Exhibit 10.2

LOAN AGREEMENT

 

THIS LOAN AGREEMENT (this “Agreement”) is made, entered into and effective as of
June 20, 2019 (the “Effective Date”), by and between CHOICE FINANCIAL GROUP, a
North Dakota banking corporation doing business as Choice Bank (“Lender”),
FAMOUS DAVE’S OF AMERICA, INC., a Minnesota corporation (“FDOA”), MINWOOD
PARTNERS, INC., a Delaware corporation (“MinWood”), D&D OF MINNESOTA, INC., a
Minnesota corporation (“D&D”), FAMOUS DAVE’S RIBS OF MARYLAND, INC., a Minnesota
corporation (“FDRM”), FAMOUS DAVE’S RIBS, INC., a Minnesota corporation (“FDR”),
FAMOUS DAVE’S RIBS-U, INC., a Minnesota corporation (“FDRU”), and LAKE &
HENNEPIN BBQ AND BLUES, INC., a Minnesota corporation (“Lake & Hennepin” or
collectively with FDOA, MinWood, D&D, FDRM, FDR and FDRU, “Borrowers” or each a
“Borrower”). Lender or Borrowers may be individually referred to herein as a
“party” or collectively as the “parties.”

RECITALS

A.It is proposed that Borrowers borrow from Lender and Lender lend to Borrowers
the principal sum of up to $24,000,000.00 (the “Term Loan Amount”) via a term
loan facility (the “Term Loan”), to be secured by an Amended and Restated
Mortgage, Security Agreement and Fixture Financing Statement, an Amended and
Restated Assignment of Leases, Rents and Income, and certain other collateral
loan documents deemed necessary by Lender or Lender’s counsel to secure the Term
Loan.

B.It is also proposed that Borrowers borrow from Lender and Lender lend to
Borrowers the additional principal sum of up to $1,000,000.00 (the “Revolving
Loan Amount” or collectively with the Term Loan Amount, the “Loan Amounts”) via
a revolving loan facility (the “Revolving Loan” or collectively with the Term
Loan, the “Loans”), to be secured by an Amended and Restated Mortgage, Security
Agreement and Fixture Financing Statement, an Amended and Restated Assignment of
Leases, Rents and Income, and certain other collateral loan documents deemed
necessary by Lender or Lender’s counsel to secure the Revolving Loan.

C.Lender is willing, upon the terms and subject to the conditions herein set
forth, to make the Loans to Borrowers.

D.Borrowers have issued, caused the issuance of and/or shall issue or cause to
be timely issued, the following documentation, in such form and substance as
required by Lender in its sole and absolute discretion, fully executed by all
applicable parties thereto (collectively, the “Loan Documents”):

D.1this Agreement executed by Lender and Borrowers;

D.2Term Promissory Note issued by Borrowers to Lender in the principal amount of
$24,000,000.00 (the “Term Note”);

D.3Revolving Promissory Note issued by Borrowers to Lender in the principal
amount of $1,000,000.00 (the “Revolving Note” or collectively with the Term
Note, the “Notes”);

D.4Amended and Restated Mortgage, Security Agreement and Fixture Financing
Statement (the “Mortgage”) encumbering the real property therein described (the
“Mortgaged Property”);

D.5Amended and Restated Assignment of Leases, Rents and Income (the “Assignment
of Rents”);

D.6Security Agreement;

D.7Uniform Commercial Code Financing Statement perfecting security interest in
the assets of Borrowers in favor of Lender;

D.8ADA and Environmental Indemnification Agreement;

D.9Borrower’s Affidavits from each Borrower;

 

D.10Resolutions and Secretary’s Certificate of each Borrower;

D.11Deposit Account Control Agreement;

D.12Collateral Assignment of Promissory Note dated October 31, 2017, by and
between Venture Bank (as predecessor-in-interest by merger and acquisition to
Lender) and FDOA (the “Collateral Assignment”); and

D.13all additional documentation not otherwise listed herein as required by
Lender.

AGREEMENTS

NOW THEREFORE, in consideration of the mutual covenants hereinafter contained,
it is hereby agreed as follows:

1.Recitals. The recitals set forth above are hereby fully incorporated herein.

2.Loans. Subject to the terms of this Agreement and the Loan Documents, Borrower
agrees to take and Lender agrees to make certain Advances (as defined below) of
up to and including:  (a) the Term Loan Amount, said Term Loan to be evidenced
by the Term Note; and (b) the Revolving Loan Amount, said Revolving Loan to be
evidenced by the Revolving Note. The terms and conditions of the Loan Documents
are hereby expressly incorporated herein by reference and made a part hereof.

2.1Notes. The obligation to repay the Loans together with interest and other
charges thereon shall be evidenced by the Notes.

2.2Use of Proceeds. The proceeds of the Term Loan shall be used solely to:  (a)
satisfy in full Lender’s loan number 17381 as evidenced by that certain
Promissory Note dated December 2, 2016 issued by FDOA and MinWood to Venture
Bank (Lender’s predecessor-in-interest by merger and acquisition) in the
original principal amount of $3,700,000.00 (the “2016 Term Loan”); and (b) for
certain acquisitions and expansions of Borrowers’ business operations, as
approved by Lender in its sole and absolute discretion pursuant to this
Agreement.

The proceeds of the Revolving Loan shall be used solely to:  (a) satisfy in full
Lender’s loan 17396 as evidenced by that certain Promissory Note dated December
2, 2016, issued by FDOA, D&D, FDRM, FDR, FDRU and Lake & Hennepin in the
original principal amount of $1,000,000.00 (the “2016 Revolving Loan”); and (b)
for the general capital needs in connection with the operation of the business
of Borrowers as approved by Lender in its sole and absolute discretion pursuant
to this Agreement.

2.3Advance Procedures.

2.3.1Provided no uncured Event of Default then exists, Lender agrees, on the
terms and subject to the conditions set forth below, for a period commencing on
the Effective Date and ending on the twelve (12) month anniversary thereof (the
“Draw Period”), to make certain advances (each an “Advance” or collectively,
“Advances”) to Borrowers. As used herein, the term “Disburse” or “Disbursement”
shall mean the disbursement of Advances made or to be made by Lender. The Term
Loan is not a revolving credit facility; no re-Advance(s) of any portion of the
Term Loan shall be made.  Borrowers may request an extension of the Draw Period
by providing written notice to Lender prior to the expiration of the Draw
Period, which extension may be granted or withheld by Lender at its sole and
absolute discretion.

2.3.3Advances under the Term Loan shall be made during the Draw Period upon the
submission by Borrowers to Lender of a request for an Advance in such form and
substance as required

 

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by Lender in its sole and absolute discretion. All Advances shall be subject to
the approval by Lender in its sole and absolute discretion of such a request.

2.3.4Provided no uncured Event of Default then exists, Lender agrees, on the
terms and subject to the conditions set forth below, to make certain Advances or
re-Advances to Borrowers of any remaining amount of the Revolving Loan Amount
under the Revolving Loan to satisfy-in-full the 2016 Revolving Loan and
thereafter as requested by any Borrower and as approved by Lender in its sole
and absolute discretion.

2.3.5Each request for an Advance shall constitute a reaffirmation by Borrowers
that all representations and warranties set forth in this Agreement and the Loan
Documents are true and correct as of the date of such request.

2.4Protective Advances and Disbursements.  Notwithstanding anything herein to
the contrary, Lender shall have the irrevocable right, but no obligation, at any
time and from time to time to cause an Advance or a Disbursement of funds that
are on deposit with Lender to pay principal or interest on the Notes and to pay
any and all costs and expenses referred to in this Agreement or the Loan
Documents, all without receipt of a request from any Borrower.

2.5Payment and Balance. All payments of principal, interest and other charges
under the Notes and of all amounts hereunder shall be made to Lender in
immediately available funds. Borrowers agree that the amount shown on the books
and records of Lender as being the aggregate balance of the Loans outstanding
shall be prima facie evidence of the outstanding balance of the Notes.

3.Additional Requirements for the Advances and Disbursements. Notwithstanding
the foregoing, Borrowers covenant and agree to immediately, and without expense
to Lender, satisfy the following additional requirements prior to any Advance
and thereafter prior to Disbursement thereof, which Advance(s) and
Disbursement(s) shall remain at all times subject to the sole and absolute
discretion of Lender:

3.1Deliver to Lender the required Loan Documents.

3.2Deliver to Lender a date down endorsement of Old Republic National Title
Insurance Company Loan Policy of Title Insurance Number LX-11656815 issued by
DCA Title, as agent, to Lender on December 9, 2016 and December 12, 2016, with
such coverages and subject only to exceptions as permitted by Lender at its sole
and absolute discretion.

3.3Deliver to Lender a certificate or policy for all insurance required, under
the terms hereof and the Loan Documents, to be maintained by Borrowers.

3.4Deliver to Lender evidence reasonably satisfactory to Lender in its sole
discretion that Borrowers’ business operations will at all times comply with all
governmental and quasi-governmental regulations applicable thereto.

3.5Deliver to Lender Certificates of Good Standing for each Borrower issued by
the applicable governmental authorities in the jurisdiction in which said
Borrower is domiciled within thirty (30) days of the Effective Date.

3.6Deliver to Lender any amendments or changes to the following incorporation
documents of each Borrower since the date copies were last provided by Borrowers
to Lender: (a) Certificate and Articles of Organization; (b) Bylaws; (c)
Shareholder, Voting Control or Buy-Sell Agreements; and (d) such other and
further matters or documents as Lender may reasonably require.

3.7No uncured Event of Default hereunder or event which would constitute such an
Event of Default but for the requirement that notice be given or time elapse
shall have occurred and be continuing, and all

 

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representations and warranties made by Borrowers in this Agreement or the Loan
Documents shall continue to be true and correct as of the date of such Advance
and Disbursement.

3.8Provide to Lender such evidence of compliance with all of the provisions of
this Agreement as Lender may reasonably request.

 

3.9Provide Lender such assurances that any other loans or mortgages, rights of
reversion, leases or other encumbrances for any portion of any collateral
pledged by any Borrower to Lender shall be subordinate to the Loans.

3.10Deliver to Lender a FIRREA compliant appraisal of the Mortgaged Property on
an “as if construction completed and stabilized occupancy” basis showing an
appraised value of not less than $7,170,000.00 and as otherwise acceptable to
Lender in Lender’s sole and absolute discretion.

3.11Deliver to Lender an origination fee equal to one-half of one percent
(0.50%) of the Term Loan Amount and any additional fees or costs required by
Lender hereunder.

3.12Deliver to Lender zoning letters issued by applicable governmental
authorities that state the Mortgaged Property complies with its intended use and
will comply with all zoning and use laws, regulations, rules or ordinances.

3.13Deliver to Lender such environmental studies and audits in form and content
acceptable to Lender prepared by an engineer or scientist acceptable to Lender,
showing no substantial environmental hazards on the Mortgaged Property.

3.14Deliver to Lender such other and further documents or provide Lender such
other and further information as Lender may reasonably require.

The making of any Advance or Disbursement prior to the satisfaction of any
requirement hereof shall not be construed as a waiver of such requirement, and
Lender reserves the right to require the satisfaction of any and all such
conditions prior to making any subsequent Advance or Disbursement, which Advance
or Disbursement shall remain at all times subject to the sole and absolute
discretion of Lender

4.Affirmative Covenants. Each Borrower covenants and agrees that hereunder and
thereafter, so long as any portion of the Loan Amounts remain outstanding under
this Agreement, it will:

4.1Payment of Obligations. Evidence payment of and discharge all taxes and other
governmental charges and all contractual obligations calling for the payment of
money before the same shall become overdue, unless and to the extent only that
such payment is being contested in good faith, with adequate reserves as
determined by Lender in its sole and absolute discretion.

4.2Payment of Charges. Evidence payment of all charges required by any local,
state or federal governments for the maintenance and operation of the Mortgaged
Property.

4.3Insurance.  To obtain and maintain at all times (and, from time to time at
the request of Lender, furnish Lender with proof of payment of premiums on or a
certificate of insurance, as requested by Lender): (a) comprehensive general
public liability insurance (including operations, contingent liability,
operations of subcontractors, completed operations and contractual liability
insurance) providing for limits of coverage of not less than $1,000,000.00 per
occurrence and $2,000,000.00 general aggregate with umbrella or excess coverage
of not less than $5,000,000.00 and naming Lender as an additional insured; (b)
workers’ compensation insurance to the extent required by applicable law; and
(c) such other insurance as is normally carried by companies engaged in similar
businesses and owning similar property or as otherwise required by the Loan
Documents or Lender in its reasonable discretion.

 

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The policies of insurance required hereunder shall be in form and content
reasonably satisfactory to Lender and placed with financially sound and
reputable insurers, acceptable to Lender, licensed to transact business in the
State of Minnesota; and such policies of insurance shall contain an agreement of
the insurer to give not less than thirty (30) days’ advance written notice to
Lender in the event of cancellation, termination or amendment of such policy
affecting the coverage thereunder.

4.4Books and Records; Inspection and Examination.  Maintain accurate books and
records in accordance with generally accepted accounting principles (“GAAP”)
consistently applied, as applicable. Upon request and reasonable notice by
Lender, each Borrower must permit any representative of Lender, at any
reasonable time mutually agreeable between said Borrower and Lender (but in no
event more than two (2) business days after the request from Lender) during
business hours, to inspect, audit, examine, and make copies of all corporate and
financial books and records of said Borrower and to inspect any collateral
pledged by any Borrower to Lender.

4.5Notice of Adverse Change. Provide Lender timely notice of any condition or
event which constitutes, or with the running of time and/or the giving of notice
would constitute a default under this Agreement or any of the Loan Documents,
and promptly inform Lender of any material adverse change in the financial
condition of a Borrower.

4.6Additional Assignments and Consents. At any time or times, execute
assignments or supplemental assignments and such other and further instruments
of assurance as Lender may request and deem necessary in order to carry into
effect the full intent and purpose of this Agreement and otherwise to do any and
all things and acts whatsoever that Lender may request as reasonably required in
order to perfect the assignment to Lender of any security granted pursuant to
this Agreement.

4.7Hold Harmless. Hold Lender harmless from, and Lender shall have no liability
or obligation of any kind to any Borrower, creditors of any Borrower or any
third party, in connection with, any defective, improper or inadequate
workmanship performed in or about, or materials supplied to the Mortgaged
Property, or any mechanic’s, supplier’s or materialman’s liens arising as a
result of such defective, improper or inadequate workmanship or materials, and
upon Lender’s request, to replace or cause to be replaced, any such defective,
improper or inadequate workmanship or materials.

4.8Condition. Keep the Mortgaged Property, and all improvements, equipment and
fixtures thereon, in good working order and condition.

4.9Reporting Requirements.

4.9.1Annual Financial Statements. As soon as available, and in any event within
ninety (90) days after the end of each fiscal year, each Borrower shall furnish
to Lender the following: (i) annual financial statements of said Borrower for
the calendar year end, which financial statements must include, but not be
limited to, a balance sheet, a statement of liabilities and shareholder equity,
a statement of income or loss and retained earnings, statement of cash flows,
and a statement of changes in financial position, all with footnotes, if any,
included; and (ii) any other financial statements and information that Lender
reasonably requests. All annual financial statements furnished by Borrowers must
be prepared in reasonable detail and in accordance with GAAP (or tax accounting
reconciled to GAAP) and audited by a reputable accounting firm in form and
substance acceptable to Lender and with such certifications as Lender may
specify. The foregoing financial statements shall have been deemed delivered to
Lender as to a Borrower (and said Borrower shall have complied in all respects
with the requirements of this Section 4.9.1) without any other action required
by said Borrower upon the filing of Borrower’s 10-K each year with the
Securities Exchange Commission.

4.9.2Quarterly Financial Statements. As soon as available, and in any event
within forty-five (45) days after the end of each calendar quarter, and as
otherwise reasonably requested by Lender, each Borrower must furnish to Lender
the following: (i) financial statements of

 

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said Borrower for the fiscal quarter end, which financial statements must
include, but not be limited to, a balance sheet, a statement of income or loss;
and (ii) any other financial statements and information that Lender reasonably
requests. All quarterly financial statements furnished by Borrowers must be
prepared in reasonable detail and in accordance with GAAP (or tax accounting
reconciled to GAAP) and reviewed by a reputable accounting firm in form and
substance acceptable to Lender and with such certifications as Lender may
specify. The foregoing financial statements shall have been deemed delivered to
Lender as to a Borrower (and said Borrower shall have complied in all respects
with the requirements of this Section 4.9.2) without any other action required
by said Borrower upon the filing of Borrower’s 10-Q each quarter with the
Securities Exchange Commission.

4.9.3Delivery of Quarterly Compliance Certificate. Borrowers shall furnish to
Lender at the time it delivers (or is deemed to deliver) each set of financial
statements required by Section 4.9 hereof a Compliance Certificate in
substantially the form of Exhibit A hereto, duly executed by either Borrower’s
Chief Executive Officer, Chief Financial Officer or Chief Accounting Officer,
which shall set forth in reasonable detail the computations necessary to
determine whether Borrowers are in compliance with the financial covenants
contained in Section 4.10 hereof.

4.10Debt Coverage Ratio. Borrowers shall maintain a global minimum Debt Coverage
Ratio of 1.5 to 1.0. For purposes of this section, the Debt Coverage Ratio shall
be the ratio of:  (a) Borrowers’ EBITDA to (b) the aggregate amount of principal
and interest due and payable by Borrowers under the Loans and any other debt
obligations of any Borrower.  The Debt Service Coverage ratio shall each be
calculated quarterly using the preceding twelve (12) months of the Borrowers’
operations utilizing Borrowers’ public financial statements and
Borrower-prepared supplemental schedules.

For purposes of this Agreement, “EBITDA” means, for any period, the sum of the
following determined on a consolidated basis, without duplication, for Borrowers
and their respective subsidiaries in accordance with GAAP (a) consolidated net
income for the most recently completed period, plus (b) the following to the
extent deducted in calculating such consolidated net income (without
duplication): (i) interest expense, (ii) the provision for federal, state, local
and foreign income taxes payable, (iii) depreciation and amortization expense,
and (iv) non-cash charges and losses, including any write-offs or write-downs
and in respect of equity-based compensation and asset impairment.

4.11Deposit Account(s). Except as otherwise permitted by Lender, Borrowers shall
maintain all of their respective deposit account(s) with Lender for all periods
during which any Borrower shall have any outstanding loan obligations to Lender
or shall have the right to draw upon any credit obligations of Lender.

5.Negative Covenants. Each Borrower agrees that, without the prior written
consent of Lender, it will not:

 

5.1grant any security interest in the Mortgaged Property or any part thereof or
create or permit to be created or allow to exist any mortgage, encumbrance or
other lien upon the Mortgaged Property other than the Mortgage;

 

5.2sell or otherwise voluntarily transfer any of its business interests or make
any material change in its capital structure or general business objects or
purposes;

 

5.3enter into any merger, reorganization or consolidation, or sell, lease,
transfer or dispose of all, substantially all, or any material part of its
assets, except in the ordinary course of its business;

 

5.4guaranty, endorse, assume, or otherwise become directly or contingently
liable in connection with any debt, obligation or liability of any other person
or entity, except by the endorsement of negotiable instruments for deposit or
collection or similar transactions in the ordinary course of business;

 

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5.5become or remain obligated for any indebtedness for borrowed money or for any
indebtedness incurred in connection with the acquisition of any property, real
or personal, tangible or intangible, except: (a) indebtedness to Lender; (b)
current trade, utility or non-extraordinary accounts payable arising in the
ordinary course of business; or (c) as permitted with the written consent of
Lender;

 

5.6purchase or otherwise acquire or become obligated for the purchase of all or
substantially all of the assets or business interests of any person, firm or
corporation, or any shares of stock or ownership interest of any corporation,
partnership, limited liability company, trusteeship or association, or in any
other manner effectuate or attempt to effectuate an expansion of present
business by acquisition without the written consent of Lender;

 

5.7declare or issue any dividends or distributions to any shareholders;

 

5.8affirmatively pledge or mortgage any of its assets, whether now owned or
hereafter acquired, or create or permit to exist any lien, security interest or
encumbrance thereon, except to Lender, except as authorized in writing by
Lender; or

 

5.9enter into or be a party to any transaction with any Related Party except in
the ordinary course of and pursuant to the reasonable requirements of such
business and upon fair and reasonable terms that are no less favorable than
would be obtained in a comparable arms-length transaction with a third party
(for purposes of this Agreement, “Related Party” means a party that is any of
the following: (i) an Affiliate of a Borrower; (ii) an individual or entity that
has, directly or indirectly, a ten percent (10%) or more ownership interest in a
Borrower; or (iii) an entity that is owned entirely or in part by a Borrower;
and “Affiliate” means a person or entity who controls, is controlled by or is
under common control with another person or entity).

 

Notwithstanding Sections 5.2 and 5.3, Lender acknowledges that Borrowers intend
to undertake a corporate reorganization pursuant to which the issued and
outstanding capital stock of each Borrower would be transferred to a new
corporate entity (the “Parent”), with each Borrower thereafter constituting a
wholly-owned subsidiary of Parent. Lender will not unreasonably withhold its
approval of such transfers, provided that Borrowers and Parent shall provide
such documentation evidencing such transfers as reasonably requested by Lender
and Parent shall enter into such agreements with Lender as reasonably requested
by Lender such that Parent shall become an obligor under this Agreement and the
Loan Documents that is jointly and severally liable with Borrowers.

 

6.Time of Essence. Time is of the essence in the performance of this Agreement.

7.Assignability. No Borrower shall assign its rights or interest in this
Agreement nor assign its obligations as specified herein without the written
consent of Lender.

8.Representations and Warranties. Borrowers represent and warrant to Lender the
following:

8.1Good Standing. Each Borrower is a corporation, duly incorporated and validly
existing under the laws of the state of its domicile and has the power to enter
into and has authorized execution and delivery of this Agreement and the Loan
Documents.

8.2No Conflict of Law or Agreements. The execution, delivery and performance of
this Agreement and the Loan Documents are within the powers of each Borrower,
have been duly authorized by all necessary action on the part of each Borrower,
and do not violate any provision of law or of the governing documents of a
Borrower or result in the breach of, or constitute a default under, or result in
the creation of any lien, charge or encumbrance upon any property or assets of a
Borrower pursuant to any indenture or loan or credit agreement or other
agreement or instrument to which a Borrower is a party or by which a Borrower or
its property may be bound or affected, except other agreements with Lender.

 

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8.3Financial Statements. Any and all financial statements heretofore delivered
to Lender by Borrowers are true and correct in all respects, and fairly
represent the financial conditions of the subjects thereof as of the respective
dates thereof in all material respects. No materially adverse change has
occurred in the financial conditions reflected therein since the respective
dates thereof and no additional borrowings have been made by any Borrower since
the date thereof other than the borrowing contemplated hereby or approved by
Lender. None of the aforesaid financial statements or any certificate or
statement furnished to Lender by or on behalf of a Borrower in connection with
the transactions contemplated hereby, and none of the representations and
warranties in this Agreement, contains any untrue statement of a material fact
or omits to state a material fact necessary in order to make the statements
contained therein or herein not misleading. To the best of the knowledge of each
Borrower, there is no fact which materially adversely affects or in the future
(so far as a Borrower can now foresee) may materially adversely affect the
business or prospects or condition (financial or other) of a Borrower or its
properties or assets, which has not been set forth herein or in a certificate or
statement furnished to Lender by a Borrower.

8.4Material Misstatements or Omissions. No information, exhibit or report
furnished by a Borrower to Lender in connection with the negotiation of this
Agreement contains any material misstatement of facts or omits to state a
material fact or any fact necessary to make the statements contained therein not
misleading.

8.5Financial Condition. After the closing of the transactions provided for in
this Agreement, Borrowers will be in a financial position to enable them to pay
their debts in the ordinary course of business as they become due. No Borrower
is contemplating either the filing of a petition by it under any state or
federal bankruptcy or insolvency laws or the liquidating of all or a major
portion of its property. No Borrower has any knowledge of any person
contemplating the filing of any such petition against it.

8.6Regulation U. No Borrower is engaged in the business of extending credit for
the purpose of purchasing or carrying margin stock (within the meaning of the
Regulations of the Board of Governors of the Federal Reserve System), and no
part of the proceeds of any advance will be used to purchase or carry any margin
stock or to extend credit to others for the purpose of purchasing or carrying
any margin stock.

8.7Claims. Except as set forth in Schedule 8.7 to this Agreement, no litigation,
tax claims or governmental proceedings are pending or threatened against a
Borrower, and no judgment or order of any court or administrative agency is
outstanding against a Borrower.

8.8Taxes. Borrowers have each respectively filed and will file and cause to be
filed, all tax returns (federal and state) required to be filed and pay all
taxes shown thereon to be due, including interest and penalties, or has provided
adequate reserves for payment thereof.

8.9OFAC Lists. No Related Entity is (and to each Borrower’s knowledge after
diligent inquiry, no other person holding any legal or beneficial interest
whatsoever in a Borrower, directly or indirectly, is) included in, owned by,
controlled by, acting for or on behalf of, providing assistance, support,
sponsorship, or services of any kind to, or otherwise associated with any of the
persons referred to or described in any list of persons, entities, and
governments issued by the Office of Foreign Assets Control of the United States
Department of the Treasury (“OFAC”) pursuant to Executive Order 13224 – Blocking
Property and Prohibiting Transactions with Persons Who Commit, Threaten to
Commit, or Support Terrorism, as amended (“Executive Order 13224”), or any
similar list issued by OFAC or any other department or agency of the United
States of America (collectively, the “OFAC Lists”); and no Related Entity is
controlled by, acting for or on behalf of, providing assistance, support,
sponsorship, or services of any kind to, or otherwise associated with any of the
persons referred to or described in any list of persons, entities, and
governments issued by OFAC pursuant to Executive Order 13224, or any other OFAC
Lists. “Related Entity” as used in this Agreement shall mean each Borrower, each
shareholder of a Borrower and any other Affiliate which directly or indirectly
owns any legal or beneficial interest in a Borrower.

 

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8.10Compliance with Anti-Terrorism Regulations.  No Related Entity will be
included in, owned by, controlled by, act for or on behalf of, provide
assistance, support, sponsorship, or services of any kind to, or otherwise be
associated with any of the persons referred to or described in any list of
persons, entities, and governments issued by OFAC pursuant to Executive Order
13224 or any other OFAC Lists; none of the Related Entities will be controlled
by, act for or on behalf of, provide assistance, support, sponsorship, or
services of any kind to, or otherwise associate with any of the persons referred
to or described in any list of persons, entities, and governments issued by OFAC
pursuant to Executive Order 13224, or any other OFAC Lists; Borrowers will
comply at all times with the requirements of Executive Order 13224; the
International Emergency Economic Powers Act, 50 U.S.C. Section 1701-06; the
United and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001, Pub. L. 107-56; the United Nations
Participation Act, 22 U.S.C. Section 287c; the Antiterrorism and Effective Death
Penalty Act (enacting 8 U.S.C. Section 219, 18 U.S.C. Section 2332d, and 18
U.S.C. Section 2339b); the International Security and Development Cooperation
Act, 22 U.S.C. Section 2349 aa-9; the Terrorism Sanctions Regulations, 31 C.F.R.
Part 595; the Terrorism List Government Sanctions Regulations, 31 C.F.R. Part
596; and the Foreign Terrorist Organizations Sanctions Regulations, 31 C.F.R.
Part 597, and any similar laws or regulations currently in force or hereafter
enacted (collectively, the “Anti-Terrorism Regulations”); and if a Borrower
becomes aware or receives any notice that any Related Entity is named on any of
the OFAC Lists (such occurrence, an “OFAC Violation”), Borrowers will
immediately: (a) give notice to Lender of such OFAC Violation; and (b) comply
with all laws applicable to such OFAC Violation (regardless of whether the party
included on any of the OFAC Lists is located within the jurisdiction of the
United States of America), including without limitation, the Anti-Terrorism
Regulations, and each Borrower hereby authorizes and consents to Lender’s taking
any and all steps Lender deems necessary, in its sole discretion, to comply with
all laws applicable to any such OFAC Violation, including, without limitation,
the requirements of the Anti-Terrorism Regulations (including the freezing
and/or blocking of assets).

8.11Business Purposes. All amounts loaned to Borrowers by Lender pursuant to
this Agreement and the Loan Documents are being loaned for business purposes
only.

8.12Environmental Matters.  No Borrower is in violation of any applicable
federal, state or local law, statute, rule, regulation, ordinance or requirement
relating in any way to any Hazardous Substance or the protection of the
environment.

8.13Compliance with Laws.  Each Borrower’s business operations do not violate
any federal, state, local law or ordinance or any applicable provisions of any
zoning, use, Environmental Laws or building laws, regulations, rules or
ordinances.  Each Borrower shall maintain all permits and licenses necessary to
operate its business.

8.14Reaffirmation of Collateral Assignment.  FDOA reaffirms its obligations
under the Collateral Assignment and acknowledges and agrees that the
“Obligations” as defined therein includes the Loans.

For purposes of this Agreement, “Environmental Laws” and “Hazardous Substance”
shall have the meanings set forth in the Mortgage.

9.Indemnification. Borrowers agree to jointly and severally indemnify Lender and
save it harmless against all loss, liability, expense, or damages including but
not limited to attorneys’ fees, which may arise by reason of a breach by a
Borrower of any warranties, representations or covenants contained in this
Agreement or the Loan Documents. Excluding any amounts of principal, interest
and other fees and costs for which Borrowers may be liable pursuant to the Note,
Borrowers shall not be liable under any indemnification obligations under this
Section 9 for any special, indirect, punitive or consequential damages or lost
profits.

10.Events of Default. Any of the following, after any applicable period to cure,
shall be an Event of Default:

 

9

 

10.1Payments. Borrowers shall fail to pay when due any amount of principal or
interest or other amount payable under the Notes or hereunder, whether any such
indebtedness is now existing or hereafter arises and whether direct or indirect,
due or to become due, absolute or contingent, primary or secondary or joint or
joint and several, and such failure shall continue unremedied for a period of
fifteen (15) days.

10.2Representations and Warranties. Any representation or warranty by a Borrower
under or in connection with this Agreement or any of the Loan Documents shall
prove to have been incorrect in any material respect when made or deemed made.

10.3Failure to Perform Certain Covenants. Except for Sections 10.1 or 10.13 of
this Agreement (for which no cure period shall be available to Borrowers), any
Borrower shall fail to perform or observe any term, covenant or agreement
contained in this Agreement or the Loan Documents and said Borrower shall fail
to cure the same within thirty (30) days of its receipt of written notice
thereof from Lender.

10.4Insolvency. Any Borrower or any subsidiary of a Borrower: (a) shall make a
general assignment for the benefit of creditors; (b) shall voluntarily cease to
conduct its business in the ordinary course; (c) shall commence any insolvency
proceeding with respect to itself; or (d) shall take any action to effectuate or
authorize any of the foregoing.

10.5Involuntary Proceedings. Upon the occurrence of any of the following:  (a)
any involuntary insolvency proceeding is commenced or filed against a Borrower
or; (b) any writ, judgment, warrant of attachment, execution or similar process,
is issued or levied against a substantial part of any Borrower and any such
proceeding or petition shall not be dismissed, or such writ, judgment, warrant
of attachment, execution or similar process shall not be released, vacated or
fully bonded within thirty (30) days after commencement, filing or levy; (c) any
Borrower admits the material allegations of a petition against it in any
insolvency proceeding, or an order for relief (or similar order under non-U.S.
law) is ordered in any insolvency proceeding; or (d) any Borrower acquiesces in
the appointment of a receiver, trustee, custodian, conservator, liquidator,
mortgagee in possession (or agent therefor), or other similar person for itself
or himself or a substantial portion of its or his property or business.

10.6Defaults under other Agreements with Lender. Any Borrower: (a) shall fail to
pay any indebtedness owing under any other agreement with Lender or any of its
subsidiaries or under any note or instrument in favor of Lender or any of its
subsidiaries, when due (whether at scheduled maturity or by required prepayment,
acceleration, demand or otherwise); or (b) shall otherwise be in breach of or
default in any of its obligations under any such agreement, note or instrument,
and such failure shall continue after the applicable grace period, if any,
specified in such agreement, note or instrument.

10.7Judgments. Final judgment(s) for the payment of money shall be rendered
against any Borrower and shall remain undischarged and unsatisfied for a period
of thirty (30) days during which execution shall not be effectively stayed.

10.8Existence. The insolvency, dissolution, liquidation, merger or consolidation
of any Borrower or, except for the sale of any ownership interest of a Borrower
on a public securities exchange, the sale, assignment, conveyance, encumbrance
or transfer of any ownership interest in any Borrower, including any financial
or governance rights associated with any ownership interest of any Borrower,
without the prior written consent of Lender, which consent may be granted or
withheld by Lender at its sole discretion.

10.9Sale of Assets. The sale, lease or other disposition (whether in one or more
transactions) to one or more persons or entities of all or a substantial part of
the assets of any Borrower, including but not limited to the Mortgaged Property.

 

10

 

10.10Tax Liens. The attachment of any tax lien to any property of a Borrower for
any past due tax obligation.

10.11Material Adverse Change. There is a material adverse change in the
condition (financial or otherwise), business or property of any Borrower.

10.12Insecurity. Lender shall in good faith believe that the prospect of due and
punctual payment or performance of the Notes or the due and punctual payment or
performance of any other note, obligation, mortgage, deed of trust, assignment,
guaranty, or other agreement heretofore, herewith or hereafter given to Lender
from any Borrower or acquired by Lender is impaired.

10.13Multiple Occurrences of an Event of Default. An Event of Default shall
occur three (3) or more times in a twelve (12) month calendar year commencing
January 1, regardless of whether or not any Event of Default was cured.

10.14Mortgaged Property. Any of the following shall occur: (a) all or any
portion of the Mortgaged Property, or the legal, equitable or any other interest
herein, shall be sold or otherwise disposed of without the prior written consent
of Lender; (b) title to the Mortgaged Property is not reasonably satisfactory to
Lender; (c) the Mortgaged Property or any improvements thereupon is materially
damaged or destroyed by casualty and the loss, in the reasonable judgment of
Lender, is not adequately covered by insurance actually collected or in the
process of collection; or (d) the Mortgaged Property is abandoned.

10.15Mechanics’ Liens. Any mechanic’s or materialman’s lien is filed against the
Mortgaged Property or any lien, of any nature, is filed against the Mortgaged
Property and is not released, satisfied or discharged or bonded to Lender’s
satisfaction within thirty (30) days.

11.Rights and Remedies. Upon the occurrence of an Event of Default and
expiration of any period allowed by Lender for any Borrower to cure the same,
Lender may, at its option, exercise any and all of the following rights and
remedies (and any other rights and remedies available to it):

11.1Lender may declare immediately due and payable all unpaid principal of and
accrued interest on the Notes, and the same shall thereupon be immediately due
and payable without presentment or other demand, protest, notice of dishonor or
any other notice of any kind, all of which are hereby expressly waived.

11.2Lender may declare all indebtedness of every type or description owed by
Borrowers to Lender to be immediately due and payable, without presentment,
demand or protest, and the same shall thereupon be immediately due and payable.

11.3Lender may offset any deposits of any Borrower held by Lender against sums
due hereunder or against any other indebtedness then owed by any Borrower to
Lender, whether or not then due.

11.4Lender shall have the right, in addition to any other rights provided by
law, to enforce its rights and remedies under any of the Loan Documents, under
any other agreement, and/or granted to Lender by law.

12.Right of Set-Off. To the extent permitted by applicable law, Lender reserves
a right of set-off in all of each Borrower’s accounts with Lender (whether
checking, savings or any other account). This includes all accounts a Borrower
holds jointly. Each Borrower authorizes Lender, to the extent permitted by
applicable law, to charge or set-off all sums owing under the Notes or the Loan
Documents or any other sums owed Lender by any Borrower against any and all such
accounts, and, at Lender’s option, to administratively freeze all such accounts
to allow Lender to protect Lender’s charge and set-off rights provided in this
Agreement or the Loan Documents.

13.Notices. Any notice required or permitted to be given under this Agreement
shall be in writing, given to

 

11

 

Lender or Borrowers, or their respective legal counsel.  Any such notice
required or contemplated hereunder shall be effective:  (a) when delivered
personally; (b) one (1) business day after being deposited with a
nationally-recognized delivery or courier service; or (c) two (2) business days
after being deposited postage pre-paid in the United States Mail, certified or
registered, return receipt requested, in each case to the address of the
respective party specified herein (or to such other address as a party may
designate in the manner set forth herein for the giving of notices).

 

Rejection or other refusal to accept or inability to deliver because of a
changed address of which no notice was given shall be deemed to be receipt of
such communication.

 

Notice shall be sent to:

If to Lender:

Choice Bank

Attn: Bryan Frandrup

2640 Eagan Woods Drive, Suite 100

Eagan, MN 55121

 

If to Borrowers (as applicable):

Famous Dave’s of America, Inc.

MinWood Partners, Inc.

D&D of Minnesota, Inc.

Famous Dave’s RIBS of Maryland, Inc.

Famous Dave’s RIBS, Inc.

Famous Dave’s RIBS-U, Inc.

Lake & Hennepin BBQ and Blues, Inc.

Attn: Jeffery Crivello or Paul Malazita

12701 Whitewater Drive, Suite 190

Minnetonka, MN 55343

14.Fees. Borrowers agree to pay all fees of title, appraisal fees, survey fees,
recording fees, license and permit fees and title insurance and other insurance
premiums, and agree to reimburse Lender upon demand for all reasonable
out-of-pocket expenses actually incurred by Lender in connection with this
Agreement or in connection with the transactions contemplated by this Agreement,
including but not limited to, any and all reasonable legal expenses and
attorneys’ fees sustained by Lender in the exercise of any right or remedy
available to it under this Agreement or the Loan Documents or otherwise by law
or equity and all reasonable fees and disbursements of counsel for Lender for
the services performed by such counsel in connection with the preparation of
this Agreement and the documents and instruments contemplated hereby and any
modifications or amendments of the same.

15.Headings. The headings used in this Agreement are for convenience only and do
not define, limit or construe the contents of this Agreement.

16.Binding on Successors and Assigns. Subject to the limitations contained in
this Agreement, this Agreement and the Loan Documents shall be binding upon and
inure to the benefit of the successors and assigns of the parties hereto.

 

17.Survival of Warranties and Agreements. All of the representations, warranties
and agreements made herein, in the application for the Loans, any other
instrument required under this Agreement or in connection with the Loans, shall
survive the closing of the Loans and inure to the benefit of Lender, its
successor and assigns.

 

18.Consent to Loan Participation. Each Borrower agrees and consents to Lender’s
sale or transfer, whether now or later, of one or more participation interests
in the Loans to one or more purchasers, whether related or unrelated to Lender.
Lender may provide, without any limitation whatsoever, to any one or more
purchasers, or potential purchasers, any information or knowledge Lender may
have about any Borrower or about any other matter relating to the Loans, and
each Borrower hereby waives any rights to privacy they may have with respect to
such matters. Borrowers additionally waive any and all notices of sale of
participation interests, as well as all notices of any repurchase of such
participation interests. Borrowers also agree that the purchasers of any such
participation interests will be considered as the absolute owners of such
interests in the Loans and will have all the rights granted under the
participation agreement or agreements governing the sale of such participation
interests. Borrowers further waive all

 

12

 

rights of off-set or counterclaim that they may have now or later against Lender
or against any purchaser of such a participation interest and unconditionally
agree that either Lender or such purchaser may enforce a Borrower’s obligation
under the Loans irrespective of the failure or insolvency of any Lender of any
interests in the Loans. Borrowers further agree that the purchaser of any such
participation interest may enforce its interest irrespective of any personal
claims or defenses that any Borrower may have against Lender.

19.Waiver of Right to a Trial by Jury. TO THE MAXIMUM EXTENT PERMITTED BY
APPLICABLE LAW, ALL PARTIES TO THIS AGREEMENT HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY, AND AFTER AN OPPORTUNITY TO CONSULT WITH LEGAL COUNSEL:

19.1WAIVE ANY AND ALL RIGHTS TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING IN
CONNECTION WITH THIS AGREEMENT, THE LOANS, THE LOAN DOCUMENTS AND ALL MATTERS
CONTEMPLATED HEREBY, INCLUDING BUT NOT LIMITED TO THE AMOUNT, REASONABLENESS AND
ENTITLEMENT TO ATTORNEYS’ FEES; AND

19.2AGREE NOT TO SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN
WHICH A JURY TRIAL CANNOT BE, OR HAS NOT BEEN, WAIVED.

EACH PARTY TO THIS AGREEMENT CERTIFIES THAT NEITHER LENDER NOR ANY OF ITS
REPRESENTATIVES, AGENTS OR COUNSEL HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
LENDER WOULD NOT IN THE EVENT OF ANY SUCH PROCEEDING SEEK TO ENFORCE THIS WAIVER
OF RIGHT TO TRIAL BY JURY.

20.Jurisdiction; Governing Law.  Borrowers consent to the jurisdiction of the
state and federal courts located in Minneapolis, Minnesota in connection with
any controversy relating in any way to this Agreement or to any transaction or
matter relating to this Agreement, waive any argument that venue in such forums
is not convenient. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Minnesota (excluding conflict
of law rules).

 

21.No Waiver. Lender shall not be deemed by any act of omission or commission to
have waived any of its rights or remedies hereunder unless such waiver is in
writing and signed by Lender, and then only to the extent specifically set forth
in the writing. A waiver with reference to one event shall not be construed as
continuing or as a bar to or waiver of any right or remedy as to a subsequent
event.

 

22.Entire Agreement. This Agreement and the Loan Documents supersede and replace
any previous letter or communication from Lender which summarizes the terms of
the transactions described herein and any previous loan agreement or credit
agreement for such transactions, and any such previous letters, loan agreements
and credit agreements are terminated. No provision of this Agreement can be
amended, modified, waived or terminated, except by a writing executed by
Borrowers and Lender.

 

23.Errors and Omissions. Borrowers agree to fully cooperate with Lender, correct
and adjust for any clerical errors contained in any or all loan closing
documentation, including but not limited to the Loan Documents.

 

24.Multiple Borrowers. This Agreement has been executed by multiple obligors who
are referred to herein individually and collectively and interchangeably as
“Borrower” or “Borrowers”.  Unless specifically stated to the contrary, the
words “Borrower” or “Borrowers” as used in this Agreement, including without
limitation all representations, warranties and covenants, shall include all
Borrowers, jointly and severally.  Borrowers understand and agree that, with or
without notice to any Borrower, Lender may:

 

24.1make one or more additional secured or unsecured loans or otherwise extend
additional credit with respect to any other Borrower;

 

24.2with respect to any other Borrower, alter, compromise, renew, extend,
accelerate or otherwise change one or more times the time for payment or other
terms of any indebtedness, including increases or decreases of the rate of
interest on any indebtedness;

 

 

13

 

24.3exchange, enforce, waive, subordinate, fail or decide not to perfect and
release any security, with or without the substitution of new collateral;

 

24.4release, substitute, agree not to sue, or deal with any one or more of
Borrowers or any other Borrower’s sureties, endorsers or other guarantors on any
terms or in any manner Lender may choose;

 

24.5determine how, when and what application of payments and credits shall be
made on any indebtedness;

 

24.6apply such security and direct the order or manner of sale of any
collateral, including without limitation, any non-judicial sale permitted by the
terms of the controlling security agreement or deed of trust, as Lender, in its
sole and absolute discretion, may determine;

 

24.7exercise or refrain from exercising any rights against any Borrower or
others or otherwise act or refrain from acting;

 

24.8settle or compromise any indebtedness; and

 

24.9subordinate the payment of all or any part of any of Borrowers’ indebtedness
to Lender to the payment of any liabilities which may be due Lender or others.

 

25.Counterparts.  This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original, but all of which when taken together
shall constitute but one and the same instrument. Executed copies of the
signature pages of this Agreement sent by facsimile or transmitted
electronically in either Tagged Image File Format (“TIFF”) or Portable Document
Format (“PDF”) shall be treated as originals, fully binding and with full legal
force and effect, and the parties waive any rights they may have to object to
such treatment.  Any party delivering an executed counterpart of this Agreement
by facsimile, TIFF or PDF also shall deliver a manually executed counterpart of
this Agreement, but the failure to deliver a manually executed counterpart
should not affect the validity, enforceability, and binding effect of this
Agreement. The pages of any counterpart of this Agreement containing any party’s
signature or the acknowledgement of such party’s signature hereto may be
detached therefrom without impairing the effect of the signature or
acknowledgement, provided such pages are attached to any other counterpart
identical thereto except having additional pages containing the signatures or
acknowledgements thereof of other parties.

 

26.Partial Release of Mortgaged Property.  Provided no uncured Event of Default
then exists, Lender will release from the Mortgage that portion of the Mortgaged
Property referenced as Parcel 4 therein and generally known as 3211 Northdale
Boulevard NW, Coon Rapids, Minnesota, upon a payment by Borrowers to Lender of
principal under the Term Loan in an amount necessary to reduce the outstanding
Principal Balance (as defined in the Term Note) thereof to an amount less than
or equal to $22,000,000.00, at which time the Term Loan Amount shall be
permanently reduced to $22,000,000.00.

 

 

[This space intentionally left blank; signature pages follow.]

 

 

 

 

 

14

 

Lender:  

CHOICE FINANCIAL GROUP,

a North Dakota banking corporation doing business as Choice Bank

 

 

/s/ Bryan P. Frandrup____________________

By:  Bryan P. Frandrup

Its:  Vice President

 

 

 

 

[Lender Signature Page to Loan Agreement dated June 20, 2019, entered into by
and between Choice Financial Group, Famous Dave’s of America, Inc., MinWood
Partners, Inc., D&D of Minnesota, Inc., Famous Dave’s RIBS of Maryland, Inc.,
Famous Dave’s RIBS, Inc., Famous Dave’s RIBS-U, Inc., and Lake & Hennepin BBQ &
Blues, Inc.]

 

 

 

 

15

 

EACH BORROWER REPRESENTS AND WARRANTS TO LENDER AND AGREES THAT EACH HAS READ
THIS ENTIRE AGREEMENT AND UNDERSTANDS ALL OF THE PROVISIONS OF THIS AGREEMENT.

 

Borrowers:

FAMOUS DAVE’S OF AMERICA, INC.,

a Minnesota corporation

 

_/s/ Jeffery Crivello______________________

By:  Jeffery Crivello

Its:  Chief Executive Officer

 

MINWOOD PARTNERS, INC.,

a Delaware corporation

 

_/s/ Jeffery Crivello______________________

By:  Jeffery Crivello

Its:  Chief Executive Officer

 

D&D OF MINNESOTA, INC.,

a Minnesota corporation

 

_/s/ Jeffery Crivello______________________

By:  Jeffery Crivello

Its:  Chief Executive Officer

 

FAMOUS DAVE’S RIBS OF MARYLAND, INC., a Minnesota corporation

 

_/s/ Jeffery Crivello______________________

By:  Jeffery Crivello

Its:  Chief Executive Officer

 

FAMOUS DAVE’S RIBS, INC.,

a Minnesota corporation

 

_/s/ Jeffery Crivello______________________

By:  Jeffery Crivello

Its:  Chief Executive Officer

 

FAMOUS DAVE’S RIBS-U, INC.,

a Minnesota corporation

 

_/s/ Jeffery Crivello______________________

By:  Jeffery Crivello

Its:  Chief Executive Officer

 

LAKE & HENNEPIN BBQ AND BLUES, INC.,

a Minnesota corporation

 

_/s/ Jeffery Crivello______________________

By:  Jeffery Crivello

Its:  Chief Executive Officer

 

[Borrower Signature Pages to Loan Agreement dated June 20, 2019, entered into by
and between Choice Financial Group, Famous Dave’s of America, Inc., MinWood
Partners, Inc., D&D of Minnesota, Inc., Famous Dave’s RIBS of Maryland, Inc.,
Famous Dave’s RIBS, Inc., Famous Dave’s RIBS-U, Inc., and Lake & Hennepin BBQ
and Blues, Inc.]

 

 

16

 

EXHIBIT A

COMPLIANCE CERTIFICATE

(Form)

 

Pursuant to Section 4.9 of the Loan Agreement dated as of June 20, 2019 (the
terms defined therein being used herein as therein defined and terms used herein
and not otherwise defined therein being used herein as defined in the Loan
Agreement) between CHOICE FINANCIAL GROUP, a North Dakota banking corporation
(“Lender”), and FAMOUS DAVE’S OF AMERICA, INC., a Minnesota corporation, MINWOOD
PARTNERS, INC., a Delaware corporation, D&D OF MINNESOTA, INC., a Minnesota
corporation, FAMOUS DAVE’S RIBS OF MARYLAND, INC., a Minnesota corporation,
FAMOUS DAVE’S RIBS, INC., a Minnesota corporation, FAMOUS DAVE’S RIBS-U, INC., a
Minnesota corporation, LAKE & HENNEPIN BBQ AND BLUES, INC., a Minnesota
corporation (each a “Borrower” or collectively, “Borrowers”), Borrowers hereby
certify to Lender as follows:

 

1.The financial statements of Borrowers attached hereto for the period ending
___________, 20___, are maintained on a consolidated and consolidating reporting
basis and are complete and correct in all material respects and fairly present
the financial condition of Borrowers as of the date of said financial statements
and results of their respective business operations for the period covered
thereby, and are prepared in reasonable detail and in accordance with GAAP (or
tax accounting reconciled to GAAP).

 

2.As of ______________, 20___ (the “Reporting Date”), Borrowers are in
compliance with Section 4.10 of the Loan Agreement. The calculations made to
determine compliance with such provision were as follows:

 

 

 

DEBT SERVICE COVERAGE RATIO:

The Ratio of:

On a consolidated basis:

 

net income (net loss)

$_______________

interest expense

+_______________

income tax expense

+_______________

depreciation and amortization expense

+_______________

non-cash charges and losses, including any write-offs or write-downs and in
respect of equity-based compensation and asset impairment

+_______________

Subtotal

$_______________

To

the aggregate amount of principal and interest due and payable by Borrowers
under the Loans and any other loans

$_______________

Actual Ratio

________________

Minimum Required per Covenant This Period

1.50

 

 

Date:  _____________, 20___.

 

[This space intentionally left blank; signature pages follow.

A-1

 

 

Borrowers:

FAMOUS DAVE’S OF AMERICA, INC.,

a Minnesota corporation

 

_/s/ Jeffery Crivello______________________

By:  Jeffery Crivello

Its:  Chief Executive Officer

 

MINWOOD PARTNERS, INC.,

a Delaware corporation

 

_/s/ Jeffery Crivello______________________

By:  Jeffery Crivello

Its:  Chief Executive Officer

 

D&D OF MINNESOTA, INC.,

a Minnesota corporation

 

_/s/ Jeffery Crivello______________________

By:  Jeffery Crivello

Its:  Chief Executive Officer

 

FAMOUS DAVE’S RIBS OF MARYLAND, INC., a Minnesota corporation

 

_/s/ Jeffery Crivello______________________

By:  Jeffery Crivello

Its:  Chief Executive Officer

 

FAMOUS DAVE’S RIBS, INC.,

a Minnesota corporation

 

_/s/ Jeffery Crivello______________________

By:  Jeffery Crivello

Its:  Chief Executive Officer

 

FAMOUS DAVE’S RIBS-U, INC.,

a Minnesota corporation

 

_/s/ Jeffery Crivello______________________

By:  Jeffery Crivello

Its:  Chief Executive Officer

 

LAKE & HENNEPIN BBQ AND BLUES, INC.,

a Minnesota corporation

 

_/s/ Jeffery Crivello______________________

By:  Jeffery Crivello

Its:  Chief Executive Officer

 

 

[Borrower Signature Pages to Compliance Certificate dated __________, 20____,
submitted to Choice Financial Group by Famous Dave’s of America, Inc., MinWood
Partners, Inc., D&D of Minnesota, Inc., Famous Dave’s RIBS of Maryland, Inc.,
Famous Dave’s RIBS, Inc., Famous Dave’s RIBS -U, Inc., and Lake & Hennepin BBQ
and Blues, Inc.]

 

 

A-2