LETTER AGREEMENT
WHEREAS, certain of the undersigned are stockholders, direct or
beneficial, of Red ▇▇▇▇▇ Gourmet Burgers, Inc., a Delaware corporation (the
"Company"); and
WHEREAS, (i) Spotlight Advisors, LLC, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, (together, the
"Spotlight Parties") and (ii) ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Master Fund, Ltd., Clinton Group,
Inc. and ▇▇▇▇▇▇ ▇. ▇▇▇▇ (together, the "Clinton Parties," and collectively with
the Spotlight Parties, the "Group"), wish to enter into this Letter Agreement
(the "Letter Agreement") pertaining to their investments in, and activities
related to, the Company and its Securities.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound hereby, covenant and agree as follows:
1. Spotlight Advisors, LLC and Clinton Group, Inc. each agree to
consult with each other regarding all purchases and sales of Securities of the
Company by their affiliates. "Securities" shall mean equity securities of the
Company, options to purchase or sell equity securities of the Company, and
swaps, synthetics and other derivative securities or instruments, the value of
which is solely and directly related to equity securities of the Company.
Furthermore, so long as this Agreement is in effect, (i) none of the parties
shall acquire Securities of the Company if as a result the Group would be deemed
to have beneficial ownership of 10% or more of any class of the outstanding
equity of the Company without the prior agreement of Spotlight Advisors, LLC, or
its representatives, and Clinton Group, Inc., or its representatives
(collectively, the "Representatives"), (ii) none of the parties shall purchase,
sell or otherwise increase or decrease their economic exposure to Securities of
the Company if such party reasonably believes that, as a result of such action,
the Group or any member thereof would be likely to be required to make any
regulatory filing without using their reasonable efforts to give the other
parties at least 24 hours prior written notice, and (iii) each of the
undersigned shall provide written notice to the other of (a) any of their
purchases or sales of Securities of the Company; and (b) any Securities of the
Company over which they acquire or dispose of beneficial ownership, no later
than 24 hours after each such transaction.
2. Each party shall pay its pro rata portion of all expenses incurred
in connection with the Group's activities based on their relative security
ownership.
3. Each of the undersigned agrees that any filing with the Securities
and Exchange Commission, press release or stockholder communication proposed to
be made or issued by the Group or any member of the Group in connection with the
Group's activities shall be jointly approved by the Representatives, which
approval shall not be unreasonably withheld or delayed.
4. The relationship of the parties hereto shall be limited to carrying
on the activities of the Group in accordance with the terms of this Agreement.
Such relationship shall be construed and deemed to be for the sole and limited
purpose of carrying on such activities as described herein. Nothing herein shall
be construed to authorize any party to act as an agent for any other party, or
to create a joint venture or partnership, or to constitute an indemnification.
Except as otherwise expressly provided herein, nothing herein shall restrict any
party's right to purchase or sell Securities of the Company, as he/it deems
appropriate, in his/its sole discretion, provided that all such sales are made
in compliance with all applicable securities laws.
5. This Agreement may be executed in counterparts, each of which shall
be deemed an original and all of which, taken together, shall constitute but one
and the same instrument, which may be sufficiently evidenced by one counterpart.
6. In the event of any dispute among the parties hereto arising out of
the provisions of this Agreement or their investment in the Company, the parties
hereto consent and submit to the exclusive jurisdiction of the Federal and State
Courts in the State of New York.
7. Any party hereto may terminate his/its obligations under this
Agreement on 24 hours written notice to all other parties.
8. Each party acknowledges that ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇ LLP shall act as
counsel for both the Group and the Clinton Parties relating to their investment
in the Company.
9. Each of the undersigned parties hereby agrees that this Group
Agreement shall be filed as an exhibit to an amendment to a Schedule 13D.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, each of the parties hereto has caused this
Group Agreement to be executed as of the 21st day of December, 2009.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ MASTER FUND, LTD.
By: Clinton Group, Inc., its investment manager
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Chief Financial Officer
CLINTON GROUP, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Chief Financial Officer
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇
SPOTLIGHT ADVISORS, LLC
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Managing Member
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
