-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, TrQJlowjnm4GvKUJ3rluN8xM8cOnLXWPtDZHrvamBkiFlE/PxwcBaLfMghAVGooH +qW1DosJwbNwOX6NP4s3rw== 0000899681-07-000359.txt : 20070509 0000899681-07-000359.hdr.sgml : 20070509 20070509143919 ACCESSION NUMBER: 0000899681-07-000359 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 20070509 DATE AS OF CHANGE: 20070509 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: SMITH & WOLLENSKY RESTAURANT GROUP INC CENTRAL INDEX KEY: 0001137047 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-EATING PLACES [5812] IRS NUMBER: 582350980 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-61691 FILM NUMBER: 07831861 BUSINESS ADDRESS: STREET 1: 114 1ST AVENUE CITY: NEW YORK STATE: NY ZIP: 10021 BUSINESS PHONE: 2128382061 MAIL ADDRESS: STREET 1: 114 1ST AVENUE CITY: NEW YORK STATE: NY ZIP: 10021 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: STILLMAN ALAN N CENTRAL INDEX KEY: 0001140862 STATE OF INCORPORATION: TX FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A MAIL ADDRESS: STREET 1: C/O SMITH WOLLENSKY RESTAURANT GROUP INC STREET 2: 1114 FIRST AVENUE CITY: NEW YORK STATE: NY ZIP: 10021 SC 13D/A 1 smith-sc13da_050807.htm SC-13D/A

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

SCHEDULE 13D
(Rule 13d-1)

INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO
RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO
RULE 13d-2(a)
(Amendment No. 2)

The Smith & Wollensky Restaurant Group, Inc.

(Name of Issuer)

Common Stock, $0.01 par value per share

(Title of Class of Securities)

831758107

(CUSIP Number)

Martin H. Neidell
Stroock & Stroock & Lavan LLP
180 Maiden Lane
New York, NY 10038
212-806-5836

(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)

May 6, 2007

(Date of Event which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Sections 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box [ ].

NOTE: Schedules filed in paper format shall include a signed original and five copies of the Schedule, including all exhibits. See Section 240.13d-7 for other parties to whom copies are to be sent.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (the “Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

(Continued on following pages)

(Page 1 of 6)

SCHEDULE 13D

CUSIP No.: 831758107

Page 2 of __ Pages

1	NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (Entities Only) Alan N. Stillman

2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [ ]

3	SEC USE ONLY

4	SOURCE OF FUNDS

5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]

6	CITIZENSHIP OR PLACE OF ORGANIZATION United States

NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH

7

8

9

10

SOLE VOTING POWER

SHARED VOTING POWER

SOLE DISPOSITIVE POWER

SHARED DISPOSITIVE POWER

1,321,119

107,500

1,321,119

107,500

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,428,619

12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 16.36%

14	TYPE OF REPORTING PERSON IN

This Amendment No. 2 is being filed on behalf of Alan N. Stillman, relating to the common stock, par value $0.01 per share (the “Common Stock”), of The Smith & Wollensky Restaurant Group, Inc. (the “Issuer”). This amendment is being filed pursuant to Rule 13d-2 of the General Rules and Regulations under the Securities Exchange Act of 1934. Terms defined in Amendment No. 1 to this Schedule 13D shall have the same meaning when used herein.

ITEM 1.

SECURITY AND ISSUER.

This Amendment relates to the Common Stock of the Issuer, a Delaware corporation. The Issuer’s principal executive offices are located at 880 Third Avenue, 4th Floor, New York, NY 10022.

ITEM 2.

IDENTITY AND BACKGROUND.

Mr. Stillman’s business address is c/o The Smith & Wollensky Restaurant Group, Inc., 880 Third Avenue, New York, NY 10022.

ITEM 4.

PURPOSE OF TRANSACTION.

See response to Item 6.

ITEM 5.

INTEREST IN SECURTIES OF THE ISSUER.

(a) Mr. Stillman beneficially owns 1,428,619 shares of Common Stock of the Issuer, representing approximately 16.36% of the issued and outstanding shares.

(b) Mr. Stillman directly owns 56,791 shares of Common Stock of the Issuer over which he has sole voting and dispositive power. Mr. Stillman owns options to purchase an aggregate of 241,667 shares of Common Stock of the Issuer, of which options to purchase an aggregate of 135,667 shares have vested.

Stillman’s First, Inc., which may be deemed to be an affiliate of Mr. Stillman, owns 107,500 shares of Common Stock of the Issuer. Mr. Stillman disclaims beneficial ownership of such shares, and this report shall not be deemed an admission that Mr. Stillman is the beneficial owner of such shares for the purposes of Section 16 or for any other purpose, except to the extent of his pecuniary interest therein. Mr. Stillman has shared voting power and shared dispositive power over such shares of Common Stock of the Issuer. Donna Stillman, Mr. Stillman’s wife, also has shared voting power and shared dispositive power over such 107,500 shares of Common Stock of the Issuer.

La Cite, Inc., which may be deemed to be an affiliate of Mr. Stillman, owns 348,191 shares of Common Stock of the Issuer. Mr. Stillman disclaims beneficial ownership of such shares, and this report shall not be deemed an admission that Mr. Stillman is the beneficial owner of such shares for the purposes of Section 16 or for any other purpose, except to the extent of his pecuniary interest therein. Mr. Stillman has sole voting power and sole dispositive power over such shares of Common Stock of the Issuer.

White & Witkowsky, Inc., which may be deemed to be an affiliate of Mr. Stillman, owns 395,070 shares of Common Stock of the Issuer. Mr. Stillman disclaims beneficial ownership of such shares, and this report shall not be deemed an admission that Mr. Stillman is the beneficial owner of such shares for the purposes of Section 16 or for any other purpose, except to the extent of his pecuniary interest therein. Mr. Stillman has sole voting power and sole dispositive power over such shares of Common Stock of the Issuer.

Thursday’s Supper Pub, Inc., which may be deemed to be an affiliate of Mr. Stillman, owns 385,400 shares of Common Stock of the Issuer. Mr. Stillman disclaims beneficial ownership of such shares, and this report shall not be deemed an admission that Mr. Stillman is the beneficial owner of such shares for the purposes of Section 16 or for any other purpose, except to the extent of his pecuniary interest therein. Mr. Stillman has sole voting power and sole dispositive power over such shares of Common Stock of the Issuer.

The Donna Stillman Trust owns 90,754 shares of Common Stock of the Issuer. These shares are not included in this filing. Mr. Stillman disclaims beneficial ownership of such shares, and this report shall not be deemed an admission that Mr. Stillman is the beneficial owner of the 90,754 shares owned by the Donna Stillman Trust for any purpose. Donna Stillman, Eugene I. Zuriff and Robert D. Villency, the trustees, have the shared power to direct the receipt of dividends and the proceeds of a sale of shares with respect to such 90,754 shares of Common Stock of the Issuer. Mr. Stillman has no voting power or dispositive power over such 90,754 shares of Common Stock of the Issuer. The address for each of Donna Stillman and Eugene I. Zuriff has changed and is c/o The Smith & Wollensky Restaurant Group, Inc., 880 Third Avenue, New York, NY 10022.

The Alan N. Stillman Grantor Retained Annuity Trust owns 175,000 shares of Common Stock of the Issuer. These shares are not included in this filing. Mr. Stillman disclaims beneficial ownership of such shares and this report shall not be deemed an admission that Mr. Stillman is the beneficial owner of such shares for the purpose of Section 16 or for any other purpose. Donna Stillman, Eugene I. Zuriff and Robert D. Villency are the trustees of this trust and share voting and dispositive power with respect to such shares. Mr. Stillman has no voting power or dispositive power over the shares of Common Stock of the Issuer owned by this trust.

ITEM 6.

CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER.

On May 6, 2007, the Issuer amended the Merger Agreement (the “Amended Merger Agreement”) previously entered into with Patina and Patina assigned its rights thereunder to Project Grill, LLC (“Grill”). In connection therewith, the Patina Agreement was assigned to Grill and amended. The purchase price under the Patina Agreement payable by the Stillman Group was increased from $5,304,057 to $6,850,000 in cash and/or stock. The Voting Agreement was also assigned to Grill. Pursuant to the Amended Merger Agreement, if the Amended Merger Agreement is terminated in such a manner that Grill is required to pay a Parent Termination Fee (as defined therein), then Mr. Stillman agreed to personally guarantee payment of $212,925 of the Parent Termination Fee pursuant to a Limited Guarantee.

As a condition for entering into the Amended Merger Agreement, Grill required that St. James agree to amend various provisions of the License Agreement. On May 6, 2007, Grill and St. James entered into a letter agreement pursuant to which the License Agreement will be amended effective on the closing of the merger to effectuate the following: Grill has agreed to open at least two new Smith & Wollensky restaurants and to open or make advance payments of additional royalty payments for two additional such restaurants within six years; St. James will eliminate the 1% royalty fee on all restaurant and non-restaurant sales at any steakhouse owned or operated by Grill or its affiliates if such restaurant does not use the Smith & Wollensky name, provided such royalty will continue to be payable unless Grill has fulfilled its build-out obligations; St. James agreed to eliminate the posting by assignees of a letter of credit in connection with the assignment of the License Agreement; if the management services agreement relating to Patina’s management of the Smith & Wollensky restaurant is terminated or if neither Patina nor Messrs. Valenti and Splichal are no longer in charge of the management of such restaurants, provisions were added relating to a successor licensee; and St. James agreed to other technical amendments. Based on Patina’s representations to St. James that Patina is a reputable restaurant operator that has managed high quality fine dining restaurants continuously for at least five years and that Patina is a nationally known reputable company active in the food service business, St. James acknowledged that the Amended Merger Agreement is expressly permitted by the License Agreement. In addition, effective on the closing of the merger, the management agreement dated May 1, 2001 between St. James and the Issuer relating to the management of the Smith & Wollensky restaurant in New York will be assigned to Mr. Stillman or an entity controlled by him.

The foregoing is a summary of the various agreements entered into in connection with the Amended Merger Agreement and the summary is qualified in its entirety by the actual agreements filed as exhibits hereto.

ITEM 7.

MATERIAL TO BE FILED AS EXHIBITS.

1. Letter Agreement dated April 27, 2007, between Project Grill, LLC and Alan N. Stillman.

2. Two letter agreements each dated May 6, 2007 between Project Grill, LLC and Alan N. Stillman.

3. Consent to and acknowledgement of Assignment dated April 25, 2007 of Voting Agreement dated February 26, 2007, among Patina Restaurant Group, LLC and certain holders of Common Stock of The Smith & Wollensky Restaurant Group, Inc.

4. Letter Agreement dated May 6, 2007 relating to proposed amendments to Amended and Restated Sale and License Agreement dated as of January 1, 2006, by and between St. James Associates, L.P. and The Smith & Wollensky Restaurant Group, Inc.

5. Limited Guarantee dated May 6, 2007 of Alan N. Stillman.

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Dated: May 9, 2007

/s/ Alan N. Stillman
Alan N. Stillman

EX-1 2 smith-ex1_050807.htm Exhibit 1

Project Grill, LLC
c/o Patina Restaurant Group, LLC
120 West 45^th Street
New York, New York 10036

April 27, 2007

Mr. Alan N. Stillman
c/o The Smith & Wollensky Restaurant Group, Inc.
880 Third Avenue
New York New York 10022

Dear Alan:

Capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Letter Agreement.

Patina has agreed to assign to Project Grill, LLC (“Grill”) all of Patina’s right, title and interest in, to and under the Merger Agreement and the Letter Agreement and Grill has agreed to assume all of Patina’s obligations thereunder (the “Assignment and Assumption Agreement”). A copy of the proposed form of the Assignment and Assumption Agreement has been provided to you. We ask that you evidence your consent to the Assignment and Assumption Agreement by signing the enclosed copy of this letter and returning the same to me.

As you know, Grill, in its capacity as successor to Patina, is proposing to amend the Merger Agreement to provide, among other things, for an increase in the Merger Consideration payable under the Merger Agreement from $9.25 a share to $11.00 a share. In the event that the Merger Consideration is so increased, we have agreed that Section 2 of the Letter Agreement shall be deemed to be amended to read in its entirety as follows:

“Section 2 Payment. At the Closing, as partial consideration for the Transferred Assets, you or your designees shall make a payment to SWRG of $6,850,000, which payment may be made at your option (a) in cash, (b) in shares of common stock of SWRG valued at $11.00 a share, or (c) a combination of (a) and (b).”

If the above accurately reflects our understanding with respect to the subject matter thereof, please sign the enclosed copy of this letter and return the same to the undersigned.

Sincerely yours,

Project Grill, LLC

By: /s/ Fortunato N. Valenti
Fortunato N. Valenti, Member

Agreed:

/s/ Alan N. Stillman
Alan N. Stillman

EX-2 3 smith-ex2_050807.htm Exhibit 2

Project Grill, LLC
c/o Patina Restaurant Group, LLC
120 West 45th Street
New York, New York 10036

May 6, 2007

Mr. Alan N. Stillman
c/o The Smith & Wollensky Restaurant Group, Inc.
880 Third Avenue
New York New York 10022

Dear Alan:

Reference is made to the letter agreement between you and Patina Restaurant Group, LLC (“Patina”) dated February 26, 2007 (the “Letter Agreement”) relating to Patina’s proposed acquisition of 100% of the equity interests in The Smith and Wollensky Restaurant Group, Inc. (“SWRG”). Reference is also made to the Amended and Restated Agreement and Plan of Merger (the “Amended and Restated Merger Agreement”), dated as of May 6, 2007, by and among Project Grill, LLC, a Delaware limited liability company (“Parent”), SWRG Acquisition, Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of Parent and SWRG, and the Disclosure Schedule prepared and delivered in connection with the Amended and Restated Merger Agreement.

1. Capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Letter Agreement.

2. All references in the Letter Agreement to the Merger Agreement shall be to the Amended and Restated Merger Agreement.

3. All references in the Letter Agreement to the Disclosure Schedule shall be to the Disclosure Schedule prepared and delivered in connection with, and forms a part of, the Amended and Restated Merger Agreement (the “Disclosure Schedule”).

4. The following paragraphs and references to the Disclosure Schedule in “Schedule II – Assumed Liabilities” of the Letter Agreement shall be clarified and deemed to be amended as follows:

(a) Clause (ii) in paragraph (g) (Employee Obligations) shall be deleted and replaced by the following clause: “(ii) referred to in Item 8 of Part 2.15(b) of the Disclosure Schedule.”

(b) Clause (ii) in paragraph (i) (Income Taxes) shall be deleted and replaced by the following clause: “(ii) all tax obligations referred to in Items 1-5 of Part 2.14(c) of the Disclosure Schedule.”

If the above accurately reflects our understanding with respect to the subject matter thereof, please sign the enclosed copy of this letter and return the same to the undersigned.

Sincerely yours,

Project Grill, LLC

By: /s/ Fortunato N. Valenti
Fortunato N. Valenti, Member

Agreed:

/s/ Alan N. Stillman
Alan N. Stillman

Project Grill, LLC
c/o Patina Restaurant Group, LLC
120 West 45th Street
New York, New York 10036

May 6, 2007

Mr. Alan N. Stillman
c/o The Smith & Wollensky Restaurant Group, Inc.
880 Third Avenue
New York New York 10022

Dear Alan:

Reference is made to the letter agreement between you and Patina Restaurant Group, LLC dated February 26, 2007 (the “Letter Agreement”), as amended by the letter agreement between you and Project Grill, LLC (“Grill”) dated April 27, 2007, relating to Grill’s proposed acquisition of 100% of the equity interests in The Smith and Wollensky Restaurant Group, Inc.

Capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Letter Agreement.

Notwithstanding section 13 of the Letter Agreement, if the Merger Agreement, as may be amended from time to time, is terminated, the Letter Agreement shall automatically terminate subject to the terms and conditions therein. We ask that you evidence your agreement to the foregoing by signing the enclosed copy of this letter and returning the same to me.

Sincerely yours,

Project Grill, LLC

By: /s/ Fortunato N. Valenti
Fortunato N. Valenti, Member

Agreed:

/s/ Alan N. Stillman
Alan N. Stillman

EX-3 4 smith-ex3_050807.htm Exhibit 3

CONSENT TO AND ACKNOWLEDGMENT OF ASSIGNMENT

This Consent to and Acknowledgment of Assignment is made as of the 25th day of April, 2007, by Alan N. Stillman, Stillman’s First, Inc., La Cite, Inc., White & Witkowsky, Inc. Thursdays Supper Pub, Inc., Alan N. Stillman Grantor Retained Annuity Trust and Donna Stillman Trust (each, a “Stockholder,” and collectively, the “Stockholders”) in favor of Project Grill, LLC (“Grill”) and SWRG Acquisition Sub, Inc. (“Newco”).

Reference is made to: (i) that certain voting agreement, dated as of February 26, 2007, by and among Patina Restaurant Group, LLC (“Patina”), SWRG Holdings, Inc. (“SWRG”) and the Stockholders listed on Schedule I attached thereto (the “Voting Agreement”); and (ii) that certain Assignment and Assumption Agreement, dated April 25, 2007, by and between Patina, SWRG, Grill and Newco (the “Assignment Agreement”), attached hereto.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements contained herein and for other good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:

Notwithstanding Section 9(c) of the Voting Agreement, each Stockholder hereby consents to and acknowledges the assignments by Patina to Grill and by SWRG to Newco all of their respective rights, title and interest in, to and under the Voting Agreement, pursuant to Section 1 of the Assignment Agreement.

IN WITNESS WHEREOF, the undersigned hereto has executed this Consent to and Acknowledgment of Assignment on the date first written above.

ALAN N. STILLMAN

/s/ Alan N. Stillman

STILLMAN'S FIRST, INC.

By: /s/ Alan N. Stillman
       Name:
       Title:

LA CITE, INC.

By: /s/ Alan N. Stillman
       Name:
       Title:

WHITE & WITKOWSKY

By: /s/ Alan N. Stillman
       Name:
       Title:

THURSDAYS SUPPER PUB, INC.

By: /s/ Alan N. Stillman
       Name:
       Title:

ALAN N. STILLMAN GRANTOR RETAINED
ANNUITY TRUST

By: /s/ Eugene I. Zuriff
       Name:
       Title:

DONNA STILLMAN TRUST

By: /s/ Eugene I. Zuriff
       Name:
       Title:

EX-4 5 smith-ex4_050807.htm Exhibit 4

Project Grill, LLC
120 West 45^th Street
New York, New York 10036

May 6, 2007

St. James Associates, L.P.
c/o Levi Company
85 Larchmont Avenue
Larchmont, New York 10538

Amended and Restated Sale and License Agreement dated
as of the 1^st day of January, 2006, by and between St.
James Associates, L.P., as Licensor, and The Smith &
Wollensky Restaurant Group, Inc., as Licensee, (the
“License Agreement”)

Gentlemen:

Project Grill, LLC, a Delaware limited liability company (“Project Grill”), proposes to acquire all of the outstanding equity interests (the “Acquisition”) in The Smith & Wollensky Restaurant Group, Inc. (“SWRG” or “Licensee”). Following the Acquisition, SWRG, as a wholly owned subsidiary of Project Grill, will continue to be bound by all of the terms, covenants and conditions of the License, and will continue to own and operate the existing eight Smith & Wollensky restaurants owned by SWRG and located outside of the City of New York (the “Licensed Units”). Substantially all of the other assets of SWRG (including the management agreement between St. James Associates, L.P. (“St. James”) and SWRG relating to the operation of the Smith & Wollensky restaurant in New York City) are to be transferred to Mr. Alan Stillman or his designees at the closing of the Acquisition (the “Split-off”).

Following the Acquisition and the Split-off, Patina and Project Grill agree that neither Mr. Stillman nor his designee, will have any equity interest in or any management or consulting responsibilities for SWRG, Project Grill or Patina or any successor or assign of any of the foregoing. The provisions of this paragraph shall survive the Acquisition and Split-off

This letter sets forth the understanding between St. James and Project Grill as to the Acquisition and the Split-off and as to certain amendments to the License Agreement which are to become effective upon the closing of the Acquisition. Capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the License Agreement.

1. At the Closing of the Acquisition, (a) Project Grill shall cause SWRG to execute and deliver to St. James, and (b) St. James will execute and deliver to SWRG, a letter agreement in the form of that attached hereto as Schedule 1, amending and clarifying certain provisions of the License Agreement, and (c) the management agreement, dated May 1, 2001, between St. James and SWRG will be assigned by SWRG to Alan Stillman or an entity controlled by him, and SWRG will be relieved of any further obligations thereunder.

2. The obligations of Project Grill and St. James under the terms of this letter agreement shall automatically terminate and be of no further force and effect (and upon such termination neither party shall have any further obligation or responsibility to the other hereunder) if the Acquisition has not been consummated by Project Grill (or an Affiliate of Project Grill) and SWRG by the earlier to occur of the following: (i) the date on which either SWRG or Project Grill (or an Affiliate of Project Grill) either (x) gives St. James or the other written notice or (y) publicly announces that either Project Grill (or an Affiliate of Project Grill) or SWRG has abandoned its efforts to conclude the Acquisition, (ii) an Acquisition occurs with an entity other than Project Grill (or an Affiliate of Project Grill) or (iii) January1, 2008, unless the Acquisition has closed prior to such date.

3. Project Grill hereby represents and warrants to you that the consideration to be paid by Project Grill in connection with the Acquisition exceeds ninety-one million dollars ($91,000,000.00), and upon the Closing of the Acquisition, Project Grill will have a net worth of at least thirty million dollars ($30,000,000.00).

4. In order to induce you to enter into this Agreement, Project Grill hereby represents and warrants to you as follows:

(i) Project Grill is beneficially owned and controlled by, Fortunato N. Valenti (“Valenti”), Joachim Splichal (“Splichal”) and Bunker Hill Capital, L.P. and Bunker Hill Capital (QP), LP (collectively “Bunker”) who have committed to make capital contributions to Project Grill in the following respective amounts in connection with the Acquisition: Valenti — $6 Million, Splichal — $6 Million and Bunker — $25 Million. In addition Wells Fargo Foothill, Inc. (“WFF”) has committed to provide Project Grill with a credit facility of up to $70 Million in connection with the Acquisition. Copies of the respective commitment letters of Valenti, Splichal , Bunker and WFF have been provided to you concurrently with the execution and delivery of this letter.

(ii) Messrs. Valenti and Splichal (x) serve as officers of Project Grill and as members of its governing board (and of the executive committee of such governing board), and (y) have a substantial equity interest in Project Grill and upon the closing of the Acquisition will have a substantial equity interest in Licensee;

(iii) Mr. Valenti is the Manager and Mr. Splichal is a senior executive of Patina Restaurant Group, LLC (“Patina”), and together with the other executives at Patina have for more than the past five years been continuously engaged in the management of fine dining establishments and other aspects of the food service industry; and

(iv) At the closing of the Acquisition, the warranties and representations set forth in clauses (i) to (iii) above shall be true and correct and, at or prior to that time, Patina will enter into a five-year management services agreement with Licensee pursuant to which Patina will assume responsibility for the management and day to day operation of the Licensed Units (the “MSA”). The MSA will be in substantially in the form of the draft thereof being provided to you concurrently with the execution and delivery of this letter.

5. This letter supersedes and replaces that certain letter agreement between you and Patina, dated February 26, 2007 which is hereby terminated and shall be of no further force and effect.

If the above accurately reflects our understanding as to the subject matter thereof, please so indicate by signing the enclosed copy of this letter and retuning the same to the undersigned.

Sincerely yours,

Project Grill, LLC

By: /s/ Fortunato N. Valenti
Fortunato N. Valenti, Member

Agreed:

St James Associates, L.P.

By its General Partners:

Chamblair Realty, Inc.

and

Smith & Wollensky Operating Corp.

By: /s/ Thomas J. Malmud
Thomas J. Malmud, President

By: /s/ Alan N. Stillman
Alan N. Stillman, President

Patina Restaurant Group, LLC

By: /s/ Fortunato N. Valenti
Fortunato N. Valenti, Manager

SCHEDULE 1—FORM OF AMENDMENT TO LICENSE AGREEMENT

The Smith & Wollensky Restaurant Group, Inc.
880 Third Avenue
New York, New York 10022

[Insert Closing Date] , 2007

St. James Associates, L.P.
c/o Levi Company
85 Larchmont Avenue
Larchmont, New York 10538

Amended and Restated Sale and License Agreement dated
as of the 1st day of January, 2006, by and between St.
James Associates, L.P. as Licensor and The Smith &
Wollensky Restaurant Group, Inc. as Licensee
(the “License Agreement”)

Gentlemen:

Project Grill, LLC, a Delaware limited liability company (the “SWRG Parent”) has, this day, (the “Effective Date”) acquired all of the outstanding equity interests (the “Acquisition”) in The Smith & Wollensky Restaurant Group, Inc. (“SWRG” or “Licensee”). To induce St. James Associates, L.P. (“St. James” or “Licensor”) to execute and deliver this agreement, SWRG Parent and the Licensee jointly and severally warrant and represent to Licensor (i) that SWRG Parent is beneficially owned and controlled by Joachim Splichal (“Splichal”), Fortunato N. Valenti (“Valenti”), and Bunker Hill Capital, L.P. and Bunker Hill Capital (QP), LP, and (ii) that SWRG Parent owns all of the issued and outstanding shares of SWRG.

Patina Restaurant Group, LLC (“Patina”) and Licensee have entered into a Management Services Agreement (the “Management Services Agreement”), pursuant to which Patina has assumed day-to-day management responsibility for the operations of Licensee’s Restaurants, a copy of which is annexed hereto as Exhibit A.

This letter agreement is entered into in connection with the closing of the Acquisition and sets forth the understanding between St. James and SWRG as to certain matters relating to the License Agreement. Capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the License Agreement.

1. Modification of Provisions of Paragraph 4. with respect to new Restaurants.

1.1 Paragraph 4 of the License Agreement is hereby modified as follows:

1.1.1 To add the following language to Paragraph 4.b: "Any relocated Restaurant which is opened in compliance with the provisions of the last grammatical paragraph of Paragraph 4.b of the License Agreement shall not satisfy the obligations of Licensee under Paragraph 4.d of the License Agreement to open new Restaurants and make Additional Sale Price Payments (said obligations of Licensee, collectively, the “Build Out Obligations”).

1.1.2 To add a new subparagraph 4.d. to provide as follows:

d. New Restaurants.

“Between the Effective Date and the sixth (6^th) anniversary of the Effective Date (said period, the “Applicable Period”), Licensee shall (i) open up at least two (2) new Restaurants and make the Additional Sale Price Payment that would be due with respect to each such Restaurant pursuant to the provisions of Paragraph 4.b.(ii) of the License Agreement calculated as of the date of each such payment and (ii) make a non refundable advance payment of Additional Sale Price Payments equal to the product of (x) the number by which four (4) exceeds the number of new Restaurants that are actually opened at that time multiplied by (y) the Additional Sale Price Payment that would be due pursuant to the provisions of Paragraph 4.b.(ii) of the License Agreement calculated as of the date of such payment. Any such non refundable advance payment shall be credited against and serve to reduce any future Additional Sale Price Payments due from Licensee under the provisions of Paragraph 4.b.(ii).”

2. Modification of Paragraph 5.b. Paragraph 5 b. is amended by adding the following sentences to the end thereof: “The one percent (1%) Percentage Royalty shall be payable under the provisions of this Paragraph 5.b. with respect to any Restaurant Sales or Non-Restaurant Sales during the Applicable Period until the fulfillment by Licensee of its Build Out Obligations, but shall not be payable by Licensee thereafter. Notwithstanding the foregoing, in the event that Licensee does not fulfill the Build Out Obligations during the Applicable Period, Licensee shall thereafter be obligated to pay the one percent (1%) Percentage Royalty in accordance with the provisions of the License Agreement and such obligation shall not terminate if Licensee opens up a number of additional new Restaurants after the sixth (6^th) anniversary of the Effective Date so that the total of new Restaurants opened up after the Effective Date equals or exceeds four (4) new Restaurants.

3. Clarifications and Technical Amendments.

3.1 Licensee warrants and represents that attached hereto as Exhibit B is a complete listing of the restaurants owned, operated or managed by Patina as of the Effective Date. Information concerning such restaurants and typical menus for them can be found on Patina’s web site at www.patinagroup.com. Licensee represents and warrants to Licensor that other than Nick & Steph’s, none of such restaurants is a “steakhouse” within the meaning of Paragraph 5.b. of the License Agreement. SWRG acknowledges that Nick & Stef’s is a “steakhouse” within the meaning of Paragraph 5.b. of the License Agreement and that following the closing of the Acquisition, Licensee will be required to pay a one percent (1%) Percentage Royalty pursuant to the provisions of said Paragraph 5.b with respect to Restaurant Sales and Non-Restaurant Sales at any Nick & Stef’s restaurant which is opened on or after the Effective Date but will not be required to pay any such Percentage Royalty with respect to sales at Nick & Stef’s restaurants that were opened prior to the Effective Date as long as Patina remains an Affiliate of Licensee. Licensee further acknowledges and agrees that if after the Effective Date any of the other restaurants now owned, operated or managed by Patina or any Affiliate of Patina or subsequently acquired by Patina or any Affiliate of Patina (or any other Affiliate of Licensee) become or are commonly identified or considered by the public as a steakhouse, then Licensee shall (for so long as Patina remains an Affiliate of Licensee) become liable to pay to Licensor pursuant to the provisions of said Paragraph 5.b. a one percent (1%) Percentage Royalty on the Restaurant Sales and Non-Restaurant Sales at each of such restaurants. The foregoing covenants are in addition and supplementary to the obligations set forth in Paragraph 5.b of the License Agreement.

3.2 The Licensee hereby acknowledges that it continues to be bound by all of the terms and provisions of the License Agreement, and represents and warrants to Licensor (i) that as set forth above, Licensee and Patina have entered into a Management Services Agreement pursuant to which Patina will be responsible for the management of the Restaurants and the Grills, (ii) that Patina is a reputable restaurant operator that has managed high quality, fine dining restaurants continuously during the five-year period immediately preceding the date hereof, and (iii) that Patina is a nationally known reputable company active in the food service business. In the event that the Management Services Agreement is terminated or for any reason neither Patina, Valenti, nor Splichal is, directly or indirectly, in charge of the day to day management of the Restaurants and the Grills, whether in their capacity as owners of equity or as executives of any entity having such management responsibility or otherwise, (any such event a “Change of Conditions”), Licensee will give Licensor written notice thereof (the “Notice of Changed Conditions”) within ten (10) business days of the Change of Conditions. The parties agree that TIME IS EXPRESSLY OF THE ESSENCE WITH RESPECT TO THE GIVING OF THE NOTICE OF CHANGED CONDITIONS and that the failure to give such Notice of Changed Conditions is a material breach of Licensor’s obligations under this Section 3.2. The Notice of Changed Conditions shall include a reasonably detailed statement of the relevant Change of Conditions and the actions the Licensee has taken or is taking in connection with such Change of Conditions in respect of the management of the operations of the Restaurants and Grills to comply with the relevant requirements of the License Agreement and this Section 3.2, such description by Licensee of the actions to include, without limitation, the identity, prior restaurant experience and references for each person to whom, or each of the principals of any entity to which, Licensee has assigned or intends to assign management responsibility for the operations of the Restaurant and Grills in order to assist Licensor in evaluating whether such person meets the relevant requirements of the License Agreement and the Qualifications referred to below. Licensee warrants and covenants that any successor to Patina and any other person or the principals of any entity, as applicable, to whom Licensee assigns management responsibility for the Restaurants and the Grills shall meet the following standards (such standards, the “Qualifications”): (A) a reputable restaurant operator that has managed high quality, fine dining restaurants continuously during the five (5) year period immediately preceding the effective date of such operator’s assumption of responsibility for the management of the Restaurants (or an entity controlled by a restaurant operator having such experience), or (B) a nationally known reputable company active in the food service or hospitality business such as, but not limited to Restaurant Associates or the Hilton or Marriott companies. Any material breach of the Licensor’s obligation under this Section 3.2 shall constitute an Event of Default. It is understood and agreed that the filing of a report with the Securities and Exchange Commission shall not constitute the providing to Licensor of a Notice of Changed Circumstances. Based on such representation and in consideration of the covenants contained in this Section 3.2, Licensor shall not object to the Acquisition whether or not the Licensee strictly complies with the provisions in the first sentence of Paragraph 8.b(i) of the License Agreement (it being understood that such failure to object shall in no event be deemed to constitute an amendment to the License Agreement or a waiver of any of the rights of Licensor hereunder).

3.3 Paragraph 8. b. of the License Agreement is hereby modified by deleting all of the text after the first “provided, however” provision thereof and replacing that language with the following: “provided, however, that if Licensee shall sell or otherwise transfer its entire business (as opposed to merely its rights under this Agreement), whether simultaneously or subsequent to any assignment permitted hereby, then this Agreement and all rights of the Licensee hereunder shall terminate simultaneously with such sale unless prior thereto, Licensee or its assignee shall furnish to Licensor then current audited financial statements(which financial statements must be prepared in accordance with generally accepted accounting principles and accompanied by a favorable opinion of an independent certified public accountant) demonstrating that such assignee has a net worth of not less than $20 Million (determined in accordance with generally accepted accounting principles) both before and after giving effect to the assignment).

3.4 Paragraph 12.a (iv) is hereby deleted to eliminate any prohibition on the opening of steakhouses that do not utilize the Marks.

3.5 The notice provisions set forth in Paragraph 18.e. of the License Agreement are hereby amended as follows: (a) to provide that notices to SWRG be sent to it in care of Patina Restaurant Group, LLC 120 West 45^th Street, New York, New York 10036, Attention: Chief Executive Officer and that copies of all such notices be sent to: Dornbush Schaeffer Strongin & Venaglia, LLP, 747 Third Avenue, New York, New York 10017, Attention: Landey Strongin, Esq. and to Bingham McCutchen, 150 Federal Street, Boston, Mass. 02110, Attn: Brian Keeler, Esq., and (b) to provide that after the Effective Date all payments to Licensor shall be made to St. James Associates, L.P. c/o Smith & Wollensky Operating Corp., 880 Third Avenue, New York, New York, 10022, Attention: Alan N. Stillman.

3.6 Paragraph 18.f of the License Agreement is hereby deleted in its entirety and replaced by the following:

“f. Licensor hereby acknowledges that Licensee and its Affiliates are currently engaged in other business ventures and activities which could be considered to be competitive with the NY Restaurant and any other Restaurants and Grills which may hereafter be opened. Subject to the specific limitations contained in this Agreement, Licensee and its Affiliates may engage in other business ventures of every nature and description, independently or with others, including without limitation restaurant businesses in all its phases, even if the same compete with the NY Restaurant or any Restaurants or Grills, and except as expressly provided herein, neither Licensor nor any partner thereof shall have any rights in or claims with respect to said ventures, or the income or profits derived therefrom.”

3.7 The following definitions in the License Agreement are modified:

3.7.1 The second sentence of the definition of Affiliate contained in Paragraph 1 of the License Agreement is hereby deleted and replaced by the following two sentences: “The term “Affiliate” shall also include any limited liability company, corporation or other entity which any Affiliate of Licensee “controls”, that is (x) in the case of a corporation, where any Affiliate of Licensee possesses the power to direct the management of the entity through ownership of a majority of the voting securities, by voting trust agreement or otherwise, and (y) in the case of a partnership or limited liability company where any Affiliate of Licensee is designated as managing general partner or manager, as the case may be. Under all circumstances, Patina (or any of its successors or assigns) shall be deemed an Affiliate of Licensee for so long as Patina (or any such successor or assign) (i) has responsibility for the management of the Restaurants or the Grills or (ii) is controlled, directly or indirectly, by any person, including Valenti or Splichal, who directly or indirectly controls or has a direct or indirect equity interest in Licensee, SWRG or SWRG Parent. Notwithstanding the preceding, for the purposes only of interpreting the provisions of Paragraph 5.b.Shidax Corporation shall not be considered an Affiliate of Licensee with respect to any restaurant which (a) is not operated under the Marks, and (b) is located in Japan, China, South Korea, Singapore or Thailand.”

3.7.2 The definition of Grill is modified to add, after the word “restaurant” in the first line thereof the following: “operating under the Marks and which is owned, operated or leased by Licensee or any Sublicensee or by any Affiliate of either and”.

3.7.3 The definition of Restaurant is modified to add, after the word "Sublicensee" in the second line thereof, the following: “or by any Affiliate of either”.

3.8 The following new Paragraph 5.f. is added to the License: “f. For the avoidance of doubt, each Restaurant (but not a Grill) shall pay a Percentage Royalty under Paragraph 5.a. and each Grill (but not any Restaurant) shall pay a Grill Percentage Royalty under Paragraph 5.c. but no Restaurant or Grill shall pay both a Percentage Royalty and a Grill Percentage Royalty.”

3.9 Paragraph 18.d. is amended to provide that any arbitration proceeding provided for therein shall be held in Manhattan in the City of New York.

3.10 Paragraph 11 of the License Agreement is hereby deleted and replaced with the following:

"The parties acknowledge that it may be mutually advantageous to simultaneously advertise or promote the NY Restaurant along with the Restaurants and Grills and/or other restaurants that may be owned or operated by Licensee or its Affiliates. Licensee or its Affiliates may do so, but only after obtaining the prior written consent of Licensor, which Licensor may withhold in its sole and absolute discretion. Any request for a consent shall be accompanied by a copy of the advertisement or promotional material, the media in which it is to be used, the dates of such use, the cost thereof, and the portion of the cost which Licensee requests Licensor to bear. If Licensor shall fail to respond within ten (10) days to such request, the request shall be deemed not consented to. Notwithstanding the foregoing, if any such advertisement or promotion which is consented to by Licensor shall depict or refer to any Restaurant or Grill, whether or not the NY Restaurant is mentioned prominently, the entire cost of such promotion or advertisement shall be paid by Licensee.”

4. Ratification of License Agreement. Except as modified by this instrument, the License Agreement is ratified, confirmed and approved.

If the above accurately reflects our understanding as to the subject matter thereof, please so indicate by signing the enclosed copy of this letter and retuning the same to the undersigned.

Sincerely yours,

The Smith & Wollensky Restaurant Group, Inc.

By:
Fortunato N. Valenti, President

The foregoing is agreed to:

St James Associates, L.P.
By: Chamblair Realty, Inc.
General Partner

By:
        Thomas J. Malmud,
        President

By: Smith & Wollensky Operating Corp.
General Partner

By:
Alan N. Stillman, President

Patina Restaurant Group, LLC

By:
Fortunato N. Valenti, Manager

Project Grill, LLC

By:
Fortunato N. Valenti, Member

EXHIBIT A—MANAGEMENT SERVICES AGREEMENT

EXHIBIT B—LIST OF RETAURANTS OWNED AND MANAGED BY PATINA

NEW YORK CITY
Rockefeller Center
The Rink • The Rink Bar • Rock Center Café • The Sea Grill • Cucina & Co.
MetLife Building
Café Centro • Cucina & Co. • Cucina Express • Naples 45 • Tropica
The Metropolitan Opera House at Lincoln Center
The Grand Tier Restaurant
The Seagram Building
Brasserie
The Gordon Bunshaft Building
Brasserie 8 ½
Macy’s Herald Square
Macy’s Cellar Bar & Grill • Cucina & Co.
Madison Square Garden
Nick + Stef’s Steakhouse

GREATER METRO NEW YORK
Panevino Ristorante (Livingston, NJ)

DOWNTOWN LOS ANGELES
Cafe Pinot • Zucca Ristorante
Music Center of Los Angeles County
Patina • Concert Hall Café at Walt Disney Concert Hall
Kendall’s Brasserie and Bar • Pinot Grill • Spotlight Cafe
Wells Fargo Center
Nick & Stef’s Steakhouse • Market Cafe
Museum Of Contemporary Art
Patinette Cafe

GREATER LOS ANGELES
eat. on sunset • lounge. on sunset • Pinot Bistro
Los Angeles County Museum of Art
Pentimento • Plaza Cafe

ORANGE COUNTY
Park Privé, an exclusive event venue • Market Cafe • Pinot Provence
Orange County Performing Arts Center
Leatherby’s Cafe Rouge • Market Cafe
Bowers Museum
Tangata
Downtown Disney® District
Catal Restaurant & Uva Bar • Naples • Napolini • Tortilla Jo’s

LAS VEGAS
Pinot Brasserie at the Venetian

NORTHERN CALIFORNIA
Julia’s Kitchen at COPIA • American Market Café at COPIA

Other Museums and Performing Arts Centers
Cerritos Center for Performing Arts • Descanso Gardens • Hollywood Bowl
Norton Simon Museum • San Francisco War Memorial and Performing Arts Center

EX-5 6 smith-ex5_050807.htm Exhibit 5

LIMITED GUARANTEE

LIMITED GUARANTEE, dated as of May 6, 2007 (this “Limited Guarantee”), by Alan N. Stillman (the “Guarantor”) in favor of The Smith & Wollensky Restaurant Group, Inc., a Delaware corporation (the “Guaranteed Party”).

1. GUARANTEE. To induce the Guaranteed Party to enter into that certain Amended and Restated Agreement and Plan of Merger, dated as of May 6, 2007 (as amended, restated, supplemented or otherwise modified from time to time, the “Merger Agreement”), by and among the Guaranteed Party, Project Grill, LLC, a Delaware limited liability company (“Parent”), and SWRG Holdings, Inc., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub”), pursuant to which Merger Sub will merge with and into the Guaranteed Party (the “Merger”), the Guarantor, intending to be legally bound, hereby absolutely, irrevocably and unconditionally guarantees to the Guaranteed Party, on the terms and conditions set forth herein, the due and punctual payment when due of 4.73% (the “Guaranteed Percentage”) of the payment obligations of Parent with respect to the Parent Termination Fee, subject to the terms and limitations of the Merger Agreement (the “Obligations”), provided that in no event shall the Guarantor’s aggregate liability under this Limited Guarantee exceed an amount (the “Cap”) equal to the lesser of (i) the Guaranteed Percentage multiplied by the Parent Termination Fee or (ii) $212,925.00 (it being understood that this Limited Guarantee may not be enforced against the Guarantor without giving effect to the Cap). The Guaranteed Party hereby agrees that in no event shall the Guarantor be required to pay to any Person under, in respect of, or in connection with this Limited Guarantee, more than the Cap, and that Guarantor shall not have any obligation or liability to any Person relating to, arising out of or in connection with this Limited Guarantee or the Merger Agreement other than as expressly set forth herein. The Guaranteed Party further acknowledges that in the event that Parent or Merger Sub has any unsatisfied Obligations, payment of the Guaranteed Percentage of such unsatisfied Obligations by Guarantor (or by any other Person, including Parent or Merger Sub, on behalf of Guarantor) shall constitute satisfaction in full of Guarantor’s obligation with respect thereto. All payments hereunder shall be made in lawful money of the United States by wire transfer of immediately available funds to one or more accounts specified by the Guaranteed Party in writing. Concurrently with the delivery of this Limited Guarantee, the parties set forth on Schedule A (the “Other Guarantors”) are also entering into limited guarantees (the “Other Guarantees”) with the Guaranteed Party. Each capitalized term used and not defined herein shall have the meaning ascribed to it in the Merger Agreement, except as otherwise provided.

Without limiting, and in furtherance of, the foregoing, the Guarantor hereby acknowledges that the Guaranteed Party may, in its sole discretion, bring and prosecute a separate action or actions against the Guarantor for the full amount of the Guarantor’s Guaranteed Percentage of the Obligations (subject to the Cap), regardless of whether action is brought against Parent, Merger Sub or the Other Guarantors or whether Parent, Merger Sub or the Other Guarantors are joined in any such action or actions.

2. NATURE OF GUARANTEE. The Guaranteed Party shall not be obligated to file any claim relating to the Obligations in the event that Parent or Merger Sub becomes subject to a bankruptcy, reorganization or similar proceeding, and the failure of the Guaranteed Party to so file shall not affect the Guarantor’s obligations hereunder. In the event that any payment to the Guaranteed Party in respect of the Obligations is rescinded or must otherwise be returned to the Guarantor for any reason whatsoever, the Guarantor shall remain liable hereunder with respect to its Guaranteed Percentage of the Obligations (subject to the Cap) as if such payment had not been made. This Limited Guarantee is an unconditional guarantee of payment and not of collection.

3. CHANGES IN OBLIGATIONS, CERTAIN WAIVERS. The Guarantor agrees that the Guaranteed Party may at any time and from time to time, without notice to or further consent of the Guarantor, extend the time of payment of any of the Obligations, and may also make any agreement with Parent or Merger Sub for the extension, renewal, payment, compromise, discharge or release thereof, in whole or in part, without in any way impairing or affecting the Guarantor’s obligations under this Limited Guarantee. The Guarantor agrees that the obligations of Guarantor hereunder shall not be released or discharged, in whole or in part, or otherwise affected by, among other things, (a) the failure or delay on the part of the Guaranteed Party to assert any claim or demand or to enforce any right or remedy against Parent, Merger Sub, the Other Guarantors or any other Person; (b) any change in the time, place or manner of payment of any of the Obligations or any rescission, waiver, compromise, consolidation or other amendment or modification of any of the terms or provisions of the Merger Agreement made in accordance with the terms thereof or any agreement evidencing, securing or otherwise executed in connection with any of the Obligations; (c) the addition, substitution or release of any Person (whether or not such Person is interested in the transactions contemplated by the Merger Agreement), including, without limitation, the Other Guarantors; (d) any change in the corporate existence, structure or ownership of Parent, Merger Sub or any other Person (whether or not such Person is interested in the transactions contemplated by the Merger Agreement), including, without limitation, the Other Guarantors; (e) any insolvency, bankruptcy, reorganization or other similar proceeding affecting Parent, Merger Sub or any other Person liable with respect to any of the Obligations (including, without limitation, the Other Guarantors); (f) the existence of any claim, set-off or other right which the Guarantor may have at any time against Parent, Merger Sub, the Guaranteed Party or any other Person, whether in connection with the Obligations or otherwise; or (g) the adequacy of any other means the Guaranteed Party may have of obtaining payment related to the Obligations. To the fullest extent permitted by Law the Guarantor hereby irrevocably and unconditionally expressly waives any and all rights or defenses arising by reason of any Law which would otherwise require any election of remedies by the Guaranteed Party. Without limiting, and in furtherance of, the foregoing, the Guarantor hereby irrevocably and unconditionally expressly waives promptness, diligence, notice of the acceptance of this Limited Guarantee and of the Obligations, presentment, demand for payment, notice of non-performance, default, dishonor and protest, notice of any Obligations incurred and all other notices of any kind (other than notices to Parent or Merger Sub pursuant to the Merger Agreement), all defenses which may be available by virtue of any valuation, stay, moratorium Law or other similar Law now or hereafter in effect, any right to require the marshalling of assets of Parent or Merger Sub or any other Person (whether or not such Person is interested in the transactions contemplated by the Merger Agreement), including, without limitation, the Other Guarantors, and all suretyship defenses generally (other than fraud or willful misconduct by the Guaranteed Party or any of its Subsidiaries or Affiliates, defenses to the payment of the Obligations that are available to Parent or Merger Sub under the Merger Agreement or breach by the Guaranteed Party of this Limited Guarantee). The Guarantor hereby acknowledges that it will receive substantial direct and indirect benefits from the transactions contemplated by the Merger Agreement and that the waivers set forth in this Limited Guarantee are knowingly made in contemplation of such benefits. The Guaranteed Party hereby covenants and agrees that it shall not institute, directly or indirectly, and shall cause its Subsidiaries and Affiliates not to institute, any proceeding or bring any other claim arising under, or in connection with, the Merger Agreement, the transactions contemplated thereby or the Equity Financing Commitments, against the Guarantor or any Non-Recourse Party (as defined in Section 9 hereof), except for claims against the Guarantor under this Limited Guarantee (subject to the limitations described herein) and against the Other Guarantors under the Other Guarantees. The Guarantor hereby covenants and agrees that it shall not institute, directly or indirectly, and shall cause its Subsidiaries and Affiliates not to institute, any proceeding or bring any other claim asserting that this Limited Guarantee is illegal, invalid or unenforceable in accordance with its terms.

The Guarantor hereby irrevocably and unconditionally waives any rights that it may now have or hereafter acquire against Parent or Merger Sub that arise from the existence, payment, performance, or enforcement of the Guarantor’s obligations under or in respect of this Limited Guarantee or any other agreement in connection therewith, including, without limitation, any right of subrogation, reimbursement, exoneration, contribution or indemnification and any right to participate in any claim or remedy of the Guaranteed Party against Parent or Merger Sub or such other Person (including the Other Guarantors), whether or not such claim, remedy or right arises in equity or under contract, statute or common Law, including, without limitation, the right to take or receive from Parent or Merger Sub or such other Person (including the Other Guarantors), directly or indirectly, in cash or other property or by set-off or in any other manner, payment or security on account of such claim, remedy or right, unless and until all of the Obligations and all other amounts payable under this Limited Guarantee shall have been paid in full in immediately available funds. If any amount shall be paid to the Guarantor in violation of the immediately preceding sentence at any time prior to the payment in full in immediately available funds of the Obligations and all other amounts payable under this Limited Guarantee, such amount shall be received and held in trust for the benefit of the Guaranteed Party, shall be segregated from other property and funds of the Guarantor and shall forthwith be paid or delivered to the Guaranteed Party in the same form as so received (with any necessary endorsement or assignment) to be credited and applied to the Obligations and all other amounts payable under this Limited Guarantee, in accordance with the terms of the Merger Agreement, whether matured or unmatured, or to be held as collateral for any Obligations or other amounts payable under this Limited Guarantee thereafter arising. Notwithstanding anything to the contrary contained in this Limited Guarantee, the Guaranteed Party hereby agrees that to the extent Parent and Merger Sub are relieved of any of their obligations with respect to the Parent Termination Fee, the Guarantor shall be similarly relieved of its obligations under this Limited Guarantee.

4. NO WAIVER; CUMULATIVE RIGHTS. No failure on the part of the Guaranteed Party to exercise, and no delay in exercising, any right, remedy or power hereunder shall operate as a waiver thereof; nor shall any single or partial exercise by the Guaranteed Party of any right, remedy or power hereunder preclude any other or future exercise of any right, remedy or power hereunder. Each and every right, remedy and power hereby granted to the Guaranteed Party shall be cumulative and not exclusive of any other, and may be exercised by the Guaranteed Party at any time or from time to time. The Guaranteed Party shall not have any obligation to proceed at any time or in any manner against, or exhaust any or all of the Guaranteed Party’s rights against, the Parent or any other Person (including, without limitation, the Other Guarantors) liable for any Obligations prior to proceeding against the Guarantor hereunder.

5. REPRESENTATIONS AND WARRANTIES. The Guarantor hereby represents and warrants to the Guaranteed Party that:

(a) the execution, delivery and performance of this Limited Guarantee have been duly authorized by all necessary action and do not contravene any provision of the Guarantor’s certificate of incorporation, certificate of formation, partnership agreement, operating agreement or similar organizational documents or any Law, regulation, rule, decree, order, judgment or contractual restriction binding on the Guarantor or its assets;

(b) all consents, approvals, authorizations, permits of, filings with and notifications to, any governmental authority necessary for the due execution, delivery and performance of this Limited Guarantee by the Guarantor have been obtained or made and all conditions thereof have been duly complied with, and no other action by, and no notice to or filing with, any governmental authority or regulatory body is required in connection with the execution, delivery or performance of this Limited Guarantee;

(c) this Limited Guarantee constitutes a legal, valid and binding obligation of the Guarantor enforceable against the Guarantor in accordance with its terms, subject to (i) the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other similar Laws affecting creditors’ rights generally, and (ii) general equitable principles (whether considered in a proceeding in equity or at Law); and

(d) the Guarantor has the financial capacity to pay and perform all of its obligations under this Limited Guarantee, and all funds necessary for the Guarantor to fulfill its obligations under this Limited Guarantee shall be available to the Guarantor (or its assignee pursuant to Section 6 hereof) for so long as this Limited Guarantee shall remain in effect in accordance with Section 8 hereof.

6. NO ASSIGNMENT. Neither the Guarantor nor the Guaranteed Party may assign or delegate its rights, interests or obligations hereunder to any other Person without the prior written consent of the other party hereto.

7. NOTICES. All notices, requests, claims, demands and other communications hereunder shall be given by the means specified in the Merger Agreement (and shall be deemed given as specified therein), as follows:

                if to the Guarantor:

                Alan N. Stillman
                c/o The Smith & Wollensky Restaurant Group, Inc.
                880 Third Avenue
                New York, NY 10022
                Attention: Alan N. Stillman
                Tel: (212) 838-2061

                with a copy (which shall not constitute notice) sent at the same time and by the same means to:

                Stroock & Stroock & Lavan LLP
                180 Maiden Lane
                New York, NY 10038
                Attention: Martin H. Neidell
                Tel: (212) 806-5836
                Facsimile: (212) 806-7836

If to the Guaranteed Party, as provided in the Merger Agreement.

8. CONTINUING GUARANTEE. This Limited Guarantee may not be revoked or terminated and shall remain in full force and effect and shall be binding on the Guarantor, its successors and assigns until all of the Obligations payable under the Limited Guarantee have been paid in full. Notwithstanding the foregoing, this Limited Guarantee shall terminate and the Guarantor shall have no further obligations under this Limited Guarantee as of the earliest of (i) the Effective Time, (ii) the termination of the Merger Agreement in accordance with Section 8.1(a) thereof or under circumstances in which Parent would not be obligated to pay the Parent Termination Fee, and (iii) 91 days after any termination of the Merger Agreement in accordance with its terms under circumstances in which Parent would be obligated to the Parent Termination Fee if the Guaranteed Party has not presented a claim for payment of any Obligation to the Guarantor by such 91^st day.

9. NO RECOURSE. Notwithstanding anything that may be expressed or implied in this Limited Guarantee or any document or instrument delivered in connection herewith, by its acceptance of the benefits of this Limited Guarantee, the Guaranteed Party covenants, agrees and acknowledges that no Person other than the Guarantor has any obligations hereunder and that, notwithstanding that the Guarantor may be a partnership or limited liability company, the Guaranteed Party has no right of recovery under this Limited Guarantee or in any document or instrument delivered in connection herewith, or for any claim based on, in respect of, or by reason of, such obligations or their creation, against, and no personal liability shall attach to, the former, current or future equity holders, controlling persons, directors, officers, employees, agents, Affiliates, members, managers, general or limited partners or assignees of any of the Guarantor, Parent, Merger Sub or the Other Guarantors, or any former, current or future stockholder, controlling person, director, officer, employee, general or limited partner, member, manager, Affiliate, agent or assignee of any of the foregoing (collectively, but not including Parent, Merger Sub and the Other Guarantors, each a “Non-Recourse Party”), through Parent, Merger Sub or otherwise, whether by or through attempted piercing of the corporate veil, by or through a claim by or on behalf of Parent or Merger Sub against any Non-Recourse Party (including a claim to enforce the Equity Financing Commitments), by the enforcement of any assessment or by any legal or equitable proceeding, by virtue of any statute, regulation or applicable Law, or otherwise, and the Guaranteed Party further covenants, agrees and acknowledges that the only rights of recovery that the Guaranteed Party has in respect of the Merger Agreement or the transactions contemplated thereby are its rights to recover from Parent and Merger Sub under and to the extent expressly provided in the Merger Agreement, Guarantor (but not any Non-Recourse Party) under and to the extent expressly provided in this Limited Guarantee and subject to the Cap and the other limitations described herein and the Other Guarantors pursuant to and subject to the limitations set forth in the Other Guarantees. The Guaranteed Party acknowledges and agrees that Parent and Merger Sub have no assets other than cash in a de minimis amount and that no additional funds are expected to be contributed to Parent or Merger Sub unless and until the Closing occurs. Nothing set forth in this Limited Guarantee shall confer or give or shall be construed to confer or give to any Person other than the Guaranteed Party (including any Person acting in a representative capacity) any rights or remedies against any Person including Guarantor, except as expressly set forth herein.

10. GOVERNING LAW; JURISDICTION. This Limited Guarantee shall be deemed to be made in and in all respects shall be interpreted, construed and governed by and in accordance with the Laws of the State of New York applicable to contracts executed in and to be performed therein without regard to the conflicts of law principles thereof. The parties hereby irrevocably submit to the personal jurisdiction of the courts of the State of New York located in the Borough of Manhattan, and the Federal courts of the United States of America located in the State of New York, Borough of Manhattan, solely in respect of the interpretation and enforcement of the provisions of this Limited Guarantee and of the documents referred to in this Limited Guarantee, and in respect of the transactions contemplated hereby, and hereby waive, and agree not to assert, as a defense in any action, suit or proceeding for the interpretation or enforcement hereof or of any such document, that it is not subject thereto or that such action, suit or proceeding may not be brought or is not maintainable in said courts or that the venue thereof may not be appropriate or that this Limited Guarantee or any such document may not be enforced in or by such courts, and the parties hereto irrevocably agree that all claims with respect to such action or proceeding shall be heard and determined in such a New York State or Federal court. The parties hereby consent to and grant any such court jurisdiction over the person of such parties and, to the extent permitted by Law, over the subject matter of such dispute and agree that mailing of process or other papers in connection with any such action or proceeding in the manner provided herein or in such other manner as may be permitted by Law shall be valid and sufficient service thereof.

11. WAIVER OF JURY TRIAL. Each party acknowledges and agrees that any controversy which may arise under this Limited Guarantee is likely to involve complicated and difficult issues, and therefore each such party hereby irrevocably and unconditionally waives any right such party may have to a trial by jury in respect of any litigation directly or indirectly arising out of or relating to this Limited Guarantee, or the transactions contemplated by this Limited Guarantee. Each party hereby certifies and acknowledges that (i) no representative, agent or attorney of any other party has represented, expressly or otherwise, that such other party would not, in the event of litigation, seek to enforce the foregoing waiver, (ii) each party understands and has considered the implications of this waiver, (iii) each party makes this waiver voluntarily, and (iv) each party has been induced to enter into this Limited Guarantee by, among other things, the mutual waivers and certifications in this Section 11.

12. COUNTERPARTS. This Limited Guarantee may be executed in any number of counterparts (including by facsimile), each such counterpart when executed being deemed to be an original instrument, and all such counterparts shall together constitute one and the same agreement.

13. NO THIRD PARTY BENEFICIARIES. Except as provided in Section 9, the parties hereby agree that their respective representations, warranties and covenants set forth herein are solely for the benefit of the other party hereto, in accordance with and subject to the terms of this Limited Guarantee, and this Limited Guarantee is not intended to, and does not, confer upon any Person other than the parties hereto any rights or remedies hereunder, including, the right to rely upon the representations and warranties set forth herein.

14. CONFIDENTIALITY. This Limited Guarantee shall be treated as confidential and is being provided to the Guaranteed Party solely in connection with the Merger. This Limited Guarantee may not be used, circulated, quoted or otherwise referred to in any document, except with the written consent of the Guarantor and the Guaranteed Party; provided that no such written consent shall be required (and the Guarantor and its Affiliates shall be free to release such information) for disclosures to Guarantor’s and its Affiliates’ respective Representatives, so long as such Persons agree to keep such information confidential on terms substantially identical to the terms contained in this Section 14; provided, further, that the Guarantor and the Guaranteed Party may disclose the existence of this letter agreement to the extent required by Law, the applicable rules of any national securities exchange or in connection with any SEC filings relating to the Merger.

15. MISCELLANEOUS.

(a) This Limited Guarantee contains the entire agreement between the parties relative to the subject matter hereof and supersedes all prior agreements and undertakings between the parties (written or oral) with respect to the subject matter hereof. No modification or waiver of any provision hereof shall be enforceable unless approved by the Guaranteed Party and the Guarantor in writing.

(b) Any term or provision hereof that is prohibited or unenforceable in any jurisdiction shall be, as to such jurisdiction, ineffective solely to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction; provided, however, that this Limited Guarantee may not be enforced without giving effect to the limitation of the amount payable hereunder to the Cap provided in Section 1 hereof and the provisions of Sections 8 and 9 and this Section 15(b).

(c) The descriptive headings herein are inserted for convenience of reference only and are not intended to be part of or to affect the meaning or interpretation of this Limited Guarantee.

(d) All parties acknowledge that each party and its counsel have reviewed this Limited Guarantee and that any rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Limited Guarantee.

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IN WITNESS WHEREOF, the Guarantor has caused this Limited Guarantee to be executed and delivered as of the date first written above by its officer thereunto duly authorized.

GUARANTOR:

ALAN N. STILLMAN

By:  /s/ Alan N. Stillman
        Name:
        Title:

IN WITNESS WHEREOF, the Guaranteed Party has caused this Limited Guarantee to be executed and delivered as of the date first written above by its officer thereunto duly authorized.

GUARANTEED PARTY:

THE SMITH & WOLLENSKY RESTAURANT
      GROUP, INC.

By:  /s/ Richard A. Mandel
        Name:
        Title:

CONSENT TO AND ACKNOWLEDGMENT OF ASSIGNMENT

LIMITED GUARANTEE

SCHEDULE A

Fortunato N. Valenti

Joachim B. Splichal

Bunker Hill Capital, L.P.