EXHIBIT 10.34
FORM OF
AMENDMENT NUMBER ONE TO
STOCK PLEDGE AGREEMENT
This AMENDMENT NUMBER ONE TO STOCK PLEDGE AGREEMENT (this "Amendment")
is entered into as of June 9, 1998, by and between Foothill Capital Corporation,
a California corporation ("Foothill"), and FRI-MRD CORPORATION, a Delaware
corporation ("FRI-MRD") with reference to the following facts:
A. Foothill, on the one hand, and El Torito Restaurant's, Inc. ("El
Torito"), a Delaware corporation, Chi-Chi's, Inc., a Delaware
Corporation (collectively with El Torito, "Borrower"), FRI-MRD, and
certain of their Affiliates, on the other hand, heretofore have
entered into that certain Loan and Security Agreement, dated as of
January 10, 1997, as amended by that certain Amendment Number One to
Loan and Security Agreement, dated as of May 23, 1997, as amended by
that certain Amendment Number Two to Loan and Security Agreement,
dated as of August 12, 1997, as amended by that certain Amendment
Number Three to Loan and Security Agreement, dated as of April __,
1998, and as amended by that certain Amendment Number Four to Loan and
Security Agreement, dated as of the date hereof (the "Fourth
Amendment"), (collectively, the "Loan Agreement");
B. Foothill and FRI-MRD have heretofore entered into that certain Stock
Pledge Agreement, dated as of January 10, 1997 (the "Stock Pledge
Agreement"), pursuant to which FRI-MRD pledged, granted, transferred,
and assigned to Foothill a security interest in the Collateral (as
therein defined) to secure the Secured Obligations (as therein
defined), as provided therein;
C. Concurrently herewith, Borrower, FRI-MRD, and Foothill are entering
into the Fourth Amendment to permit, inter alia, (a) FRI-MRD's
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issuance of new Senior Secured Discount Notes in the original
principal amount of up to $24,000,000 (yielding gross proceeds of
approximately $21,000,000) to be secured by a pledge of the Pledged
HGI Collateral, and (b) the merger of FRI-Sub, Inc., a Delaware
corporation ("FRI-Sub"), into ▇▇▇ ▇▇▇ Roo, Inc., a Delaware
corporation ("KKR"), with KKR as the survivor.
D. Borrower and FRI-MRD have requested Foothill to amend the Stock Pledge
Agreement to permit the foregoing transactions; and
E. Foothill is willing to so modify the Stock Pledge Agreement in
accordance with the terms and conditions hereof;
NOW, THEREFORE, in consideration of the above recitals and the mutual
premises contained herein, Foothill and FRI-MRD hereby agree as follows:
1. DEFINITIONS FOR THIS AMENDMENT.
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Any and all initially capitalized terms used herein shall have the
meanings ascribed thereto in the Stock Pledge Agreement, as amended hereby. For
purposes of this Amendment only, the following initially capitalized terms shall
have the following meanings:
"Effective Date" means the date on which Foothill acknowledges, in
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writing, that each of the conditions contained in Section 3 have been fulfilled
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or waived.
"HGI Closing Date" shall have the meaning ascribed thereto in the
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Fourth Amendment.
"KKR Closing Date" shall have the meaning ascribed thereto in the
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Fourth Amendment.
2. AMENDMENTS TO THE STOCK PLEDGE AGREEMENT TO FACILITATE THE HGI
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ACQUISITION.
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a. Section 1(a) of the Stock Pledge Agreement hereby is amended
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by modifying the following definition:
"Future Rights" shall mean: (a) to the extent of Pledgor's
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interest therein, all shares of stock (other than Pledged Shares) of the
Issuers, and all securities convertible or exchangeable into, and all
warrants, options, or other rights to purchase, shares of stock of the
Issuers; (b) to the extent of Pledgor's interest therein, all shares of,
all securities convertible or exchangeable into, and all warrants, options,
or other rights to purchase shares of stock of any Person, not including
HGI, in which Pledgor, after the date of this Agreement, acquires a direct
equity interest, irrespective of whether such Person is or becomes a
Subsidiary of Pledgor; and (c) the certificates or instruments representing
such additional shares, convertible or exchangeable securities, warrants,
and other rights and all dividends, cash, options, warrants, rights,
instruments, and other property or proceeds from time to time received,
receivable, or otherwise distributed in respect of or in exchange for any
or all of such shares.
3. AMENDMENTS TO THE STOCK PLEDGE AGREEMENT TO FACILITATE THE KKR
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MERGER.
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a. Schedule A of the Stock Pledge Agreement is hereby amended,
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restated, and replaced in its entirety by the Schedule A attached hereto.
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4. CONDITIONS PRECEDENT TO THE EFFECTIVENESS OF SECTION 2 TO THIS
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AMENDMENT.
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The effectiveness of the provisions of Section 2 of this Amendment is
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subject to the fulfillment, to the satisfaction of Foothill and its counsel, of
each of the following conditions:
a. Foothill shall have received each of the following
documents, in form and substance satisfactory to Foothill and its counsel, duly
executed, and each such document shall be in full force and effect:
(1) this Amendment; and
(2) the Fourth Amendment;
b. Foothill shall have received a certificate from the
Secretary of FRI-MRD attesting to the resolutions of FRI-MRD's Board of
Directors authorizing its execution, delivery, and performance of this Amendment
and authorizing specific officers of FRI-MRD to execute the same;
c. All conditions to the effectiveness of Section 3 of the
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Fourth Amendment shall have been fulfilled or waived, and the same shall be in
full force and effect.
d. As of the HGI Closing Date, no injunction, writ, restraining
order, or other order of any nature prohibiting, directly or indirectly, the
consummation of the transactions contemplated herein shall have been issued and
remain in force by any governmental authority against Borrower, FRI-MRD, any
Guarantor, Foothill, or any of their Affiliates; and
e. All other documents and legal matters in connection with the
transactions contemplated by this Amendment shall have been delivered or
executed or recorded and shall be in form and substance reasonably satisfactory
to Foothill and its counsel.
5. CONDITIONS PRECEDENT TO THE EFFECTIVENESS OF SECTION 3 TO THIS
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AMENDMENT.
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The effectiveness of the provisions of Section 3 of this Amendment is
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subject to the fulfillment, to the satisfaction of Foothill and its counsel, of
each of the following conditions:
a. Foothill shall have received each of the following
documents, in form and substance satisfactory to Foothill and its counsel, duly
executed, and each such document shall be in full force and effect:
(1) this Amendment; and
(2) the Fourth Amendment.
b. All conditions to the effectiveness of Section 4 of the
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Fourth Amendment shall have been fulfilled or waived, and the same shall be in
full force and effect.
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c. Foothill shall have received a certificate from the
Secretary of FRI-MRD attesting to the resolutions of FRI-MRD's Board of
Directors authorizing its execution, delivery, and performance of this Amendment
and authorizing specific officers of FRI-MRD to execute the same;
d. As of the KKR Closing Date, no injunction, writ, restraining
order, or other order of any nature prohibiting, directly or indirectly, the
consummation of the transactions contemplated herein shall have been issued and
remain in force by any governmental authority against Borrower, FRI-MRD, any
Guarantor, Foothill, or any of their Affiliates; and
e. All other documents and legal matters in connection with the
transactions contemplated by this Amendment shall have been delivered or
executed or recorded and shall be in form and substance reasonably satisfactory
to Foothill and its counsel.
6. REPRESENTATIONS AND WARRANTIES. FRI-MRD hereby represents and
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warrants to Foothill that: (a) the execution, delivery, and performance of this
Amendment and of the Stock Pledge Agreement, as amended by this Amendment, are
within its corporate powers, have been duly authorized by all necessary
corporate action, and are not in contravention of any law, rule, or regulation,
or any order, judgment, decree, writ, injunction, or award of any arbitrator,
court, or governmental authority, or of the terms of its charter or bylaws, or
of any contract or undertaking to which it is a party or by which any of its
properties may be bound or affected; (b) this Amendment and the Stock Pledge
Agreement, as amended by this Amendment, constitute FRI-MRD's legal, valid, and
binding obligation, enforceable against FRI-MRD in accordance with its terms.
7. EFFECT ON STOCK PLEDGE AGREEMENT. The Stock Pledge Agreement, as
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amended by this Amendment, shall be and remain in full force and effect in
accordance with its respective terms and hereby is ratified and confirmed in all
respects. The execution, delivery, and performance of this Amendment shall not
operate as a waiver of or, except as expressly set forth herein, as an
amendment, of any right, power, or remedy of Foothill under the Stock Pledge
Agreement, as in effect prior to the date hereof.
8. MISCELLANEOUS.
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a. Upon the effectiveness of this Amendment, each reference in
the Stock Pledge Agreement to "this Agreement", "hereunder", "herein", "hereof"
or words of like import referring to the Stock Pledge Agreement shall mean and
refer to the Stock Pledge Agreement as amended by this Amendment.
b. Upon the effectiveness of this Amendment, each reference in
the Loan Documents to the "Stock Pledge Agreement", "thereunder", "therein",
"thereof" or words of like import referring to the Stock Pledge Agreement shall
mean and refer to the Stock Pledge Agreement as amended by this Amendment.
c. This Amendment may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties
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hereto may execute this Amendment by signing any such counterpart. Delivery of
an executed counterpart of this Amendment by telefacsimile shall be equally as
effective as delivery of a manually executed counterpart of this Amendment. Any
party delivering an executed counterpart of this Amendment by telefacsimile also
shall deliver a manually executed counterpart of this Amendment but the failure
to deliver a manually executed counterpart shall not affect the validity,
enforceability, and binding effect of this Amendment.
[Signature page to follow.]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed as of the date first written above.
FRI-MRD CORPORATION,
a Delaware corporation
By___________________________
Title:_______________________
FOOTHILL CAPITAL CORPORATION,
a California corporation
By___________________________
Title:_______________________
-S-1-
SCHEDULE A
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TO
STOCK PLEDGE AGREEMENT
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Pledgor: FRI-MRD CORPORATION
Pledged Shares
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Former Name, if Pledgor's
Number of Certificate any, in which Percentage Jurisdiction of
Issuer Shares Class Numbers Certificate Issued Ownership Incorporation
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EL TORITO RESTAURANTS, INC. 100 common 3 100% Delaware
CHI-CHI'S INC. 1000 common 5 100% Delaware
FRI-ADMIN CORPORATION 100 common 3 100% Delaware
EL TORITO FRANCHISING COMPANY 100 common 1 100% Delaware
▇▇▇ ▇▇▇ ROO, INC. _____ common _______ 100% Delaware