Exhibit 10.33
LOAN NO.163
LOAN AND SECURITY AGREEMENT
Made By
SYBRA, INC.
a Michigan Corporation
("Borrower")
in favor of
U.S. RESTAURANT LENDING GROUP I, L P.
a Delaware Limited Partnership
("Secured Party")
LOAN AND SECURITY AGREEMENT
LOAN AND SECURITY AGREEMENT (this "Security Agreement"), dated as of
December 22, 1999, by SYBRA, INC., a Michigan corporation (the "Borrower"), in
favor of U.S. RESTAURANT LENDING GROUP I, L.P., a Delaware limited partnership
(together with its successors and assigns, the "Secured Party").
PRELIMINARY STATEMENTS
1. On the date hereof the Secured Party will make the loans
(individually, a "Loan", and collectively, the "Loans") to the Borrower
reflected in the promissory notes (individually, a "Promissory Note", and
collectively, the "Promissory Notes") in the aggregate loan amount (the
"Aggregate Loan Amount") of $5,500,000.00, dated the date hereof, in the form of
EXHIBIT E prepared by and acceptable to Secured Party, which Promissory Notes
will evidence the Borrower's obligation, INTER, ALIA (i) to repay the Loans, and
(ii) to pay interest and other amounts as set forth therein. The value of that
certain Promissory Note executed by Borrower with respect to this Security
Agreement is $100,000.00.
2. It is a condition to the making of the Loan, that the Borrower shall
have executed and delivered this Security Agreement whereby the Borrower, in
order to provide security for the full payment when due of all amounts payable
under the Promissory Note, shall pledge and grant to the Secured Party a
security interest in the collateral described herein.
NOW THEREFORE, in consideration of the foregoing and in order to induce
the Secured Party to make the Loan available to the Borrower and for other good
and valuable consideration, the receipt and sufficiency of which the Borrower
hereby acknowledges, the Borrower and the Secured Party agree as follows:
ARTICLE I
DEFINITIONS AND OTHER TERMS
1. Definitions and Other Terms.
1. 1. DEFINED TERMS. The following terms shall have the meanings herein
specified unless the context otherwise requires. All terms not otherwise defined
herein shall have the meaning ascribed to such terms in the Promissory Note. All
terms defined in the singular will have the same meaning when used in the plural
and vice versa.
"ACCOUNTS" means, "accounts", with respect to the Pledged
Store, as such term is defined in the UCC.
"AFFILIATE" means, with respect to any designated Person, any
Person that, directly or indirectly, controls or is controlled by or is under
common control with such designated Person and, without limiting the generality
of the foregoing, shall include, (i) any Person who is a director or officer of
the designated Person; (ii) any Person of which or whom the designated Person is
a director or officer; (iii) any Person, who, directly or indirectly, is the
legal or beneficial owner of or controls 10% or more of any class of equity
securities of the designated Person; and (iv) any Person, who is an Affiliate,
as defined in clauses (i), (ii) or (iii) of an Affiliate of the specified
person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlled by" and "under common control
LOAN AND SECURITY AGREEMENT -- PAGE 1
SYBRA, INC./LOAN NO. 163
ARBY'S/DALLAS, TEXAS
with"), as used with respect to any Person, shall mean the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of such Person, whether through the ownership of voting securities,
by contract or otherwise.
"BORROWER" means the Person or Persons (if more than one,
collectively, and jointly and severally) executing this Agreement as Borrower.
"BUSINESS" means the Pledged Stores operated by the Borrower.
"BUSINESS DAY" means any day other than a Saturday, Sunday or
a day on which borrowing institutions in New York, New York, are authorized or
obligated by law or executive order to be closed.
"BUSINESS VALUATION" means the business valuation of the
Pledged Store and Collateral prepared by Valuation Consultants.
"CHANGE IN CONTROL" means the sale, transfer or other
disposition, whether voluntary or involuntary, of more than forty-nine percent
(49.0%) of the outstanding voting equity interest in Borrower without Lender's
prior written consent, which consent shall not be unreasonably withheld or
delayed, or the merger, consolidation or combination of Borrower with any other
Person where Borrower is not the surviving entity.
"CHATTEL PAPER" means the chattel paper, as defined under the
UCC, with respect to the Pledged Store.
"CODE" means the Internal Revenue Code of 1986 as amended.
"COLLATERAL" has the meaning ascribed to such term in Section
2.
"CONSOLIDATED CASH FLOW" means, for any period, with respect
to the Consolidated Pledged Stores, an amount equal to (a) the sum of (i)
pre-tax income; (ii) interest expense; (iii) all non-cash charges, including
depreciation and amortization; (iv) Rental Expense; and (v) Non-Recurring
Expenses, all as recorded on the Consolidated Pledged Stores' financial
statements for such period in accordance with GAAP.
"CONSOLIDATED FCCR" means, for any period, the ratio of (a)
the Borrower's Consolidated Cash Flow for such period to (b) the sum of Fixed
Charges and Rental Expense of the Borrower for the Consolidated Pledged Stores
for such period.
"CONSOLIDATED PLEDGED STORES" means the Stores listed on
SCHEDULE 5 attached hereto.
"CONTRACTS" shall mean all contracts and agreements related to
the Pledged Store to which the Borrower now is, or hereafter will be, bound, or
a party, beneficiary or assignee (other than rights evidenced by Chattel Paper,
Documents or Instruments), other than the Franchise Agreement, License or any
other agreement which, by its terms, is non-assignable.
"CONTROL PERSONS" has the meaning ascribed to such term in
Section 3.19.
LOAN AND SECURITY AGREEMENT -- PAGE 2
SYBRA, INC./LOAN NO. 163
ARBY'S/DALLAS, TEXAS
"CORPORATE CASH FLOW" means, for any period, with respect to
the Borrower, an amount equal to (a) the sum of (i) pre-tax income, (ii)
interest expense, (iii) all non-cash charges, including depreciation and
amortization, (iv) Rental Expense, and (v) Non-Recurring Expenses, all as
recorded on the Borrower's financial statement for such period in accordance
with GAAP.
"CORPORATE FCCR" means, for any period, the ratio of (a) the
Corporate Cash Flow for such period to (b) the sum of Fixed Charges and Rental
Expense of the Borrower for such period.
"DEFAULT" means any event or condition which, with the giving
of any applicable notice or lapse of time or both, would become an Event of
Default.
"DEFAULT RATE" has the meaning ascribed to such term in the
Promissory Note.
"DEPOSIT ACCOUNTS" means the deposit accounts of Borrower set
forth on SCHEDULE 4 hereto.
"DISTRIBUTIONS" means all distributions and other payments by
Borrower to any Person on account of such Person's equity ownership in Borrower,
but shall not include stock dividends or reimbursement for insurance policies
expressly required to be maintained pursuant to Section 3.17 hereof.
"DOCUMENT" means the documents, as defined under the UCC, with
respect to the Pledged Store.
"ERISA" means the Employee Retirement Income Security Act of
1974 as amended.
"EQUIPMENT" means any "equipment", as such term is defined in
the UCC, used or bought for use primarily in the Pledged Store and not included
within Inventory, now or hereafter owned by the Borrower and, in any event,
shall include, but shall not be limited to, all appliances, machinery, tools,
office equipment, furniture, appliances, store fixtures, food service equipment,
coolers, furnishings, fixtures, petroleum storage tanks and pumps, and any
manuals, instructions and similar items which relate to the foregoing, and any
and all additions, substitutions and replacements of any of the foregoing,
wherever located, together with all improvements thereon and all attachments,
components, parts, equipment and accessories installed thereon or affixed
thereto.
"EVENT OF DEFAULT" has the meaning ascribed to such term in
Section 7.
"FINANCING STATEMENTS" means the UCC financing statements,
substantially in the form of EXHIBIT D hereto, prepared by Secured Party, and
delivered to Borrower and which Borrower must execute and deliver to Secured
Party as a condition under the Loan Documents.
"FIXED CHARGES" means, with respect to any Person, for any
period, without duplication, the aggregate amount of all scheduled or required
(accrued or otherwise) payments of Indebtedness by such Person during such
period, as determined in accordance with GAAP.
"FRANCHISE AGREEMENT" means, with respect to the Pledged
Store, the franchise agreement between Franchisor, as franchisor, and Borrower,
as franchisee.
"FRANCHISOR" means the franchisor identified as such on
SCHEDULE 1.
LOAN AND SECURITY AGREEMENT -- PAGE 3
SYBRA, INC./LOAN NO. 000
XXXX'X/XXXXXX, XXXXX
"FUNDING DATE" means the date the Loan is actually closed and
funds are wired.
"GAAP" means generally accepted accounting principles
consistently applied.
"GENERAL INTANGIBLES" shall mean "general intangibles" as such
item is defined in the UCC, with respect to the Pledged Store, and shall
include, but not be limited to, writings, memoranda, confirmations, passbooks,
signature cards, acknowledgments, understandings, Contract rights, leases,
permits, filings, consents, and approvals, and all puts, calls, options, and all
security interests, methods, and information (including proprietary information,
director and shareholder, sales, business, financial, accounting, forecasts,
projections, media, and other information), know-how, programs, plans, data,
blueprints, designs, drawings, surveys, notices, and goodwill, and all
recordings and registrations thereof, applications for recording or
registration, renewals, modifications, supplements, reissues, continuations,
extensions, divisions thereof and rights corresponding thereto, and all manuals,
standards, practices, mail, advertisements, files, reports, books, catalogs,
records, journals, invoices, and bills, and all rights (including voting rights,
rights to receive notice or to consent, rights to payment, interest, dividends,
distributions or earnings, rights to xxx and enforce), powers (including powers
of attorney), privileges, benefits, and remedies relating thereto or arising in
connection therewith.
"GOODS" means the goods, as defined under the UCC, with
respect to the Pledged Store, and shall include (i) all Inventory, and (ii) all
Equipment.
"GUARANTOR" has the meaning assigned to such term in the
Promissory Note.
"INDEBTEDNESS" means, with respect to any Person, (i) all
obligations of such Person for borrowed money, including the Promissory Note,
(ii) all obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments, (iii) all obligations of such Person to pay the
deferred purchase price of property or services, (iv) all capitalized lease
obligations of such Person, (v) all indebtedness of others secured by a Lien on
any asset of such Person, whether or not such indebtedness has been assumed by
such Person, (vi) all indebtedness of others to the extent guaranteed by such
Person, and (vii) reimbursement obligations of such Person (whether contingent
or otherwise) in respect of letters of credit, bankers' acceptances, surety and
other bonds and similar instruments.
"INSTRUMENT" means the instruments, as defined under the UCC,
with respect to the Pledged Store (other than Instruments constituting Chattel
Paper).
"INVENTORY" means the inventory of the Borrower as such term
is defined in the UCC, with respect to the Pledged Store, now owned or hereafter
acquired and wherever located, whether raw, in process or furnished, and all
materials usable in processing the same and all documents of title covering any
inventory, including, without limitation, work in process, materials used or
consumed in the Pledged Store, now owned or hereafter acquired or manufactured
by the Borrower and held for sale in the ordinary course of its business, all
present and future substitutions thereof, parts and accessories thereof and all
additions thereto, and all Proceeds thereof and products of such inventory in
any form whatsoever.
"LEASE OBLIGATIONS" means with respect to any Person, any
obligations of such Person in connection with any leases for personal property
(including Equipment) or real property, to the extent such obligations are not
included in Indebtedness.
LOAN AND SECURITY AGREEMENT -- PAGE 4
SYBRA, INC./LOAN NO. 000
XXXX'X/XXXXXX, XXXXX
"LICENSE" means, with respect to the Pledged Store, the
license to use the Trademark of Franchisor under the Franchise Agreement.
"LIEN" means any deed, mortgage, pledge, security interest,
hypothecation, collateral assignment, encumbrance, lien (statutory or other), or
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever (including, without limitation, any conditional
sale or other title retention agreement, any financing lease having
substantially the same economic effect as any of the foregoing, and the filing
of any financing statement under the UCC).
"LOAN" has the meaning ascribed to such term in the
preliminary statements of this Security Agreement.
"LOAN AMOUNT" shall have the meaning ascribed to such term in
the Promissory Note.
"LOAN DOCUMENTS" means the Promissory Note, this Security
Agreement and any commitment letter, guarantee, mortgage, assignment of lease,
deed of trust, environmental indemnity affidavit, assignment or other
instrument, agreement, certificate or other writing, now or hereafter executed
and delivered in connection with the Promissory Note or the Obligations.
"MATERIAL ADVERSE EFFECT" shall mean a material adverse effect
on (a) the business, operations, property, condition (financial or otherwise) or
prospects of the Borrower; (b) the validity or enforceability of this Security
Agreement or any of the other Loan Documents or the rights or remedies of the
Secured Party hereunder or thereunder; or (c) the ability of any Person to
perform its Obligations with or in respect of any Loan Documents.
"NON-RECURRING EXPENSES" [and "NON-RECURRING INCOME"] mean
expenses or income, as the case may be, that are extraordinary and generally not
reflected in any prior period or reasonably anticipated to be incurred in any
subsequent period.
"OBLIGATIONS" means each and every obligation, covenant,
agreement, Indebtedness and liability of the Borrower to the Secured Party with
respect to the Pledged Store or Other Pledged Stores evidenced by, arising under
or in connection with the Promissory Note (including, without limitation,
indebtedness, obligations and liabilities in respect of principal, interest and
the Prepayment Amount for the Loan), this Security Agreement, or any other Loan
Document, and any future advances thereon, renewals, extensions, modifications,
amendments, substitutions and consolidations thereof, including the Borrower's
obligations to pay (or reimburse the Secured Party for) all reasonable costs and
expenses (including reasonable attorneys' fees and disbursements) incurred by
the Secured Party in obtaining, maintaining, protecting and preserving its
interest in the Collateral or its security interest therein, foreclosing,
retaking, holding, preparing for sale or lease, selling or otherwise disposing
or realizing on the Collateral or in exercising its rights hereunder or as a
secured party under the UCC, any other applicable law, regulation or rule or
this Security Agreement.
"OTHER PLEDGED STORES" means the Arby's restaurants operated
by Borrower as identified on SCHEDULE 5 hereto.
LOAN AND SECURITY AGREEMENT -- PAGE 5
SYBRA, INC./LOAN NO. 163
ARBY'S/DALLAS, TEXAS
"PERMITTED LIENS" means (i) any and all of the Liens set forth
on EXHIBIT C attached hereto; (ii) Liens arising as a matter of law to secure
payment of taxes, assessments or charges owing to any governmental authority but
which are not yet due or which are being contested in good faith by appropriate
proceedings or other appropriate actions and with respect to which adequate
reserves or other appropriate provisions are being maintained in accordance with
GAAP; (iii) statutory Liens of landlords and Liens of carriers, warehousemen,
mechanics, materialmen and other Liens imposed by law, created in the ordinary
course of business and for amounts not yet due (or which are being contested in
good faith by appropriate proceedings or other appropriate actions which are
sufficient to prevent imminent foreclosure of such Liens, are promptly
instituted and diligently conducted) and with respect to which adequate reserves
or other appropriate provisions are being maintained in accordance with GAAP;
(iv) Liens incurred or deposits made in the ordinary course of business
(including, without limitation, security deposits for leases, surety bonds and
appeal bonds) in connection with workers' compensation, unemployment insurance
and other types of social security benefits or to secure the performance of
tenders, bids, contracts (other than for the repayment or guarantee of borrowed
money or purchase money obligations), statutory obligations and other similar
obligations or arising as a result of progress payments under government
contracts; (v) easements (including, without limitation, reciprocal easement
agreements and utility agreements), rights-of-way, covenants, consents,
reservations, encroachments, minor defects or irregularities in title,
variations and other restrictions, charges or encumbrances (whether or not
recorded) affecting the use of real property, which individually or in the
aggregate do not or are not reasonably likely to have a material adverse effect
on the conduct of the Borrower's business or on the use of such real property or
on the value to or marketability by the Borrower of its interest in such real
property; (vi) Liens arising under the Loan Documents in favor of the Secured
Party; (vii) Liens incurred in connection with the purchase or acquisition of
equipment or fixed assets, as security for the deferred purchase or acquisition
price of such equipment or assets, each of which Liens shall extend only to the
equipment or assets so purchased or acquired and shall secure only up to 100% of
the deferred purchase or acquisition price thereof, and (viii) extensions,
renewals or replacements or any Lien referred to in clauses (i) through (vii)
above.
"PERSON" means any individual, corporation, limited liability
company, partnership, unincorporated association, firm, trust, joint stock
company, joint venture, government or agency thereof or other entity of whatever
nature.
"PLEDGED STORE" means the Store listed on SCHEDULE 1, attached
hereto.
"PLEDGED STORE CASH FLOW" means, for any period, with respect
to the Pledged Store, an amount equal to (a) the sum of (i) pre-tax income, (ii)
interest expense, (iii) all non-cash charges, including depreciation and
amortization, (iv) Rental Expense, and (v) Non-Recurring Expenses.
"PREPAYMENT AMOUNT" shall have the meaning ascribed to such
term in the Promissory Note.
"PROCEEDS" shall mean "proceeds" as such term is defined in
the UCC or under other relevant law with respect to the Pledged Store and shall
include, but shall not be limited to, (a) any and all proceeds of any insurance
(insuring the Collateral or otherwise required to be maintained hereunder,
including return of unearned premium), indemnity, warranty or guaranty payable
to the Secured Party or Borrower from time to time, and claims for insurance,
indemnity, warranty or guaranty effected or held for the benefit of the
Borrower, with respect to any of the Collateral, (b) any and all payments (in
any form whatsoever) made or due and payable to the Borrower from time to time
in connection with any requisition, confiscation, condemnation, seizure or
forfeiture of all or any part of the Collateral by any governmental authority
(or any person acting under color of governmental authority) and (c) any and all
interest, income, dividends, distributions and earnings on the Collateral or
other monies, revenues or other amounts derived
LOAN AND SECURITY AGREEMENT -- PAGE 6
SYBRA, INC./LOAN NO. 000
XXXX'X/XXXXXX, XXXXX
from the Collateral, including any such amounts received in connection with any
disposition of the Franchise Agreement.
"PROMISSORY NOTE" has the meaning ascribed to such term in the
preliminary statements to this Security Agreement.
"PROPERTY" means the real property on which the Pledged Store
is located, as more specifically described on SCHEDULE 1 attached hereto.
"RENTAL EXPENSE" means, with respect to any Person, for any
period, the aggregate of all amounts paid or accrued with respect to leases
(including building and ground operating lease expense), plus percent rent, plus
capitalized building lease expense (net of principal and interest), minus rent
on regional and corporate offices.
"REQUIRED CORPORATE FCCR" has the meaning ascribed to such
term in Section 3.14.
"SCHEDULED MONTHLY LOAN PAYMENT" shall have the meaning
ascribed to such term in the Promissory Note.
"SECURITIZATION" means the sale, pledge, grant of a security
interest, collateral assignment, transfer and delivery or other encumbrance or
disposition of the Loan (or the Secured Party's rights and powers therein) by
the Secured Party, from time to time, to one or more of its Affiliates or to
other Persons, including, without limitation, the sale of the Loan by the
Secured Party to one or more Persons who will issue debt instruments or equity
certificates backed by such Loan and the servicing of such Loan by the Person
appointed as Servicer in connection therewith.
"SERVICER" shall mean the Person designated by the Secured
Party from time to time to service the Loan.
"STATE" shall have the meaning ascribed to such term in the
Promissory Note.
"STORE" means a business/commercial property owned and/or
operated by the Borrower and includes all aspects of the operating unit.
"UCC" means the Uniform Commercial Code of the State and the
state where the Pledged Store is located, if different and as applicable.
"UCC SEARCH" means the security interest, tax lien, suit and
judgment search of the Borrower conducted in the locations set forth on SCHEDULE
2 hereto.
"UNIT FCCR" means, with respect to the Pledged Store and Other
Pledged Stores, for any period, the ratio of (x) such Pledged Store's or Other
Pledged Stores' Pledged Store Cash Flow for such period to (y) the sum of Fixed
Charges and Rental Expense for such Pledged Store or Other Pledged Store for
such period. In determining Unit FCCR, Indebtedness shall include only the
indebtedness of the Borrower to the Secured Party, and any Indebtedness secured
by Permitted Liens with respect to the Pledged Store or Other Pledged Stores.
LOAN AND SECURITY AGREEMENT -- PAGE 7
SYBRA, INC./LOAN NO. 000
XXXX'X/XXXXXX, XXXXX
"VALUATION CONSULTANTS" shall mean Deloitte & Touche LLP, or
such other consultants selected by the Secured Party to prepare a Business
Valuation.
1.2. CERTAIN CALCULATIONS. For the purposes of calculating the
Borrower's Cash Flow, Non-Recurring Expenses, Non-Recurring Income and
Indebtedness, the term "financial statement" shall mean the consolidated
financial statement of the Borrower prepared in accordance with GAAP.
1.3. RULES OF CONSTRUCTION. When used in this Security Agreement:
(a) "or" is not exclusive; (b) a reference to a law includes any amendment or
modification of such law; (c) a reference to a Person includes its permitted
successors and permitted assigns; and (d) a reference to an agreement,
instrument or document shall include such agreement, instrument or document as
the same may be amended, modified or supplemented from time to time in
accordance with its terms.
ARTICLE II
SECURITY INTERESTS
2. SECURITY INTERESTS.
2.1. PLEDGE AND GRANT OF SECURITY INTEREST. As collateral security
for the prompt and complete payment and performance when due of all of the
Obligations, the Borrower hereby pledges and grants to the Secured Party, a
continuing security interest in, and Lien on, all of the Borrower's right, title
and interest in and to the following (collectively, the "COLLATERAL"): all
Accounts, Goods, Documents, Chattel Paper, Deposit Accounts, Inventory,
Equipment, Contracts, General Intangibles (other than the Franchise Agreement
and Licenses), certificates of title, fixtures, credits, claims, demands, assets
and other personal property of Borrower, whether now owned, existing, hereafter
acquired, held, used, or sold to the extent that any such items are located at,
or used solely in the ownership or operation of, the Pledged Store, and any
other property, rights and interests of the Borrower which at any time relate
to, arise out of or in connection with the foregoing or which shall come into
the possession or custody or under the control of the Secured Party or any of
its agents, representatives, associates or correspondents, in connection with
the foregoing, any and all additions and accessions, replacements,
substitutions, and improvements, of or to all the foregoing and all products,
rents, profits, offspring, and Proceeds thereof subject to restrictions or
limitations on pledge or assignment of such Collateral contained in any existing
Property lease that have not been waived, subordinated or released by the
landlord of such lease pursuant to an estoppel or other similar agreement.
Without limiting the generality of the foregoing, this Agreement also secures
the payment of all amounts which constitute part of the Obligations and would be
owed by the Borrower to the Secured Party but for the fact they are
unenforceable or not allowable due to the existence of a bankruptcy,
reorganization or similar proceeding involving the Borrower.
2.2. SECURITY INTEREST ABSOLUTE. All rights of the Secured Party
and the security interests hereunder shall be absolute and unconditional
irrespective of:
(a) any change in the time, manner, amount or place of payment
of or in any other term of all or any of the Obligations, or any other amendment
or waiver of or any consent to any departure from the Promissory Note or any
other Loan Document;
LOAN AND SECURITY AGREEMENT -- PAGE 8
SYBRA, INC./LOAN XX. 000
XXXX'X/XXXXXX, XXXXX
(b) any exchange, release or non-perfection of all or any part
of the Collateral or any other collateral, or any release from, amendment to,
waiver of or consent to departure from any guaranty, for all or any of the
Obligations; or
(c) to the fullest extent permitted by law, any other
circumstances which might otherwise constitute a defense available to, or a
discharge of the Borrower or a third party pledgor.
ARTICLE III
REPRESENTATIONS, WARRANTIES AND COVENANTS
3. REPRESENTATIONS, WARRANTIES AND COVENANTS. The Borrower hereby
represents, warrants and covenants that:
3.1. ORGANIZATION. The Borrower is and will continue to be duly
formed, validly existing and in good standing under the laws of the state of its
organization set forth on SCHEDULE 1 and is duly authorized to do business in,
and is in good standing in each jurisdiction where the Business or the Property
is located and where such organization, qualification or standing is necessary,
required or proper in connection with the Borrower's ownership or use of the
Collateral or the Property or the conduct of the Business. There is no state or
jurisdiction, other than its state of organization , and, if different, the
State, where such organization, qualification or standing is necessary, required
or proper in connection with Borrower's ownership or use of the Collateral or
the Pledged Store or the conduct of its Business.
3.2. POWER AND AUTHORITY. The Borrower has and will continue to
maintain all requisite power, authority and the legal right and all necessary
permits, consents, licenses and authorizations (a) to own the Collateral, (b) to
conduct the Business and (c) to execute, deliver and perform its obligations
under this Security Agreement, the Promissory Note and the other Loan Documents,
except, in each case, where the failure to maintain such permits, consents,
licenses and authorizations would not result in a Material Adverse Effect. To
the extent that any Affiliate owns any Collateral, conducts any part of the
Business or has executed any of the Loan Documents, such Affiliate has and will
continue to maintain all requisite power, authority and the legal right and all
necessary permits, consents, licenses and authorizations (a) to own the
Collateral, (b) to conduct the Business and (c) to execute, deliver and perform
its obligations under this Security Agreement, the Promissory Note and the other
Loan Documents, except, in each case, where the failure to maintain such
permits, consents, licenses and authorizations would not result in a Material
Adverse Effect.
3.3 EXECUTION AND DELIVERY; ENFORCEABILITY. Upon execution, this
Security Agreement, the Promissory Note and the other Loan Documents will be
duly executed and delivered by the Borrower. Upon execution, each of this
Security Agreement, the Promissory Note and the other Loan Documents will
constitute a legal, valid and binding obligation of the Borrower, enforceable
against the Borrower, in accordance with its terms, subject to the effect of any
applicable bankruptcy, insolvency, reorganization or moratorium or similar laws
affecting the rights of creditors generally and general principles of equity. To
the extent that any Affiliate executes any of the Loan Documents, such Loan
Documents will be duly executed and delivered by the Affiliate. Upon execution,
each Loan Document executed by the Affiliate will constitute a legal, valid and
binding obligation of the Affiliate, enforceable against the Affiliate, in
accordance with its terms, subject to the effect of any applicable bankruptcy,
insolvency, reorganization or moratorium or similar laws affecting the rights of
creditors generally and general principles of equity.
LOAN AND SECURITY AGREEMENT -- PAGE 9
SYBRA, INC./LOAN NO. 163
ARBY'S/DALLAS, TEXAS
3.4. NAME: CHIEF EXECUTIVE OFFICE: LOCATION.
(a) The Borrower's legal name, federal taxpayer identification
number, and mailing address are accurately set forth on SCHEDULE 1. As of the
Funding Date, the Borrower has not, merged, consolidated, acquired all or
substantially all of the assets of any other Person or, except as disclosed on
SCHEDULE 1, used any other name (whether in connection with the Business,
Property or the Collateral or for business, obtaining credit or financing or
otherwise) in the last five (5) years.
(b) As of the Funding Date, the Borrower's principal place of
business, chief executive office (and, if the Borrower is an individual,
residence) is accurately set forth on SCHEDULE 1.
(c) As of the Funding Date, the Borrower operates the Pledged
Store from the Property at the address and in the county and state set forth in
SCHEDULE 1. SCHEDULE 1 correctly discloses that the Borrower either (i) is sole
record owner of the fee estate in the Property or (ii) leases (or subleases) the
Property and the record owner of the Property is the person or entity disclosed
on SCHEDULE 1. All personal property of the Borrower owned, acquired, held,
used, sold or consumed in the Pledged Store, including Goods, Inventory,
Equipment, General Intangibles, Contracts, Chattel Paper, Instruments,
Documents, certificates of title, fixtures, and all writings relating thereto
and records thereof, books of record or account are located at and conducted out
of such Property or at its chief executive office.
(d) The Borrower will neither change its name, federal
taxpayer identification number, or its chief executive office nor the location
of the Pledged Store or the Collateral), without in each instance providing the
Secured Party with not less than thirty (30) days' prior written notice of the
proposed action and specifying within such notice and with reasonable clarity
and particularity the timing and nature of such proposed action. Additionally,
the Borrower shall provide such other information in connection with the
proposed action as the Secured Party may reasonably request and shall have taken
all action, reasonably satisfactory to the Secured Party, to maintain the
security interest of the Secured Party in the Collateral intended to be granted
hereby at all times fully perfected and in full force and effect.
3.5. NO CONFLICT. The Borrower's execution, delivery and
consummation of the transactions contemplated by this Security Agreement, the
Promissory Note and other Loan Documents do not and will not (with the passage
of time or otherwise) (i) conflict with, violate or constitute a default under
any law, rule, regulation, order, decree, contract, agreement (including the
Franchise Agreement, if applicable), note, mortgage, bond, indenture, lease,
license, or obligation of or applicable to the Borrower, or the Collateral or
(ii) grant, create or result in any Lien in favor of any person (other than the
Secured Party) in the Collateral. No Event of Default has occurred and is
continuing.
3.6. NO CONSENT REQUIRED. Except for the filing of the Financing
Statements in the locations set forth on SCHEDULE 2 hereto and as otherwise set
forth therein (and, if applicable, the recording of the mortgage or deed of
trust included in the Loan Documents), no consent of any other Person and no
authorization, approval or other action by and no notice to or filing with, any
court, government, agency or regulatory authority is required (i) for the grant
by the Borrower of the pledge and security interest granted hereby or for the
execution, delivery or performance of this Security Agreement, the Promissory
Note and other Loan Documents or (ii) for validity, perfection or maintenance of
the pledge, lien and security interest created hereby.
LOAN AND SECURITY AGREEMENT -- PAGE 10
SYBRA, INC./LOAN NO. 163
ARBY'S/DALLAS, TEXAS
3.7. TITLE TO THE COLLATERAL. The Borrower has and, subject to
Section 4, will maintain good and marketable title to the Collateral, free of
all Liens (other than Permitted Liens and the security interest granted to the
Secured Party hereunder) and such Collateral is sufficient to enable the Pledged
Store to be operated at the Property in accordance with the Franchise Agreement.
3.8. OWNERSHIP; NO LIENS. The Borrower has, and will continue to
have good and marketable title to each item of Collateral, free and clear of all
Liens, other than Permitted Liens, and except as shown on the UCC List attached
hereto as SCHEDULE 3, as of the Funding Date there is no Lien (including any
federal or state tax lien), suit (including any action, proceeding, or other
litigation pending, or to the Borrower's knowledge, threatened) or judgment
(including any award, injunction, order) filed with, registered, indexed or
recorded in any public office, court, arbitration panel, administrative agency
or regulatory authority (or intended so to be), directly or indirectly,
identifying or encumbering or covering or involving the Collateral or which
could have a material adverse effect on the Borrower, the Pledged Store or the
Borrower's ability to perform its Obligations. All Liens listed on SCHEDULE 3
shall be removed upon funding of the Loan unless such lien is specifically
identified as a Permitted Lien. Other than the security interest granted to the
Secured Party hereunder and the Permitted Liens, and except as provided in
Section 4 hereof the Borrower has not and, without the prior written consent of
the Secured Party, will not enter into any agreement or understanding or take,
permit or suffer to exist any action (including the filing of a financing
statement, agreement, pledge, mortgage, notice or registration) or event
(whether by operation of law or otherwise) for the purpose of or that may have
the effect of directly or indirectly, (i) granting a Lien on (including any
state of federal tax lien), pledging, transferring, assigning, selling,
disposing of or encumbering any Collateral including any interest therein or
rights pertaining thereto or involving the Pledged Store, or (ii) changing,
modifying, supplementing, or increasing the amount of credit, loans,
Indebtedness or value secured by the Permitted Liens, if any, or the amount,
property or assets encumbered thereby.
3.9. MAINTENANCE OF COLLATERAL AND BUSINESS. The Equipment and
Inventory are located at the Pledged Store. At the Borrower's sole cost and
expense, the Borrower shall continue to (i) keep, use, operate and maintain the
Collateral, the Pledged Store, the Business and the Property in accordance with
the Franchise Agreement and/or License and applicable laws, rules, and
regulations in all material respects, (ii) operate the Pledged Store at the
Property and in accordance with the Franchise Agreement (if applicable) and
customary, prudent business practices, and at all times fully comply with terms
and provisions of the Franchise Agreement (if applicable) in all material
respects, (iii) fully comply with all current and future laws and regulations
concerning the storage and sale of petroleum products, if applicable, in all
material respects and (iv) not do or acquiesce in any act whereby the value of
the Collateral, the Property or the Pledged Store or any part or interest
therein may be lessened in any material respect. The Borrower shall notify the
Secured Party promptly of any actual or threatened destruction or material
damage or impairment of the Pledged Store, the Collateral or the Property or if
Borrower receives a notice of violation from any governmental entity or agency.
Notwithstanding the foregoing to the contrary, Borrower may, without Secured
Party's prior consent but with prior written notice to Secured Party, cease
business operations at the Pledged Store on a temporary basis in order to
remodel the Pledged Store or otherwise comply with the requirements of the
Franchise Agreement or applicable law. In addition, Borrower may, with Secured
Party's prior written consent, which shall not be unreasonably withheld or
delayed, substitute a restaurant of approximately equal value for the Pledged
Store, in which event Secured Party shall release the Lien against the Pledged
Store. For purposes hereof, a restaurant (the "SUBSTITUTE STORE") shall not be
considered to be of equal value to the Pledged Store to be replaced (the
"REPLACED STORE"), unless (i) the Substitute Store is subject to a Franchise
Agreement, (ii) the lease agreement for the Substitute Store is of equivalent
duration and rental rate to the Replaced Store, (iii) Borrower shall have
obtained landlord estoppels and such security documents pledging the Substitute
Store (including leasehold mortgages and financing statements) in form
reasonably
LOAN AND SECURITY AGREEMENT -- PAGE 11
SYBRA, INC./LOAN NO. 163
ARBY'S/DALLAS, TEXAS
satisfactory to Secured Party, (iv) neither Secured Party nor its Affiliates may
operate any business at the Replaced Store after the date the Lien with respect
to such Replaced Store is released, (v) the Loan with respect to the Replaced
Store shall not exceed seventy percent (70.0%) of the value of such Substitute
Store, based on a current appraisal performed by such appraisal firm regularly
employed by Secured Party, (vi) the Substitute Store had Unit FCCR for the
twelve (12) month period preceding the date of substitution of at least 1.25 to
1.00, and (vii) the Replaced Store had Unit FCCR for the twelve (12) month
period preceding the date of substitution of less than 1.25 to 1.00. Borrower
shall pay all appraisal, legal and other reasonable expenses incurred by Secured
Party hereunder.
3.10. PERFECTED SECURITY INTEREST. This Security Agreement and the
grant and transfer of the Collateral hereunder creates a valid and enforceable
security interest in the Collateral. Upon filing of the Financing Statements in
the locations set forth on SCHEDULE 2 hereto, such security interest will be
perfected and subject to no prior or equal security interest other than and only
to the extent of the Permitted Liens. The execution and filing of the Financing
Statements has been duly authorized by all appropriate action on the part of the
Borrower (and any other Person named as debtor therein) and the Borrower (and
any other Person named as debtor therein) has duly executed the Financing
Statements.
3.11. NO VIOLATION; INDEMNITY. The Borrower has not and shall not
acquire, obtain, make, manufacture, produce, operate, hold, possess, maintain,
use, sell, transfer, grant, pledge, or dispose of (for purposes of this Section
3.11, collectively "the Borrower's use") any of its Business, (including any
proceeds of the Loan, the Collateral and the Property) in violation of any
statute, law, rule, ordinance, regulation, policy, procedure, injunction, award,
decree, judgment, contract, agreement (including the Franchise Agreement, if
applicable), understanding, or right or interest of any other Person (for
purposes of this Section 3.11, each such event a "violation"), and to the
Borrower's knowledge no such violation has been made by any other Person and no
basis for a claim of any such violation exists.
3.12. FRANCHISE AGREEMENT.
(a) The Borrower, if a franchisee or franchisor under a
Franchise Agreement, is and will continue to be in good standing under such
Franchise Agreement in all material respects. The termination date of such
Franchise Agreement is scheduled to occur after the maturity date of the
Promissory Note. The Borrower, if a franchisee or franchisor under a Franchise
Agreement, has not breached and is not in default under the Franchise Agreement
in any material respect; the Borrower shall not terminate, fail to renew, breach
or be in default under the Franchise Agreement in any material respect; and the
Borrower has no knowledge of any claim of (or basis for any claim of) any such
termination, non-renewal, material breach or default. The Borrower agrees to
fully comply, at the Borrower's own cost and expense, with the terms of the
License and the Franchise Agreement (including any renewal option) in all
material respects and to promptly notify the Secured Party of any material
adverse development with regard to the Franchise Agreement or the License,
including any claim of a material breach of or default under, or threat of
non-renewal or termination of or litigation involving the Franchise Agreement or
the License.
(b) Borrower agrees that until such time as Borrower's
Obligations under the Loan Documents (including the Promissory Note) have been
fully satisfied, if, whether because of a change in the Franchise Agreement,
applicable law or otherwise, Borrower is able to grant a security interest in
the Franchise Agreement to the Secured Party to secure its Obligations without
Franchisor's consent and without breaching or defaulting under the Franchise
Agreement, Borrower agrees to promptly grant such security interest in favor of
the Secured Party and to obtain, procure, execute and deliver, file and affix
such further agreements (including modification of the Security Agreement),
assignments, instruments, documents, notices, statements, writings (including
financing statements), powers (including
LOAN AND SECURITY AGREEMENT -- PAGE 12
SYBRA, INC./LOAN XX. 000
XXXX'X/XXXXXX, XXXXX
stock and bond powers, and powers of attorney), tax stamps and information, and
to do or cause to be done all such further acts and things (including the
execution, delivery and filing of financing statements on Form UCC-1) as Secured
Party may reasonably request, from time to time, in its discretion, in
connection with such security interest and the perfection thereof. Without
limiting the foregoing, Borrower authorizes Secured Party to the extent
permitted by law to execute and file, or file without Borrower's signature, any
and all financing statements, amendments thereto and continuations thereof as
Secured Party deems necessary or appropriate in connection therewith.
(c) Until such time as the Obligations of Borrower under the
Loan Documents (including the Promissory Note) have been fully satisfied,
Borrower agrees to make one or more timely elections to renew the term of the
Franchise Agreement in accordance with the terms of the Franchise Agreement for
a period which extends beyond the Maturity Date (as defined in the Promissory
Note) of the Loan and shall use its reasonable best efforts to satisfy any and
all conditions to any such renewal, and to obtain, procure, execute and deliver,
file and affix such further agreement, instruments, documents, notices,
statements, writings, powers and information, and to do or cause to be done all
such further acts and things as Secured Party may reasonably request, from time
to time, in its discretion, in connection with Borrower's Obligations set forth
herein.
3.13. OPERATING EXPERIENCE. The Borrower has had at least three (3)
years' experience operating a business or businesses similar to the Business of
the Pledged Store.
3.14. FCCR. The Borrower shall maintain a Corporate FCCR of not less
than 1.10 to 1.00 to be tested annually on December 31st of each year for the
fiscal year then ended (the "Required Corporate FCCR"). The Borrower or an
Affiliate shall have the right to cure any breach by the Borrower of such
Required Corporate FCCR within forty-five (45) days of such breach, by
depositing into a segregated escrow account in Borrower's name (with
contemporaneous written notice to Secured Party of the deposit account and
amount escrowed): (i) if the Corporate FCCR is less than 1.00 to 1.00, an amount
in cash such that the interest income thereon is sufficient in amount to cause
the future Corporate FCCR to be equal to or greater than 1.10 to 1.00, or (ii)
if the Corporate FCCR is equal to or greater than 1.05 to 1.00, then an amount
in cash equal to the difference between the income of the Borrower assuming a
Corporate FCCR of 1.05 to 1.00 and the income of the Borrower assuming a
Corporate FCCR of 1.10 to 1.00. In no event shall the Borrower be required to
maintain funds in the escrow account in excess of the outstanding aggregate
principal balance of the Loan. Borrower shall grant Secured Party a perfected
first lien security interest in the escrow account to the extent allowable under
Borrower's financing arrangement with Xxxxxxxx, Inc., as of the date of this
Security Agreement, or any refinancing thereof. Any amounts deposited into the
escrow account shall be returned to Borrower, if Borrower is not in default
hereunder after applicable notice and cure periods and upon compliance with the
Required Corporate FCCR for two (2) consecutive fiscal quarters.
3.15. LIMITATION ON INDEBTEDNESS, LEASE OBLIGATIONS AND
DISTRIBUTIONS. The Borrower shall not, directly or indirectly, incur any
Indebtedness, Lease Obligations or make or become obligated to make any
Distributions if after giving effect to such incurrence or payments, the
Corporate FCCR would be less than the Required Corporate FCCR. Notwithstanding
the foregoing to the contrary, Borrower may at any time incur Indebtedness to an
Affiliate of Borrower which is unsecured and with respect to which Secured Party
and the Affiliate making such loan have entered into an agreement subordinating
repayment of such loan to the Loan Amount in form reasonably acceptable to
Secured Party.
3.16. INSPECTION. The Borrower shall allow the Secured Party, its
agents and representatives, from time to time, to inspect the Collateral, the
Property and the Borrower's books and records pertaining thereto, to inspect the
LOAN AND SECURITY AGREEMENT -- PAGE 13
SYBRA, INC./LOAN NO. 163
ARBY'S/DALLAS, TEXAS
Business during normal business hours and unless an Event of Default has
occurred and is continuing, upon reasonable prior notice and in a reasonable
manner that will not unduly interfere with normal operations, and the Borrower
will assist (and permit abstracts and photocopies of the Borrower's books and
records to be taken and retained by) the Secured Party, its agents and
representatives in making any such inspection.
3.17. INSURANCE. At the Borrower's sole cost and expense, the
Borrower shall:
(i) keep the Collateral (which for purposes of this
Section 3.17 includes the Property) insured against loss or damage by fire,
theft, collision and other hazards (including flood, if no certification or
other evidence satisfactory to the Secured Party is delivered to the Secured
Party to the effect that the Property is not located within a federally
designated special flood hazard area) and otherwise as may be required by the
Secured Party and shall maintain: (A) comprehensive general public liability
insurance covering all claims for bodily injury, death and property damage
occurring on, in or about the Property or in connection with the Business, with
a combined single limit of not less than $1,000,000.00 per occurrence; (B)
maintain business interruption insurance covering at least six (6) months of
operating costs and expenses, including finance costs for the Obligations; (C)
"all risk" extended coverage property insurance against loss or damage to the
tangible Collateral from fire, theft or any other cause, for one hundred percent
(100%) of the full replacement value with a deductible not exceeding $50,000 per
occurrence; (D) federal flood hazard insurance in the maximum amount obtainable
to the extent any of the Collateral is located in a federally designated flood
hazard area; (E) builder's risk insurance covering the Pledged Store during
construction, restoration or renovation; (F) workers' compensation insurance
covering all of the Borrower's employees at the Pledged Store; and (G) maintain
such other or additional insurance as may be required from time to time by
Secured Party against the same or similar risks;
(ii) cause all insurance policies required hereunder to
be issued by financially sound and responsible insurance carriers authorized to
do business in the jurisdiction where the Property is located with a General
Policy Rating "A-8" or better as published in BEST'S KEY RATING GUIDE. Copies of
all insurance policies required to be maintained under this Security Agreement
shall be delivered to the Secured Party or its assigns prior to the execution
and delivery of this Security Agreement, together with evidence that premiums
have been paid in advance in full. Evidence of renewal or any modification to
any policy shall be delivered to Secured Party or its designees or assigns,
including the Servicer, not less than ten (10) days prior to the expiration
date, or modification, as applicable of such policy;
(iii) cause all policies to contain an endorsement or
agreement by the insurer that any loss will be paid to the Secured Party or its
designees or assigns in accordance with its interests and the terms of the
policy, notwithstanding any act or negligence of the Borrower or the Borrower's
agents or representatives that might otherwise result in denial or forfeiture of
coverage, and use reasonable efforts to obtain an agreement by the insurer
waiving all rights of recovery, setoff or counterclaim against the Secured Party
by way of subrogation or otherwise. Liability policies shall designate the
Secured Party or its designees and their respective successors and assigns as
additional named insureds. All other policies shall designate the Secured Party
or its designee and their respective successors and assigns as loss payees with
respect to the Collateral and all business interruption coverage, and shall
contain a standard noncontributory form of first mortgagee endorsement,
entitling the Secured Party to collect all proceeds, together with a standard
waiver of subrogation endorsement if available as above provided. All policies
shall provide for at least ten (10) days prior written notice to the Secured
Party and its designees or assigns of cancellation, non-renewal or modification
(including any reduction in the scope or limits of coverage or any increase in
deductible amounts). If any insurance coverage required to be maintained by
Borrower pursuant to this Security Agreement shall expire or lapse
LOAN AND SECURITY AGREEMENT -- PAGE 14
SYBRA, INC./LOAN XX. 000
XXXX'X/XXXXXX, XXXXX
for any reason, the Secured Party shall have the right in its sole discretion
(but not the obligation), after notice of any impending lapse, cancellation or
non-renewal of coverage, to obtain replacement coverage in some or all of the
amounts and against any and all of the risk as required under this Security
Agreement. All costs and expenses incurred by the Secured Party in doing so
shall be paid or reimbursed by the Borrower immediately, together with interest
at the Default Rate, and until repaid shall constitute part of the Obligations
secured by the Collateral;
(iv) timely pay all premiums, fees and charges required
in connection with all of its insurance policies and otherwise continue to
maintain such policies in full force and effect;
(v) promptly deliver the insurance policies,
certificates (and renewals) thereof or other evidence of compliance herewith to
the Secured Party; and
(vi) promptly notify the Secured Party of any loss
covered by such insurance policies and allow the Secured Party to join the
Borrower in adjusting any loss in excess of eighty percent (80.0%) of the Loan
Amount.
3.18. LOAN PROCEEDS. No part of the proceeds of the Loan will be
used, directly or indirectly, for the purpose of buying or carrying any "margin
stock" within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System. The Borrower intends to and agrees to use the proceeds
of the Loan solely for the lawful, proper business or commercial purpose(s) set
forth in its application for the Loan and Secured Party's commitment letter.
3.19. CAPITALIZATION; SOLVENCY.
(a) All of the issued and outstanding capital stock,
partnership or membership interests of Borrower are directly and beneficially
owned and held by the Persons identified on the SCHEDULE 1 ("Control Persons")
and all of such capital stock, partnership or membership interests have been
duly authorized and are fully paid and non-assessable, free and clear of all
claims, liens, pledges and encumbrances of any kind.
(b) The Borrower is solvent and, after giving effect to the
Obligations, will continue to be solvent. The Borrower's financial statements
fairly present the financial position of Borrower and the results of operations
as of the dates and for the periods set forth therein. The Borrower has no
material obligations or liabilities (direct, indirect, contingent or
liquidated), or liabilities for taxes required to be reflected therein that are
not reflected.
3.20. REPORTING REQUIREMENTS. The Borrower agrees to provide to the
Secured Party within forty-five (45) days after the end of each fiscal quarter
during the term of this Security Agreement, a compliance certificate (in the
form attached hereto as EXHIBIT A) executed by Borrower, and at the end of the
fourth fiscal quarter for the prior year, a calculation of Corporate FCCR (the
form calculation is attached hereto as EXHIBIT B). The Borrower further agrees
to provide to the Secured Party: (i) within forty-five (45) days after the end
of each fiscal quarter and within one hundred twenty (120) days after the end of
each fiscal year, consolidated Borrower internally generated financial
statements covering the corresponding period then ended including a balance
sheet, income and expense, cash flow and operating statements for such period
and containing comparative data from prior periods and individual Pledged Store
internally generated income and expense, or operating statements for such
period; and (ii) such other information reasonably requested by the Secured
Party and reasonably available to the Borrower. The financial statements
furnished to the Secured Party in connection with the Borrower's application for
the Loan and hereunder shall be certified by the Borrower to fairly present the
financial condition of the Borrower and the results of operations and shall
LOAN AND SECURITY AGREEMENT -- PAGE
SYBRA, INC./LOAN NO. 000
XXXX'X/XXXXXX, XXXXX
reflect all Indebtedness and Lease Obligations of the Person covered thereby and
shall be sufficiently detailed to allow the Secured Party to calculate the Unit
FCCR of the Pledged Store (where required herein), the Consolidated FCCR (where
required herein) and the Corporate FCCR. Such financial statements shall be
prepared in accordance with GAAP or such other accounting principles customarily
used in the industry and reasonably acceptable to Secured Party.
3.21. ACCURACY OF INFORMATION. All information, reports, statements
and financial and other data furnished (or hereafter furnished) by the Borrower
to the Secured Party, its agents or representatives hereunder or in connection
with the Borrower's application for the Loan and the Obligations, are (and shall
be on the date so furnished) true, complete and correct in all material
respects. All financial projections that have been or are hereafter prepared by
or on behalf of Borrower, its Affiliates or their respective agents or
representatives have been and shall be prepared in good faith and based upon
reasonable assumptions. Borrower hereby authorizes Secured Party to request
credit bureau reports while any of the Obligations are outstanding.
3.22. FULL DISCLOSURE. Neither this Security Agreement nor any
instrument, document, certificate, schedule or statement delivered herewith or
heretofore by Borrower to Secured Party contains any material untrue statement
made by Borrower of a fact or omits to state any fact necessary to keep such
statements, in light of the circumstances in which they were made, from being
materially misleading.
3.23. EMPLOYEE BENEFIT PLANS. (a) Except as set forth in SCHEDULE
3.23, neither the Borrower nor any ERISA Affiliate (as hereinafter defined) is
currently obligated to contribute to an employee benefit plan subject to ERISA
(an "ERISA Plan"). Within the five (5) year period ending on the date hereof no
ERISA Affiliate has incurred any material liability to the U.S. Pension Benefit
Guaranty Corporation (the "PBGC"), the U. S. Internal Revenue Service (the
"IRS") or an ERISA Plan on account of any failure to meet the contribution
requirements or minimum funding standards of or prohibited transactions with
respect to, any ERISA Plan, the administration or termination of any single
employer pension plan which is an ERISA Plan, or any partial or complete
withdrawal from or the insolvency, reorganization or termination of a
multi-employer plan which is an ERISA Plan, and no event has occurred and no
condition exists which presents a material risk that the Borrower will incur
liabilities on account of the foregoing circumstances which are material in
aggregate. As used in this Agreement, the term "ERISA Affiliate" means the
Borrower and any other trade or business, whether or not incorporated which is
subject to ERISA and which is from time to time a member of a controlled group
or a group under common control with the Borrower (within the meaning of Section
414(b) or Section 414(c) of the Code or Section 4001(b) (1) of ERISA); and other
terms used in this Section 3.23 shall have the meanings assigned thereto in the
applicable provisions of ERISA and the Code.
(b) Solely for the purposes of making the representation in
the next sentence and only to the extent that the accuracy of the representation
made by this sentence affects the accuracy of the representation in the next
sentence, neither the Borrower nor any of its Affiliates is a "party in
interest" (within the meaning of Section 3(14) of ERISA) with respect to any
ERISA Plan, and none of their securities are "employer securities" (within the
meaning of Section 407(d) or ERISA) with respect to any ERISA Plan. The
acquisition of the Promissory Note by Secured Party or its assigns does not and
will not constitute a "prohibited transaction" (within the meaning of Section
4975 of the Code or Section 406 of ERISA).
3.24. TAXES. The Borrower and each entity which might have tax
liabilities for which the Borrower is liable, has filed all tax returns and paid
all taxes required by law to be filed or paid, which have become due pursuant to
said returns (or which to the knowledge of the Borrower are due and payable) and
on all assessments received by the Borrower or such entity, as the case may be.
As of the Funding Date, no extensions of the time for the assessment of
LOAN AND SECURITY AGREEMENT -- PAGE 16
SYBRA, INC./LOAN NO. 000
XXXX'X/XXXXXX, XXXXX
deficiencies have been granted by the Borrower. There are no material Liens on
the Collateral imposed or arising as a result of the delinquent payment or the
nonpayment of any tax, assessment, fee or other governmental charge. As of the
Funding Date, the Borrower has not given or consented to any waiver of the
statute of limitations with respect to its tax liabilities for any fiscal year.
Adequate provision has also been made for all other taxes (whether past, current
or deferred, federal, provincial, local or foreign, due or to come due) on such
balance sheet, and the Borrower knows of no transaction or matter which might or
could result in additional tax assessments to the Borrower in the ordinary
course since the date of such balance sheet other than Permitted Liens. There
are no applicable taxes, fees or other governmental charges payable by the
Borrower in connection with the execution and delivery of this Agreement, and
the other Loan Documents by the Borrower or the offer, issuance, sale and
delivery of the Promissory Note by the Borrower. The Borrower shall pay all
taxes, assessments and governmental levies and all other claims that if unpaid
might result in the creation of a Lien upon the Collateral other than Permitted
Liens before they become delinquent and before interest or penalties accrue.
3.25. BENEFIT RECEIVED. Each signatory to this Security Agreement
acknowledges and agrees to all of the following: (a) that it has received a
direct or indirect benefit from the Loan as consideration for executing Loan
Documents providing Secured Party with collateral security for such Loan; and
(b) that it is not insolvent as of the date it executed such Loan Documents and
that providing such collateral security to Secured Party does not render such
signatory insolvent and was not done to hinder, delay, defraud or avoid any
other creditors of such signatory.
3.26. NO FURTHER DISPOSITION OR ENCUMBRANCES. Other than with
respect to the interest granted in favor of Secured Party, to the extent of the
Permitted Encumbrances, if any, and except as provided for in Section 4 hereof,
Borrower has not and, without the prior written consent of Secured Party (which
consent shall not be unreasonably withheld or delayed in connection with
encumbrances in favor of Secured Party or any of its Affiliates), will not enter
into any agreement or understanding or take, permit, or suffer to exist any
action (including the filing of a financing statement, agreement, pledge,
mortgage, notice or registration) or event (whether by operation of law or
otherwise) for the purpose of, or that may have the effect of, either directly
or indirectly, granting a security interest in or lien on (including any state
or federal tax lien), pledging, transferring, assigning, selling, disposing of,
or encumbering any Collateral or the Franchise Agreement, any interest herein or
rights pertaining thereof or involving the Pledged Store; PROVIDED, HOWEVER,
that the Borrower may transfer, assign, sell or otherwise dispose of (i)
Inventory and other assets in the ordinary course of business, (ii) Equipment
and other assets, provided that the net Proceeds of such transfer, assignment,
sale or other disposition are applied within one hundred twenty (120) days to
acquire Equipment and other assets of equal or greater value, or (iii) any
Collateral or the Franchise Agreement if in the case of a Substituted Store
pursuant to Section 3.9 or a casualty or damage pursuant to Section 5.
3.27. BROKERS AND FINANCIAL ADVISORS. Borrower represents and
warrants to Secured Party that no brokers or finders were used in connection
with the financing contemplated hereby and Borrower hereby agrees to indemnify
and hold Secured Party harmless from and against any and all liabilities, costs
and expenses (including attorneys' fees and court costs) suffered or incurred by
Secured Party as a result of or arising out of any of the transactions
contemplated hereby. The provisions of this Section shall survive the expiration
and termination of this Security Agreement and the repayment of the related
Indebtedness.
3.28. LITIGATION. Except as set forth on SCHEDULE F, as of the
Funding Date, there is no present investigation by any governmental agency
pending, or to the best of Borrower's knowledge threatened, against or affecting
Borrower, its assets or Business and there is no action, suit, proceeding or
claim by any Person pending, or to the best of Borrower's knowledge threatened,
against or affecting any transactions contemplated by this Agreement. None of
LOAN AND SECURITY AGREEMENT -- PAGE 17
SYBRA, INC./LOAN NO. 000
XXXX'X/XXXXXX, XXXXX
the investigations, actions, suits, proceedings or claims identified on SCHEDULE
F would, if adversely determined, have a Material Adverse Effect. There is no
action, suit, proceeding or claim by any Person pending, or to the best of
Borrower's knowledge threatened, against Borrower or its assets or Business that
would, if adversely determined, have a Material Adverse Effect
3.29. TRANSACTIONS WITH AFFILIATES. Borrower shall not directly or
indirectly: (a) purchase, acquire or lease any property from, or sell, transfer
or lease any property to, any Affiliate or any officer, employee, member,
manager, director, or agent of any Affiliate of Borrower; or (b) make any
payments of management, consulting or other fees for management or similar
services, or of any indebtedness owing to any Affiliate or any officer,
employee, member, manager, director, agent of any Affiliate of Borrower, except
in the ordinary course of business and pursuant to agreements in writing on
terms no less favorable to Borrower than would be available in agreements with
Persons other than those referenced in (a) or (b).
ARTICLE IV
SPECIAL PROVISIONS CONCERNING INVENTORY, EQUIPMENT AND
REAL PROPERTY
4. SPECIAL PROVISIONS CONCERNING INVENTORY, EQUIPMENT AND REAL
PROPERTY. The Borrower shall do nothing to impair the rights of the Secured
Party in the Inventory and the Equipment and shall cause the Inventory and the
Equipment to at all times be, constitute and remain personal property subject to
the security interest granted to the Secured Party. Notwithstanding the
preceding sentence, provided an Event of Default has not occurred and is not
continuing, in the ordinary course of the Borrower's Business, (i) the Borrower
may sell its Inventory, and (ii) the Borrower may, from time to time, refinance
existing Indebtedness secured by Permitted Liens in accordance with the terms
thereof, replace its Equipment, acquire new Equipment and accessions to its
Equipment, or acquire fee interest in (or ground lease of) any Property, subject
to purchase money security interests, if any; provided that if the Secured Party
has a leasehold mortgage or deed of trust on any lease of such Property, such
lease remains in full force and effect (or is spread to a fee mortgage on the
Property or on the ground lease of the Property), subject to the Secured Party's
security interest and any Person with a lien on the fee interest in (or ground
lease of such Property) provides the Secured Party with a nondisturbance
agreement and such other assurances as the Secured Party shall reasonably
request.
ARTICLE V
SPECIAL PROVISIONS CONCERNING PROCEEDS
5. SPECIAL PROVISIONS CONCERNING PROCEEDS. Unless prohibited
under the terms of the Property lease, if applicable, the Borrower hereby
directs any and all transferors, distributors or payers (including insurance
companies with whom the Borrower maintains insurance) to make payment of all
Proceeds directly to the Secured Party or its designee, including the Servicer,
and authorizes the Secured Party or its designee, including the Servicer, (i) to
apply the same toward replacement and repair of the Collateral or (ii) in the
event the damage results in fifty percent (50.0%) or more in value of the
Pledged Store requiring replacement, and the Unit FCCR of the Pledged Store for
the twelve (12) month period preceding such casualty was less than 1.25 to 1.00,
then the Secured Party may, at its sole discretion, require the proceeds to be
applied to the repayment of the Loan. In any situation where the insurance
proceeds would be applied to the repayment of the Loan as described in clause
(ii) above, Borrower may, at its election, request
LOAN AND SECURITY AGREEMENT -- PAGE 18
SYBRA, INC./LOAN NO. 000
XXXX'X/XXXXXX, XXXXX
Lender's consent (which consent shall not be unreasonably withheld or delayed)
to the insurance proceeds being paid to Borrower, with Borrower providing a
Substitute Store (as defined in Section 3.9) to replace the Pledged Store
subject to the casualty. In all cases other than as set forth in clause (ii)
above, the Borrower shall have the option of applying the proceeds to replacing
or repairing the Collateral/Pledged Store or repaying the Loan. Notwithstanding
the terms of the Property lease, if applicable, the Borrower will use its
reasonable best efforts and hereby assigns the Proceeds toward replacement of
the Collateral and shall keep any lease or options to extend the lease in effect
until the Loan is paid. All Proceeds, whether received by the Secured Party or
by the Borrower, or by any other Person will be included in the Collateral
subject to the security interest granted to the Secured Party hereunder. Upon
and during the continuation of an Event of Default the Borrower shall (i)
identify, earmark, segregate and keep separate all Proceeds received by it, (ii)
upon the Secured Party's request, promptly account to the Secured Party for all
Proceeds, and (iii) hold all Proceeds received by the Borrower in trust for the
benefit of the Secured Party and shall promptly (and in any event not later than
the fifth day after receipt) deliver (or cause to be delivered) the same to the
Secured Party and into its possession in the form received by the Borrower and
at a time and in a manner satisfactory to the Secured Party.
ARTICLE VI
SPECIAL PROVISIONS CONCERNING RIGHTS AND DUTIES WHILE IN
POSSESSION OF COLLATERAL
6. SPECIAL PROVISION CONCERNING RIGHTS AND DUTIES WHILE IN
POSSESSION OF COLLATERAL.
6.1. BORROWER'S POSSESSION. Upon and during the continuance of an
Event of Default to the extent the same shall, from time to time, be in the
Borrower's possession, the Borrower will hold all Instruments, Chattel Paper,
Documents, money on hand at the Pledged Store and other writings evidencing or
relating to the Collateral in trust for the Secured Party and, upon request or
as otherwise provided herein, promptly deliver the same to the Secured Party in
a form received and at a time and in a manner satisfactory to the Secured Party.
With respect to the Collateral in the Borrower's possession, the Borrower shall
at the Secured Party's request take such action as the Secured Party in its
discretion deems necessary or desirable to create, perfect and protect the
Secured Party's security interest in any of the Collateral.
6.2. SECURED PARTY'S POSSESSION. With respect to all of the Collateral
delivered or transferred to, or otherwise in the custody or control of
(including any items in transit to or set apart for) the Secured Party or any of
its agents, associates or correspondents in accordance with this Security
Agreement, the Borrower agrees that upon the occurrence and during the
continuation of an Event of Default, (i) such Collateral will be and be deemed
to be in the sole possession of the Secured Party; (ii) subject to Section 4,
the Borrower has no right to withdraw or substitute any such Collateral without
the consent of the Secured Party, which consent may be withheld or delayed in
the Secured Party's sole discretion; (iii) the Borrower shall not take or permit
any action, or exercise any voting and other rights, powers and privileges in
respect of the Collateral inconsistent with the Secured Party's sole possession
thereof; and (iv) the Secured Party may in its sole discretion and without
notice, without obligation or liability except to account for property actually
received by it, and without affecting or discharging the Obligations, (x)
further transfer and segregate the Collateral in its possession; (y) receive
Proceeds and hold the same as part of the Collateral and/or apply the same as
hereinafter provided; and (z) exchange any of the Collateral for other property
upon reorganization, recapitalization or other readjustment. Following the
occurrence and during the continuation of an Event of Default, the Secured Party
is authorized (i) to exercise or cause its nominee to exercise all or any
rights, powers and privileges (including to vote) on or with respect to the
Collateral with the same force and effect as an absolute owner thereof; (ii)
whether any of the Obligations be due, in its name or in the Borrower's name or
otherwise, to demand, xxx for, collect or receive any
LOAN AND SECURITY AGREEMENT -- PAGE 19
SYBRA, INC./LOAN NO. 163
ARBY'S/DALLAS, TEXAS
money or property at any time payable or receivable on account of or in exchange
for, or make any compromise or settlement with respect to, any of the
Collateral; and (iii) to extend the time of payment, arrange for payment in
installments, or otherwise modify the terms of or release, any of the
Collateral. Notwithstanding the rights accorded the Secured Party with respect
to the Collateral and except to the extent provided below or required by the UCC
or other applicable law (which requirement cannot be modified, waived or
excused), the Secured Party's sole duty with respect to the Collateral in its
possession (with respect to custody, preservation, safekeeping or otherwise)
will be to deal with it in the same manner that the Secured Party deals with
similar property owned and possessed by it. Without limiting the foregoing, the
Secured Party, and any of its officers, directors, partners, trustees, owners,
employees and agents, to the extent permitted by law (i) will not be required to
take any steps necessary to preserve any rights against prior parties to any of
the Collateral; and (ii) will not be liable for (or deemed to have made an
election of or exercised any right or remedy on account of) any delay or failure
to demand, collect or realize upon any of the Collateral. The Borrower agrees
that such standard of care is reasonable and appropriate under the
circumstances.
6.3. FUNDAMENTAL CHANGES. Without Secured Party's prior written
consent, which consent shall not be unreasonably withheld or delayed, Borrower
will not permit a Change in Control to occur. Borrower shall pay all reasonable
costs and expenses of the Secured Party incurred in connection with any proposed
Change in Control including, without limitation, the reasonable underwriting
costs, appraisal costs, the costs of Lien searches, recording and filing fees,
document preparation and reasonable attorneys' fees and expenses. No Change in
Control shall relieve Borrower or any other party liable for payment of the
Obligations including, any Guarantor, from liability for payment of the
Obligations. The Borrower and any such other party liable for payment of the
Obligations shall continue to be jointly and severally liable with any
transferee for the continued payment and performance of the Obligations.
ARTICLE VII
EVENTS OF DEFAULT
7. EVENTS OF DEFAULT. The happening of any one or more of the
following events shall constitute an "Event of Default" hereunder:
(a) the Borrower shall fail to make any payment under this
Security Agreement, the Promissory Note or any Loan Document when the same
becomes due and payable and such failure shall continue for five (5) Business
Days after the Secured Party provides notice to the Borrower of such failure; or
(b) any representation, warranty or statement made by Borrower
or any Guarantor (or any of their respective officers) in any Loan Document or
in any certificate or financial statement furnished at any time in connection
with the Obligations or this Security Agreement shall be false, misleading or
erroneous in any material respect when made; or
(c) the Borrower shall default under, fail to perform or
observe in any material respect any covenant or condition of or agreement in
this Security Agreement, the Promissory Note or any other Loan Document, and
such default, failure, or breach shall continue unremedied for fifteen (15) days
following the date of such default, failure, or breach, or the Borrower shall
default in connection with an obligation with respect to the Pledged Store
secured by a Permitted Lien and such default shall continue beyond any
applicable grace or cure period, provided, however, that if such default or
breach is not capable of cure within the foregoing periods, and provided that
Borrower has diligently commenced and continues to pursue cure thereof then
Borrower shall have such additional time as is necessary in order to cure such
breach, but in no event in excess of forty-five (45) days; or
LOAN AND SECURITY AGREEMENT -- PAGE 20
SYBRA, INC./LOAN XX. 000
XXXX'X/XXXXXX, XXXXX
(d) if the Borrower is a party to a Franchise Agreement as of
the execution of this Security Agreement with regard to the Pledged Store and
the Borrower or other party to such Franchise Agreement shall terminate or not
renew such Franchise Agreement other than in connection with a casualty or
substitution of a Substitute Store pursuant to Section 3.9; or
(e) the Borrower shall dissolve, liquidate or suspend for more
than fifteen (15) days the transaction of Business at the Pledged Store, other
than in connection with remodeling, casualty at the Pledged Store, to comply
with any provision of the Franchise Agreement (other than the termination
thereof) or applicable law, or subject to a permitted substitution of a
Substitute Store pursuant to Section 3.9; or
(f) a judgment shall be entered against the Borrower or any
Guarantor for the payment of money in excess of $1,000,000 and the same shall
not be discharged (or provision shall not be made for discharge), or a stay of
execution thereof shall not be procured, within thirty (30) days after being
entered, unless the amount of the judgment is fully covered by insurance and an
insurer has accepted in writing, responsibility for payment; or
(g) the Borrower or any Guarantor shall make or consent to an
assignment for the benefit of or composition with, creditors, or shall be or
become insolvent or unable, or admit in writing or generally fail, to pay its
debts when due, or shall be or become a party or subject to any bankruptcy,
reorganization, insolvency or other similar proceeding, or a receiver or
liquidator, custodian or trustee shall be appointed for the Borrower, any
Guarantor or any other liable party, or a substantial portion of any of the
Borrower's, any Guarantor's or their respective assets and, if any of the
foregoing shall occur involuntarily as to the Borrower or any Guarantor, it
shall not be dismissed with prejudice, stayed or discharged within ninety (90)
days; or
(h) the Borrower shall take any action to effect, or which
indicates its acquiescence in, any of (e) or (g) above; or
(i) subject to Borrower's right to provide a Substitute Store
pursuant to Section 3.9, the lease with respect to the Pledged Store is
terminated, and on or before the date of termination Borrower does not deposit
with Secured Party, as additional Collateral hereunder, cash or a letter of
credit in form reasonably acceptable to Secured Party, in the amount of the
unamortized Loan Amount allocated to such Pledged Store, or other property with
a value acceptable to Secured Party in its sole discretion; provided, however,
that if the lease is terminated because of a casualty or other similar event,
this paragraph shall not apply if Secured Party receives sufficient insurance or
other proceeds to repay the unamortized balance of the Loan Amount allocable to
such Pledged Store; or
(j) this Security Agreement or any other Loan Document shall
cease to be in full force and effect other than as a result of a voluntary
release, or this Security Agreement or any other Loan Document shall be declared
null and void or the validity or enforceability thereof shall be contested or
challenged by Borrower or any Guarantor or any of their respective shareholders
or Borrower or any Guarantor shall deny that it has any further liability or
obligation under any of the Loan Documents, or any Lien or security interest
created by the Loan Documents shall for any reason cease to be a first priority
perfected security interest in and Lien upon any of the Collateral purported to
be covered thereby, except for Permitted Liens; or
(k) there occurs any Change in Control without Secured Party's
prior written consent; or
LOAN AND SECURITY AGREEMENT -- PAGE 21
SYBRA, INC./LOAN NO. 163
ARBY'S/DALLAS, TEXAS
(l) there occurs any "Event of Default" under any other Loan
Document; or
(m) there occurs a default beyond any applicable grace or cure
period on the part of Borrower or Guarantor under any other note, agreement or
instrument related to an Other Pledged Store, whether now existing or hereafter
entered into, with the Secured Party or any Affiliate of the Secured Party; or
(n) the Borrower fails to pay when due (after the lapse of any
applicable grace or cure periods) any principal of or interest on any
Indebtedness (other than the Obligations) the principal amount of which is in
excess of $1,000,000, or any event shall have occurred that permits any holder
or any Person acting on behalf of such holder to accelerate the maturity of such
Indebtedness or such Indebtedness shall have been required to be prepaid prior
to the stated maturity thereof; or
(o) the Borrower shall have defaulted, after any applicable
notice and cure period, under the Franchise Agreement; or
(p) the Borrower, or any Affiliate of Borrower shall have
defaulted under any loan made by Secured Party to Borrower, or its
Affiliate, dated contemporaneously with the date of this Agreement.
ARTICLE VIII
REMEDIES UPON OCCURRENCE AND CONTINUATION OF A DEFAULT
8. REMEDIES UPON OCCURRENCE AND CONTINUATION OF EVENT OF DEFAULT.
8.1. CUMULATIVE RIGHTS AND REMEDIES. Upon the occurrence of an Event of
Default, and at any time thereafter if any Event of Default shall then be
continuing, the Secured Party shall have the rights, powers and remedies (i)
granted to secured parties under the UCC; (ii) granted to the Secured Party
under any other applicable statute, law, rule or regulation; and (iii) granted
to the Secured Party under this Security Agreement, the Promissory Note or any
other Loan Document or any other agreement between the Borrower and the Secured
Party. In addition, all such rights, powers and remedies shall be cumulative and
not alternative. Any single or partial exercise of or forbearance, failure or
delay in exercising any right, power or remedy shall not be, nor shall any such
single or partial exercise of or forbearance, failure or delay be deemed to be a
limitation, modification or waiver of any right, power or remedy and shall not
preclude the further exercise thereof and every right power and remedy of the
Secured Party shall continue in full force and effect until such right, power
and remedy is specifically waived by an instrument in writing executed and
delivered with respect to each such waiver by the Secured Party.
8.2. ACCELERATION OF OBLIGATIONS. Upon the occurrence of an Event of
Default, and at any time thereafter if any Event of Default shall then be
continuing, the Secured Party may, in its discretion, by written notice to the
Borrower declare the Promissory Note (including any Prepayment Amount required
to be paid upon prepayment of the Loan) and any other Obligations to be
immediately due and payable whereupon (and, automatically without any notice,
demand, notice of dishonor, notice of intent to accelerate, notice of
acceleration or other action by the Secured Party all of which are hereby
expressly waived, upon the occurrence of any Event of Default set forth in
subsections (e) through (g) of Section 7) such principal, interest and other
Obligations shall be immediately due and payable, without further notice,
presentment, demand, protest, notice of dishonor, notice of intent to
accelerate, notice of acceleration or other notice of any kind, all of which are
hereby expressly waived by the Borrower to the maximum extent permitted by law.
LOAN AND SECURITY AGREEMENT -- PAGE 22
SYBRA, INC./LOAN NO. 000
XXXX'X/XXXXXX, XXXXX
8.3. ADDITIONAL RIGHTS OF THE SECURED PARTY. Upon the occurrence of
an Event of Default, and at any time thereafter if any Event of Default shall
then be continuing, the Secured Party may, from time to time, in its discretion,
and without the Borrower's assent, without advertisements or notices of any kind
(except for the notice specified in Section 8.5 below regarding notice required
in connection with a public or private sale), or demand of performance or other
demand, or obligation or liability (except to account for amounts actually
received) to or upon the Borrower or any other person (all such advertisements,
notices and demands, obligations and liabilities, if any, hereby being expressly
waived and discharged to the extent permitted by law), forthwith, directly or
through its agents or representatives, (i) disclose such default and other
matters (including the name, address and telephone number of the Borrower) in
connection therewith in the Secured Party's reasonable discretion to the
Borrower's franchisor or franchisee (if applicable) and other creditors or
obligors of the Borrower (and the Borrower understands that the Secured Party
intends to make such disclosure, from time to time); (ii) to the extent
permitted by applicable law enter any premises, with or without the assistance
of other persons or legal process; (iii) require the Borrower to account for
(including accounting for any products and Proceeds), segregate, assemble, make
available and deliver to the Secured Party, its agents or representatives, the
Collateral; (iv) take possession of, operate, render unusable, collect, transfer
and receive, recover, appropriate, foreclose, extend payment of, adjust,
compromise, settle, release any claims included in, and do all other acts or
things necessary or, in the Secured Party's sole discretion appropriate, to
protect, maintain, preserve and realize upon, the Collateral and any products
and Proceeds, in whole or in part; and (v) exercise all rights, powers and
interests with respect to any and all Collateral, and sell, assign, lease,
license, pledge, transfer, negotiate (including endorse checks, drafts, orders,
or instruments), deliver or otherwise dispose (by contract, option(s) or
otherwise) of the Collateral or any part thereof. Any such disposition may be in
one or more public or private sales, at or upon an exchange, board or system or
in the county, in the state set forth on SCHEDULE 1 or elsewhere, at such price,
for cash or credit (or for future delivery without credit risk) and upon such
other terms and conditions as it deems appropriate, with the right of the
Secured Party to the extent permitted by law upon any cash sale or sales, public
or private, to purchase the whole or any part of said Collateral, free of any
right, claim or equity of redemption of or in the Borrower (such rights, claims
and equity or redemption, if any, hereby being expressly waived).
Notwithstanding that the Secured Party, whether in its own behalf and/or on
behalf of another or others, may continue to hold the Collateral and regardless
of the value thereof or any delay or failure to dispose thereof unless and then
only to the extent that the Secured Party proposes to retain the Collateral in
satisfaction of the Obligations by written notice in accordance with the UCC,
the Borrower shall be and remain liable for the payment in full of any balance
of the Obligations and expenses at any time unpaid. Without limiting the
foregoing, upon the occurrence and continuation of an Event of Default, in
addition to its other rights and remedies, the Secured Party may (but is not
required to), in its sole discretion and to the extent it deems necessary,
advisable or appropriate, take or cause to be taken such actions or things to be
done (including the payment or advancement of funds, or requiring advancement of
funds to be held by the Secured Party to fund such obligations, including taxes
or insurance) as may be required hereby (or necessary or desirable in connection
herewith) to correct such failure (including causing the Collateral to be
maintained or insurance protection required hereby to be procured and
maintained) and any and all costs and expenses incurred (including attorney's
fees and disbursements) in connection therewith shall be included in the
Borrower's Obligations and shall be immediately due and payable and bear
interest at the Default Rate.
8.4. APPLICATION OF PROCEEDS. The Secured Party may apply the net
proceeds, if any, of any collection, receipt, recovery, appropriation,
foreclosure or realization, or from any use, operation, sale, assignment, lease,
pledge, transfer, delivery or disposition of all or any of the Collateral, after
deducting all reasonable costs and expenses (including reasonable attorneys'
fees, court cost and legal expenses) incurred in connection therewith or with
respect to the care, safekeeping, custody, maintenance, protection,
administration or otherwise of any and all of said Collateral
LOAN AND SECURITY AGREEMENT -- PAGE 23
SYBRA, INC./LOAN NO. 163
ARBY'S/DALLAS, TEXAS
or in any way relating to the rights of the Secured Party under this Security
Agreement, (i) first, to the satisfaction of the Obligations, in whole or in
part, in such order as the Secured Party may, in its discretion, elect; (ii)
second, to the payment, satisfaction or discharge of any other Indebtedness or
obligation as required by any law, rule or regulation; and (iii) lastly, the
surplus, if any, to the Borrower.
8.5. REQUIRED NOTICE OF SALE. In exercising its rights, powers and
remedies as secured party, the Secured Party agrees to give the Borrower ten
(10) days notice of the time and place of any public sale of Collateral or of
the time after which any private sale of Collateral may take place, unless the
Collateral is perishable or threatens to decline speedily in value or is of a
type customarily sold on a recognized market. The Borrower agrees that such
period and notice is commercially reasonable under the circumstances.
ARTICLE IX
POST-DEFAULT POWER OF ATTORNEY
9. POST-DEFAULT POWER OF ATTORNEY. The Borrower hereby
irrevocably constitutes and appoints, effective on and after the occurrence of
an Event of Default and at anytime thereafter if any Event of Default shall then
be continuing, the Secured Party acting through any officer or agent thereof
with full power of substitution, as the Borrower's true and lawful
attorney-in-fact with full irrevocable power and authority in the Borrower's
place and stead and in the Borrower's name or in its own name, from time to time
in the Secured Party's discretion, to receive, open and dispose of mail
addressed to the Borrower, to take any and all action, to do all things, to
execute, endorse, deliver and file any and all writings, documents, instruments,
notices, statements (including financing statements, and writings to correct any
error or ambiguity in any Loan Document), applications and registrations,
checks, drafts, acceptances, money orders, or other evidence of payment or
proceeds, which may be or become necessary or desirable in the sole discretion
of the Secured Party to accomplish the terms, purposes and intent of this
Security Agreement and the other Loan Documents with respect to the Collateral,
including the right to appear in and defend any action or proceeding brought
with respect to the Collateral or Property, and to bring any action or
proceeding, in the name and on behalf of the Borrower, which the Secured Party,
in its discretion, deems necessary or desirable to protect its interest in the
Collateral or Property. Said attorney or designee shall not be liable for any
acts of commission or omission, nor for any error of judgment or mistake of fact
or law, unless and then only to the extent that the same constitutes its
negligence or willful misconduct. This power is coupled with an interest and is
irrevocable. THIS POWER DOES NOT AND SHALL NOT BE CONSTRUED TO AUTHORIZE ANY
CONFESSION OF JUDGMENT.
ARTICLE X
INDEMNIFICATION
10. INDEMNIFICATION. THE BORROWER AGREES TO INDEMNIFY THE SECURED PARTY
AND EACH OF ITS AFFILIATES AND THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES,
ATTORNEYS AND AGENTS (COLLECTIVELY, THE "INDEMNIFIED PARTIES") FROM AND HOLD
EACH OF THEM HARMLESS AGAINST THIRD PARTY CLAIMS RESULTING IN ANY AND ALL
LIABILITIES (WHETHER IN CONTRACT OR TORT), OBLIGATIONS, LOSSES, CLAIMS, DAMAGES
(WHETHER SUCH THIRD PARTY CLAIMS ARE DIRECT, INDIRECT, CONSEQUENTIAL, PUNITIVE,
INCIDENTAL, SPECIAL OR OTHERWISE), PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS,
EXPENSES (INCLUDING ATTORNEYS' FEES) OR DISBURSEMENTS OF ANY KIND OR NATURE
WHATSOEVER WHICH MAY BE IMPOSED ON, INCURRED BY, OR ASSERTED AGAINST ANY
INDEMNIFIED PARTY DIRECTLY OR INDIRECTLY RELATING TO, ARISING OUT OF OR IN
CONNECTION WITH THE BORROWER, THE
LOAN AND SECURITY AGREEMENT -- PAGE 24
SYBRA, INC./LOAN NO. 000
XXXX'X/XXXXXX, XXXXX
COLLATERAL, THIS SECURITY AGREEMENT, THE LOAN DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY OTHER THAN THOSE CAUSED BY SECURED PARTY'S GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT IN ITS OBLIGATIONS UNDER THIS SECURITY
AGREEMENT OR THE LOAN DOCUMENTS. WITHOUT LIMITATION OF THE FOREGOING, THE
BORROWER WILL REIMBURSE THE SECURED PARTY FOR ALL NECESSARY OR REASONABLE
EXPENSES (INCLUDING EXPENSES FOR LEGAL SERVICES OF EVERY KIND) OF, OR INCIDENTAL
TO, THE NEGOTIATION OF, ENTERING INTO AND ENFORCEMENT OF ANY OF THE PROVISIONS
HEREOF AND OF ANY OF THE OBLIGATIONS, AND ANY ACTUAL OR ATTEMPTED SALE, LEASE OR
OTHER DISPOSITION OF, AND ANY EXCHANGE, ENFORCEMENT, COLLECTION, COMPROMISE OR
SETTLEMENT OF ANY OF THE COLLATERAL AND RECEIPT OF THE PROCEEDS THEREOF, AND FOR
THE CARE OF THE COLLATERAL AND DEFENDING OR ASSERTING THE RIGHTS AND CLAIMS OF
THE SECURED PARTY IN RESPECT THEREOF, BY LITIGATION OR OTHERWISE, INCLUDING
EXPENSE OF INSURANCE, AND ALL SUCH EXPENSES SHALL BE THE BORROWER'S OBLIGATIONS.
WITHOUT PREJUDICE TO THE SURVIVAL OF ANY OTHER OBLIGATION OF THE BORROWER
HEREUNDER, THE OBLIGATIONS OF BORROWER UNDER THIS SECTION 10 SHALL SURVIVE
FORECLOSURE OR OTHER DISPOSITION OF THE COLLATERAL AND REPAYMENT IN FULL OF THE
OBLIGATIONS.
ARTICLE XI
OBLIGATIONS ABSOLUTE
11. OBLIGATIONS ABSOLUTE. The Borrower's Obligations will be
absolute, unconditional and irrevocable and will be paid or satisfied strictly
in accordance with their respective terms under all circumstances whatsoever,
including: (i) the invalidity or unenforceability of all or any of, or any part
of this Security Agreement, the Promissory Note or any other Loan Document, or
any consent, waiver, amendment or modification thereof; (ii) the existence of
any claim, setoff, defense or other right which the Borrower may have at any
time against the Secured Party, or any other Person, whether in connection with
this Security Agreement, any other Loan Documents, the transactions contemplated
hereby, thereby or otherwise all of which the Borrower hereby waives to the
maximum extent permitted by law; or (iii) the loss, theft, damage, destruction
or unavailability of the Collateral to the Borrower for any reason whatsoever,
it being understood and agreed that the Borrower retains all liability and
responsibility with respect to the Collateral.
ARTICLE XII
ASSIGNMENT AND DISSEMINATION OF INFORMATION
12. ASSIGNMENT AND DISSEMINATION OF INFORMATION.
12.1 ASSIGNMENT. This Security Agreement is freely assignable, in
whole or in part, by the Secured Party and, to the extent of any such
assignment, the Secured Party shall be fully discharged from all responsibility.
The Borrower understands and agrees that the Secured Party intends to and may,
from time to time, sell, pledge, grant a security interest in and collaterally
assign, transfer and deliver or otherwise encumber or dispose of the Promissory
Note, this Security Agreement and the other Loan Documents and its rights and
powers hereunder and thereunder, in whole or in part, in connection with the
Securitization or any other assignment or other disposition of the Promissory
Note. For so long as Secured Party is the holder or servicing agent of the
Promissory Note, Secured Party shall designate one representative or contact
person to service the Loan underlying the Promissory Note. The Borrower may not,
in whole or in part, directly or indirectly, assign this Security Agreement or
any Loan Document or its rights hereunder or thereunder or delegate its duties
hereunder without, in each instance, the specific prior written consent
LOAN AND SECURITY AGREEMENT -- PAGE 25
SYBRA, INC./LOAN NO. 000
XXXX'X/XXXXXX, XXXXX
of the Secured Party, which consent may be withheld or delayed in the Secured
Party's sole discretion, and payment of the amounts required under and
compliance with Section 11(b) of the Promissory Note. Notwithstanding the
foregoing to the contrary, Borrower may assign the rights and obligations under
this Security Agreement but not its obligation under the Promissory Note to a
subsidiary corporation which, at the time of assignment and at all times
thereafter, Borrower owns one hundred percent (100%) of the outstanding stock,
with Secured Party's prior written consent, which will not be unreasonably
withheld or delayed, but may be conditioned on: (i) all leases, Franchise
Agreements and other rights and obligations of Borrower with respect to the
Pledged Store being assigned to such subsidiary concurrently with the assignment
of the Security Agreement; (ii) Borrower providing certification to Secured
Party that all necessary consents to such assignment have been obtained; (iii)
Borrower providing Secured Party with such assurances that Secured Party may
reasonably request that Secured Party will have a perfected first lien security
interest in all items of Collateral which have been transferred; and (iv)
Borrower and Secured Party have agreed to all amendments to this Security
Agreement deemed reasonably necessary by Secured Party to effectuate the
assignment, including any amendments to Borrower's representations, warranties
and covenants. Borrower will pay all Secured Party's reasonable expenses
incurred in connection with this Section.
12.2 DISSEMINATION OF INFORMATION. If Secured Party determines at
any time to sell transfer or assign the Promissory Note, Security Agreement, or
other Loan Documents, and any or all servicing rights with respect thereto, or
to otherwise issue a Securitization involving the Loan Documents, Secured Party
may forward to each purchaser, transferee, assignee, investor or their
prospective successors in such Securitization or any rating agency rating such
Securitization and each prospective investor, all documents and information
which Secured Party now has or may hereafter acquire relating to the Loan
Documents, the Borrower, any Guarantor and the Property, which shall have been
furnished by Borrower or any Guarantor, as Secured Party determines necessary or
desirable. The Borrower hereby consents to the Secured Party's disclosure of
such financial and other information about Borrower, any Guarantor, the Loan,
the Collateral and the Business in connection with such transfer or assignment
as Secured Party determines necessary or desirable.
ARTICLE XIII
FURTHER ASSURANCE
13. FURTHER ASSURANCE. The Borrower agrees, that with respect to
the Collateral and the Pledged Store, at any time and from time to time, at the
Borrower's sole cost and expense, to promptly obtain, procure, execute and
deliver, file and affix such further agreements, bills of sale and assignments,
instruments, documents, warehouse receipts, bills of lading, vouchers, invoices,
notices, statements, writings, (including financing statements, and writings to
correct any error or ambiguity in any Loan Document), powers (including stock
and bond powers, and powers of attorney), tax stamps and information, and to do
or cause to be done all such further acts and things (including the execution,
delivery and filing of financing statements on Form UCC-1, payment of filing
fees and transfer, gains and recording taxes) as the Secured Party may
reasonably request, from time to time, in its discretion, including but not
limited to all such actions required to provide Secured Party with a perfected
security interest in the Collateral (including all General Intangibles).
Additionally, the Borrower agrees to fully cooperate with the Secured Party in
connection with any Securitization or other disposition, including, but not
limited to, providing the Secured Party with any information deemed necessary to
complete the Securitization or other disposition. Furthermore, Borrower agrees
to use its reasonable best efforts (provided, however, the Borrower shall not be
obligated to make any payments with respect hereto), to provide Secured Party
with fully-executed landlord estoppels and landlord consents to leasehold
mortgages, in form and substance acceptable to Secured Party for the Pledged
Store, if the Pledged Store is leased.
LOAN AND SECURITY AGREEMENT -- PAGE 26
SYBRA, INC./LOAN NO. 000
XXXX'X/XXXXXX, XXXXX
Without limiting the foregoing, the Borrower authorizes the Secured Party to the
extent permitted under the UCC to execute and file, or file without the
Borrower's signature, any and all financing statements, amendments thereto and
continuations thereof as the Secured Party deems necessary or appropriate and
the Borrower shall pay and indemnify the Secured Party for and hold the Secured
Party harmless from any and all costs and expenses in connection therewith. The
Borrower agrees that it will promptly notify the Secured Party of and agree to
correct any defect, error or omission in the contents of any of the Loan
Documents or in the execution, delivery or acknowledgment thereof.
ARTICLE XIV
TERM, PARTIAL RELEASE AND REINSTATEMENT
14. TERM, PARTIAL RELEASE AND REINSTATEMENT.
14.1. TERM. This Security Agreement shall be immediately in full
force and effect upon the Borrower's and Secured Party's execution below. Upon
indefeasible payment in full of the Obligations in accordance with the terms
thereof this Security Agreement and the security interest granted hereunder
shall terminate and the Secured Party, at the Borrower's expense, will execute
and deliver to the Borrower the proper instruments (including UCC termination
statements) acknowledging the termination of such security interest, and will
duly assign, transfer and deliver (without recourse, representation or warranty)
such Collateral as may be in the Secured Party's possession, and not to be
retained, sold, or otherwise applied or released pursuant to this Security
Agreement, to the Borrower, except that the Borrower's obligations under
Sections 10, 11, 13 and 15 shall survive indefinitely.
14.2. PARTIAL RELEASE. Upon the indefeasible payment in full of the
Loan (including, without limitation, any Prepayment Amount or other amounts
payable by the Borrower with respect to such Loan) in accordance with the
provisions of the Promissory Note evidencing such Loan, the security interest
hereunder with respect to the Collateral shall terminate, and the Secured Party,
at the expense of the Borrower, will execute and deliver to the Borrower the
proper instruments (including UCC partial release statements) acknowledging the
termination of such security interest, and will duly assign, transfer and
deliver (without recourse, representation or warranty) such of the Collateral as
may be in the possession of the Secured Party and has not theretofore been sold
or otherwise applied or released pursuant to this Security Agreement, to the
Borrower, and shall take such other action as the Borrower may reasonably
request to effectuate the foregoing. Notwithstanding the foregoing to the
contrary, Secured Party shall not be required to release its Lien as to any
Collateral, unless either: (a) (i) the Consolidated FCCR of the Consolidated
Pledged Stores which will not be released, exceeds 1.25 to 1.00 for the twelve
(12) month period immediately preceding the date of payment of such Loan; and
(ii) the aggregate indebtedness of Borrower to Secured Party (or its Affiliates
or assigns), with respect to the Consolidated Pledged Stores which will not be
released is less than seventy percent (70.0%) of the value of such Consolidated
Pledged Stores, based upon a current appraisal performed by such appraisal firm
regularly employed by Secured Party; and (b) the release of the Collateral and
Pledged Store would not result in a decrease in the Consolidated FCCR calculated
in clause (a)(i) above, or in the loan-to-value ratio calculated in (a)(ii)
above (calculated by first including the Unit FCCR and loan-to-value ratio of
the Pledged Store, and then excluding such amounts).
14.3. REINSTATEMENT. This Security Agreement shall continue to be
effective or be reinstated, as the case may be, if at any time any amount
received by the Secured Party in respect of the Obligations is rescinded or must
otherwise be restored or returned by the Secured Party upon the insolvency,
bankruptcy, dissolution, liquidation or reorganization of the Borrower or any
Guarantor or upon the appointment of any intervenor or conservator of or trustee
LOAN AND SECURITY AGREEMENT -- PAGE 27
SYBRA, INC./LOAN NO. 163
ARBY'S/DALLAS, TEXAS
or similar official for, the Borrower, Guarantor or any substantial part of the
Borrower's or any Guarantor's assets, or otherwise, all as though such payments
had not been made.
ARTICLE XV
MISCELLANEOUS
15. Miscellaneous.
15.1. FINAL AGREEMENT, AMENDMENTS, CONSENTS, AUTHORIZATIONS. THIS
SECURITY AGREEMENT, TOGETHER WITH THE OTHER LOAN DOCUMENTS, REPRESENTS THE FINAL
AGREEMENT BETWEEN THE BORROWER AND THE SECURED PARTY AND MAY NOT BE CONTRADICTED
BY EVIDENCE OF PRIOR CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE
BORROWER AND THE SECURED PARTY. THE BORROWER UNDERSTANDS AND AGREES THAT ORAL
AGREEMENTS AND ORAL COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR FROM
ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE. THE BORROWER ACKNOWLEDGES AND
AGREES THERE ARE NO ORAL AGREEMENTS BETWEEN THE BORROWER AND THE SECURED PARTY.
This Security Agreement and the Loan Documents represent the entire
understanding of the Secured Party and the Borrower with respect to the
transactions contemplated hereby and thereby. None of the terms or provisions of
this Security Agreement or any other Loan Document may be waived, altered,
modified, or amended except in each instance by a specific written instrument
duly executed by the Secured Party. Without limiting the foregoing, no action or
omission to act shall be deemed to be a consent, authorization, representation
or agreement of the Secured Party, under the UCC or otherwise, unless, in each
instance, the same is in a specific writing signed by the Secured Party. The
inclusion of Proceeds in the Collateral does not and shall not be deemed to
authorize the Borrower to sell, exchange or dispose of the Collateral or the
Franchise Agreement or otherwise use the Collateral in any manner not otherwise
specifically authorized herein.
15.2. NOTICES. All notices and other communications given pursuant
to or in connection with this Security Agreement shall be in writing delivered
to the parties at the addresses set forth below (or such other address as may be
provided by one party in a notice to the other party):
If to the Secured Party: 00000 Xxxxxx Xxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Attn: Servicing Department
If to the Borrower, to the Borrower's chief executive office (or
residence), as represented by the Borrower herein.
Notice delivered in accordance with the foregoing shall be effective
(i) when delivered, if delivered personally or by receipted-for telex,
telecopier, or facsimile transmission, (ii) two (2) business days after being
delivered in the United States (properly addressed and all fees paid) for
overnight delivery service to a courier (such as Federal Express) which
regularly provides such service and regularly obtains executed receipts
evidencing delivery, or (iii) five (5) business days after being deposited
(properly addressed and stamped for first-class delivery) in a daily serviced
United States mail box.
LOAN AND SECURITY AGREEMENT -- PAGE 28
SYBRA, INC./LOAN NO. 000
XXXX'X/XXXXXX, XXXXX
15.3. REASONABLENESS. If at any time the Borrower believes that the
Secured Party has not acted reasonably in granting or withholding any approval
or consent under the Promissory Note, this Security Agreement, or any other Loan
Document or otherwise with respect to the Obligations, as to which approval or
consent either the Secured Party has expressly agreed to act reasonably, or
absent such agreement, a court of law having jurisdiction over the subject
matter would require the Secured Party to act reasonably, then the Borrower's
sole remedy shall be to seek injunctive relief, specific performance or actual
damages, the Borrower hereby waiving any right to punitive or consequential
damages.
15.4. RECOVERY OF SUMS REQUIRED TO BE PAID. The Secured Party shall
have the right from time to time to take action to recover any sum or sums which
constitute a part of the Obligations as the same become due, without regard to
whether or not the balance of the Obligations shall be due, and without
prejudice to the right of the Secured Party thereafter to bring an action of
foreclosure, or any other action, for a default or defaults by the Borrower
existing at the time such earlier action was commenced.
15.5. WAIVERS. THE BORROWER HEREBY MAKES AND ACKNOWLEDGES THAT IT
MAKES ALL OF THE WAIVERS SET FORTH IN THIS SECURITY AGREEMENT, THE PROMISSORY
NOTE AND THE OTHER LOAN DOCUMENTS KNOWINGLY, INTENTIONALLY, VOLUNTARILY, WITHOUT
DURESS, AND ONLY AFTER EXTENSIVE CONSIDERATION OF THE RAMIFICATIONS OF SUCH
WAIVERS WITH ITS ATTORNEY; THE BORROWER FURTHER ACKNOWLEDGES THAT SUCH WAIVERS
ARE A MATERIAL INDUCEMENT TO THE SECURED PARTY TO MAKE THE LOAN TO THE BORROWER
AND THAT THE SECURED PARTY WOULD NOT HAVE MADE THE LOAN WITHOUT SUCH WAIVERS.
15.6. WAIVER OF TRIAL BY JURY. THE BORROWER HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES, AND THE SECURED PARTY BY ITS ACCEPTANCE OF THE
PROMISSORY NOTE AND THIS SECURITY AGREEMENT AND OTHER LOAN DOCUMENTS IRREVOCABLY
AND UNCONDITIONALLY WAIVES, ANY AND ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION,
SUIT OR COUNTERCLAIM ARISING IN CONNECTION WITH, OUT OF OR OTHERWISE RELATING TO
THE PROMISSORY NOTE, THIS SECURITY AGREEMENT, OR ANY OTHER LOAN DOCUMENT OR THE
OBLIGATIONS.
15.7. RELATIONSHIP. The relationship of the Secured Party to the
Borrower hereunder is strictly and solely that of secured lender on the one hand
and borrower on the other and nothing contained in the Promissory Note, this
Security Agreement or any other Loan Document or otherwise in connection with
the Obligations is intended to create, or shall in any event or under any
circumstance be construed as creating, a partnership, joint venture,
tenancy-in-common, joint tenancy or other relationship of any nature whatsoever
between the Secured Party and the Borrower other than as secured lender on the
one hand and borrower on the other.
15.8. [Intentionally deleted].
15.9. GOVERNING LAW; BINDING EFFECT. BORROWER AND SECURED PARTY
AGREE THAT THE VALIDITY, ENFORCEABILITY, CONSTRUCTION AND INTERPRETATION OF THIS
SECURITY AGREEMENT, AND OF ALL TRANSACTIONS AND DOCUMENTS UNDER OR RELATING TO
IT, WILL BE CONSTRUED, APPLIED, ENFORCED AND GOVERNED UNDER THE LAWS OF THE
STATE OF NEW YORK (WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAW),
PROVIDED HOWEVER, THAT WITH RESPECT TO THE CREATION, ATTACHMENT, PERFECTION,
PRIORITY AND
LOAN AND SECURITY AGREEMENT -- PAGE 29
SYBRA, INC./LOAN NO. 000
XXXX'X/XXXXXX, XXXXX
ENFORCEMENT OF ANY LIENS CREATED BY THIS SECURITY AGREEMENT, THE LAWS OF THE
STATE WHERE THE APPLICABLE PROPERTY IS LOCATED SHALL APPLY. This Security
Agreement shall be binding upon the Borrower, and the heirs, devises,
administrators, executives, personal representatives, successors, receivers,
trustees, and (without limiting Section 12 hereof) assignees, including all
successors in interest of the Borrower in and to all or any part of the
Collateral, and shall inure to the benefit of the Secured Party, and the
successors and assignees of the Secured Party.
15.10. SEVERABILITY. Whenever possible this Security Agreement, the
Promissory Note and each Loan Document and each provision hereof and thereof
shall be interpreted in such manner as to be effective, valid and enforceable
under applicable law. If and to the extent that any such provision shall be held
invalid and unenforceable by any court of competent jurisdiction, such holding
shall not invalidate or render unenforceable any other provisions hereof or
thereof and any determination that the application of any provision hereof or
thereof to any person or under any circumstance is illegal and unenforceable
shall not affect the legality, validity and enforceability of such provision as
it may be applied to any other person or in any other circumstance.
15.11. HEADINGS DESCRIPTIVE. The headings, titles and captions used
herein are for convenience only and shall not affect the construction of this
Security Agreement or any term or provision hereof.
15.12. COUNTERPARTS. This Security Agreement may be executed in a
number of counterparts and each of such counterparts shall for all purposes be
deemed to be an original; and all such counterparts shall together constitute
but one and the same agreement.
15.13. ACKNOWLEDGMENT. Borrower acknowledges that Secured Party's
underwriting guidelines and standards are applied on a case-by-case basis and
that waivers may be granted in any particular case (including in the case of a
borrower to be included in a pool with Borrower). Borrower further acknowledges
that Secured Party's underwriting guidelines or standards may be modified at any
time by Secured Party without notice to Borrower.
15.14. COSTS AND EXPENSES. Borrower shall pay to Secured Party on
demand all reasonable costs, expenses, filing fees and taxes (other than income
and franchise taxes of Secured Party) paid or payable in connection with the
preparation, negotiation, execution, delivery, recording, administration,
collection, liquidation, enforcement and defense of the Obligations, Secured
Party's rights in the Collateral, this Security Agreement, the other Loan
Documents and all other documents related hereto or thereto, including any
amendments, supplements, restatements or consents which may be hereafter
contemplated (whether or not executed) or entered into in respect hereof and
thereof, including, but not limited to: (a) all reasonable costs and expenses of
filing or recording (including Uniform Commercial Code financing statement
filing taxes and fees, documentary taxes, intangible taxes and mortgage
recording taxes and fees, if applicable); (b) all title insurance and other
insurance premiums, Business Valuation fees and search fees; (c) to the extent
applicable, reasonable costs and expenses of remitting loan proceeds, collecting
checks and other items of payment, and establishing and maintaining any account
with any bank required to be listed on SCHEDULE 4 together with Secured Party's
customary charges and fees with respect thereto; (d) reasonable costs and
expenses of preserving and protecting the Collateral; (e) reasonable costs and
expenses paid or incurred in connection with obtaining payment of the
Obligations, enforcing the security interests and liens of Secured Party,
selling or otherwise realizing upon the Collateral, and otherwise enforcing the
provisions of this Security Agreement and the other Loan Documents or defending
any claims made or threatened against Secured Party arising out of the
transactions contemplated hereby and thereby (including, without limitation,
preparations for and consultations concerning any such matters); (f) all
reasonable out-of-pocket expenses and costs heretofore and from time to time
hereafter incurred by Secured Party
LOAN AND SECURITY AGREEMENT -- PAGE
SYBRA, INC./LOAN NO. 000
XXXX'X/XXXXXX, XXXXX
during the course of periodic field examinations of the Collateral and
Borrower's operations; (g) survey costs for the Property; and (h) the actual and
reasonable fees and disbursements of counsel (including legal assistants) to
Secured Party in connection with any of the foregoing.
15.15. ACH AUTHORIZATION FOR REQUIRED PAYMENTS. Borrower agrees to
make each required payment due under the Promissory Note only by ACH Transfer
and in connection therewith, Borrower agrees to execute the ACH Authorization
Form attached hereto as EXHIBIT G.
15.16. PUBLIC ANNOUNCEMENT. Upon the closing of the Loan, Secured
Party is authorized in its discretion to issue news releases and at its own
expense to publish "tombstone ads" and other announcements in newspapers, trade
journals and other appropriate media, containing information about the Loan as
may be deemed noteworthy by Secured Party, including without limitation the
legal and trade name of Borrower, the amount of the Loan and the name, nature
and location of the Collateral.
15.17. SURVIVAL. All representations, warranties and agreements
contained in this Security Agreement or any other Loan Document or in any
certificate, document or statement furnished in connection with this Security
Agreement shall survive the execution and delivery of this Security Agreement
and the other Loan Documents and no investigation by the Secured Party or any
closing shall affect such representations, warranties or agreements or the
Secured Party's right to rely on them.
NOTICE OF INDEMNIFICATION: It is expressly agreed and understood that
this Security Agreement includes indemnification provisions including, without
limitation, those contained in Article X.
IN WITNESS WHEREOF, the Borrower has executed and entered into this
Security Agreement and delivered it to the Secured Party on and as of the date
set forth below. This document is executed under seal and intended to take
effect as a sealed instrument.
[Signature Page Follows]
LOAN AND SECURITY AGREEMENT -- PAGE 31
SYBRA, INC./LOAN NO. 163
ARBY'S/DALLAS, TEXAS
BORROWER:
SYBRA, INC.
By:
-------------------------------------
Name/Title:
-----------------------------
SECURED PARTY:
U.S. RESTAURANT LENDING GROUP I, L.P.
BY: U.S. RESTAURANT LENDING GP, INC.,
ITS GENERAL PARTNER
By:
-------------------------------------
Name/Title:
-----------------------------
