Exhibit 5
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January 10, 1997
Three Cities Fund II, L.P.
Three Cities Offshore II C.V.
Terfin International Ltd.
c/o Three Cities Research, Inc.
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Standstill Agreement
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Gentlemen:
Reference is made to the Securities Purchase Agreement, dated
December 30, 1996 (the "Securities Purchase Agreement"), by and between the
undersigned and Three Cities Fund II, L.P., Three Cities Offshore II C.V., and
Terfin International Ltd. (the "Purchasers") pursuant to which the Purchasers
agreed to purchase from the undersigned, and the undersigned agreed to sell to
such Purchasers, the Equity Securities (as defined in the Securities Purchase
Agreement) of Family Bargain Corporation, a Delaware corporation (the
"Company").
In consideration of the amount of $10,000.00, the receipt of which
is hereby acknowledged, the undersigned hereby covenant and agree with the
Purchasers that, for a period of three years from the date hereof, the
undersigned will refrain from (a) acquiring direct or indirect beneficial
ownership of any shares of any class of capital stock of the Company, or any
debt or equity securities (including warrants and options) convertible or
exchangeable into, or which may be exercised for, any class of capital stock of
the Company, with or without additional cash or consideration; (b) directly or
indirectly soliciting proxies or becoming a "participant" in a "solicitation"
(as such terms are defined in Regulation 14A under the Securities Exchange Act
of 1934, as amended) in opposition to a recommendation of the Board of Directors
of the Company; (c) initiating or inducing or attempting to induce or give
material support to any other person to initiate, or in other way participating
in, any tender or exchange offer, for acquisition of, shares of the Company or
any change of control of the Company, or any proxy solicitation which relates to
the Company; (d) initiating any communication with, or responding to any
communication from, any shareholder of the Company in his, her or its capacity
as a shareholder if such communication relates to any of the matters set forth
in (a), (b) or (c) above; or (e) attempting to influence the affairs of the
Company in any other manner or respect.
2
This letter agreement constitutes the entire agreement and
supersedes all prior agreements and understandings, whether oral or written,
among the parties hereto with respect to the subject matter hereof. The parties
hereby agree and acknowledge that the allocation of consideration for the
subject matter hereof is the proper allocation, and the parties will not agree
to any other allocation.
This letter agreement shall become effective, and the $10,000.00
(the "Payment") shall be delivered, upon, and only upon, the Closing (as defined
in the Securities Purchase Agreement) of the Securities Purchase Agreement. Such
Payment shall be made to the undersigned by wire transfer of immediately
available funds to an account or accounts designated by the undersigned prior to
the Closing.
This letter agreement and all questions relating to its validity,
interpretation, performance and enforcement (including, without limitation,
provisions concerning limitations of actions), shall be governed by and
construed in accordance with the laws of the State of New York.
This letter agreement may be executed in any number of counterparts,
each of which shall, when executed, be deemed to be an original and all of which
shall be deemed to be one and the same instrument.
Very truly yours,
/s/ Xxxxxx X. Xxxxxx
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XXXXXX X. XXXXXX
/s/ Xxxxxx Xxxxx
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XXXXXX XXXXX
/s/ Xxxx X. Xxxxxx
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XXXX X. XXXXXX
3
DUTFORD LIMITED
By: /s/ Xxxx Xxxxxx
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Name:
Title: Attorney-In-Fact
COPLEX FOUNDATION
/s/ Xxxx Xxxxxx
By: /s/ Xxxxxx X. Xxxxxx
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Name:
Title: Trustee
Accepted and agreed to as of the date first written above:
THREE CITIES FUND II, L.P.
By: TCR Associates, L.P.,
as General Partner
By: /s/ J. Xxxxxxx Xxxxx
--------------------------------
Name: J. Xxxxxxx Xxxxx
Title: Attorney-In-Fact
THREE CITIES OFFSHORE II C.V.
By: TCR Associates Offshore, L.P.,
as General Partner
By: /s/ J. Xxxxxxx Xxxxx
--------------------------------
Name: J. Xxxxxxx Xxxxx
Title: General Partner
TERFIN INTERNATIONAL LTD.
By: /s/ J. Xxxxxxx Xxxxx
--------------------------------
Name: J. Xxxxxxx Xxxxx
Title: Attorney-In-Fact
