<PAGE>

                                                                     Exhibit 4.8

                                 FIFTH AMENDMENT

            FIFTH AMENDMENT, dated as of August 16, 2000 (this "Amendment"), to
the Credit Agreement, dated as of November 19, 1997 (as amended, supplemented or
otherwise modified, the "Credit Agreement"), among FRIENDLY ICE CREAM
CORPORATION, a Massachusetts corporation (the "Borrower"), the several banks and
other financial institutions or entities parties thereto (the "Lenders"), and
SOCIETE GENERALE, as administrative agent (in such capacity, the "Administrative
Agent").

                              W I T N E S S E T H:

            WHEREAS, pursuant to the Credit Agreement, the Lenders have agreed
to make, and have made, extensions of credit to the Borrower; and

            WHEREAS, the Borrower has requested, and upon this Amendment
becoming effective, the Lenders will have agreed, that certain provisions of the
Credit Agreement be amended in the manner provided for in this Amendment;

            NOW, THEREFORE, in consideration of the premises and the agreements
hereinafter set forth, the parties hereto hereby agree as follows:

            SECTION 1. DEFINITIONS. Unless otherwise defined herein, terms
defined in the Credit Agreement and used herein shall have the meanings given to
them in the Credit Agreement.

            SECTION 2. AMENDMENTS TO SECTION 1.1 OF CREDIT AGREEMENT. Section
1.1 of the Credit Agreement is hereby amended by deleting therefrom the
definitions of the following terms in their respective entireties and
substituting in lieu thereof the following definitions:

            "'Asset Sale': any Disposition of Property or series of related
      Dispositions of Property to the same purchaser or group of related
      purchasers (excluding any such Disposition permitted by clause (a), (b),
      (c), (d) or (g) of Section 7.5) which yields gross proceeds to the
      Borrower or any of its Subsidiaries (valued at the initial principal
      amount thereof in the case of non-cash proceeds consisting of notes or
      other debt securities and valued at fair market value in the case of other
      non-cash proceeds) in excess of $100,000."
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                                                                               2


            "'Net Cash Proceeds': (a) in connection with any Asset Sale or any
      Recovery Event, the proceeds thereof in the form of cash and Cash
      Equivalents (including any such proceeds received by way of deferred
      payment of principal pursuant to a note or installment receivable or
      purchase price adjustment receivable or otherwise, but only as and when
      received) of such Asset Sale or Recovery Event, net of (i) attorneys'
      fees, accountants' fees, investment banking fees, amounts required to be
      applied to the repayment of Indebtedness secured by a Lien expressly
      permitted hereunder on any asset which is the subject of such Asset Sale
      or Recovery Event (other than any Lien pursuant to a Security Document)
      and other similar customary fees and expenses actually incurred in
      connection therewith, (ii) taxes paid or reasonably estimated to be
      payable as a result thereof (after taking into account any available tax
      credits or deductions and any tax sharing arrangements), (iii) appropriate
      amounts to be provided by the Borrower or any Subsidiary, as the case may
      be, as a reserve, in accordance with GAAP, against any contingent
      liabilities directly associated with such Asset Sale and retained by the
      Borrower or any Subsidiary, as the case may be, after such Asset Sale,
      including liabilities related to environmental matters and liabilities
      under any indemnification obligations associated with such Asset Sale
      (provided that, if and to the extent that such reserves are no longer
      required to be maintained in accordance with GAAP, such amounts shall
      constitute Net Cash Proceeds) and (iv) in the case of Asset Sales
      expressly permitted hereunder consisting of the sales of the 150
      restaurant properties listed on Schedule A to the letter dated August 16,
      2000 from the Borrower to the Agent, an aggregate amount in respect of all
      such Asset Sales of up to $5,500,000 of rental expenses, demarking
      expenses, lease termination expenses and employee severance and other
      similar employment termination expenses, in each case, to the extent
      actually incurred in connection with the closure of stores located on such
      properties and paid by the Borrower or any of its Subsidiaries in cash and
      (b) in connection with any issuance or sale of equity securities or debt
      securities or instruments or the incurrence of loans, the cash proceeds
      received from such issuance or incurrence, net of attorneys' fees,
      investment banking fees, accountants' fees, underwriting discounts and
      commissions and other customary fees and expenses actually incurred in
      connection therewith."

            SECTION 3. CONDITIONS TO EFFECTIVENESS. This Amendment shall become
effective as of the date set forth above (the "Amendment Effective Date") on the
date on which (a) the Borrower and the Required Lenders shall have executed and
delivered to the Administrative Agent this Amendment and (b) each Guarantor
shall have executed the Acknowledgment and Consent in the form annexed hereto.

            SECTION 4. REPRESENTATIONS AND WARRANTIES. In order to induce the
Administrative Agent and the Lenders to enter into this Amendment, the Borrower
hereby represents and warrants to the Administrative Agent and the Lenders that
the representations and warranties made by the Loan Parties in the Loan
Documents are true and correct in all material respects on and as of the
Amendment Effective Date, before and after giving effect to the effectiveness of
this Amendment, as if made on and as of the Amendment Effective Date, except to
the extent such representations and warranties expressly relate to a specific
earlier date, in which case such representations and warranties were true and
correct as of such earlier date.
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            SECTION 5. PAYMENT OF EXPENSES. The Borrower agrees to pay or
reimburse the Administrative Agent for all of its reasonable out-of-pocket costs
and expenses incurred in connection with this Amendment and any other documents
prepared in connection herewith and the transactions contemplated hereby,
including, without limitation, the reasonable fees and disbursements of counsel
to the Administrative Agent.

            SECTION 6. REFERENCE TO AND EFFECT ON THE LOAN DOCUMENTS. On and
after the Amendment Effective Date, each reference in the Credit Agreement to
"this Agreement", "hereunder", "hereof" or words of like import referring to the
Credit Agreement, and each reference in the other Loan Documents to "the Credit
Agreement", "thereunder", "thereof" or words of like import referring to the
Credit Agreement, shall mean and be a reference to the Credit Agreement as
amended hereby. The execution, delivery and effectiveness of this Amendment
shall not, except as expressly provided herein, operate as a waiver of any
right, power or remedy of any Lender or the Administrative Agent under any of
the Loan Documents. Except as expressly amended herein, all of the provisions of
the Credit Agreement and the other Loan Documents are and shall remain in full
force and effect in accordance with the terms thereof and are hereby in all
respects ratified and confirmed.

            SECTION 7. COUNTERPARTS. This Amendment may be executed by one or
more of the parties to this Amendment on any number of separate counterparts,
and all of said counterparts taken together shall be deemed to constitute one
and the same instrument. Delivery of an executed signature page of this
Amendment by facsimile transmission shall be effective as delivery of a manually
executed counterpart hereof. A set of the copies of this Amendment signed by all
the parties shall be lodged with the Borrower and the Administrative Agent.

            SECTION 8. GOVERNING LAW. This Amendment and the rights and
obligations of the parties hereto shall be governed by, and construed and
interpreted in accordance with, the law of the State of New York.
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            IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed and delivered by their proper and duly authorized officers as
of the day and year first above written.

                                    FRIENDLY ICE CREAM CORPORATION


                                    By: ______________________________________
                                        Title:


                                    SOCIETE GENERALE


                                    By: ______________________________________
                                        Title:


                                    TRANSAMERICA BUSINESS CREDIT
                                      CORPORATION


                                    By: ______________________________________
                                        Title:


                                    BLACK DIAMOND INTERNATIONAL
                                      FUNDING, LTD.


                                    By: ______________________________________
                                        Title:


                                    BLACK DIAMOND CLO, 1998-I LTD.


                                    By: ______________________________________
                                        Title:
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                                                                               5


                                    BLACK DIAMOND CLO, 2000-I LTD.


                                    By: ______________________________________
                                        Title:


                                    FLEET NATIONAL BANK


                                    By: ______________________________________
                                        Title:


                                    GENERAL ELECTRIC CAPITAL
                                      CORPORATION


                                    By: ______________________________________
                                        Title:


                                    FIRST SOURCE FINANCIAL LLP

                                    By:  First Source Financial, Inc.,
                                          its Agent/Manager


                                    By: ______________________________________
                                        Title:


                                    BANK OF AMERICA, N.A.


                                    By: ______________________________________
                                        Title:
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                                                                               6


                                    PAMCO CAYMAN LTD.

                                    By:   Highland Capital Management, L.P.,
                                          as Collateral Manager


                                    By: ______________________________________
                                        Title:


                                    PAM CAPITAL FUNDING, L.P.

                                    By:   Highland Capital Management, L.P.,
                                          as Collateral Manager


                                    By: ______________________________________
                                        Title:


                                    SENIOR DEBT PORTFOLIO

                                    By:   Boston Management and Research, as
                                          Investment Advisor


                                    By: ______________________________________
                                        Title:


                                    FIRST UNION NATIONAL BANK


                                    By: ______________________________________
                                        Title:


                                    FOOTHILL INCOME TRUST, L.P.

                                    By:   FIT GP LLC, its General Partner


                                    By: ______________________________________
                                        Title:
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                                    LONG LANE MASTER TRUST IV


                                    By: ______________________________________
                                        Title:
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                           ACKNOWLEDGMENT AND CONSENT

            Each of the undersigned corporations as guarantors under the
Guarantee and Collateral Agreement, dated as of November 19, 1997, made by the
undersigned corporations in favor of the Administrative Agent, for the benefit
of the Lenders, hereby (a) consents to the transactions contemplated by this
Amendment and (b) acknowledges and agrees that the guarantees (and grants of
collateral security therefor) contained in such Guarantee and Collateral
Agreement are, and shall remain, in full force and effect after giving effect to
this Amendment and all prior modifications to the Credit Agreement.



                                    FRIENDLY'S RESTAURANTS FRANCHISE,
                                      INC.


                                    By: ______________________________________
                                        Title:


                                    FRIENDLY'S INTERNATIONAL, INC.


                                    By: ______________________________________
                                        Title: