Document:

<PAGE>

                                                                 EXHIBIT 10.1(c)

                 SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT

                                                              As of May 31, 2002

         THIS SECOND AMENDMENT TO THE LOAN AND SECURITY AGREEMENT dated as of
October 1, 2001 (the "Second Amendment") is entered into as of May 31, 2002 by
and among Samuels Jewelers, Inc. as Borrower (the "Borrower"), the lenders party
thereto (the "Lenders") and DDJ Capital Management LLC as agent for the Lenders
(the "Agent"). All capitalized terms used in this Amendment shall have the
meanings given to them in the Loan and Security Agreement (as defined below)
unless specifically defined herein.

         WHEREAS, Borrower, Lenders and Agent are parties to that certain Loan
and Security Agreement, dated as of October 1, 2001, as amended pursuant to the
First Amendment dated as of November 12, 2001 (the "Loan and Security
Agreement"), pursuant to which Lenders have made certain credit available to the
Borrower and to secure the obligations outstanding under the Loan Agreement and
the documents and instruments executed in connection therewith (collectively,
the "Loan Documents");

         WHEREAS, pursuant to the Loan and Security Agreement, dated as of
October 1, 2001, the Lenders agreed to commit an aggregate principal amount of
$20,000,000 to the Borrower;

         WHEREAS, Borrower, Lenders and Agent are also parties to that certain
Loan Agreement dated as of April 30, 2001, as amended and modified from time to
time (the "Subordinated Loan Agreement"), pursuant to which Lenders have made
certain credit available to and on behalf of Borrower;

         WHEREAS, Lenders executed that certain Intercreditor and Subordination
Agreement, dated as of October 1, 2001 (the "Subordination Agreement"), whereby
Lenders agreed that the obligations incurred pursuant to the Subordinated Loan
Agreement are subordinate in right of payment to the prior payment in full of
all of the obligations incurred pursuant to the Loan and Security Agreement;

         WHEREAS, on or about November 12, 2001, Borrower entered into supply
agreements (the "Supply Agreements") with certain suppliers of inventory and
their affiliates (the "Suppliers") and in consideration for the Supply
Agreements, Borrower granted the Suppliers a security interest in substantially
all of the assets of Borrower;

         WHEREAS, the Suppliers and Lenders entered into an Intercreditor and
Subordination Agreement dated as of November 12, 2001, which governs the
priorities of Lenders and the Suppliers;

         WHEREAS, the Borrower has requested certain modifications to the terms
of the Loan Documents, and the Lenders have agreed to modify certain terms under
which the Lenders may

<PAGE>

advance the funds committed to the Borrower; provided, however, that this
amendment shall in no way be construed to increase the $20,000,000 commitment
made by the Lenders.

         NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereby amend and modify the Loan and Security
Agreement as follows:

         1.  AMENDMENTS

         1.1 The following definition of "Capital Expenditures" shall be added
to Section 1 of the Loan and Security Agreement:

             "Capital Expenditure" means, for any period, the aggregate of all
             expenditures of Borrower made during such period which in
             conformity with GAAP, are required to be included in or reflected
             by the purchase of property, plant or equipment or similar fixed
             asset reflected on the statement of cash flow of the Borrower.

         1.2 The following definition of "Obligations" shall replace the
definition of such term as used in the Loan and Security Agreement:

             "Obligations" means all loans, Advances, Overadvances, debts,
             principal, interest (including any interest that, but for the
             provisions of the Bankruptcy Code, would have accrued), premiums,
             liabilities (including all amounts charged to Borrower's Loan
             Account pursuant hereto), obligations, fees, charges, costs, or
             Lender Group Expenses (including any fees or expenses that, but for
             the provisions of the Bankruptcy Code, would have accrued), lease
             payments, guaranties, covenants, and duties owing by Borrower to
             the Lender Group of any kind and description (pursuant to or
             evidenced by the Loan Documents irrespective of whether for the
             payment of money), whether direct or indirect, absolute or
             contingent, due or to become due, now existing or hereafter
             arising, and further including all interest not paid when due and
             all Lender Group Expenses that Borrower is required to pay or
             reimburse by the Loan Documents, by law, or otherwise.

         1.3 Section 2.1(e) of the Loan and Security Agreement is hereby deleted
in its entirety and replaced with the following:

             (e) Notation. The Agent shall record on its books the principal
             amount of the Advances and Overadvances (if any) owing to each
             Lender and the interests therein of each Lender, from time to time.
             In addition, each Lender is authorized, at such Lender's option, to
             note the date and amount of each payment or prepayment of principal
             of such Lender's Advances and Overadvances (if any) in its books
             and records, including computer records, such books and records
             constituting rebuttably presumptive evidence, absent

                                       2
<PAGE>

             manifest error, of the accuracy of the information contained
             therein.

         1.4 Section 2.2(b) of the Loan and Security Agreement is hereby deleted
in its entirety and replaced with the following:

             (b) Apportionment and Application of Payments. Aggregate principal
             and interest payments shall be apportioned ratably among the
             Lenders (according to the unpaid principal balance of the Advances
             and Overadvances (if any) held by each Lender) and payments of the
             fees (other than fees designated for Agent's separate account)
             shall, as applicable, be apportioned ratably among the Lenders. All
             payments shall be remitted to Agent and all such payments not
             relating to principal or interest on specific Advances (or
             Overadvances, if any) or not constituting payment of specific fees
             and all proceeds of collateral received by Agent, shall be applied,
             first, to pay any Overadvances outstanding (including interest
             accrued thereon); second, to pay any fees or expense reimbursements
             then due to Agent from Borrower; third, to pay any fees or expense
             reimbursements then due to the Lenders from Borrower; fourth, to
             pay interest due in respect of all Advances; fifth, ratably to pay
             principal of Advances; and sixth ratably to pay any other
             Obligations due to Agent or any Lender by Borrower. Agent shall
             promptly distribute to each Lender, pursuant to the applicable wire
             transfer instructions received from each Lender in writing, such
             funds as it may be entitled to receive.

         1.5 Section 2.3 of the Loan and Security Agreement is hereby deleted in
its entirety and replaced with the following:

             2.3 OVERADVANCES.

             (a) If, at any time or for any reason, the amount of Obligations
             owed by Borrower to the Lender Group pursuant to Sections 2.1 and
             2.3 is greater than either the Dollar or percentage limitations set
             forth in Section 2.1(a), Borrower shall, upon request of Agent, pay
             to Agent no later than the third Business Day following such
             request, in cash, the amount of such excess (the "Overage"), to be
             used by Agent to reduce the Obligations. The Borrower shall
             promptly notify Agent in the event of any increase in the Overage
             and shall, upon request of Agent, promptly provide Agent with a
             calculation of the Overage. For avoidance of doubt, Overage is not
             an Overadvance.

             (b) The Lenders may make additional Advances to Borrower in excess
             of the Borrower's Availability (each additional advance made by the
             Lenders pursuant to this Section 2.3, is referred to as

                                       3
<PAGE>
             an "Overadvance"); provided that (i) the amount the Overage
             (including the requested Overadvance) does not exceed $7,000,000
             and (ii) the aggregate amount of the Revolving Facility Usage and
             all Overadvances (including the requested Overadvance) do not
             exceed the Maximum Amount. Nothing herein shall create an
             obligation on the Lenders to make an Overadvance and each such
             Overadvance made by the Lenders shall be in their sole and absolute
             discretion.

             (c) Any Overadvance outstanding shall be repaid to the Lenders upon
             three (3) Business Days notice from the Agent to the Borrower that
             such Overadvance must be repaid to reduce the Obligations.

             (d) Interest on any Overadvance shall bear interest at a per annum
             rate of 12.0%; provided that upon the occurrence and during the
             continuation of an Event of Default, any Overadvance outstanding
             shall bear interest at a per annum rate of 15%.

         1.6 Section 2.8 of the Loan and Security Agreement is hereby deleted in
its entirety and replaced with the following:

             2.8 MAINTENANCES OF LOAN ACCOUNT; STATEMENTS OF OBLIGATIONS. Agent
             shall maintain an account on its books in the name of Borrower (the
             "Loan Account") on which Borrower will be charged with all Advances
             and Overadvances (if any) made by the Lender Group to Borrower or
             for Borrower's account, including, accrued interest, Lender Group
             Expenses, and any other payment Obligations of Borrower. In
             accordance with Section 2.5, the Loan Account will be credited with
             all payments received by Agent from Borrower or for Borrower's
             account. Agent shall render statements regarding the Loan Account
             to Borrower, including principal, interest, fees, and including an
             itemization of all charges and expenses constituting the Lender
             Group Expenses owing and of all expenses, charges, and costs
             provided for in Section 2.9(c) and attaching detailed invoices in
             respect of any such material charge, expense, or cost not otherwise
             set forth in detail on such statement, and such statements shall be
             conclusively presumed to be correct and accurate and constitute an
             account stated between Borrower and the Lender Group unless, within
             30 days after receipt thereof by Borrower, Borrower shall deliver
             to Agent written objection thereto describing the error or errors
             contained in any such statements.

         1.7 Section 3.3 of the Loan and Security Agreement is hereby deleted in
its entirety and replaced with the following:

                                       4
<PAGE>

             TERM. This Agreement shall terminate on June 30, 2003 (the
             "Termination Date").

         1.8 Section 7.19 of the Loan and Security Agreement is hereby deleted
it its entirety and replaced with the following:

             7.19. FINANCIAL COVENANTS. Tangible Net Worth: On the dates set
             forth below, the Borrower shall have Tangible Net Worth equal to or
             greater than the amount set forth in the corresponding column of
             such date:

<Table>
<Caption>
                      ===================================================
                            Testing Date    Minimum Tangible Net Worth
                      ===================================================
<S>                                         <C>
                              09/30/02                  $ 6,500,000
                      ---------------------------------------------------
                              12/31/02                  $11,000,000
                      ---------------------------------------------------
                              02/28/03                  $10,000,000
                      ---------------------------------------------------
                              05/31/03                  $ 8,000,000
                      ---------------------------------------------------
</Table>

         1.9  Section 7.20 of the Loan and Security Agreement is hereby deleted
in its entirety and replaced with the following:

              7.20. CAPITAL EXPENDITURES. The Borrower shall not make Capital
              Expenditures greater than $1.1 million in the aggregate for the
              period beginning May 31, 2002 and ending May 31, 2003.

         1.10 Section 7.21 of the Loan and Security Agreement is hereby deleted
in its entirety and replaced with the following:

              7.21. MINIMUM EBITDA. The Borrower shall not permit EBITDA for
              each of the periods ending on the dates set forth below to be less
              than the amount set forth for such period.

<Table>
<Caption>
                      ====================================================
                            Period Ended                Minimum EBITDA
                      ====================================================
<S>                                                     <C>
                        12 months (trailing) ended      $(8,900,000)
                          8/31/02
                      ----------------------------------------------------
                        12 months (trailing) ended      $(3,900,000)
                          12/31/02
                      ----------------------------------------------------
                        12 months (trailing) ended      $ 2,600,000
                          5/31/03
                      ----------------------------------------------------
</Table>

                                       5
<PAGE>
         1.11 Article 8 of the Loan and Security Agreement is hereby amended to
delete the punctuation from the end of clause (a) and add the following:

                  ", including, without limitation, any Overadvances that the
                  Lenders have given notice must be repaid pursuant to Section
                  2.3(c);"

         2. REPRESENTATIONS AND WARRANTIES. Borrower hereby affirms to Lenders
and Agent that all of Borrower's representations and warranties set forth in the
Loan and Security Agreement are true, complete and accurate in all respects as
of the date hereof (except to the extent such representations and warranties
relate solely to an earlier date).

         3. RATIFICATION OF EXISTING AGREEMENTS. The Borrower hereby ratifies
and confirms the enforceability in all respects of the Loan Documents and the
Borrower's Obligations thereunder. The Borrower acknowledges that the Agent on
behalf of the Lenders has a valid first-priority perfected lien security for the
repayment of the Obligations against substantially all of the assets of the
Borrower, except as may be limited by the Supply Agreements.

         4. COSTS AND EXPENSES. Borrower shall pay to Agent all of Agent's
out-of-pocket costs and expenses (including, without limitation, the reasonable
fees and expenses of its counsel, which counsel may include any local counsel
reasonably deemed necessary, search fees, filing and recording fees,
documentation fees, appraisal fees, travel expenses, and other fees) arising in
connection with the preparation, execution, and delivery of this Amendment and
any related documents.

         5. EFFECTIVENESS; CONDITION TO EFFECTIVENESS. This Amendment shall
become effective as of the date first set forth above, upon execution hereof by
the Lenders, the Agent and the Borrower.

         6. COUNTERPARTS. This Amendment may be executed in counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same document.

                                       6
<PAGE>

         IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date and year first written above.

                                  SAMUELS JEWELERS, INC.

                                  By:       /s/ RANDY MCCULLOUGH
                                     ------------------------------------------
                                  Name:  Randy McCullough
                                  Title: President & C.E.O.

                                  DDJ CAPITAL MANAGEMENT, LLC

                                  By:       /s/ R. L. HOCKETT
                                      -----------------------------------------
                                  Name:  Robert L. Hockett
                                  Title: Authorized Signatory

                                  By:       /s/ JOHN J. RUSSELL
                                      -----------------------------------------
                                  Name:  John J. Russell
                                  Title: Authorized Signatory

                                  B III CAPITAL PARTNERS:
                                  By:  DDJ Capital III, LLC, its General Partner
                                  By:  DDJ Capital Management, LLC, Manager

                                  By:       /s/ R. L. HOCKETT
                                      -----------------------------------------
                                  Name:  Robert L. Hockett
                                  Title: Authorized Signatory

                                  By:       /s/ JOHN J. RUSSELL
                                      -----------------------------------------
                                  Name:  John J. Russell
                                  Title: Authorized Signatory

                                       7

<PAGE>
                                  B III-A CAPITAL PARTNERS, L.P.
                                  By:  GP III-A, LLC, its General Partner
                                  By:  DDJ Capital Management, LLC, Manager

                                  By:       /s/ R. L. HOCKETT
                                      -----------------------------------------
                                  Name:  Robert L. Hockett
                                  Title: Authorized Signatory

                                  By:       /s/ JOHN J. RUSSELL
                                      -----------------------------------------
                                  Name:  John J. Russell
                                  Title: Authorized Signatory

                                       8<PAGE>

                                                                   EXHIBIT 10.11

                                                                  EXECUTION COPY

                      SETTLEMENT AND TERMINATION AGREEMENT

                                   dated as of

                                 April 17, 2002

                                     between

                             SAMUELS JEWELERS, INC.

                                       and

                             WILKERSON & ASSOCIATES

<PAGE>
                      SETTLEMENT AND TERMINATION AGREEMENT

         This SETTLEMENT AND TERMINATION AGREEMENT ("Agreement"), dated as of
April 17, 2002, is made and entered into by and between Samuels Jewelers, Inc.,
a Delaware corporation ("SAMUELS"), and Wilkerson & Associates, an Arkansas
corporation ("WILKERSON").

                                 R E C I T A L S

         WHEREAS, Samuels and Wilkerson are parties to that certain Assets
Purchase Agreement, dated as of December 15, 1999 (the "ASSET PURCHASE
AGREEMENT"), which set forth the terms and conditions relating to a purchase by
Samuels of certain assets owned by Wilkerson in a chain of jewelry stores
operating under the name of Musselman Jewelers;

         WHEREAS, under the terms of the Asset Purchase Agreement, Samuels
transferred shares of its common stock, par value $.001 per share, to Wilkerson
as part of the purchase price for the assets purchased by Samuels thereunder;

         WHEREAS, in addition to the transfer of shares of its common stock,
Samuels provided Wilkerson a right with respect to such transferred shares to
cause Samuels to repurchase such shares or any portion thereof (as further
described in Section 2.3 of the Asset Purchase Agreement, the "PUT RIGHT"); and

         WHEREAS, upon the terms and subject to the conditions set forth herein,
Samuels and Wilkerson wish to terminate and cancel the Put Right so that such
right may be of no further force and effect;

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

                                    ARTICLE I

                                   DEFINITIONS

         The following terms, as used herein, have the following meanings:

         "Final Payment Date" shall mean June 30, 2002.

         "Law" shall mean all laws, statutes, ordinances, regulations, orders,
writs, rulings, judgments, directives, injunctions and decrees of any executive
office, legislature, court, governmental agency, commission, or administrative,
regulatory or self-regulatory authority or instrumentality, domestic or foreign.

<PAGE>

         "Lien" shall mean any mortgage, pledge, assessment, security interest,
lease, sublease, lien, adverse claim, levy, charge, or other encumbrance of any
kind, or any conditional sales contract, title retention contract, or other
contract to give any of the foregoing.

         "Payee's Account" shall mean an account of Wilkerson designated to
Samuels in writing at least three (3) business days prior to the Final Payment
Date.

         "Person" shall mean any natural person, corporation, general
partnership, limited partnership, limited liability company proprietorship,
trust, union, association, court, tribunal, agency, government, department,
commission, self-regulatory organization, arbitrator, board, bureau,
instrumentality, or other entity, enterprise, authority, or business
organization.

         "Sales Agreement" shall mean that certain Agreement, dated as of the
date hereof, between Wilkerson and Samuels, which relates to Samuels' retention
of Wilkerson as its agent for the purposes of liquidating inventory at the
jewelry store located as 1485 Pole Line Road, Twin Falls, Idaho 83301.

         "Settlement Amount" shall mean $100,000.

         All references in this Agreement to an "Article," "Section," "Exhibit"
or "Schedule" are to an Article, Section, Exhibit or Schedule of this Agreement,
unless the context requires otherwise. Unless the context requires otherwise,
the words "this Agreement," "hereof," "hereunder," "herein," "hereby" or words
of similar import refer to this Agreement as a whole and not to a particular
Article, Section, subsection, clause or other subdivision hereof. Whenever the
context requires, the words used herein include the masculine, feminine and
neuter gender, and the singular and the plural. The words "include", "includes"
and "including" shall mean "include, without limitation,", "includes, without
limitation" and "including, without limitation,", respectively. All references
herein to "dollars" or "$" refer to currency of the United States of America.

                                   ARTICLE II

                           SETTLEMENT AND TERMINATION

         Section 2.1 Settlement. In exchange for Wilkerson's agreement as set
forth in Section 2.2 below, Samuels:

                 (a) shall pay the Settlement Amount to Wilkerson, with payment
to be made by Samuels as provided and in accordance with the terms of Section
1.4(a) of the Sales Agreement, provided that, if Wilkerson shall not have
received payment of the complete Settlement Amount prior to the Final Payment
Date, Samuels shall pay, in cash by wire transfer of immediately available funds
to the Payee's Account, on the Final Payment Date an amount equal to the
Settlement Amount minus the amount theretofore paid under the terms of Section
1.4(a) of the Sales Agreement; and

                                       2
<PAGE>
                 (b) shall, in respect of its termination of business operations
at the first ten (10) jewelry store locations it decides to close after the date
hereof, permit Wilkerson the opportunity to bid and make a proposal with respect
to conducting the termination of operations at such site, including, without
limitation, the sale of merchandise and liquidation of inventory in connection
therewith. In performing its obligations under this Section 2.1(b), upon
Samuels' determination to terminate its business operations at a specific
jewelry store location, it shall provide Wilkerson notice of such determination
at least ten (10) days prior to Samuels' final decision as to the manner in
which it intends to conduct the termination of the business operations at the
applicable location and, as part of such notice, shall provide Wilkerson with a
copy of the standard twelve-month operating statement (in similar form and
substance with such twelve-month operating statement provided to Wilkerson in
connection with Wilkerson's investigation of detail in respect of the jewelry
store location that is the subject of the Sales Agreement) for the applicable
jewelry store location for the purpose of enabling Wilkerson to formulate its
bid or proposal. Unless otherwise mutually agreed by Wilkerson and Samuels, if
Wilkerson fails to provide a bid or proposal (for conducting the termination of
business operations at the applicable store location) on or before the tenth
(10th) day immediately following the date upon which Samuels provided the
foregoing notice to Wilkerson (with respect to the applicable location), for the
avoidance of doubt, Samuels shall nevertheless be considered to have provided
the opportunity to Wilkerson as required herein.

         Section 2.2 Termination and Release. In exchange for the payment by
Samuels as set forth in Section 2.1(a) above and Samuels' agreement as set forth
in Section 2.1(b) above, Wilkerson agrees that the Put Right shall terminate,
and agrees to fully releases and hold Samuels harmless with respect to any
claims, demands, damages and causes of action, if any, that Wilkerson may have
against Samuels in respect of the Put Right, whether arising in contract, in
tort, by statute, at law, in equity or otherwise, whether fixed or contingent,
known or unknown, actual or potential, and/or raised or not. Upon payment under
Section 2.1(a) by Samuels, the Put Right, and the rights and obligations set
forth in Section 2.3 of the Asset Purchase Agreement generally, shall be of no
further force and effect and any rights or obligations relating thereto shall be
released and terminated without any further right or liability in respect
thereof. Wilkerson agrees that, with respect to its exercise of the Put Right,
until the earlier of the day immediately following the Final Payment Date and
the termination of this Agreement, it shall suspend further action in connection
with such exercise of the Put Right.

         Section 2.3 Mutual Covenant. Each of Wilkerson and Samuels covenants
and agrees that, at all times on or prior to the Final Payment Date, it shall
use all reasonable efforts to take, or cause to be taken, all action, and to do,
or cause to be done, as promptly as practicable, all things necessary, proper
and advisable under applicable laws and regulations to consummate and make
effective as promptly as practicable the transactions contemplated by this
Agreement, including, without limitation, taking such action or performing such
obligations as necessary to make its representations and warranties as set forth
in Section 3.1 or 3.2, as applicable, true,

                                       3
<PAGE>

complete and correct in all material respects as of the Final Payment Date. For
the avoidance of doubt, Samuels shall have no obligation to make any payment as
required under Section 2.1(a) hereof to the extent that Wilkerson's
representation and warranty as set forth in Section 3.2.1 hereof is not true,
complete and correct in all material respects.

                                   ARTICLE III

                         REPRESENTATIONS AND WARRANTIES

         Section 3.1 Samuels Representation and Warranties. Samuels hereby
represents and warrants to Wilkerson as follows:

                 3.1.1 Authorization. Samuels has all necessary corporate power
and authority to execute and deliver this Agreement and to perform its
obligations under this Agreement. The execution and delivery of this Agreement
by Samuels and the performance by Samuels of its obligations under this
Agreement have been duly and validly authorized by all necessary corporate
action on the part of Samuels. This Agreement has been duly and validly executed
and delivered by Samuels and (assuming that this Agreement is a legal, valid and
binding obligation of Wilkerson) constitutes a legal, valid and binding
obligation of Samuels, enforceable against Samuels in accordance with its terms,
except to the extent that enforcement may be limited by or subject to any
bankruptcy, insolvency, reorganization, moratorium or similar Laws now or
hereafter in effect relating to or limiting creditors' rights generally, to
general principles of equity and to mandatory provisions of public policy.

                 3.1.2 No Conflicts or Violations; Approvals. The execution and
delivery of this Agreement by Samuels does not, and the performance of Samuels'
obligations under this Agreement will not:

                       (a) conflict with or result in a violation or breach of
any provision of the certificate of incorporation or by-laws of Samuels;

                       (b) conflict with or result in a violation or breach of,
or constitute a default under, with or without notice or lapse of time, or both,
or require any consent under, any provision of any permit, license, contract or
agreement to which Samuels is a party, except for such conflicts, violations or
defaults that would not, individually or in the aggregate, impair the
consummation of the transactions contemplated hereunder; or

                       (c) violate any term or provision of any Law or rule
applicable to Samuels in a manner which would prevent or prohibit the
consummation of the transactions contemplated hereby.

No action, approval, consent or authorization, including, without limitation,
any action, approval, consent or authorization by, or any other order of, action
by, filing with or notification to, any governmental or quasi-governmental
agency, commission, board,

                                       4
<PAGE>

bureau or instrumentality, is or will be necessary to be obtained or made by
Samuels to make this Agreement a legal, valid and binding obligation of Samuels,
or to consummate the transactions contemplated hereunder.

                 3.1.3 Litigation; Compliance with Laws. There are no actions,
suits, claims, arbitration proceedings or governmental investigations or
inquiries that are pending or, to the knowledge of Samuels, threatened, against
Samuels, or its officers, directors, employees or their assets that could
prevent, prohibit or impair or impede the transactions contemplated by this
Agreement. Samuels has complied with all applicable Laws, rules, reporting
requirements, codes, plans and charges of federal, state, local and foreign
governments, except where the failure to do so would not impair or impede the
consummation of the transactions contemplated by this Agreement.

                 3.1.4 Knowledge and Release. Samuels has read this Agreement
and freely and voluntarily enters into this Agreement, and no promise,
agreement, representation or statement not set forth in this Agreement has been
relied upon by Samuels in entering this Agreement.

         Section 3.2 Wilkerson Representations and Warranties. Wilkerson hereby
represents and warrants to Samuels as follows:

                 3.2.1 Title. Wilkerson has good and marketable title to the Put
Right (including never having assigned, transferred or conveyed the Put Right),
free and clear of any Liens, and will, pursuant hereto, terminate and release
the Put Right free and clear of any Liens. Wilkerson has not provided any
subscription, option or right of any kind issued, granted by or binding upon
Wilkerson or any of its affiliates to purchase or otherwise acquire the Put
Right or any portion thereof.

                 3.2.2 Authorization. Wilkerson has all necessary organizational
power and authority to execute and deliver this Agreement and to perform its
obligations under this Agreement. The execution and delivery of this Agreement
by Wilkerson and the performance by Wilkerson of its obligations under this
Agreement have been duly and validly authorized by all necessary organizational
action on the part of Wilkerson. This Agreement has been duly and validly
executed and delivered by Wilkerson and (assuming that this Agreement is a
legal, valid and binding obligation of Samuels) constitutes a legal, valid and
binding obligation of Wilkerson, enforceable against Wilkerson in accordance
with its terms, except to the extent that enforcement may be limited by or
subject to any bankruptcy, insolvency, reorganization, moratorium or similar
Laws now or hereafter in effect relating to or limiting creditors' rights
generally, to general principles of equity and to mandatory provisions of public
policy.

                 3.2.3 No Conflicts or Violations; Approvals. The execution and
delivery of this Agreement by Wilkerson does not, and the performance of
Wilkerson's obligations under this Agreement will not:

                                       5
<PAGE>
                       (a) conflict with or result in a violation or breach of
any provision of the organizational documents of Wilkerson;

                       (b) conflict with or result in a violation or breach of,
or constitute a default under, with or without notice or lapse of time, or both,
or require any consent under, any provision of any permit, license, contract or
agreement to which Wilkerson is a party, except for such conflicts, violations
or defaults that would not, individually or in the aggregate, impair the
consummation of the transactions contemplated hereunder; or

                       (c) violate any term or provision of any Law or rule
applicable to Wilkerson in a manner which would prevent or prohibit the
consummation of the transactions contemplated hereby.

No action, approval, consent or authorization, including, without limitation,
any action, approval, consent or authorization by, or any other order of, action
by, filing with or notification to, any governmental or quasi-governmental
agency, commission, board, bureau or instrumentality, is or will be necessary to
be obtained or made by Wilkerson to make this Agreement a legal, valid and
binding obligation of Wilkerson, or to consummate the transactions contemplated
hereunder.

                 3.2.4 Litigation; Compliance with Laws. There are no actions,
suits, claims, arbitration proceedings or governmental investigations or
inquiries that are pending or, to the knowledge of Wilkerson, threatened,
against Wilkerson, or its officers, directors, employees or their assets that
could prevent, prohibit or impair or impede the transactions contemplated by
this Agreement. Wilkerson has complied with all applicable Laws, rules,
reporting requirements, codes, plans and charges of federal, state, local and
foreign governments, except where the failure to do so would not impair or
impede the consummation of the transactions contemplated by this Agreement.

                 3.2.5 Knowledge and Release. Wilkerson has read this Agreement
and freely and voluntarily enters into this Agreement, and no promise,
agreement, representation or statement not set forth in this Agreement has been
relied upon by Wilkerson in entering this Agreement.

                                   ARTICLE IV

                       CLOSING; CONDITIONS TO OBLIGATIONS

         Section 4.1 Conditions to Obligations of Wilkerson. The obligations of
Wilkerson hereunder are subject to the fulfillment of each of the following
conditions:

                 4.1.1 Representations and Warranties. The representations and
warranties made by Samuels in this Agreement shall be true, complete and correct
in all material respects.

                                       6
<PAGE>
                 4.1.2 Performance of Obligations. All of the covenants,
agreements, obligations and conditions of Samuels contained in this Agreement to
be performed on or before the Final Payment Date shall have been so performed.

                 4.1.3 No Injunction or Proceeding. There shall not be in effect
any writ, judgment, injunction, decree or similar order of any court or
governmental or regulatory authority restraining, enjoining, or otherwise
preventing consummation of any of the transactions contemplated by this
Agreement, and there shall not be pending any claim, action, suit or other
proceeding brought by any governmental or regulatory authority to restrain,
enjoin, or otherwise prevent consummation of any of the transactions
contemplated by this Agreement.

                 4.1.4 Regulatory Approvals and Consents. All approvals,
authorizations and clearances of any governmental or regulatory authority and
any third parties necessary or appropriate for the consummation of the
transactions contemplated hereby and the performance of the obligations of
Samuels hereunder shall have been obtained and shall be in full force and effect
on the date hereof.

         Section 4.2 Conditions to Obligations of Samuels. The obligations of
Samuels hereunder are subject to the fulfillment of each of the following
conditions:

                 4.2.1 Representations and Warranties. The representations and
warranties made by Wilkerson in this Agreement shall be true, complete and
correct in all material respects.

                 4.2.2 Performance of Obligations. All of the covenants,
agreements, obligations and conditions of Wilkerson contained in this Agreement
to be performed on or before the Final Payment Date shall have been so
performed.

                 4.2.3 No Injunction or Proceeding. There shall not be in effect
any writ, judgment, injunction, decree or similar order of any court or
governmental or regulatory authority restraining, enjoining, or otherwise
preventing consummation of any of the transactions contemplated by this
Agreement, and there shall not be pending any claim, action, suit or other
proceeding brought by any governmental or regulatory authority to restrain,
enjoin, or otherwise prevent consummation of any of the transactions
contemplated by this Agreement.

                 4.2.4 Regulatory Approvals and Consents. All approvals,
authorizations and clearances of any governmental or regulatory authority and
any third parties necessary or appropriate for the consummation of the
transactions contemplated hereby and the performance of the obligations of
Wilkerson hereunder shall have been obtained and shall be in full force and
effect on the date hereof.

                                       7
<PAGE>
                                    ARTICLE V

                                  MISCELLANEOUS

         Section 5.1 Indemnification.

                 5.1.1 Samuels Indemnity. Samuels agrees to indemnify, defend
and hold harmless Wilkerson and each of its respective shareholders, affiliates,
officers, directors, employees, agents, successors and permitted assigns (the
"WILKERSON INDEMNIFIED PERSONS") from and against any and all losses,
liabilities, damages, claims, expenses or deficiencies (including interest,
penalties, fines, judgments, settlements, costs of preparation and
investigation, costs incurred in enforcing this indemnity and reasonable
attorneys' fees and expenses (collectively, "LOSSES")) that any Wilkerson
Indemnified Persons may suffer, sustain, incur or become subject to, arising out
of or due to (i) the inaccuracy of any representation or the breach of any
warranty of Samuels in this Agreement or in any instrument or certificate
delivered by Samuels pursuant to this Agreement and (ii) the nonfulfillment of
any covenant, agreement or other obligation of Samuels under this Agreement.

                 5.1.2 Wilkerson Indemnity. Wilkerson agrees to indemnify,
defend and hold harmless Samuels and each of its respective shareholders,
affiliates, officers, directors, employees, agents, successors and permitted
assigns (the "SAMUELS INDEMNIFIED PERSONS") from and against any and all Losses
that any Samuels Indemnified Persons may suffer, sustain, incur or become
subject to, arising out of or due to (i) the inaccuracy of any representation or
the breach of any warranty of Wilkerson in this Agreement or in any instrument
or certificate delivered by Wilkerson pursuant to this Agreement and (ii) the
nonfulfillment of any covenant, agreement or other obligation of Wilkerson under
this Agreement.

                 5.1.3 Survival of Reps and Warranties. The representations and
warranties of each of the parties hereto shall survive the execution and
delivery hereof.

         Section 5.2 Notices. Any notice or other communication given pursuant
to this Agreement must be in writing and (a) delivered personally, (b) sent by
facsimile or other similar facsimile transmission, (c) delivered by overnight
express, or (d) sent by registered or certified mail, postage prepaid, as
follows:

                 (i) if to Samuels:

                     Samuels Jewelers, Inc.
                     2914 Montopolis Dr., Suite 200
                     Austin, TX 78741
                     Attention:  Robert J. Herman
                     Facsimile No.:  512-369-1522

                 with a copy to:

                                       8
<PAGE>

                     Jeffrey D. Hopkins
                     c/o Weil, Gotshal & Manges LLP
                     700 Louisiana, Suite 1600
                     Houston, TX 77002
                     Facsimile No.: 713-224-9511

                (ii) if to Wilkerson:

                     Wilkerson & Associates
                     222 South Main Street
                     Stuttgart, AR 72160
                     Attention: Bobby Wilkerson
                     Facsimile No.: 800-648-9182

                with a copy to:

                     Carl R. Bishop, Esq.
                     Moore & Serio
                     Clarendon, AR 72029
                     Facsimile No.:  870-747-3767

All notices and other communications required or permitted under this Agreement
that are addressed as provided in this Section 5.2 will (A) if delivered
personally or by overnight express, be deemed given upon delivery; (B) if
delivered by facsimile or similar facsimile transmission, be deemed given when
electronically confirmed; and (C) if sent by registered or certified mail, be
deemed given when received. Any party from time to time may change its address
for the purpose of notices to that party by giving a similar notice specifying a
new address, but no such notice will be deemed to have been given until it is
actually received by the party sought to be charged with the contents thereof.

         Section 5.2 Entire Agreement. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
there are no agreements, understandings, representations or warranties between
the parties with respect to such subject matter other than those set forth or
referred to herein. Each party understands that this Agreement is a full, final
and complete settlement and release of the Put Right and that the consideration
described herein to be provided by Samuels is all of the consideration to ever
be given. Notwithstanding the foregoing, the parties hereto agree that the
representations, warranties, agreement and covenants contained herein and the
consideration to be transferred pursuant hereto is intended to compromise
doubtful and disputed claims, avoid litigation, and, therefore, no payments made
or other consideration given shall be construed as an admission of liability by
any party--all liability being expressly denied.

                                       9
<PAGE>

         Section 5.3 Expenses and Fees. All costs and expenses incurred in
connection with this Agreement and the transactions contemplated hereby shall be
borne by the party incurring such costs and expenses.

         Section 5.4 Binding Effect. This Agreement is binding upon and will
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.

         Section 5.5 Specific Performance. Each of the parties hereto
acknowledges and agrees that the other parties hereto would be irreparably
damaged in the event any of the provisions of this Agreement were not performed
in accordance with their specific terms or were otherwise breached. Accordingly,
each of the parties hereto agrees that the other parties hereto will be entitled
to an injunction or injunctions to prevent breaches of the provisions of this
Agreement and to enforce specifically this Agreement and the terms and
provisions hereof in any action, in addition to any other remedy to which any
party hereto may be entitled, at Law or in equity.

         Section 5.6 Further Assurances. Each of Samuels and Wilkerson agrees
that, upon the reasonable request of the other, they will cooperate and will,
execute and/or deliver such documents and instruments as any other party hereto
may reasonably request containing terms and conditions mutually satisfactory to
such parties to further effectuate the terms hereof.

         Section 5.7 Amendments and Waivers. This Agreement may not be modified
or amended except by an instrument or instruments in writing signed by the party
against whom enforcement of any such modification or amendment is sought. Any
term or condition of this Agreement may be waived at any time by the party that
is entitled to the benefit thereof. Such waiver must be in writing and must be
executed by an executive officer or similar responsible party of such party. A
waiver on one occasion will not be deemed to be a waiver of the same or any
other breach or non fulfillment on a future occasion. All remedies, either under
this Agreement, or by Law or otherwise afforded, will be cumulative and not
alternative.

         Section 5.8 Confidentiality. Each of the parties shall, and shall cause
their respective affiliates, officers, directors, employees, agents, successors
and permitted assigns to, not disclose without the prior written consent of the
other party the existence of this Agreement or any of the terms hereof, provided
that a party may disclose any such information (a) as may be required in
response to any summons or subpoena or in connection with any litigation or (b)
in order to comply with any Law applicable to such party. Each party hereto
shall promptly notify the other party through its signatory to this Agreement
should a third party formally request or seek to compel discovery, disclosure or
production of this Agreement.

         Section 5.9 Governing Law. This Agreement, including, without
limitation, the interpretation, construction, validity and enforceability
thereof, shall be

                                       10
<PAGE>

governed by the internal Laws of the State of Delaware, without regard to the
principles of conflict of Laws thereof.

         Section 5.10 Submission to Jurisdiction.

                 (a) Any legal action or proceeding with respect to this
Agreement or any document related thereto shall be brought solely in the courts
of the State of Texas or of the United States of America for the Western
District of Texas, and, by execution and delivery of this Agreement, each party
hereby accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts. The parties hereto
hereby irrevocably waive any objection, including, without limitation, any
objection to the laying of venue or based on the grounds of forum non
conveniens, which any of them may now or hereafter have to the bringing of any
such action or proceeding in such respective jurisdictions.

                 (b) Each party hereto irrevocably consents to the service of
process of any of the aforesaid courts in any such action or proceeding by the
mailing of copies thereof by registered or certified mail, postage prepaid, to
such party, respectively, at its address provided herein.

                 (c) Nothing contained in this Section 5.10 shall affect the
right of any party hereto to serve process in any other manner permitted by Law.

         Section 5.11 Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.

         Section 5.12 Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of Law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect unless the result of such
invalidity, illegality or incapability is to deny the parties hereto the benefit
of the bargain as expressed in this Agreement. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced and
that such determination nevertheless does not deny the parties hereto the
benefit of their bargain hereunder, (a) such term or other provision shall be
fully severable; (b) this Agreement will be construed and enforced as if such
illegal, invalid, or unenforceable term or other provision had never comprised a
part hereof; and (c) the remaining terms and provisions of this Agreement will
remain in full force and effect and will not be affected by the illegal,
invalid, or unenforceable term or other provision or by its severance from this
Agreement.

         Section 5.13 Headings. The headings of the Articles and Sections of
this Agreement have been inserted for convenience of reference only, are not
intended to be considered a part hereof, and shall not affect in any way the
meaning or interpretation of this Agreement.

                                       11
<PAGE>

                  Section 5.15 Counterparts. This Agreement may be executed
simultaneously in any number of counterparts, each of which will be deemed an
original, but all of which will constitute one and the same instrument. A
facsimile signature of this Agreement shall be effective in all respects.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       12
<PAGE>
         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their respective authorized officers as of the
date first written above.

                                           SAMUELS JEWELERS, INC.

                                           By:   /s/ RANDY MCCULLOUGH
                                              ---------------------------------
                                              Name:  Randy McCullough
                                                   ----------------------------
                                              Title: President and C.E.O.
                                                    ---------------------------

                                           WILKERSON & ASSOCIATES

                                           By:   /s/ BOBBY WILKERSON
                                              ---------------------------------
                                              Name:  Bobby Wilkerson
                                                   ----------------------------
                                              Title: President
                                                    ---------------------------

                                       13

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