Birch Holdings LLC, et al. – ‘SC 13D’ on 2/17/98 re: Discovery Zone Inc – EX-4

As of:  Tuesday, 2/17/98   ·   Accession #:  950142-98-168   ·   File #:  5-43337

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General Statement of Beneficial Ownership   —   Schedule 13D
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: SC 13D      General Statement of Beneficial Ownership              9     37K 
 2: EX-1        Exhibit A                                              1      6K 
 3: EX-2        Exhibit C                                             94    206K 
 4: EX-3        Exhibit D                                              5     20K 
 5: EX-4        Exhibit E                                              3     11K 

EX-4   —   Exhibit E

EX-4
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                                                                       EXHIBIT E

                   January 8, 1998

VIA FACSIMILE                                                                   
212-265-8049                                                                    

B1 Investments LLC                                                              
Balfour Investors Incorporated                                                  
Veritov Trade, Inc.                                                             
c/o Balfour Investors Incorporated                                              
620 Fifth Avenue                                                                
New York, NY  10020                                                             
Attention:  Mr. Ken Grossman                                                    

    Re:   Discovery Zone, Inc. Class 6 Common Stock and Warrants

Gentlemen:                                                                      

            Reference is made to (i) that certain Amended and Restated Operating
Agreement of Birch Holdings LLC ("Birch"), dated as of July 17, 1996, among     
Birch Acquisition LLC ("SM Acquisition"), B1 Investments LLC ("BF Acquisition") 
and the individual named therein as the withdrawing member (the "Agreement"),   
and (ii) that certain letter agreement (the "Letter Agreement"), also dated July
17, 1996, between SM Acquisition, BF Acquisition and Veritov, Trade Inc.        
("Veritov"). Capitalized terms used but not otherwise defined herein shall have 
the respective meanings ascribed thereto in the Agreement of the Letter         
Agreement, as the case may be.                                                  

       The purpose of this letter is to confirm our understanding with
respect to the following matters:                                               

     1.    Upon issuance of the shares DZ Common Stock and General
              Warrants in accordance with the letter of instruction (the
                  "Letter of Instruction") dated December 23, 1997 to Mr. Robert
               Rooney of DZ (a copy of which is attached hereto as Exhibit
                 A), such issuances by DZ shall be in full satisfaction of the
        obligations of the Company, SM Acquisition and their
         respective Affiliates to distribute or transfer to BF
              Acquisition and its Affiliates (including each of you) any
           warrants to purchase DZ Common Stock. In addition, such
issuances shall be deemed to constitute a   

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                 BF Acquisition Satisfaction Event, with the effects set forth
in paragraph 3(i) of the Letter Agreement.  

       2.    The provisions of Article 8 of the Agreement shall apply,
            mutatis mutandis, to the 213,983 and 37,757 shares of DZ
      Common Stock held by Balfour in Veritov and Birch,
        respectively, to be issued pursuant to the Letter of
           Instruction, and each of you agrees to be bound by such
    provisions to the same extent as BF Acquisition.

           If the foregoing correctly sets forth our agreement with respect to
the subject matter hereof, please sign the attached copy of this letter, which  
shall serve as our agreement, and return the same to me.                        

               Very truly yours,

                   BIRCH ACQUISITION LLC

                     By: /s/ Greg S. Feldman
                                           -------------------------------------
                            Name:  Greg S. Feldman
                             Title: Managing Partner

Acknowledged and Agreed:                                                        

B1 INVESTMENTS LLC                                                              

By: /s/ Jay Goldsmith                                                           
------------------------------                                          
Name:  Jay Goldsmith                                                    
Title: Member                                                           

BALFOUR INVESTORS INC.                                                          

By: /s/ Harry I. Freund                                                         
------------------------------                                          
Name:  Harry I. Freund                                                  
Title: Chairman of the Board                                            

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VERITOV TRADE, INC.                                                             

By: /s/ Harry I. Freund                                                         
------------------------------                                          
Name:  Harry I. Freund                                                  
Title: President                                                        

Dates Referenced Herein

				Referenced-On Page
This ‘SC 13D’ Filing		Date		First		Last			Other Filings
Filed on:		2/17/98							None on these Dates
		1/8/98		1
		12/23/97		1
		7/17/96		1
									List all Filings