration
to be received by the New Stockholders in such sale for their shares of Common
Stock is not less than the aggregate fair market value of the shares of Common
Stock held by the New Stockholders and (ii) the Company shall have obtained a
fairness opinion from an investment banking firm that such a sale is fair, from
a financial point of view, to the holders of Common Stock.
3.2 Termination and Assignment. The obligations of the New
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Stockholders pursuant to this Section 3 shall be binding on any transferee of
Securities
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held by a New Stockholder, and each New Stockholder shall obtain and deliver to
the FS Stockholder a written commitment to be bound by such provisions from each
such transferee prior to any transfer. The obligations of each Stockholder
pursuant to this Section 3, and the obligations of any such transferee, shall
terminate upon the consummation of an Initial Public Offering. The rights of FS
Stockholder under this Section 3 shall not be assignable and shall terminate in
the event that the FS Stockholder holds a number of shares of Common Stock which
represents less than 33-1/3% of the total number of shares of Common Stock
outstanding at any time (with FSEP III and FSEP International considered
collectively for this purpose).
4. Restrictions on Transfers of Securities; Right of First Offer.
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4.1 Transfer Restrictions. Notwithstanding any other provision
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of this Agreement, including (without limitation) the provisions of Exhibit A,
no New Stockholder shall (i) pledge, hypothecate or encumber any Securities;
(ii) sell, assign, transfer, or otherwise dispose of or convey ("Transfer") any
Securities, or any right, title or interest therein, except in compliance with
the Securities Act and all applicable state securities laws or (iii) Transfer
any Securities, or any right, title or interest therein except for sales of
Securities expressly permitted by and in compliance with this Agreement,
including (without limitation) Subsection 4.2 and Section 10. Any attempt to
Transfer, pledge, hypothecate or encumber Securities, or any right, title or
interest therein, not in compliance with this Agreement shall be null and void,
and the Company shall not give effect to any such attempted transaction or
Transfer. Any Securities Transferred pursuant to the terms and requirements of
this Agreement shall be Transferred free and clear of all mortgages, liens,
pledges, charges and security interests or encumbrances, or any obligations or
liabilities in connection therewith. Each New Stockholder, on the execution and
delivery of this Agreement, agrees that such New Stockholder will not Transfer
any Securities prior to delivery to the Company of an opinion of counsel in form
and substance satisfactory to the Company with respect to compliance with the
Securities Act, or until a registration statement with respect to such
Securities under the Securities Act has become effective. All transferees of
Securities will be bound by this Agreement in the same manner and to the same
extent as the transferor and prior to any Transfer must deliver to the Company
and the Stockholders a written undertaking to be and become so bound. Upon
completion of any Transfer in compliance with this Agreement, the transferee
shall become a Stockholder and entitled to the rights hereunder which may be
duly and validly assigned to such transferee. A New Stockholder may transfer
Securities to a Permitted Transferee provided that such transferee executes a
written undertaking to be and becomes bound by this Agreement in the same manner
and to the same extent as the transferring New Stockholder; and provided
further, that prior to the consummation of any transaction in which a Permitted
Transferee ceases to be an Affiliate of such New Stockholder, such Permitted
Transferee shall reconvey all Securities to the transferring New Stockholder and
the Securities will remain subject to this Agreement. A Permitted Transferee
may not subsequently transfer the Securities, except transfers of Securities
back to the transferring New Stockholder.
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4.2 Right of First Offer by New Stockholders. Subject to
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Sections 4.1 and 10 of this Agreement, each of the New Stockholders hereby
agrees not to Transfer any of the Securities held by them to any Person (other
than a Permitted Transferee) unless certain other Stockholders are given the
right to acquire such Securities pursuant to the provisions of this Subsection
4.2. If any of the New Stockholders receives an offer from any person to
acquire any Securities, or decides to solicit or cause to be solicited a
proposal or proposals to acquire Securities, such New Stockholder (the "Offering
Stockholder") shall first give all other New Stockholders (each, an "Offeree,"
and together, the "Offerees"), the Company and the FS Stockholder written notice
(the "Stockholder Notice") of such intention, which notice shall include a term
sheet stating, among other material terms, the minimum cash sales price (the
"Target Price") that the Offering Stockholder would entertain for the Securities
to be sold (the "Offered Securities"). Each of the Offerees shall have the
right for a period of 30 days following the delivery of the Stockholder Notice
(the "Acceptance Period") to accept the offer to purchase all but not less than
all of its respective Offeree Pro Rata Share (as defined below) of the Offered
Securities at the Target Price and upon the other terms provided with the
Stockholder Notice; provided that all and not less than all of the Offered
Securities are purchased. Each Offeree that has elected to purchase its Offeree
Pro Rata Share of the Offered Securities will have the right to purchase all or
any part of the unsubscribed portion of the Offered Securities up to its pro
rata share of such unsubscribed portion (determined in accordance with the
number of shares of Voting Securities owned by the parties that elect to
purchase such unsubscribed for portion). Each Offeree shall exercise its rights
under this Subsection 4.2 by delivering to the Offering Stockholder written
notice of its election prior to 5:00 p.m. Los Angeles time on the final day of
the Acceptance Period. On the first business day following the termination of
the Acceptance Period, the Company shall notify all Offerees that have exercised
their rights hereunder of the amount of any unsubscribed portion of the Offered
Securities, and such Offerees shall have five business days to accept the offer
to purchase their pro rata share of such unsubscribed portion. If some portion
of the Offered Securities remains unsubscribed following such five business day
period, the Offering Stockholder shall send the Stockholder Notice to the FS
Stockholder, and the FS Stockholder shall have the right for a period of 35
days following the termination of the five business day period ("the Second
Acceptance Period") to accept the offer to purchase all or any part of the
unsubscribed portion of the Offered Securities ("Unsubscribed Offered
Securities"). The FS Stockholder shall exercise its rights under this Subsection
4.2 by delivering to the Offering Stockholder written notice of its election
prior to 5:00 p.m. Los Angeles time on the final day of the Second Acceptance
Period. If it elects to purchase Unsubscribed Offered Securities, the FS
Stockholder shall be deemed to be an "Offeree" for the purposes of this
Subsection 4.2. If an Offeree exercises its rights under this Subsection 4.2,
the sale of such Securities shall be consummated within 30 days of the final day
of the Acceptance Period or, if applicable, the Second Acceptance Period (the
"Purchase Period"). If the Offerees do not elect to purchase such Securities on
such terms or fail to consummate a purchase of such Securities within the
Purchase Period, the Offering Stockholder shall have the right to consummate the
sale of such Securities for a sales price equal to or greater than the Target
Price and on terms no more favorable to the purchaser than specified in the
Stockholder Notice for a period of
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90 days (the "Consummation Period") after the expiration of the Acceptance
Period or, if applicable, the Second Acceptance Period or the Purchase Period.
If the Offering Stockholder does not complete such sale, transfer or conveyance
within the Consummation Period, the Offering Stockholder shall not have the
right to sell, transfer or convey any of such Securities without again complying
with this Subsection 4.2. In the event the Offering Stockholder intends to sell
Securities for consideration other than cash, the Offering Stockholder shall
notify the Offerees and the FS Stockholder of the terms of such non-cash
consideration. The Offerees may elect within ten days of such notice to have the
fair market value of such non-cash consideration determined, with the parties
jointly selecting an investment banking firm to resolve any dispute regarding
the fair market value of such non-cash consideration; in the absence of
agreement on such firm, ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. shall determine such fair market
value. The Offeree and the FS Stockholder shall be immediately notified of this
fair market value determination. If the sum of the fair market value of the non-
cash consideration and the cash consideration (in the case of a sale that is
partially for cash) is less than the cash price offered to the Offerees pursuant
to this Subsection 4.2, the Offerees may, within 10 days of the determination of
the fair market value of the non-cash consideration, elect to purchase the
Securities proposed to be sold for an amount equal to the sum of (i) the fair
market value of the non-cash consideration and (ii) the cash consideration, if
any. If some portion of the Offered Securities remains unsubscribed following
such 10-day period, the Offering Stockholder shall send notice of the amount of
unsubscribed Offered Securities to the FS Stockholder. The FS Stockholder shall
then have an additional 15 days to elect to purchase such unsubscribed Offered
Securities. Such purchase must be consummated within 15 days of such election to
purchase (including, if applicable, the FS Stockholder's election). For purposes
of this Subsection 4.2, "Offeree Pro Rata Share" shall mean a fraction (i) the
numerator of which is the total number of shares of Voting Securities then held
by a New Stockholder and (ii) the denominator of which is the total number of
shares of Voting Securities then held by all New Stockholders entitled to
receive the right of first offer. If the Offering Stockholder receives a written
offer for such Securities at any time during the Consummation Period which is
acceptable to the Offering Stockholder but is less than the Target Price or is
upon terms less favorable to the Offering Stockholder than the terms provided to
the Offerees in the Stockholder Notice (the "Below Target Price Offer"), the
Offering Stockholder shall promptly deliver a copy of such written offer to the
Offerees. During the 15-day period following delivery of such written offer, the
Offerees shall have the right to accept the offer to purchase the Securities
offered on the terms reflected in such written offer. Each Offeree shall, if it
so desires, exercise such right by delivery to the Offering Stockholder written
notice of its election to purchase all but not less than all of its Offeree Pro
Rata Share of the Offered Securities prior to 5:00 p.m. Los Angeles time on the
final day of such additional 15 day period and the sale of such Securities shall
be consummated within 30 days of the delivery of such written notice. Any
unsubscribed portion of the Offered Securities shall be offered to the Offerees
and, if applicable, the FS Stockholder, in the manner provided above. If the
Offerees do not elect to accept the offer to purchase the Offered Securities on
such terms or fail to consummate the purchase of the Offered Securities within
30 days of the date of the Offerees' acceptance of the Below Target Price Offer,
the Offering Stockholder shall have 90 days to consummate the sale of the
Offered Securities at a price and upon terms that are not less favorable to the
Offering Stockholder than the price and terms specified in the written offer
delivered to the Offerees. In the event a Below Target Price Offer involves any
non-cash consideration, the procedures for valuing such non-cash consideration
set forth in Subsection 4.2 above shall be utilized to determine the fair market
value of such non-cash consideration.
4.3 Charitable Organization. A CRT shall only be deemed to be a
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"Permitted Transferee" under the terms of this Agreement if:
(a) The Stockholder, or Stockholder's spouse or issue (the "Trustee"),
and the Charitable Organization that is the beneficiary of such CRT makes the
following applicable representations, warranties and covenants:
(1) The Trustee is the sole trustee of the CRT, and represents and
warrants that, (i) under the terms of the CRT, the Trustee has the requisite
power and authority to bind the CRT to this
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Agreement and (ii) upon its execution, this Agreement is enforceable against the
CRT in accordance with its terms; such Trustee also covenants to be personally
liable for all loss, damages, liabilities or deficiencies incurred by the
Company or its subsidiaries or any other Stockholders as a result of any breach
of this Agreement committed by the Trustee or the CRT;
(2) The Charitable Organization beneficiary represents and warrants
that it has full right, title and authority to enter into this Agreement, that
it has the power and authority to execute this Agreement and to perform the
obligations and duties set forth herein, and, upon its execution and delivery,
this Agreement shall be enforceable against the Charitable Organization in
accordance with its terms and that this Agreement shall constitute a valid and
binding obligation of such Charitable Organization in accordance with its terms;
(b) Upon formation of the CRT, such Charitable Organization executes
this Agreement which shall become effective immediately upon any receipt of the
Securities by the Charitable Organization in accordance with the terms of this
Agreement; and
(c) The terms of the CRT provide that the Charitable Organization
beneficiary may only receive the Securities held by the CRT upon the death of
the Stockholder (or Stockholder's spouse or issue, if applicable);
Further, neither the CRT nor the Charitable Organization beneficiary
may Transfer any Securities received under any circumstance prior to the
termination of this Section 4 to any party other than the Trustee.
4.4 Termination and Assignment. The obligations of a Stockholder
--------------------------
pursuant to this Section 4 shall terminate upon an Initial Public Offering. The
rights granted to Stockholders under Subsection 4.2 shall not be assignable
except to Permitted Transferees. Any transferee of Securities from a Stockholder
other than a purchaser of shares from a Stockholder after the Stockholder has
duly complied with its obligations under this Section 4 with respect to such
sale, shall be bound by the provisions of this Section 4 and such Stockholder
shall obtain and deliver to each other Stockholder a written commitment to be
bound by such provisions from each such transferee prior to any transfer.
5. Registration Rights. Each Stockholder shall be entitled to
-------------------
certain "piggy-back" registration rights with respect to future public offerings
of Common Stock by Company and to certain demand registration rights (the
"Registration Rights"). The terms of the Registration Rights are set forth in
Exhibit A attached hereto. The rights granted to Stockholders under this
Section 5 shall not be assignable except to a Permitted Transferee. The rights
granted to Stockholders under this Section 5 are subject to the provisions of
Section 10 of this Agreement.
6. Other Agreements. The Company shall not consummate any material
----------------
transaction with a Stockholder or any Affiliate of a Stockholder other than
transactions on terms that are no less favorable to the Company than could have
been obtained with a person that is not a stockholder (as determined in the good
faith judgment of the Board) and other than indemnification of any of Company's
officers or directors whether pursuant to any indemnity agreement or applicable
law.
7. Copy of Agreement. A copy of this Agreement and all amendments
-----------------
hereto shall be filed with the Secretary of Company and shall be kept at the
principal executive offices of Company.
Page 14
8. Governing Law. This Agreement shall be governed by and construed
-------------
and enforced in accordance with the laws of the State of Minnesota without
regard to the conflicts of laws rules thereof.
9. Representations and Warranties. Each Stockholder represents and
------------------------------
warrants (a) that such Stockholder has full power, capacity, right and
authority, and any requisite approvals or consents to enter into and perform
this Agreement; (b) that this Agreement and the performance of its obligations
hereunder have been duly authorized, executed and delivered by such Stockholder
and is a valid and binding agreement, enforceable against such Stockholder in
accordance with its terms; (c) that such Stockholder owns beneficially and of
record the shares of Common Stock set forth opposite its name on Schedule 2
hereto, free and clear of any lien, claim, charge, option, security interest,
restriction or encumbrance and (d) that such Stockholder does not own
beneficially or of record any other securities or rights, options or warrants to
purchase any securities of the Company.
10. Merger Tax Treatment. Notwithstanding any provision to the
--------------------
contrary, each New Stockholder represents, warrants and agrees that such New
Stockholder (i) has no plan or intention to engage in a sale, exchange,
transfer, distribution, redemption, or reduction in any way of such New
Stockholder's Common Stock or risk of ownership by short sale or otherwise, or
other disposition, directly or indirectly (such actions being collectively
referred to herein as a "Sale") of any of such New Stockholder's Common Stock as
of the effective date hereof; (ii) will not engage in a Sale of such New
Stockholder's Common Stock for a period of one (1) year after the effective date
hereof unless the Company can obtain, at such Stockholder's expense, a written
opinion from the tax advisors of the Company, in form and substance reasonably
satisfactory to the Company, to the effect that the proposed Sale will not cause
the Merger to fail to qualify for tax-free treatment under the provisions of
section 368(a)(1)(A) of the Internal Revenue Code of 1986, as amended (the
"Code") (whether under section 368(a)(2)(D) or 368(a)(2)(E) of the Code); (iii)
except as provided in the Merger Agreement, has paid his own expenses in
connection with the Merger, (iv) did not sell any common stock of SCC in
contemplation of the Merger; and (v) will take such further actions consistent
with the terms of this Agreement and applicable law, as may be reasonably
necessary to cause the Merger to be treated as a tax-free reorganization under
the provisions of sections 368(a)(1)(A) of the Code (taking into account section
368(a)(2)(D) or 368(a)(2)(E) of the Code, as the case may be), including,
without limitation, preparing appropriate tax returns, filings and reports
consistent with the treatment of the Merger as such reorganization. Each New
Stockholder acknowledges that except as provided in this Agreement, each New
Stockholder has unrestricted rights of ownership in the Common Stock and each
New Stockholder's ability to retain their Common Stock is not limited in any
way.
11. Amendment and Waiver; Successors. This Agreement may be amended,
--------------------------------
modified or supplemented, and compliance with any provision hereof may be
waived, only with the written consent of the FS Stockholder and those other New
Page 15
Stockholders then holding a majority of the shares of Voting Securities then
held by such New Stockholders, and any amendment, modification, supplement or
waiver so consented to in writing shall be binding upon the parties hereto and
their successors and permitted transferees and assigns; provided that any
amendment that materially and adversely affects the rights of any Stockholder
hereunder shall require the consent of each Stockholder so affected. This
Agreement shall be binding on the parties hereto and, their successors,
transferees, assigns, heirs and personal representatives; provided however, that
unless expressly permitted herein, this Agreement under the rights granted
hereunder shall not be assignable without the written consent of all of the
parties hereto, which consent may be withheld in each such party's sole
discretion.
12. Interpretation. The headings of the Sections contained in this
--------------
Agreement are solely for the purpose of reference, are not part of the agreement
of the parties and shall not affect the meaning or interpretation of this
Agreement.
13. Notices. All notices and other communications provided for or
-------
permitted hereunder shall be in writing and shall be deemed to have been duly
given if delivered personally or delivered by telecopier (with receipt
confirmed), on the date of such delivery or transmission, or three (3) days
after deposit in the mail, by registered or certified mail (return receipt
requested) postage prepaid (i) if to Company, at AFC Enterprises, Inc., ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, Esq., (ii) if to the FS Stockholder, at ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co.
Incorporated, ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, telecopier: (▇▇▇) ▇▇▇-▇▇▇▇, and (iii) if
to any of the New Stockholders, the address specified by such New Stockholder's
name in Schedule 1 attached hereto (or at such other address or telecopier
number for any party as shall be specified by like notice provided that notices
of a change of address or telecopier number shall be effective only upon receipt
thereof).
14. Legends. All certificates evidencing Securities which are issued
-------
to any of the Stockholders shall be legended as follows (in addition to any
other legend required to be placed thereon):
"THE SECURITIES EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO
CERTAIN RESTRICTIONS AND OBLIGATIONS WITH RESPECT TO THE TRANSFER,
PLEDGE, HYPOTHECATION AND VOTING THEREOF AS SET FORTH IN THAT CERTAIN
STOCKHOLDERS AGREEMENT DATED AS OF MARCH 18, 1998, AS AMENDED, WHICH
MAY BE REVIEWED AT THE PRINCIPAL PLACE OF BUSINESS OF THE CORPORATION
AND A COPY OF WHICH MAY BE OBTAINED FROM THE CORPORATION WITHOUT
CHARGE UPON WRITTEN REQUEST THEREFOR."
15. Further Assurances. The Stockholders shall exercise, or cause to
------------------
be exercised, voting rights with respect to Voting Securities held of record or
beneficially owned by them in a manner so that, and shall otherwise take any
necessary actions in
Page 16
order that, the covenants and understandings of the parties set forth in this
Agreement shall be implemented. Each party hereto agrees to perform any further
acts and execute and deliver any documents which may be reasonably necessary to
carry out the intent of this Agreement and to make appropriate changes to the
procedures set forth herein to implement such rights to the extent necessary to
conform to the Minnesota Business Corporation Act or other applicable law. Each
party hereto further agrees not to take any action violating the intent and
purpose of this Agreement. The Company covenants and agrees that it will act in
good faith to preserve for each of the Stockholders the benefits of this
Agreement and that it will take no voluntary action to impair the benefit hereof
or to avoid or seek to avoid the observance or performance of any of the terms
to be observed or performed hereunder or to deny to any of the Stockholders any
of the benefits or protections contemplated hereby.
16. Injunctive Relief; Disputes. It is acknowledged that it will be
---------------------------
impossible to measure in money the damages that would be suffered if the parties
hereto fail to comply with any of the obligations herein imposed on them and
that, in the event of any such failure, an aggrieved party hereto will be
irreparably damaged and will not have an adequate remedy at law. Any such party
shall, therefore, be entitled to injunctive relief, including specific
performance, to enforce such obligations, and if any action should be brought in
equity to enforce any of the provisions of this Agreement, none of the parties
hereto shall raise the defense that there is an adequate remedy at law. In the
event of any dispute among the parties arising out of this Agreement, the
prevailing party shall be entitled to recover from the non-prevailing party the
reasonable expenses of the prevailing party, including, without limitation,
reasonable attorneys' fees.
17. Severability. If any term or other provision of this Agreement
------------
is invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect to the maximum extent permitted by applicable
law. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereto shall negotiate in
good faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible in a mutually acceptable manner in order that
this Agreement be enforced as originally contemplated to the greatest extent
possible.
18. Entire Agreement. This Agreement (and Exhibits hereto), together
----------------
with the Company's Articles of Incorporation and Bylaws as in effect on the date
hereof constitute the entire agreement and understanding among the parties
pertaining to the subject matter hereof and supersede any and all prior
agreements, whether written or oral, relating hereto.
19. Counterparts. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same instrument.
Page 17
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
FS EQUITY PARTNERS III, L.P., a Delaware limited partnership
By: FS Capital Partners, L.P.
Its: General Partners
By: FS Holdings, Inc.
By:
Its:
FS EQUITY PARTNERS INTERNATIONAL, L.P., a Delaware limited partnership
By: FS&Co. International, L.P.
Its: General Partners
By: FS International Holdings Limited
Its: General Partner
By:
Its:
AFC ENTERPRISES, INC.
By:
Its:
Page 18
The undersigned, a former shareholder of Seattle Coffee Company, a Washington
corporation ("SCC"), hereby accepts the terms and conditions of the Stockholders
Agreement dated as of March 18, 1998, and acknowledges that such acceptance is a
condition to the acquisition of the common stock of AFC Enterprises, Inc.
("AFC") by the undersigned in connection with the Merger between a wholly-owned
subsidiary of AFC and SCC pursuant to the Agreement and Plan of Merger dated as
of January 23, 1998 by and among AFC, AFC Acquisition Corp., SCC and the
principal shareholders of SCC listed therein.
Shareholder Name Number of SCC shares held: ____
____________________________
(Please Print)
Signature: Number of AFC shares received: _____
______________________________
Title:
(If the signatory is signing on behalf
of a corporation, partnership, trust or
other similar entity)
Page 19
SPOUSAL CONSENT
---------------
I acknowledge that I am the spouse of _______________________, a
stockholder of AFC Enterprises, Inc., a Minnesota corporation (the "Company"),
who signed the attached Stockholders Agreement, dated as of March 18, 1998 (the
"Stockholders Agreement"), which relates to the shares of the outstanding
capital stock of the Company. I have read the Stockholders Agreement and know
its contents. I am aware that by its provisions, transfer of shares of the
Company's capital stock are restricted and that my spouse agrees to sell and to
refrain from selling shares of the Company's capital stock, including any
community property or other interest that I may have or acquire therein, under
certain circumstances specified therein. I hereby approve of the provisions of
the Stockholders Agreement and agree to be bound thereby.
Dated: As of March 18, 1998
Signature of Spouse: ______________________________
Name of Spouse: ______________________________
Page 20
SCHEDULE 1
NEW STOCKHOLDERS
Shares of AFC
Name and Address Common Stock/1/
---------------------------------- ---------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ 7988
c/o Capstan Partners
▇▇▇▇ ▇▇▇▇▇ ▇▇▇. #▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, UTMA Custodian 598
For ▇▇▇▇▇▇▇ MacP. ▇▇▇▇▇▇
c/o Capstan Partners
▇▇▇▇ ▇▇▇▇▇ ▇▇▇ #▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, UTMA Custodian
For Caitlin ▇.▇. ▇▇▇▇▇▇ 598
c/o Capstan Partners
▇▇▇▇ ▇▇▇▇▇ ▇▇▇ #▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Henry Gai Family Trust B 72,468
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Henry Gai Family Trust C 72,468
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ 10,544
▇▇▇▇ - ▇▇▇▇ ▇▇▇ ▇ #▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇-Sive 3,845
▇ ▇▇▇▇▇ ▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ 23,965
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Page 21
Shares of AFC
Name and Address Common Stock/1/
---------------------------------- ---------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ 3,435
c/o Kibble & Prentice, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇ #▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ 2,051
▇▇▇▇ ▇.▇. ▇▇▇ ▇.
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 9,482
▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Revocable Trust 147,201
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ - ▇▇▇▇ ▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 14,704
▇▇▇▇ - ▇▇▇▇ ▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ 196,313
▇▇▇▇ ▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 145,649
▇▇▇▇ ▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Living Trust 228,080
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇'▇▇▇▇ 1,275
▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇ 2,635
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Page 22
Shares of AFC
Name and Address Common Stock/1/
---------------------------------- ---------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ 2,278
▇▇▇▇ - ▇▇▇▇ ▇▇▇. ▇.▇.
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ III 3,418
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇. ▇.
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇. 239,042
Olympic Capital Partners
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇. #▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Northwestern Trust Co., Trustee 64,335
▇▇▇ Account
FBO ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇. Trust 6,656
Attn: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
c/o Olympic Capital Partners
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇. #▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ 2,278
NE ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ 3,195
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Pinco Pallino, Inc. 178,868
Attn: ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ - ▇▇▇▇ ▇▇▇ ▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇ 17,415
▇▇▇▇ - ▇▇▇▇▇ ▇▇ ▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Page 23
Shares of AFC
Name and Address Common Stock/1/
---------------------------------- ---------------
▇▇▇▇▇ ▇▇▇▇▇▇, Inc., as ▇▇▇ Custodian 2,655
FBO ▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇ - ▇▇▇▇▇ ▇▇▇ ▇▇, #▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇ 6,656
c/o Prudential Securities, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇. #▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ 894
▇▇▇▇ - ▇▇▇▇▇ ▇▇▇▇▇ ▇▇ #▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ 4,821
▇▇▇▇▇ - ▇▇▇▇ ▇▇. ▇.▇.
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ 385,885
▇▇▇▇▇ - ▇▇▇▇ ▇▇▇ ▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ 238
▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇ 24,760
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇ 3,812
▇▇▇▇ -▇▇▇▇ ▇▇▇ ▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ 87,243
▇▇▇▇ - ▇▇▇▇ ▇▇▇ ▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
---------------
/1/ The shares reflected in this column include AFC Shares issued as part of the
Net Closing Payment and the Holdback Funds but do not include any AFC Shares
that may become issuable as a part of the Contingent Payment. In the event
such additional AFC Shares shall be earned pursuant to the Contingent
Payment, such AFC Shares shall be subject to all of the terms and conditions
of this Agreement.
Page 24
SCHEDULE 2
OWNERSHIP OF COMPANY COMMON STOCK
BY THE FS STOCKHOLDER AND THE NEW STOCKHOLDERS
STOCKHOLDER COMMON STOCK
------------------------------------------ ---------------
FS Equity Partners III, L.P. 18,259,483
FS Equity Partners International, L.P. 733,583
New Stockholders 1,977,748/1/
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/1/ See footnote 1.