Exhibit 10.22.2
August 31, 1999
Xx. Xxxx X. Xxxxxx
Chairman of the Board
Family Steak Houses of Florida, Inc.
0000 Xxxxxxx Xxxxxxxxx
Xxxxxxx Xxxxx, XX 00000
Dear Xxxx:
This letter is to serve as an amendment to the Agreement between
Ryan's Properties, Inc. ("Ryan's") and Family Steak Houses of
Florida, Inc. ("FSH") dated July 11, 1994, and amended on October
17, 1994 and October 3, 1996 (the "Agreement"). The Agreement
itself constituted an amendment of the Franchise Agreement (as
defined in the Agreement)(as amended, the "Franchise Agreement").
This letter also serves to amend the Franchise Agreement.
1. Clause (b) of Section 7 (Store Requirements) of the
Agreement is deleted and replaced with the following:
"At the end of each calendar year, FSH agrees to have at least
the following number of Ryan's Family Steak House restaurants in
operation:
Number of Ryan's Family Steak House
End of Calendar Year restaurants Required to be in Operation
1999 21
2000 23
2001 25
2002 27
2003 29
Subsequent Years Increases by Two per Year"
The remaining provisions of Section 7 of the Agreement remain in
full force and effect.
August 31, 1999
Page 2
2. Section XV (TERMINATION AND DEFAULTS) of the Franchise
Agreement is amended by the addition at the end of paragraph B
thereof of a new subparagraph 5 of paragraph B, which new
subparagraph 5 is set forth on the attached Rider A.
3. Section XVIII (TRANSFERABILITY OF INTEREST) of the Franchise
Agreement is amended by the addition at the end thereof of new
subparagraphs 5 and 6 of paragraph B, which new subparagraphs 5
and 6 are set forth on the attached Rider B.
Except as explicitly modified herein, the Agreement and the
Franchise Agreement shall continue in full force and effect in
all respects.
RYAN'S PROPERTIES, INC.
Xxxxxxx X. Way
President
The undersigned has read the above amendments and agrees to the
provisions contained therein.
FAMILY STEAK HOUSES OF FLORIDA, INC.
By: ________________________________________
Xx. Xxxx X. Xxxxxx
Chairman of the Board
Family Steak Houses of Florida, Inc.
amend-99.doc
Rider A
(Additional Event of Default)
5. If at the end of any calendar year the number of
Restaurants in operation is less than 80% of the number of
Restaurants required to be in operation as of that date pursuant
to the terms of this Agreement, as amended.
Rider B
(Additional Transferability Provisions)
5. For purposes of this paragraph XVIII.B, any of the
following shall be deemed to be an assignment and transfer
of this Agreement that requires FRANCHISOR's prior written
consent under this Paragraph XVIII.B:
(a) any person or group of persons (within the
meaning of the Securities Exchange Act of
1934, as amended (the "34 Act")) (other than
any person that beneficially owned 15% or
more of the issued and outstanding shares of
voting capital stock of FRANCHISEE as of
December 15, 1998) shall have acquired after
December 15, 1998 beneficial ownership
(within the meaning of Rule 13d-3 promulgated
by the Securities and Exchange Commission
(the "SEC") under the 34 Act) of 25% or more
of the issued and outstanding shares of
capital stock of FRANCHISEE (or FRANCHISEE's
direct or indirect parent) having the right
to vote for the election of directors of
FRANCHISEE (or such parent) under ordinary
circumstances, or
(b) during any period of twelve consecutive
calendar months ending after August 15, 1999,
individuals who at the beginning of such
period constituted the board of directors of
FRANCHISEE (or any direct or indirect parent
of FRANCHISEE) (together with any new
directors whose election by the board of
directors of FRANCHISEE (or such parent), or
whose nomination for election by the
stockholders of FRANCHISEE (or such parent),
was approved by a vote of at least two-thirds
of the directors then still in office who
either were directors at the beginning of
such period or whose election or nomination
for election was previously so approved)
cease for any reason other than death or
disability to constitute a majority of the
directors then in office, or
(c) FRANCHISEE, or any individual or entity that,
directly or indirectly, controls, is
controlled by or is under common control with
FRANCHISEE, directly or indirectly, owns,
maintains, engages in, participates in or has
any interest in, the operation of any other
family-oriented steak house restaurant. For
purposes of this subparagraph (c), the term
"control" has the meaning of that term under
the regulations promulgated by the SEC under
the 34 Act.
For purposes of this paragraph 5, any entity that, directly
or indirectly, controls (within the meaning of the
regulations promulgated by the SEC under the 34 Act)
FRANCHISEE shall be deemed a direct or indirect (as the case
may be) "parent" of FRANCHISEE.
6. In the event that FRANCHISOR declines to grant its
consent to any transaction requiring its consent under this
paragraph XVIII.B., the proposed transaction may nonetheless
be consummated (subject, in the case of an asset transfer,
to FRANCHISOR's right of first refusal) if the following
conditions are satisfied to the reasonable satisfaction of
FRANCHISOR:
(a) FRANCHISEE shall have paid or cause to be
paid to FRANCHISOR in immediately available
funds all amounts due and owing to FRANCHISOR
under this Agreement or accrued under this
Agreement with respect to any period prior to
the effective date of such transaction (the
"Transaction Effective Date");
(b) No event of default has occurred and is
continuing under this Agreement as of the
Transaction Effective Date;
(c) All documents and information in the
possession of FRANCHISEE that FRANCHISOR
deems to be confidential trade secrets shall
have been returned to FRANCHISOR prior to the
Transaction Effective Date;
(d) On or prior to the Transaction Effective
Date, FRANCHISEE or the transferee (as
applicable), on the one hand, and FRANCHISOR,
on the other hand, shall have executed and
delivered an amendment agreement pursuant to
which:
(i) This Agreement is modified
solely (except as provided in
clause (ii) below) to eliminate any
requirement that FRANCHISOR provide
to FRANCHISEE or such transferee
(as applicable) information deemed
confidential trade secrets by
FRANCHISOR;
(ii) The transferee (if applicable)
assumes all of FRANCHISEE's
obligations under this Agreement;
and
(iii) This Agreement shall otherwise
remain in full force and effect and
binding on FRANCHISEE or the
transferee (as applicable).
