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LOAN AGREEMENT
Dated as of December ___, 1995
between
CHAMPPS ENTERTAINMENT OF WAYZATA, INC.
as Borrower
and
DAKA INTERNATIONAL, INC.
as Lender
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TABLE OF CONTENTS
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Page
I. DEFINITIONS; PRINCIPLES OF CONSTRUCTION........................ 1
Section 1.1 Definitions..................................... 1
Section 1.2 Principles of Construction...................... 9
II. GENERAL TERMS.................................................. 9
Section 2.1 Loan Amount..................................... 9
Section 2.2 Use of Proceeds................................. 9
Section 2.3 The Note........................................ 10
Section 2.4 Interest........................................ 10
Section 2.5 Loan Repayments and Prepayments................. 10
Section 2.6 Making of Payments.............................. 10
III. CONDITIONS PRECEDENT........................................... 11
Section 3.1 Conditions Precedent to Advances................ 11
Section 3.2 Completion of the Merger........................ 13
IV. REPRESENTATIONS AND WARRANTIES................................. 13
Section 4.1 Borrower Representations........................ 13
Section 4.2 Survival of Representations..................... 18
V. AFFIRMATIVE COVENANTS.......................................... 18
Section 5.1 Borrower Covenants.............................. 18
Section 5.2 Liquor Licenses................................. 25
VI. NEGATIVE COVENANTS............................................. 26
Section 6.1 Borrower Negative Covenants..................... 26
Section 6.2 Permitted Transactions.......................... 28
VII. SPECIAL PROVISIONS............................................. 28
Section 7.1 Insurance....................................... 28
Section 7.2 Casualty and Application of Proceeds............ 28
Section 7.3 Condemnation and Application of Proceeds........ 30
Section 7.4 Pledge and Grant of Security Interest........... 30
Section 7.5 Permitted Encumbrances.......................... 31
VIII. DEFAULTS ...................................................... 31
Section 8.1 Event of Default................................ 31
Section 8.2 Remedies........................................ 33
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IX. MISCELLANEOUS.................................................. 34
Section 9.1 Survival........................................ 34
Section 9.2 Lender's Discretion............................. 34
Section 9.3 Governing Law................................... 34
Section 9.4 Modification, Waiver in Writing................. 34
Section 9.5 Delay Not a Waiver.............................. 35
Section 9.6 Notices......................................... 35
Section 9.7 Trial by Jury................................... 36
Section 9.8 Headings........................................ 36
Section 9.9 Severability.................................... 36
Section 9.10 Waiver of Notice................................ 36
Section 9.11 Intentionally Omitted........................... 36
Section 9.12 Indemnity....................................... 36
Section 9.13 Exhibits Incorporated........................... 37
Section 9.14 Offsets, Counterclaims and Defenses............. 37
Section 9.15 No Joint Venture or Partnership................. 38
Section 9.16 Waiver of Marshaling of Assets.................. 38
Section 9.17 Waiver of Counterclaim.......................... 38
Section 9.18 Conflict; Construction of Documents............. 38
Section 9.19 Prior Agreements................................ 38
Section 9.20 Usury Laws...................................... 39
Section 9.21 Collateral Assignment........................... 39
EXHIBITS
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Exhibit A List of the Restaurants
Exhibit B Insurance Requirements
SCHEDULES
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Schedule 1 Litigation
Schedule 2 Lack of Compliance with Legal Requirements
Schedule 3 Certain Contracts
Schedule 4 Material License and Permits
Schedule 5 Material Agreements
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LOAN AGREEMENT
This Loan Agreement, dated as of December ____, 1995 (as amended,
restated, replaced, supplemented or otherwise modified from time to time, this
"Agreement"), is by and between CHAMPPS ENTERTAINMENT OF WAYZATA, INC., a
Minnesota corporation (together with its successors and assigns, the "Borrower")
having an address of 000 Xxxx Xxxx Xxxxxx, Xxxxxxx, Xxxxxxxxx 00000 and DAKA
INTERNATIONAL, INC., a Delaware corporation (together with its successors and
assigns, the "Lender") having an address of Xxx Xxxxxxxxx Xxxxx, 00 Xxxxxxxxx
Xxxx, Xxxxxxx, Xxxxxxxxxxxxx 00000-0000.
All capitalized terms used in this Agreement shall have the respective
meanings set forth in Section 1 hereof.
W I T N E S S E T H
WHEREAS, the Borrower desires to obtain the Loan from the Lender;
WHEREAS, the Lender is willing to establish and make the Loan to the
Borrower, subject to and in accordance with the terms of this Agreement and the
other Loan Documents;
NOW, THEREFORE, in consideration of the making of the Loan by the Lender
and the covenants, agreements, representations and warranties set forth in this
Agreement, the parties hereto hereby covenant, agree, represent and warrant as
set forth below.
I. DEFINITIONS; PRINCIPLES OF CONSTRUCTION
SECTION 1.1 DEFINITIONS. For all purposes of this Agreement, except
as otherwise expressly required or unless the context clearly indicates a
contrary intent:
"Additional Receipts" means, with respect to any period, all amounts
received by the Borrower during such period from (i) receivables of the
Restaurants collected during such period; (ii) proceeds from the sale of any
asset which is included in the definition of Restaurant Property during any such
period; (iii) interest received during such period on account of any investment
of any rent, income, working capital or other asset (and all proceeds thereof)
of the Restaurant Property; and (iv) other non-recurring sources such as refunds
of security deposits, payments of insurance proceeds and tax refunds during such
period.
"Affiliate" means, as to any Person, any other Person that, directly or
indirectly, is in control of, is controlled by or is under common control with
such Person, is a director or officer of such Person or of an Affiliate of such
Person or any other Person directly or indirectly holding 10% or more of any
class of the capital stock or other equity interests (including options,
warrants, convertible securities and similar rights) of that Person.
"Agreement" has the meaning set forth in the first paragraph of this
Agreement.
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"Annual Operating Budget" means, with respect to any calendar year, a
detailed, itemized written budget for each Restaurant, subject to approval by
Lender pursuant to Section 4.1(k).
"Assignment of Licenses and Permits" shall mean that certain first
priority Assignment of Contracts, Licenses and Permits, Agreements, Warranties
and Approvals dated as of the date hereof from Borrower, as assignor, to Lender,
as assignee, assigning to Lender to the extent assignable all of Borrower's
interest in and to any licenses, permits, warranties, authorizations or other
consents affecting the Restaurant Property or Borrower's business therein, as
the same may be amended, restated, replaced, supplemented or otherwise modified
from time to time.
"Basic Carrying Costs" shall mean the sum of the following costs
associated with the Restaurant Property: (i) real property taxes, (ii) insurance
premiums and (iii) rent under all Ground Leases.
"Borrower" has the meaning specified in the first paragraph of this
Agreement.
"Business Day" means any day other than a Saturday, Sunday or any other
day on which banks are not open for business.
"Cash from Operations before Fixed Charges" means, with respect to any
calendar year or Interest Period, all income received by the Borrower on account
of the operation of the Restaurant Property.
"Casualty" has the meaning specified in Section 7.2.
"Casualty Insurance Proceeds" has the meaning specified in Section 7.2.
"Change of Control" shall mean any event following which Parent shall
fail to own directly all of the issued and outstanding capital stock of
Borrower.
"Closing Date" means the date of execution of the Note.
"Consolidated" or "consolidated" has the meaning specified in accordance
with GAAP.
"Deductible Disbursements" means amounts disbursed by the Borrower
during any calendar year or Interest Period for the following: (i) the required
consideration under the Ground Lease during such period; (ii) payments of
Impositions due during such period; (iii) payments of insurance premiums
necessary to meet the Insurance Requirements during such period; and (iv) all
other payments made during such period for Operating Expenses.
"Default" means the occurrence of any event hereunder or under any other
Loan Document which, but for the giving of notice or passage of time, or both,
would be an Event of Default.
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"Default Rate" has the meaning set forth in the Note.
"Environmental Laws" means all statutes, ordinances, orders, rules,
regulations and policies relating to (i) environmental matters, including,
without limitation, those relating to fines, injunctions, penalties, damages,
contribution, cost recovery compensation, losses or injuries resulting from the
Release or threatened Release of Hazardous Materials, (ii) the generation, use,
storage, transportation or disposal of Hazardous Materials, or (iii)
occupational safety and health, industrial hygiene, land use or the protection
of human, plant or animal health or welfare, in any manner applicable to
Borrower or any of its respective properties, including, without limitation the
Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C.
[SECTION] 9601 ET SEQ.), the Hazardous Materials Transportation Act (49 U.S.C.
[SECTION] 1801 ET SEQ.), the Resource Conservation and Recovery Act (42 U.S.C.
[SECTION] 6901 ET SEQ.), the Federal Water Pollution Control Act ( 33 U.S.C.
[SECTION] 1251 ET SEQ.), the Clean Air Act (42 U.S.C. [SECTION] 7401 ET SEQ.),
the Toxic Substances Control Act (15 U.S.C. [SECTION] 2601 ET SEQ.), the Federal
Pesticide, Fungicide and Rodenticide Act (7 U.S.C. [SECTION]136 ET SEQ.), the
Occupational Safety and Health Act (29 U.S.C. [SECTION] 651 ET SEQ.) and the
Emergency Planning and Community Right-to-Know Act (42 U.S.C. [SECTION] 11001 ET
SEQ.), each as amended or supplemented, and any analogous future or present
local, state and federal statutes and regulations promulgated pursuant thereto,
each as in effect as of the date of determination.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor statute.
"Event of Default" has the meaning set forth in Section 8.1.
"FF&E" means furniture, fixtures and equipment.
"Filings" means any of the following events or occurrences: if Borrower
(a) files with any bankruptcy court or is the subject of any petition under
Title 11 of the U.S. Code, as amended (and with respect to involuntary petitions
only (so long as no officer, director, Affiliate of Borrower, related party
and/or any other insider of such Borrower is a part of the petitioning creditor
group), such petition is not dismissed within one hundred twenty (120) days),
(b) is the subject of any order for relief issued under such Title 11 of the
U.S. Code, as amended, (c) files or is the subject of any petition seeking any
reorganization, arrangement, composition, readjustment, liquidation,
dissolution, or similar relief under any present or future act or law relating
to bankruptcy, insolvency, or other relief for debtors under the laws of the
United States, or any state thereof, (and with respect to involuntary petitions
only (so long as no officer, director, affiliate of Borrower, related party
and/or any other insider of such Borrower is a part of the petitioning creditor
group), such petition is not dismissed within one hundred twenty (120) days),
(d) has sought or consented to or acquiesced in the appointment of any trustee,
receiver, conservator, or liquidator of any Borrower, or (e) is the subject of
any order, judgment, or decree entered by any court of competent jurisdiction
approving a petition filed against such party for any reorganization,
arrangement, composition, readjustment, liquidation, dissolution, or similar
relief under any present or future federal or
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state act or law relating to bankruptcy, insolvency, or relief for debtors
under the laws of the United States, or any state thereof.
"Fiscal Year" means each twelve month period commencing on January 1 and
ending on December 31 during each year of the term of the Loan.
"GAAP" means generally accepted accounting principles in the United
States of America as of the date of the applicable financial report or
determination, consistently applied.
"Governmental Authority" means any court, board, agency, commission,
office or authority of any nature whatsoever for any governmental unit of any
country (federal, state, county, district, municipal, city or otherwise) whether
now or hereafter in existence.
"Ground Lease" means each ground lease to which Borrower is a party, of
land upon which any portion of the Restaurant Property is located, as each may
from time to time be amended or otherwise modified, renewed or extended in
accordance with the terms of this Agreement.
"Guaranty" means that certain unconditional Guaranty of Parent of even
date guarantying all of the Borrower's obligations under this Agreement and the
other Loan Documents.
"Hazardous Materials" means (i) any chemical, material or substance at
any time defined as or included in the definition of "hazardous substances",
"hazardous wastes", "hazardous materials", "extremely hazardous waste",
"restricted hazardous waste", "infectious waste", "toxic substances" or any
other terms intended to define, list or classify substances by reason of
deleterious properties such as ignitability, corrosivity, reactivity,
carcinogenicity, toxicity, reproductive toxicity, "TCLP toxicity" or "EP
toxicity" or words of similar import under any applicable Environmental Laws;
(ii) any oil, petroleum, petroleum fraction or petroleum derived substance;
(iii) any drilling fluids, produced waters and other wastes associated with the
exploration, development or production of crude oil, natural gas or geothermal
resources; (iv) any flammable substances or explosives; (v) any radioactive
materials; (vi) asbestos in any form; (vii) urea formaldehyde foam insulation;
(viii) electrical equipment which contains any oil or dielectric fluid
containing polychlorinated biphenyls; (ix) pesticides; and (x) any other
chemical material or substance, exposure to which is prohibited, limited or
regulated by any governmental authority or which may or could pose a hazard to
health or safety.
"Impositions" means all real estate and personal property taxes, water,
sewer and vault charges and all other taxes, levies, assessments and other
similar charges, general and special, ordinary and extraordinary, foreseen and
unforeseen, of every kind and nature whatsoever, which at any time prior to, at
or after the execution hereof may be assessed, levied or imposed by, in each
case, a Governmental Authority upon the Restaurant Property or the Property
Income from the Restaurant Property or the ownership, use, occupancy or
enjoyment thereof, and any interest, costs or penalties with respect to any of
the foregoing.
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"Improvements" means the buildings, structures, fixtures, additions,
enlargements, extensions, modifications, repairs, replacements and improvements
now or hereafter located at the Restaurants.
"Indebtedness" means all obligations, contingent and otherwise, that in
accordance with GAAP, determined on a consolidated basis, should be classified
upon the obligor's balance sheet as liabilities, or to which reference should be
made by footnotes thereto, including in any event and whether or not so
classified: (a) all debt and similar monetary obligations, whether direct or
indirect (including, without limitation, accounts payable and working capital
liabilities); (b) all liabilities secured by any mortgage, pledge, security
interest, lien, charge, or other encumbrance existing on property owned or
acquired subject thereto, whether or not the liability secured thereby shall
have been assumed; and (c) all guarantees, endorsements of notes and other
similar obligations and other contingent obligations, whether direct or
indirect, in respect of indebtedness or obligations of others, including any
obligation to supply funds to or in any manner to invest in, directly or
indirectly, the debtor, to purchase indebtedness, or to assure the owner of
indebtedness against loss, through an agreement to purchase goods, supplies, or
services for the purpose of enabling the debtor to make payment of the
indebtedness held by such owner or otherwise, and the obligations to reimburse
the issuer in respect of any letters of credit.
"Insurance Requirements" means all material terms of any insurance
policy required pursuant to this Agreement or the other Loan Documents, all
requirements of the issuer of any such policy, and all regulations and then
current standards applicable to or affecting the Restaurant Property or any part
thereof or any use or condition thereof, which may, at any time, be recommended
by the Board of Fire Underwriters, if any, having jurisdiction over the
Restaurant Property, or such other body exercising similar functions.
"Interest Payment Date" means the last Business Day of each calendar
quarter, or in the case of the final Interest Period for the Loan, the Maturity
Date.
"Interest Period" means each consecutive three (3) month period, or
portion thereof during each calendar year. Each Interest Period shall be a
period commencing on an Interest Payment Date through and including the date
immediately preceding the next following Interest Payment Date; provided,
however, that the first Interest Period shall be the period commencing on the
date of the first Advance of the Loan through and including the last Business
Day of March, 1996.
"Interest Rate" means, with respect to any Interest Period, the
applicable contract rate of interest payable under and in accordance with the
Note and described in Section 2.4.
"Irvine Restaurant" means the Restaurant located in Irvine, California
and listed as item Number 1 on Exhibit A to this Agreement.
"Legal Requirements" means (i) all federal, state, county, municipal and
other governmental statutes, laws, rules, orders, regulations, ordinances,
judgments, decrees and
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injunctions of Governmental Authorities (including, without limitation,
Environmental Laws) affecting the Restaurant Property or any part thereof or the
construction, use, alteration or operation thereof, or any part thereof, whether
now or hereafter enacted and in force, and all permits, licenses and
authorizations and regulations relating thereto, and (ii) all covenants,
restrictions, encumbrances and other similar agreements to the extent
enforceable against Borrower, contained in any instruments, either of record
or known to the Borrower, at any time in force materially affecting the
Restaurant Property or any part thereof, including, without limitation, any
which may (a) require repairs, modifications or alterations in or to the
Restaurant Property or any part thereof, or (b) in any way limit the use and
enjoyment thereof.
"Lender" has the meaning specified in the first paragraph hereof.
"Lien" means any mortgage, deed of trust, lien, pledge, hypothecation,
assignment, security interest, or any other encumbrance, charge or transfer of,
on or affecting the Restaurant Property or any portion thereof, or any interest
therein, 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, the filing of any financing statement, and
mechanic's, materialmen's and other similar liens and encumbrances.
"Liquor Licenses" means any and all licenses and permits required by any
Governmental Authorities having jurisdiction over the Restaurant Property for
the sale or service of alcoholic beverages at the Restaurant Property in
compliance with all Legal Requirements, whether the same have been issued to or
are hereafter acquired by Borrower.
"Loan" means the loan made by Lender to Borrower under the terms of this
Agreement as evidenced by the Note and secured by the other Loan Documents
executed and delivered by the Borrower.
"Loan Amount" has the meaning provided in Section 2.1.
"Loan Documents" means, collectively, this Agreement, the Note, the
Assignment of Licenses and Permits, the Security Agreement, the UCC-1 Financing
Statements and all other documents or instruments now or hereafter executed or
delivered in connection with the Loan.
"Material Adverse Effect" means any change, circumstance, fact or event
that (i) impairs the validity, priority, perfection or enforceability of any of
the Loan Documents (unless such effect shall result directly from any activity
or inactivity of Lender), (ii) has or could have a material adverse effect on
the ability of Borrower and Guarantor collectively to pay the Obligations or
(iii) has or could have a material adverse effect on the physical or financial
condition of the Restaurant Property or on the condition (financial or
otherwise), operations, business, management or assets of the Borrower taken as
a whole.
"Material Agreements" means (i) any Ground Lease; (ii) each equipment or
personal property lease or other contract to which Borrower is a party, and
(iii) all executory construction, engineering, architectural, maintenance and
other similar contracts or other
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agreements affecting the Restaurant Property. Contracts and agreements listed
in items (ii) and (iii) shall be included in Material Agreements only if they
represent obligations of the Borrower in excess of $25,000.00.
"Material License" means each material certificate, permit and license
of any Governmental Authority, including certificates of occupancy, innkeepers'
licenses and Liquor Licenses necessary or desirable for the operation in the
ordinary course of business of the Restaurant Property.
"Maturity Date" means the date on which the final payment of principal
of and interest on the Note becomes due and payable as herein and therein
provided, whether at stated maturity, by declaration of acceleration, or
otherwise, but in no event later than October 10, 2000.
"Merger Agreement" means that certain Agreement and Plan of Merger
between Parent, Lender and CEI Acquisition Corp., dated as of October 10, 1995.
"Merger Transaction" means the proposed merger of Parent and Lender
pursuant to the terms of the Merger Agreement.
"Note" means that certain Promissory Note made by Borrower in favor of
Lender of even date herewith evidencing the Loan, as the same may be amended,
restated, replaced, supplemented or otherwise modified from time to time.
"Obligations" means the repayment of the Loan evidenced by the Note
together with all other obligations and liabilities of the Borrower due or to
become due to the Lender in respect of the Loan in accordance with any of the
Loan Documents, all amounts, sums and expenses paid by or payable to the Lender
pursuant to any of the Loan Documents, and all other covenants, obligations and
liabilities of the Borrower in respect of the Loan pursuant to any of the Loan
Documents, together with all interest thereon and all other sums due in
connection therewith.
"Officer's Certificate" means a certificate delivered to the Lender by
the Borrower which is signed by an authorized officer of the Borrower.
"Operating Expenses" means, with respect to each Fiscal Year and any
Interest Period all ordinary, customary and necessary expenses, determined in
accordance with GAAP, with respect to such period in connection with the
operation, and maintenance of the Restaurant Property, in accordance with the
applicable Annual Operating Budget, but excluding depreciation, amortization and
payments of interest, principal, or other amounts in respect of any borrowed
money.
"Parent" means Champps Entertainment, Inc., a Minnesota corporation.
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"Payment Date" means the date on which interest is due hereunder or as
stated in the Note.
"Permitted Encumbrances" means, collectively, (a) the Liens and security
interests created by the Loan Documents, (b) all Liens, encumbrances and other
matters previously disclosed in writing to and approved by Lender, (c) Liens, if
any, for Impositions imposed by any Governmental Authority not yet delinquent or
being contested in good faith and by appropriate proceedings in accordance with
the applicable provisions of the Loan Documents.
"Person" means any individual, corporation, partnership, joint venture,
limited liability company, estate, trust, unincorporated association, any
federal, state, county or municipal government or any bureau, department or
agency thereof and any fiduciary acting in such capacity on behalf of any of the
foregoing.
"Policies" has the meaning specified in Section 7.1.
"Property Income" with respect to any period means (a) the sum of (i)
Cash from Operations before Fixed Charges derived in any way from the Restaurant
Property during each such period and (ii) the Additional Receipts (except to the
extent any such Additional Receipt was previously included in the calculation of
Cash from Operations before Fixed Charges) during such period.
"Release" means any release, spill, emission, leading, pumping, pouring,
injection, escaping, deposit, disposal, discharge, dispersal, dumping, leaching
or migration of Hazardous Materials into the indoor or outdoor environment
(including, without limitation, the abandonment or disposal of any barrels,
containers or other closed receptacles containing any Hazardous Materials), or
into or out of any parcel of land or improvements thereon, including the
movement of any Hazardous Material through the air, soil, surface water,
groundwater or property.
"Reports" means any study or report of existing conditions at the
Restaurants including environmental, engineering, zoning, structural, traffic,
survey, plan, or any other type of report or study prepared in connection with
the analysis of any Restaurant Property now or hereafter possessed by Borrower
or Parent.
"Request for Advance" has the meaning set forth in Section 3.1.
"Restaurant Property" means all of Borrower's interest of every kind and
description, now existing or hereafter acquired, in the restaurants listed in
Exhibit A (the "Restaurants"), including, but not limited to, all of Borrower's
interest in the Ground Lease, Improvements, FF&E, rents, all personal property,
goods, accounts, contract rights, insurance proceeds, leases, inventory,
goodwill, licenses, permits, approvals, intangibles and all appurtenant rights
to each of the foregoing. "Restaurant Property" shall be deemed to include
property rights in the Reston Restaurant as the same are developed, created and
acquired by Borrower.
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"Reston Restaurant" means the Restaurant to be developed in Reston,
Virginia at the location listed as Number 2 on Exhibit A to this Agreement.
"Restoration" has the meaning set forth in Section 7.2.
"Security Agreement" shall mean the agreement of even date between
Borrower and Lender granting the Lender a first priority security interest in
all of the Restaurant Property and all proceeds thereof (subject only to the
Permitted Encumbrances).
"State" means the state, respectively, in which each Restaurant Property
is located.
"Stock Pledge Agreement" means that certain Stock Pledge Agreement of
even dated executed by Parent and evidencing a security interest in all of the
stock of Borrower in favor of Lender as security for the Guaranty.
"Survey" means a survey of the real property portion of the Restaurant
Property, prepared by a surveyor licensed in the State, which survey is
satisfactory to the Lender, and containing a certification of such surveyor
satisfactory to the Lender.
"UCC" or "Uniform Commercial Code" means the Uniform Commercial Code as
in effect in the applicable State.
SECTION 1.2 PRINCIPLES OF CONSTRUCTION. All references to sections,
schedules and exhibits are to sections, schedules and exhibits in or to this
Agreement unless otherwise specified. The words "hereof," "herein" and
"hereunder" and words of similar import when used in this Agreement shall refer
to this Agreement as a whole and not to any particular provision of this
Agreement, unless otherwise specified. All meanings attributed to defined terms
herein shall be equally applicable to both the singular and plural forms of the
terms so defined, unless otherwise specified. All accounting terms not
specifically defined herein shall be construed and interpreted, all accounting
determinations shall be made, and all financial statements required to be
delivered by any Person pursuant to this Agreement shall be prepared in
accordance with GAAP, as modified herein.
II. GENERAL TERMS
SECTION 2.1 LOAN AMOUNT. Lender agrees to lend to Borrower a
principal sum not to exceed $3,000,000, to be advanced to Borrower in accordance
with the terms of the Note and this Agreement (the "Loan Amount"), and Borrower
agrees to borrow and repay to Lender on or before the Maturity Date the Loan
Amount together with interest thereon, all pursuant to and in accordance with
the terms and conditions contained in the Note and in this Agreement.
SECTION 2.2 USE OF PROCEEDS. All proceeds of the Loan shall be
advanced to the Borrower, who shall use the proceeds of the Loan solely for (a)
refunding to Parent its costs incurred in connection with development of the
Irvine Restaurant and (b) costs related to the
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development of the Reston Restaurant in accordance with the proposed
disbursements recited in the appropriate Draw Request submitted to Lender
requesting such Advance.
SECTION 2.3 THE NOTE. The Loan shall be evidenced by the Note. The
Loan shall bear interest as provided in the Note and in Section 2.4 hereof. The
Note shall be construed in accordance with this Agreement, and shall be secured
by the Loan Documents and guaranteed by the Guaranty.
SECTION 2.4 INTEREST.
(a) Interest on the Loan Amount and overdue payments thereof
shall be computed on the basis of a 360 day year and the actual number of days
elapsed with respect to each Advance. During each Interest Period, the
principal balance of the Loan Amount that is outstanding from time to time
shall bear interest at a rate of ten (10%) percent per annum.
(b) Overdue principal and, to the extent permitted by
applicable law, overdue interest and every other overdue amount payable under
this Agreement or any other Loan Document shall bear interest at a rate equal
to fourteen (14%) percent per annum (the "Default Rate"). Payment of interest
at the Default Rate on overdue amounts will be due and payable on demand.
(c) Interest on the daily principal balance of the Loan
outstanding shall accrue daily and shall be payable quarterly in arrears,
commencing on the first Payment Date and thereafter on each succeeding Payment
Date; provided, however, that notwithstanding anything to the contrary
contained herein, the final payment of accrued interest hereunder shall be paid
on the Maturity Date.
SECTION 2.5 LOAN REPAYMENTS AND PREPAYMENTS.
(a) REPAYMENTS. The Borrower shall repay the outstanding Loan
Amount in full on the Maturity Date of the Loan, together with all accrued
interest and other charges to and including the date of repayment.
(b) VOLUNTARY PREPAYMENTS OF THE LOAN. The Borrower may prepay
the Loan in whole or in part, by wire transfer to the Lender of (i) the portion
of the Loan Amount then being prepaid, (ii) all interest accrued and unpaid on
such amount to and including the date of prepayment as determined by the Lender
and (iii) all other charges and sums due under the Loan to and including the
date of prepayment, as determined by the Lender. Any such prepayments shall be
without penalty or premium.
SECTION 2.6 MAKING OF PAYMENTS. Each payment by the Borrower
hereunder or under the Note shall be made in funds immediately available to the
Lender on the date such payment is due. Whenever any payment hereunder or under
the Note shall be stated to be due on a day which is not a Business Day, such
payment shall be made on the immediately preceding Business Day.
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III. CONDITIONS PRECEDENT
SECTION 3.1 CONDITIONS PRECEDENT TO ADVANCES. The obligation of the
Lender to make Advances of the Loan ("Advances") hereunder is subject to the
fulfillment by the Borrower, to the reasonable satisfaction of Lender, of the
following conditions precedent, any of which conditions may be waived by Lender
in its sole discretion (the making of such Advance by Lender being deemed a
temporary waiver of such conditions, but in no event shall the making of any
Advances be deemed a waiver of any conditions to subsequent Advances):
(a) REPRESENTATIONS AND WARRANTIES; COMPLIANCE WITH CONDITIONS.
The representations and warranties of the Borrower contained in this Agreement
and the other Loan Documents shall be true and correct in all material respects
on and as of the Closing Date and on the date of each Advance and no event
shall have occurred and be continuing that would constitute, by reason of the
execution, delivery and performance of this Agreement or the other Loan
Documents, the grant of the Lien on the Restaurant Property contemplated
hereby, the making of any Advance, or the consummation of the other
transactions contemplated by this Agreement or the other Loan Documents, a
Default, or an Event of Default and no Default or Event of Default would occur
as a result of the making of the Loan; and the Borrower shall be in compliance
in all material respects with all terms and conditions set forth in this
Agreement and in each other Loan Document on its part to be observed or
performed.
(b) REQUEST FOR ADVANCE. At such time as Borrower shall desire
to obtain an Advance, Borrower shall submit to Lender the following documents
and materials at least three (3) Business Days prior to the date of the
requested Advance, and no more frequently than once each week (each such
submission being referred to herein as a "Request for Advance" or "Request"):
(i) a written request for the amount of the Advance
desired (not to exceed, together with all other advances previously
requested, the Loan Amount);
(ii) with respect to Requests for Advances for the Reston
Restaurant, a complete and itemized list of the amounts, parties and
purposes for and to whom disbursements of the Advance shall be made by
Borrower, together with supporting documents reasonably justifying such
disbursements, including a current statement of actual consolidated
cashflows, uses and needs and Borrower's projections for the period
preceding the next anticipated Advance;
(iii) a certification that all representations and
warranties of Borrower contained in this Agreement and the Loan Documents
remain true as of the date of such Draw Request;
(iv) with respect to Requests for Advances for the Reston
Restaurant only, such other information, documentation and certification
as the Lender
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may reasonably request, evidencing that the conditions described herein
have been satisfied.
(c) APPROVAL. Lender shall review each Request for Advance and
on or before the third (3rd) Business Day following submission of such Request
for Advance Lender shall either (i) approve such Request for Advance and
advance to Borrower the amount stated in such Request, or (ii) deliver to
Borrower a written statement explaining the reasons for refusing such Request,
including a list of any documents or other materials which Lender shall
reasonably require before making the Advance referenced in such Request.
(d) SECURITY AGREEMENT AND ASSIGNMENT OF LICENSES AND PERMITS.
The Lender shall have received from the Borrower fully executed and
acknowledged counterparts of the Assignment of Licenses and Permits and the
UCC-1 financing statements for recording or filing, in the judgment of the
Lender, so as to effectively create upon such recording or filing a valid and
enforceable first Lien valid and enforceable first lien or valid and
enforceable first priority security interest, as the case may be, upon the
Restaurant Property in favor of the Lender, subject only to the Permitted
Encumbrances.
(e) INSURANCE. The Lender shall have received valid
certificates of insurance for all of the policies of insurance required by this
Agreement to be carried pursuant to Section 7.1 hereof.
(f) DELIVERY OF ORGANIZATIONAL DOCUMENTS. On or before the
Closing Date, the Borrower shall deliver or cause to be delivered to Lender (i)
copies, certified by the Borrower of all organizational documentation related
to Borrower, (ii) original counterparts of good standing and/or qualification
of Borrower to do business, and such other certificates as the Lender may
reasonably request, each issued by the appropriate Governmental Authority and
(iii) corporate resolutions and incumbency certifications authorizing the
applicable officer of the Borrower to obtain the Loan and to enter into the
Loan Documents.
(g) OPINIONS OF THE BORROWER'S COUNSEL. The Lender shall have
received an opinion of counsel for the Borrower (who shall be satisfactory to
the Lender), in form and substance reasonably satisfactory to the Lender, dated
as of the Closing Date and addressing the corporate power and authority of the
Borrower, the execution, delivery and enforceability of the Note, this
Agreement, the other Loan Documents, the Guaranty and the Stock Pledge
Agreement and addressing such other matters as the Lender may reasonably
request.
(h) COMPLETION OF PROCEEDINGS. All corporate and other
proceedings taken or to be taken in connection with the transactions
contemplated by this Agreement and the other Loan Documents and all documents
incidental thereto shall be satisfactory in form and substance to the Lender,
and the Lender shall have received all such counterpart originals or certified
copies of such documents as the Lender may reasonably request.
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(i) DELIVERY OF REPORTS. Borrower shall have delivered copies
of all Reports to Lender.
(j) CONSENT OF LANDLORD. The written consent of the landlord
under the respective Ground Lease, in form reasonably satisfactory to Lender,
evidencing such landlord's consent to the assignment of the Ground Lease from
Parent to Borrower, the pledge of the stock of Borrower to Lender pursuant to
the Stock Pledge Agreement, and the collateral assignment of the tenant's
interest under the respective Ground Lease by Borrower to Lender.
(k) CONSENT OF BORROWER AND GUARANTOR'S LINE CREDITOR. The
written consent and agreement of the lender providing an operating line of
credit to Parent ("Line Creditor"), in form reasonably satisfactory to Lender,
evidencing (i) the Line Creditor's consent to the assignments and collateral
assignments of the Restaurant Property made in connection with the Loan, (ii)
agreeing to the release by the Line Creditor of all liens encumbering the
Restaurant Property (together with duly executed UCC-3's evidencing the release
of such liens), and (iii) agreeing that the Guaranty of Parent given to Lender
in connection with the Loan shall enjoy priority that is pari passu with the
obligations of Parent to the Line Creditor.
(l) BASIC CARRYING COSTS. The Borrower shall have paid, or
cause to be paid, all Basic Carrying Costs and other Impositions which are
currently due and payable.
(m) BUDGETS. Borrower shall have delivered, and Lender shall
have reasonably approved, the Annual Operating Budget for each Restaurant
Property.
(n) NO LITIGATION, ETC. No action, suit, proceeding or
investigation, at law or in equity, shall be pending against Borrower or
Parent, or in any way with respect to the Restaurant Property before any court,
arbitration board or tribunal, public board or body or other Governmental
Authority which, if adversely determined, would have a Material Adverse Effect.
Any such action, suit, proceeding or investigation is disclosed on SCHEDULE 1.
(o) LICENSES AND PERMITS. Borrower shall have delivered to
Lender copies of all Material Licenses in connection with the operation of the
Irvine Restaurant and, in connection with any Advance with respect to the
Reston Restaurant, all Material Licenses for the Reston Restaurant.
SECTION 3.2 COMPLETION OF THE MERGER. The Lender shall be under no
obligation to make any Advances of the Loan following the termination of the
Merger Agreement for any reason (other than the consummation of the Merger
Transaction contemplated thereby).
IV. REPRESENTATIONS AND WARRANTIES
SECTION 4.1 BORROWER REPRESENTATIONS. The Borrower represents and
warrants that:
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(a) ORGANIZATION. The Borrower has been duly organized and is
validly existing with requisite power and authority to own its properties and
to transact the businesses in which it is now engaged. The Borrower is in good
standing and is duly qualified to do business in each jurisdiction where it is
required to be so qualified in connection with its properties, businesses and
operations, and the execution and delivery of this Agreement and each other
Loan Document to which it is a party and each of the transactions contemplated
hereby and thereby. The Borrower possesses all rights, licenses, permits and
authorizations, governmental or otherwise, necessary to entitle it to own its
properties and to transact the businesses in which it is now engaged and is not
in violation of any such rights, licenses, permits and authorizations.
(b) PROCEEDINGS. The Borrower has taken all necessary action
to authorize the execution, delivery and performance of this Agreement and the
other Loan Documents. All Loan Documents have been duly executed and delivered
by or on behalf of the Borrower and constitute legal, valid and binding
obligations of the Borrower enforceable against the Borrower in accordance with
their respective terms, subject to applicable bankruptcy, insolvency and
similar laws affecting rights of creditors generally.
(c) NO CONFLICTS. The execution, delivery and performance by
Borrower of this Agreement and the other Loan Documents will not conflict with
or result in a breach of any of the terms or provisions of, or constitute a
default under, or result in the creation or imposition of any lien, charge or
encumbrance (other than pursuant to the Loan Documents) upon any of the
property or assets of Borrower pursuant to the terms of any indenture,
mortgage, deed of trust, loan agreement, partnership agreement or other
agreement or instrument to which the Borrower is a party or by which any of the
Borrower's property or assets is subject nor will such action result in any
violation of the provisions of any statute or any order, rule or regulation of
any court or governmental agency or body having jurisdiction over the Borrower
or any properties or assets of the Borrower, and any consent, approval,
authorization, order, registration or qualification of or with any court or any
such regulatory authority or other governmental agency or body required for the
execution, delivery and performance by the Borrower of this Agreement or any
other Loan Documents has been obtained and is in full force and effect.
(d) LITIGATION. There are no actions, suits or proceedings at
law or in equity by or before any Governmental Authority or other agency or any
claims, arbitrations or investigations now pending or threatened against or
affecting the Borrower which actions, suits, proceedings, claims, arbitrations
or investigations, if determined against the Borrower or the Restaurant
Property, would have a Material Adverse Effect. Except as and to the extent
noted therein, all of such actions, suits or proceedings set forth on SCHEDULE
1 are covered by valid insurance policies.
(e) AGREEMENTS. Borrower is not in default in any material
respect in the performance, observance or fulfillment of any of the material
obligations, covenants or conditions contained in any material agreement or
instrument to which it is a party or by which the Borrower or any or all of
its properties are bound.
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(f) TITLE. The Borrower is the holder of the tenant's interest
under the Ground Leases to the portion of the Restaurant Property constituting
real property and has good, clear and marketable title to its personalty and
all other aspects of the Restaurant Property which does not constitute real
property, free and clear of all Liens whatsoever except the Permitted
Encumbrances. There are no claims for payment for work, labor or materials
affecting the Restaurant Property which are or may become a Lien prior to, or
of equal priority with, the Lien created by the Loan Documents, other than
inchoate Liens which the Borrower shall pay in the ordinary course of business.
(g) NO BANKRUPTCY FILING. Borrower is not contemplating either
a Filing or the liquidation of all or a major portion of the Borrower's assets
or property, and Borrower has no knowledge of any Person contemplating such a
Filing against it. Borrower has not made and is not the subject of any Filing.
(h) FULL AND ACCURATE DISCLOSURE. No statement of fact made by
the Borrower in this Agreement or in any of the other Loan Documents, and no
documents, information and materials delivered by Borrower to the Lender in
connection with the Loan, contains any untrue statement of a material fact or
omits to state any material fact necessary to make statements contained herein
or therein not materially misleading. There is no fact presently known to the
Borrower which has not been disclosed in writing to Lender and which is likely
to have a Material Adverse Effect.
(i) NO PLAN ASSETS. Borrower is not an "employee benefit
plan," as defined in Section 3(3) of ERISA, subject to Title I of ERISA, and
none of the assets of any Borrower constitutes or will constitute "plan assets"
of one or more such plans within the meaning of 29 C.F.R. Section 2510.3-101.
(j) COMPLIANCE. Except as set forth on SCHEDULE 2, the
Borrower and the Restaurant Property and the use thereof comply in all material
respects with all applicable Legal Requirements, including, without limitation,
building and zoning ordinances the violation of which would have a Material
Adverse Effect. Borrower is not in default or violation and has not received
notice of a default of any order, writ, injunction, decree or demand of any
Governmental Authority, the violation of which would have a Material Adverse
Effect.
(k) CONTRACTS. Except as set forth on SCHEDULE 3, there are no
Material Agreements which are not terminable on one month's notice or less
without cause and without penalty or premium, and there are no defaults under
any material contracts affecting or relating to the Restaurant Property.
(l) FINANCIAL INFORMATION. All financial data, including,
without limitation, the statements of cash flow and income and operating
expense, that have been delivered to the Lender (i) are true, complete and
correct in all material respects, (ii) accurately represent the financial
condition of the Restaurant Property as of the date of such reports in all
material respects, and (iii) have been prepared in accordance with GAAP, each
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consistently applied throughout the periods covered (but omitting footnoted
disclosures). Except as otherwise disclosed in such financial statements or
notes thereto, there has been no material adverse change in the financial
condition of the Borrower or on the results of operations of the Restaurant
Property which has a Material Adverse Effect.
(m) CONDEMNATION. No condemnation or other taking or eminent
domain proceeding has been commenced or, to the Borrower's best knowledge, is
contemplated with respect to all or any portion of the Restaurant Property or
for the relocation of roadways providing access to the Restaurant Property.
(n) NO OBLIGATIONS. Borrower has not incurred any Indebtedness
which is prohibited by this Agreement or the other Loan Documents.
(o) USE OF PROCEEDS. The proceeds from this Loan have been
used by Borrower solely for the purposes described in Section 2.2 hereof.
(p) UTILITIES AND PUBLIC ACCESS. The Restaurant Property has
rights of access to public ways and is served by water, sewer, sanitary sewer
and storm drain facilities adequate to service the Restaurant Property for its
intended use. All public utilities necessary or convenient to the full use and
enjoyment of the Restaurant Property are available at the perimeter of the
Restaurant Property.
(q) REPORTS. All Reports have been previously delivered to
Lender. No Report contains any information identifying facts or circumstances
that are likely to result in a Material Adverse Effect.
(r) ENFORCEABILITY. The Loan Documents executed by or
otherwise binding upon Borrower are enforceable in accordance with their
respective terms, subject to applicable bankruptcy, insolvency and similar laws
affecting the rights of creditors generally, and subject, as to enforceability,
to general principles of equity (regardless of whether enforcement is sought in
a proceeding in equity or at law), and are not subject to any right of
rescission, set-off, counterclaim or defense by Borrower, including the defense
of usury, and Borrower has not asserted any right of rescission, set-off,
counterclaim or defense with respect thereto.
(s) INTENTIONALLY OMITTED.
(t) INSURANCE. The Borrower has obtained, or caused to be
obtained, and has delivered to Lender the evidence of insurance required under
Section 7.1 of this Agreement.
(u) USE OF RESTAURANT PROPERTY. The Restaurant Property is
used exclusively as a restaurant and other appurtenant and related uses.
(v) INTENTIONALLY OMITTED.
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(w) FLOOD ZONE. Borrower is carrying flood insurance in
commercially reasonable amounts covering any portion of the Restaurant Property
that is located in a flood hazard area as defined by the Federal Insurance
Administration.
(x) PHYSICAL CONDITION. With respect to the Irvine Restaurant,
the Restaurant Property, including, without limitation, all buildings,
improvements, parking facilities, sidewalks, storm drainage system, roof,
plumbing system, HVAC system, fire protection system, electrical system,
equipment, elevators, exterior sidings and doors, landscaping, irrigation
systems and all structural components (i) is in good condition, order and
repair in all material respects, (ii) have no structural or other material
defects whether latent or otherwise, and Borrower has not received notice from
any insurance company, bonding company, tenant, Governmental Authority or other
Person, of any defects or inadequacies in the Restaurant Property, or any part
thereof, which would adversely affect the value of the Restaurant Property, the
insurability of the same or cause the imposition of extraordinary premiums or
charges thereon or of any termination or threatened termination of any policy
of insurance or bond, and (iii) are structurally and physically sound.
(y) INTENTIONALLY OMITTED.
(z) INTENTIONALLY OMITTED.
(aa) MATERIAL LICENSES. SCHEDULE 4 accurately and completely
lists each Material License necessary or desirable for the operation of the
Restaurant Property, including alcohol beverage licenses and other related
permits, agreements, leases or management agreements necessary or desirable for
the provision of alcohol at the Restaurant Property. Except as otherwise set
forth in SCHEDULE 4 (as the same may be updated from time to time), each such
alcohol beverage license and other agreements and all of the other Material
Licenses are validly issued and in full force and effect, and each of the
holders of such licenses and agreements have fulfilled and performed in all
material respects all of their respective obligations with respect thereto and
have all requisite corporate or other power and authority to operate
thereunder. Except as otherwise set forth on SCHEDULE 5 (as the same may be
updated from time to time), there is no outstanding notice from any
Governmental Authority to the effect that any such holder fails to hold any
Material License necessary for the operation of the Restaurant Property or of
any violation by any party of any Material License or other similar agreements
(other than violations that are not material), and no such Material License is
presently suspended or subject to any pending or overtly threatened legal,
administrative or investigatory proceeding that could result in a suspension or
revocation of such Material License.
(bb) MATERIAL AGREEMENTS. SCHEDULE 5 accurately and completely
lists all executory Material Agreements affecting the Restaurant Property.
Except as otherwise set forth on SCHEDULE 5 (as the same may be updated from
time to time), the Borrower is not in default, nor does the Borrower know of
any claim by any Person that Borrower is or, upon the passage of time or giving
of notice or both, will be in default under any material term of any Material
Agreement to which the Borrower is a party or by which the Borrower or the
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Restaurant Property may be bound, except for such defaults that will not result
in a Material Adverse Effect. Except as set forth on SCHEDULE 5 (as the same
may be updated from time to time), all of the Material Agreements relating to
the Restaurant Property are valid, subsisting agreements of the parties thereto
and are in full force and effect. Except as otherwise set forth on SCHEDULE 5
(as the same may be updated from time to time), to the knowledge of the
Borrower, there exists no violation or breach of any material term of any
Material Agreement on the part of any Person (other than Borrower as provided
above) that is a party to such agreement, which violation or breach will, or in
the reasonable business judgment of the Borrower, is likely to have a Material
Adverse Effect. Except as otherwise set forth on SCHEDULE 5, none of the
Material Agreements listed therein contains any provision restricting the
incurring of indebtedness by the Borrower or that, in the reasonable business
judgment of the Borrower, is likely to result in a Material Adverse Effect.
SECTION 4.2 SURVIVAL OF REPRESENTATIONS. The Borrower agrees that
all of the representations and warranties of the Borrower set forth in Section
4.1 and elsewhere in this Agreement and in the other Loan Documents shall
survive for so long as any Obligations remain outstanding under any of the Loan
Documents, including for so long as any amount remains owing to the Lender under
this Agreement or any of the other Loan Documents by the Borrower. All
representations, warranties, covenants and agreements made in this Agreement or
in the other Loan Documents by the Borrower shall be deemed to have been relied
upon by the Lender notwithstanding any investigation heretofore or hereafter
made by the Lender or on its behalf.
V. AFFIRMATIVE COVENANTS
SECTION 5.1 BORROWER COVENANTS. From the date hereof and until
payment and performance in full of all Obligations, the Borrower hereby
covenants and agrees with the Lender that:
(a) EXISTENCE; COMPLIANCE WITH LEGAL REQUIREMENTS; INSURANCE.
Borrower shall do or cause to be done all things necessary to preserve, renew
and keep in full force and effect its existence, rights, licenses, permits and
franchises and comply with all Legal Requirements applicable to it. Borrower
shall at all times maintain, preserve and protect all franchises and trade
names and preserve all the remainder of its property used or useful in the
conduct of its business and keep the Restaurant Property in good working order
and repair, and from time to time make, or cause to be made, all necessary
repairs, renewals, replacements, betterments and improvements thereto, as
provided herein and in the other Loan Documents. The Borrower shall keep the
Restaurant Property insured at all times, by insurers satisfactory to the
Lender, to such extent and against such risks, and maintain liability and such
other insurance, as is more fully provided in this Agreement.
(b) IMPOSITIONS AND OTHER CHARGES. The Borrower shall pay and
discharge or cause to be paid and discharged all Impositions, now or hereafter
levied or assessed or imposed against the Restaurant Property or any part
thereof and shall pay all ground rents, maintenance charges, and license fees,
now or hereafter levied or assessed or
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imposed against the Restaurant Property or any part thereof (the "Other
Charges") prior to delinquency but subject to Borrower's right to contest such
amounts as set forth below. The Borrower will deliver to the Lender, promptly
upon the Lender's reasonable request, evidence satisfactory to the Lender that
the Impositions and Other Charges have been so paid or are not then delinquent.
The Borrower shall not suffer, and the Borrower shall promptly cause to be paid
and discharged, any Lien or charge whatsoever which may be or become a Lien or
charge against the Restaurant Property except only as and to the extent the same
may be contested hereunder and shall promptly pay, or cause to be paid, all
utility services provided to the Restaurant Property. The Borrower shall
furnish to the Lender or its designee receipts for the payment of the
Impositions and Other Charges prior to the date the same shall become
delinquent. After prior written notice to the Lender, the Borrower, at its own
expense, may contest by appropriate legal proceeding, promptly initiated and
conducted in good faith and with due diligence, the amount or validity or
application in whole or in part of any Impositions or Other Charges, provided
that (i) no Event of Default has occurred and remains uncured, (ii) such
proceeding shall suspend the collection of the Impositions or Other Charges,
(iii) such proceeding shall be permitted under and be conducted in accordance
with the provisions of any other instrument to which Borrower is subject and
shall not constitute a default thereunder, (iv) neither the Restaurant Property
nor any part thereof or interest therein will be in danger of being sold,
forfeited, terminated, canceled or lost, and (v) the Borrower shall have
furnished such security as may be required in the proceeding, or as may be
requested by the Lender to insure the payment of any such Impositions or Other
Charges, together with all interest and penalties thereon.
(c) LITIGATION. The Borrower shall give prompt written notice
after obtaining knowledge thereof to the Lender of any litigation or
governmental proceedings pending or threatened against Borrower, Parent or the
Restaurant Property which would have a Material Adverse Effect on the condition
(financial or otherwise) of such Person or the Restaurant Property, as the case
may be.
(d) ACCESS TO PREMISES. The Borrower shall permit agents,
representatives and employees of the Lender, on one occasion per quarter and
with twenty-four hours' advance notice (i) to inspect all or any part of the
Restaurant Property and (ii) to have access to the books and records for the
Restaurant Property, PROVIDED, however, that Lender and its agents,
representatives and employees shall have the unlimited right to inspect the
Restaurant Property and the Borrower's books and records following an Event of
Default. Borrower shall furnish Lender, within ten (10) days of Borrower's
receipt, copies of all inspection reports on the Restaurant Property by or on
behalf of any governmental or quasi-governmental agency, insurance company or
any other Person.
(e) NOTICE OF DEFAULT. The Borrower shall promptly (and in any
event, within 48 hours of any such occurrence) advise the Lender of any change,
occurrence or event which has or could be expected to have a Material Adverse
Effect or the occurrence of any default or Event of Default of which the
Borrower has knowledge. If any Person, other than the Lender, shall give any
notice or take any other action in respect to (x) a claimed default (whether or
not constituting an Event of Default) under this Agreement or (y) a
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claimed failure by Borrower to comply with any term, condition or provision of
or under any note, evidence of Indebtedness, indenture or other obligation to
which or with respect to which Borrower is a party or obligor, whether as
principal or surety, the Borrower shall forthwith give written notice thereof to
the Lender describing the notice or action and the nature of the claimed
failure to comply.
(f) ENVIRONMENTAL EVENTS. The Borrower will promptly give
notice in writing to the Lender (i) upon obtaining knowledge of any violation
of any Environmental Law regarding the Restaurant Property (ii) upon obtaining
knowledge of any known Release in violation of any Legal Requirements, of any
Hazardous Material at, from or into the Restaurant Property which it reports in
writing or is reportable by it in writing to any Governmental Authority or
which is material in amount or nature or which could materially affect the
value of the Restaurant Property; (iii) upon receipt of any notice of material
violation of any Environmental Laws or of any Release of Hazardous Materials in
violation of any Environmental Laws, including a notice or claim of liability
or potential responsibility from any third party (including without limitation
any federal, state or local governmental officials) and including notice of any
formal inquiry, proceeding, demand, investigation or other action with regard
to (A) contamination on, from or into the Restaurant Property, or (B)
investigation or remediation of off-site locations at which Borrower or any of
its predecessors are alleged to have directly or indirectly disposed of
Hazardous Materials; or (iv) upon obtaining knowledge that any expense or loss
has been incurred by such Governmental Authority in connection with the
assessment, containment, removal or remediation of any Hazardous Materials with
respect to which Borrower may be liable or for which a lien may be imposed on
the Restaurant Property.
(g) ENVIRONMENTAL INDEMNITY. Borrower shall protect,
indemnify, and hold harmless Lender from and against all liabilities,
obligations, claims, demands, damages, penalties, causes of action, losses,
fines, costs and expenses (including without limitation reasonable attorneys'
fee and disbursements), imposed upon or incurred by or asserted against Lender
by reason of (a) the presence, disposal, escape, seepage, leakage, spillage,
discharge, emission, release, or threatened release of any Hazardous Substance
on, from or affecting the Restaurant Property; (b) any personal injury
(including wrongful death) or property damage (real or personal) arising out of
or related to such Hazardous Substance; (c) any lawsuit brought or threatened,
settlement reached, or government order relating to such Hazardous Substance;
and (d) any violation of the Environmental Laws, which are based upon or in any
way related to such Hazardous Substance including, without limitation, the
costs and expenses of any remedial work, attorney and consultant fees and
disbursements, investigation and laboratory fees, court costs, and litigation
expenses.
(h) COOPERATE IN LEGAL PROCEEDINGS. Borrower shall cooperate
fully with Lender with respect to any proceedings before any court, board or
other Governmental Authority which may in any way affect the rights of Lender
hereunder or any rights obtained by Lender under any of the Loan Documents and,
in connection therewith, permit Lender, at its election, to participate in any
such proceedings. Provided, however, nothing contained in
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the preceding sentence shall require Borrower to cooperate with Lender in any
such proceeding where Borrower's interests are adverse to those of Lender.
(i) INSURANCE BENEFITS. The Borrower shall cooperate with the
Lender in obtaining for the Lender (subject to disbursement by Lender as
provided herein) the benefits of any insurance proceeds lawfully or equitably
payable to Borrower in connection with the Restaurant Property or any part
thereof, and the Lender shall be reimbursed for any reasonable expenses
incurred in connection therewith (including attorneys' fees and disbursements)
out of such insurance proceeds.
(j) FURTHER ASSURANCES; SUPPLEMENTAL AFFIDAVITS. (i) The
Borrower shall, at its sole cost and expense:
(i) execute and deliver to the Lender such documents,
instruments, certificates, assignments and other writings, and do such
other acts necessary or desirable, to evidence, preserve and/or protect
the collateral at any time securing or intended to secure the obligations
of the Borrower under the Loan Documents, as the Lender may reasonably
require; and
(ii) do and execute all and such further lawful acts,
conveyances and assurances for the better and more effective carrying out
of the intent and purposes of this Agreement and the other Loan Documents,
as the Lender shall reasonably require from time to time.
(iii) pay all state, county and municipal recording and
all other taxes imposed upon the execution and recordation of any and all
Loan Documents.
(k) MANAGEMENT OF PROPERTY. The Borrower shall manage the
Restaurant Property in a first-class manner, and in the manner that an
experienced and reputable, independent third-party manager would manage a
first-class Restaurant property similar to the Restaurant Property. The
Borrower covenants and agrees that it shall at all times during the term of the
Loan maintain worker's compensation insurance to the extent required by
Governmental Authorities with respect to the management of the Restaurant
Property. The Borrower shall keep the Restaurant Property in good working
order and condition, ordinary wear and tear accepted. The Borrower shall
comply, and shall cause the Restaurant Property to comply with the requirements
of all Governmental Authorities and Legal Requirements.
(l) FINANCIAL REPORTING.
(i) The Borrower will furnish to the Lender monthly,
within forty-five (45) days following the end of each month, for the
period beginning on the first day and ending on the last day of the
preceding month (the "Reporting Period") internal management reports
prepared by Borrower (if any) with respect to the Restaurant Property.
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(ii) The Borrower will keep and maintain or will cause to
be kept and maintained on a Fiscal Year basis, in accordance with GAAP
(but omitting footnoted disclosures), proper and accurate books, records
and accounts reflecting all of the financial affairs of the Borrower and
all items of income and expense in connection with the operation of the
Restaurant Property and in connection with any services, equipment or
furnishings provided in connection with the operation of the Restaurant
Property. After the occurrence and during the continuation of an Event of
Default, the Borrower shall pay any costs and expenses incurred by the
Lender to examine the Borrower's accounting records with respect to the
Restaurant Property, as the Lender shall determine to be necessary or
appropriate in the protection of the Lender's interest.
(iii) The Borrower shall furnish to the Lender, within
ten (10) Business Days after request, such further detailed information
with respect to the operation of the Restaurant Property and the financial
affairs of the Borrower as may be maintained by Borrower reasonably
requested by the Lender. Together with the financial statements and
information required under this Section 5.1(l), the Borrower shall furnish
to the Lender an Officer's Certificate certifying as of the date thereof
(A) that such financial statements and information accurately represent
the financial condition of the Borrower and the Restaurant Property, and
(B) whether there exists an event or circumstance which constitutes a
default or Event of Default under the Loan Documents and if such default
or Event of Default exists, the nature thereof, the period of time it has
existed and the action then being taken to remedy the same.
(iv) As soon as available and in any event within
forty-five (45) days after the end of each fiscal quarter, the Borrower
will deliver to Lender the consolidated and consolidating balance sheets
of Borrower as at the end of such fiscal quarter and the related
consolidated and consolidating statements of income, stockholders' equity,
a calculation of Cash from Operations before Fixed Charges, Property
Income, Deductible Disbursements, Additional Receipts, together with a
reconciliation of cash in the form of a statement of changes in financial
position, setting forth in each case in comparative form the corresponding
figures for the corresponding periods of the previous fiscal year and the
corresponding figures from the Annual Operating Budget for the current
Fiscal Year, all in reasonable detail and certified by the Chief Financial
Officer of the Borrower as fairly presenting the official condition of
Borrower on the dates indicated and the results of its operations and its
cash flows for the periods indicated, subject to changes resulting from
audit and normal year-end adjustments.
(v) As soon as available and in any event within ninety
(90) days after the end of each Fiscal Year, the Borrower will deliver to
Lender the consolidated and consolidating balance sheets of the Borrower
and for the Restaurant Property as at the end of such Fiscal Year and the
related consolidated and consolidating statements of income, stockholders'
equity, cash flows, and a calculation of Cash from Operations before Fixed
Charges, Property Income, Deductible
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Disbursements, and Additional Receipts, for such Fiscal Year, together with
a reconciliation to cash in the form of a statement of changes in financial
position, setting forth in each case in comparative form the corresponding
figures for the previous fiscal year and the corresponding figures from the
Annual Operating Budget for the Fiscal Year covered by such financial
statements, all in reasonable detail and certified by the Chief Financial
Officer of Borrower as fairly presenting the financial condition of
Borrower on the dates indicated and the results of its operations and
its cash flows for the periods indicated.
(vi) In addition, at least forty-five (45) days prior to
the end of any Fiscal Year, Borrower shall deliver to Lender a proposed
Annual Operating Budget which Annual Operating Budget shall include,
without limitation, monthly projected balance sheets and statements of
income, and cash flows for such Fiscal Year, annual projected statements
of income and cash flows, and projected Property Income for such Fiscal
Year itemized as to revenue source, in each case signed by the Chief
Financial Officer of Borrower. Within thirty (30) days after receipt
thereof, Lender shall give notice to Borrower whether the Lender approves
or disapproves each such proposed Annual Operating Budget, which approval
shall not be unreasonably withheld or delayed. In a case of disapproval,
such notice shall state the reasons for such disapproval and shall
indicate the changes the Lender requires thereto, and within ten (10) days
after receipt of any such notice of disapproval, Borrower shall deliver to
the Lender a proposed Annual Operating Budget revised in accordance with
such notice. Borrower may from time to time deliver to the Lender
proposed modifications to any Annual Operating Budget which modifications
shall be subject to the Lender's approval as provided above and shall, in
any event, promptly deliver to Lender copies of any other significant
projections that Borrower prepares or receives and revisions of all such
projections. Borrower shall use reasonable efforts at all times to
operate and maintain the Restaurant Property, or cause the Restaurant
Property to be operated and maintained, in a manner consistent with the
applicable Annual Operating Budget.
(vii) Borrower will furnish to Lender, within twenty
(20) days after the date requested, such further detailed information with
respect to the operation of the Restaurant Property and the financial
affairs of Borrower as may be reasonably requested by Lender.
(m) BUSINESS AND OPERATIONS. The Borrower will qualify to do
business and will remain in good standing under the laws of each jurisdiction
as and to the extent the same are required for the ownership, maintenance,
management and operation of the Restaurants.
(n) TITLE TO PROPERTIES. The Borrower will warrant and defend
(i) the title to the Restaurant Property and every part thereof, subject only
to Permitted Encumbrances, and (ii) the validity and priority of the lien of
the Loan Documents subject only to Permitted Encumbrances, in each case against
the claims of all Persons whomsoever. Borrower shall reimburse the Lender for
any losses, costs, damages or reasonable expenses
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(including reasonable attorneys' fees and court costs) incurred by the Lender
if an interest in all or any part of the Restaurant Property, other than as
permitted hereunder, is claimed by another Person.
(o) COSTS OF ENFORCEMENT. In the event (i) that the Lender
exercises its rights under this Agreement or any Loan Documents for collection,
suit, action or foreclosure, (ii) of the bankruptcy, insolvency, rehabilitation
or other similar proceeding in respect of Borrower or an assignment by Borrower
for the benefit of its creditors, Borrower, its successors or assigns, shall be
chargeable with and agree to pay all costs of collection and defense, including
reasonable attorneys' fees in connection therewith and in connection with any
appellate proceeding or post-judgment action involved therein, which shall be
due and payable together with all required service or use taxes.
(p) ESTOPPEL STATEMENT. The Borrower within 10 days after
request from the Lender, shall from time to time furnish to the Lender a
statement, duly acknowledged and certified by Borrower, setting forth (a) the
amount then owing by the Borrower in respect of the Indebtedness under this
Agreement, (b) the date through which interest on the Loan has been paid, and
(c) any offsets, counterclaims, credits or defenses to the payment of the
Borrower's obligations under the Loan Documents and acknowledging that this
Agreement and the other Loan Documents executed and delivered by, or applicable
to, the Borrower are legal, valid and binding obligations of the Borrower and
have not been modified or, if modified, giving the particulars of such
modification.
(q) LOAN PROCEEDS. Borrower shall use the proceeds of the Loan
received by it only for the purposes set forth in Section 2.2.
(r) PERFORMANCE BY THE BORROWER. Borrower shall in a timely
manner observe, perform and fulfill each and every covenant, term and provision
of each loan document executed and delivered by, or applicable to, Borrower
with respect to this Loan and all other obligations for borrowed money.
Borrower shall in a timely manner observe, perform and fulfill each and every
material covenant, term and provision of any agreement or contract relating to
any other Indebtedness of the Borrower.
(s) LEASING MATTERS. Borrower shall not enter into, amend,
terminate or otherwise modify any lease or any material obligation thereunder
without the prior written consent of the Lender having been received in each
case.
(t) PRINCIPAL PLACE OF BUSINESS. The Borrower shall not change
its name or principal place of business without first giving the Lender thirty
(30) days' prior written notice.
(u) APPRAISALS. If, at any time, Borrower shall prepare or
cause to be prepared or shall receive any appraisal or other third party
assessment or report of value for any of the Restaurant Property for any
purpose, Borrower shall immediately provide or cause to be provided to the
Lender a copy of such appraisal, assessment or report.
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(v) COMPLIANCE. Borrower shall operate the Restaurant Property
(i) in accordance with the terms and conditions of this Agreement, and (ii) all
Legal Requirements. Borrower shall immediately notify Lender (a) upon the
receipt of any notice regarding a default under any of the foregoing and (b) if
it has knowledge of the existence of any such default.
(w) OPERATING PERMITS AND LIQUOR AND FOOD LICENSES. Unless
otherwise approved in writing by Lender, Borrower shall obtain and maintain all
operating permits and liquor (subject to the terms of Section 5.2) and food
licenses required to operate the Restaurant Property as a full service
restaurant in accordance with the Legal Requirements and this Agreement.
Borrower shall promptly upon receipt submit to Lender copies of all inspection
reports, including, but not limited to, health and fire inspection reports, and
all other notices and/or operating permits and licenses from applicable
Governmental Authorities to Borrower immediately upon receipt.
(x) TERMINATION OF MATERIAL LICENSES AND MATERIAL AGREEMENTS.
The Borrower shall keep in full force and effect and not terminate, surrender
or amend any Material License or any Material Agreement, the loss, termination,
surrender or amendment of which would, after giving effect to any replacement
license or agreement then or theretofore obtained, result in a Material Adverse
Effect. The foregoing covenant shall be subject to the terms of Section 5.2 to
the extent Borrower has not yet obtained Liquor Licenses issued in its own
name.
(y) HANDICAPPED ACCESS. Borrower agrees that the Restaurant
Property shall at all times strictly comply, to the extent applicable, with the
requirements of the Americans with Disabilities Act of 1990, the Fair Housing
Amendments Act of 1988 (if applicable), all state and local laws and ordinances
related to handicapped access and all rules, regulations, and orders issued
pursuant thereto including, without limitation, the Americans with Disabilities
Act Accessibility Guidelines for Buildings and Facilities.
SECTION 5.2 LIQUOR LICENSES. Borrower covenants to use its best
efforts to obtain (at its own expense) from the appropriate Governmental
Authorities having jurisdiction over the Restaurant Property all Liquor
Licenses, properly issued in the name of Borrower and shall deliver copies
thereof to Lender upon its receipt thereof but in no event later than May 15,
1996. On or before May 31, 1996, Borrower shall execute such documents or
agreements as Lender shall reasonably request in order to create an enforceable,
perfected, first priority security interest in the Liquor Licenses in favor of
Lender (subject only to the Permitted Encumbrances) as further security for the
performance of Borrower's obligations under this Agreement and the other Loan
Documents. If security interests in Liquor Licenses are prohibited by the
State, then, at the election of Lender, Borrower shall enter into a
lease/management agreement arrangement, evidenced by documents approved by
Lender, in order to insure the continued service of alcoholic beverages at the
Restaurant Property following the exercise of any of Lender's remedies following
a default under this Agreement or any other Loan Documents, until such time as
Lender or Lender's designee shall receive new Liquor Licenses issued in the name
of Lender or Lender's designee.
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VI. NEGATIVE COVENANTS
SECTION 6.1 BORROWER NEGATIVE COVENANTS. From the date hereof until
payment and performance in full of all Obligations, the Borrower covenants and
agrees with the Lender that it will not do, directly or indirectly, or permit,
directly or indirectly, any of the following:
(a) INDEBTEDNESS. Borrower shall not, without the prior
written consent of Lender, incur any Indebtedness other than the Loan.
(b) LIENS. The Borrower shall not, without the prior written
consent of the Lender, create, incur, assume, guarantee or suffer to exist any
Lien on the Restaurant Property or any portion thereof, except:
(i) Permitted Encumbrances;
(ii) Liens for taxes, assessments or other governmental
charges not yet delinquent or which are being diligently contested in good
faith and by appropriate proceedings as permitted hereunder, if (A)
reserves in an amount not less than the tax, assessment or governmental
charge being so contested shall have been deposited in cash (or cash
equivalents) with the Lender to be held during the pendency of such
contest, or such contested amount shall have been duly bonded by the
Borrower in accordance with applicable law, (B) no risk of sale,
forfeiture or loss of any interest in the Restaurant Property or any part
thereof arises during the pendency of such contest and (C) such contest
does not have an adverse effect on the Restaurant Property;
(iii) Carriers', warehousemen's, mechanic's,
materialmen's, repairman's and other similar Liens arising in the ordinary
course of business and which are being diligently contested in good faith
and by appropriate proceedings in accordance with the provisions here of
or of the Loan Documents, as applicable, if (A) (i) reserves in an amount
not less than the claim secured by such Lien which is the subject of such
contest shall have been deposited in cash (or cash equivalents) with the
Lender, to be held during the pendency of such contest, or (ii) the
Borrower has caused such contested Lien to be duly bonded in accordance
with applicable law, (B) no risk of sale, forfeiture or loss of any
interest in the Restaurant Property or any part thereof arises during the
pendency of such contest and (C) such contest does not have an adverse
effect on such Restaurant Property; and
(iv) Provided that no Event of Default shall have occurred
and be continuing, Borrower shall have the right to lease or acquire FF&E
subject to leases, loan documents and other agreements as may be consented
to by Lender, such consent not to be unreasonably withheld or delayed,
provided further that any such additional agreements shall be entered into
with a Person in the ordinary course of business and upon arm's-length
commercially reasonable terms and conditions.
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(c) DISSOLUTION; ISSUE OF STOCK. Borrower shall not dissolve,
terminate, liquidate, merge with or consolidate into another Person. Borrower
shall not issue any shares of Borrower's stock other than those shares that
have been issued to Parent as of the date hereof.
(d) CHANGE IN BUSINESS. Borrower shall not enter into any line
of business other than its current business, or make any material change in the
scope or nature of its business objectives, purposes or operations, or
undertake or participate in activities, directly or through Persons in which it
owns interests, other than the continuance of its present business.
(e) DEBT CANCELLATION. Borrower shall not cancel or otherwise
forgive or release any claim or debt owed to Borrower by any Person, except for
adequate consideration and in such Borrower's prudent business judgment.
(f) AFFILIATE TRANSACTIONS. Borrower shall not enter into, or
be a party to, any transaction with an Affiliate except in the ordinary course
of business and on terms which are fully disclosed in writing to the Lender in
advance and are no less favorable to Borrower than would be obtained in a
comparable arm's-length transaction with an unrelated third party.
(g) ZONING. Borrower shall not initiate or consent to any
zoning reclassification of any portion of the Restaurant Property or seek any
variance under any existing zoning ordinance or use or permit the use of any
portion of the Restaurant Property in any manner that could result in such use
becoming a non-conforming use under any applicable zoning ordinance or any
other applicable land use law, rule or regulation, without the prior consent of
the Lender.
(h) ORGANIZATIONAL DOCUMENTS; PROPERTY AGREEMENTS, ETC.
Borrower shall not enter into, acquiesce in, suffer or permit any amendment,
restatement or other modification of any of its respective organizational
documents and other agreements without the prior written consent of Lender, if
such amendment, restatement or modification could reasonably be expected to
have a Material Adverse Effect, or if such amendment, restatement or
modification violates (or would cause the violation of) any term of any Loan
Document.
(i) RESTRICTION ON DISPOSITIONS, TRANSFERS. Borrower shall not
sell, assign, lease, transfer, convey, encumber or otherwise dispose of or
enter into any agreement for the sale, assignment, lease, transfer, conveyance,
encumbrance or other disposition, directly or indirectly, the Restaurant
Property or any portion thereof, FF&E or any interest therein, without in each
case obtaining the prior written consent of the Lender except for the
disposition of personal property in the ordinary course of business which is
replaced with personal property of equal or greater value and utility.
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SECTION 6.2 PERMITTED TRANSACTIONS. During such time as there exists
no Event of Default, no provision of this Agreement or any of the other Loan
Documents shall be deemed to prohibit, or to require the Lender's consent to,
transfers of Property Income between the Borrower and Parent.
VII. SPECIAL PROVISIONS
SECTION 7.1 INSURANCE.
(a) The Borrower shall, at its sole cost and expense, keep the
Restaurant Property insured during the entire term of this Agreement for the
mutual benefit of Borrower and the Lender by insurance policies with coverages
and in the amounts shown on Exhibit B (the "Policies").
(b) In the event the Borrower fails, to provide, maintain, keep
in force, or deliver and furnish to the Lender evidence of the Policies
required hereunder, the Lender may procure such insurance for such risks
covering the Lender's interest, and the Borrower will reimburse the Lender for
all premiums paid by the Lender, together with interest thereon at the Default
Rate from the date of demand, promptly upon demand by the Lender. Until such
payment is made by the Borrower, the amount of all such premiums, together with
interest thereon at the Default Rate, shall be a part of the Indebtedness and
secured by the Loan Documents.
SECTION 7.2 CASUALTY AND APPLICATION OF PROCEEDS.
(a) The Borrower shall give prompt written notice to the Lender
of damage to or destruction of all or any portion of the Restaurant Property
(any such event being herein referred to as a "Casualty"). Any insurance
proceeds in respect of a Casualty with respect to the Restaurant Property, net
of costs and expenses incurred by the Lender in collecting the same, shall be
referred to herein as "Casualty Insurance Proceeds." All Casualty Insurance
Proceeds shall be applied and disbursed in accordance with the provisions of
this Section.
(b) Any amount of the Casualty Insurance Proceeds received by
the Lender may, in the Lender's discretion, be either retained and applied by
the Lender toward payment of the Loan in such priority and proportion as the
Lender in its discretion shall deem proper or, at the discretion of the Lender,
either in whole or in part to pay for the costs and expenses of restoring,
replacing, rebuilding and repairing the Restaurant Property in question as
nearly as possible to the condition Restaurant Property was in immediately
prior to such fire or other casualty upon such terms and conditions as the
Lender shall designate.
(c) Notwithstanding the foregoing, in the event of a casualty
with respect to the Restaurant Property, the net amount of all insurance
proceeds received by the Lender with respect to such damage or destruction,
after deduction of the costs and expenses
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incurred by the Lender in collecting the same (the "Net Proceeds") shall be
disbursed by the Lender in accordance with the terms and conditions set forth
herein to pay for the costs and expenses of the Restoration (hereinafter
defined) provided (i) no Default or Event of Default has occurred and remains
uncured under this Agreement, the Note or any of the other Loan Documents, (ii)
the Borrower proceeds promptly after the insurance claims are settled with the
restoration, replacement, rebuilding or repair of the Restaurant Property as
nearly as possible to the condition the Restaurant Property was in immediately
prior to such fire or other casualty (the "Restoration"), (iii) the Restoration
shall be done in compliance with all applicable laws, rules and regulations, the
Ground Lease and the Permitted Encumbrances, (iv) plans and specifications in
connection with the Restoration shall be submitted to the Lender and shall be
subject to the Lender's prior reasonable approval, (v) the Borrower carries
builder's risk insurance satisfactory to the Lender, (vi) all costs and expenses
incurred by the Lender in connection with making the Net Proceeds available for
the Restoration of the Restaurant Property including, without limitation,
counsel fees and inspecting engineer fees incurred by the Lender, shall be paid
by the Borrower, (vii) the Restaurant Property as restored, in the judgment of
the Lender, will generate sufficient income to pay all expenses in connection
with the operation thereof and (viii) Lender shall have received evidence
satisfactory to it that, during the period of the Restoration, the sum of (A)
income derived from the Restaurant Property, as determined by the Lender, plus
(B) proceeds of business interruption insurance, if any, to be paid will equal
or exceed expenses in connection with the operation of the Restaurant Property
all as determined by the Lender in its sole discretion.
(d) The Net Proceeds shall be held in trust by the Lender in an
interest-bearing account with all interest thereon to be used in connection
with the Restoration as herein set forth, or applied to the Obligations as set
forth below, and shall be paid by the Lender to, or as directed by the
applicable Borrower less customary retainage, from time to time during the
course of the Restoration (but not more frequently than once per month), upon
receipt of evidence, satisfactory to the Lender, that (i) all materials
installed and work and labor performed (except to the extent they are to be
paid for out of the requested payment) in connection with the Restoration have
been paid for in full, (ii) no mechanics' or other liens or encumbrances on the
Restaurant Property arising out of the Restoration exist which have not been
bonded or otherwise discharged or released, and (iii) the balance of the Net
Proceeds plus the balance of any deficiency deposits given by the Borrower to
the Lender pursuant to the provisions of this paragraph hereinafter set forth
shall be sufficient to pay in full the balance of the cost of the Restoration.
(e) The excess, if any, of the Net Proceeds shall be applied by
Lender to the balance of the Loan. If at any time the Net Proceeds, or the
undisbursed balance thereof, shall not in the opinion of the Lender be
sufficient to pay in full the balance of the cost of the Restoration, the
Borrower shall deposit the deficiency with the Lender in an interest-bearing
account before any further disbursement of the Net Proceeds shall be made.
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SECTION 7.3 CONDEMNATION AND APPLICATION OF PROCEEDS.
(a) The Borrower shall promptly give the Lender notice of the
actual or threatened commencement of any condemnation or eminent domain
proceeding relating to any portion of the Restaurant Property and shall deliver
to the Lender copies of any and all papers served in connection with such
proceedings. All proceeds or awards resulting from any condemnation or eminent
domain proceeding relating thereto shall be paid to the Lender. Any
condemnation award or proceeds received by the Lender may, in the Lender's
discretion, be retained and applied by the Lender toward payment of the Loan in
such priority and proportions as the Lender in its discretion shall deem
proper.
(b) Notwithstanding any taking by any public or quasi-public
authority through eminent domain or otherwise (including but not limited to any
transfer made in lieu of or in anticipation of the exercise of such taking),
the Borrower shall continue to pay the Loan at the time and in the manner
provided for its payment in the Note and the Loan shall not be reduced until
any award or payment therefor shall have been actually received and applied by
the Lender, after the deduction of expenses of collection, to the reduction or
discharge of the Loan. The Lender shall not be limited to the interest paid on
the award by the condemning authority but shall be entitled to receive out of
the award interest at the rate or rates provided herein and in the Note.
SECTION 7.4 PLEDGE AND GRANT OF SECURITY INTEREST. As collateral
security for its obligations under the Loan Documents, including, without
limitation, its obligations in respect of the Loan, Borrower hereby (i) grants
to Lender the right to receive all Property Income to be received by or on
behalf of Borrower from the Restaurant Property and (ii) pledges and assigns to
Lender a continuing possessory lien upon and security interest in all of
Borrower's right, title and interest in and to the Property Income from the
Restaurant Property. Borrower's grant, pledge and assignment contained in the
preceding sentence shall only be effective following an Event of Default.
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SECTION 7.5 PERMITTED ENCUMBRANCES. Any capitalized lease
encumbering any FF&E located at either of the Restaurants shall be deemed to be
a Permitted Encumbrance hereunder only upon satisfaction of the following
conditions:
(a) Borrower shall have executed and delivered such lease in
its own name and delivered a copy of such lease to Lender;
(b) such lease (i) shall encumber only FF&E located at a single
Restaurant, (ii) shall contain no provision which would have the effect of
cross-collateralizing such lease with collateral located anywhere other than at
such Restaurant, and (iii) shall contain no provision which would have the
effect of cross-defaulting such lease with the obligations of Borrower or any
other Person contained in any agreement other than such lease;
(c) the total amount of Borrower's financial obligations under
such lease shall not exceed $900,000.00; and
(d) Borrower shall collaterally assign such lease to Lender,
and Lender shall have received from the lessor under the lease a written
consent to such collateral assignment, together with an acknowledgment that
Lender may succeed to the Borrower's interest under such lease provided Lender
performs the obligations of Borrower thereunder.
VIII. DEFAULTS
SECTION 8.1 EVENT OF DEFAULT. In case of the occurrence of any of
the following events (each, an "Event of Default"):
(i) if the Borrower fails to make any payment of interest
on the Loan or any other amount payable by the Borrower hereunder or under
any Loan Document within fifteen (15) days after the delivery to Borrower
of notice by Lender making demand therefor;
(ii) if the Borrower fails to pay any portion of the
principal, interest or other amounts owing with respect to the Loan on the
Maturity Date;
(iii) if any representation or warranty made by
Borrower herein, in any other Loan Document or in any report, certificate,
financial statement, other instrument, agreement or document furnished by
the Borrower in connection with this Agreement or any other Loan Document,
shall be false or misleading in any material respect as of the date such
representation or warranty was made and the same is likely to have a
Material Adverse Effect; PROVIDED, HOWEVER, that if such materially
inaccurate or misleading representation or warranty was not intentionally
made by Borrower, an Event of Default shall occur hereunder only if
Borrower shall not remedy the circumstance or state of facts causing such
representation or warranty to be materially inaccurate or misleading
within ten (10) days after notice from Lender to
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Borrower if the same can be remedied by the payment of a sum of money, or
within thirty (30) days after notice from Lender to Borrower if the same
cannot be remedied by the payment of a sum of money; and PROVIDED, FURTHER,
that if such circumstance or state of facts can be remedied but such
remediation cannot reasonably be completed within such 30-day period; and
PROVIDED, FURTHER, that Borrower shall have commenced such remediation
within such 30-day period and thereafter diligently and expeditiously
proceed to cure the same, such 30-day period shall be extended for an
additional time as it is reasonably necessary for Borrower in the
exercise of due diligence to complete such remediation, such additional
period shall not exceed 90 days;
(iv) if there is a Filing, or if Borrower shall generally
not be paying its debts as they become due;
(v) if Borrower (a) attempts to assign or transfer or
encumber or (b) does assign, transfer or encumber, in contravention of the
Loan Documents (i) its respective rights under this Agreement or under any
of the other Loan Documents or (ii) any interest herein or therein or
(iii) any interest in the Restaurant Property;
(vi) if Borrower breaches any covenant or agreement
contained in this Agreement or the other Loan Documents and such breach is
likely to have a Material Adverse Effect; PROVIDED, HOWEVER, that if such
breach arises for reasons out of the reasonable control of Borrower,
Borrower shall have the right diligently and expeditiously to cure the
same if (A) such breach is susceptible of cure by Borrower, (B) Borrower
commences such cure immediately upon obtaining knowledge of the occurrence
of such breach and thereafter diligently prosecute such cure to
completion, and (C) such breach is cured by Borrower within thirty (30)
days after obtaining knowledge of its occurrence;
(vii) if any default or breach that is likely to have a
Material Adverse Effect shall occur under any Loan Document and any notice
and/or grace period provided therein shall expire without a cure, or if
any other event shall occur or condition shall exist, if the effect of
such event or condition is to accelerate the maturity of any portion of
the Obligations or to permit the Lender to accelerate the maturity of all
or any portion of the Obligations;
(viii) if the Policies required to be procured and
maintained by the Borrower pursuant to Section 7.1 hereof are not so
maintained in accordance with the terms hereof and such failure continues
for thirty (30) days after notice from Lender to Borrower;
(ix) if any Change of Control occurs for any reason without
the Lender's prior written consent;
(x) immediately upon written notice from Lender, if any
food or beverage service (including, without limitation, alcohol sales) is
terminated or
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suspended at the Restaurant Property for any reason (other than as a result
of a Casualty or in connection with the continuous remodeling of such
Restaurant Property) for a period of sixty (60) consecutive calendar days
(or any sixty (60) days within any ninety (90) day period) without the
Lender's prior written consent;
(xi) the Lender reasonably determines that there exists any
fact or circumstances that could have a Material Adverse Effect and such
fact or circumstances is not remedied to the reasonable satisfaction of
the Lender within thirty (30) days after notice thereof;
(xii) the validity or enforceability of any provision
contained in any Loan Document is contested by the Borrower or the
Borrower denies its obligations to observe or perform any provision to be
observed or performed;
(xiii) an Event of Default under any Ground Lease;
then and in every such Event of Default and at any time thereafter during the
continuance thereof, the Lender may, in addition to any other rights or
remedies available to it pursuant to this Agreement and the other Loan
Documents or at law or in equity, take such action, without notice or demand,
that the Lender deems advisable to protect and enforce its rights against the
Borrower and in and to all or any of the Restaurant Property, including,
without limitation, declaring the Obligations to be immediately due and
payable, and may enforce or avail itself of any or all rights or remedies
provided in the Loan Documents against the Borrower and including, without
limitation, all rights or remedies available at law or in equity; and upon any
Event of Default described in clause (iv) above, the Obligations and all other
obligations of the Borrower hereunder and under the other Loan Documents shall
immediately and automatically become due and payable, without notice or demand,
and the Borrower hereby expressly waives any such notice or demand, anything
contained herein or in any other Loan Document to the contrary notwithstanding.
SECTION 8.2 REMEDIES.
(a) Upon the occurrence and during the continuation of an Event
of Default, all or any one or more of the rights, powers, privileges and other
remedies available to the Lender against the Borrower under this Agreement or
any of the other Loan Documents, or at law or in equity may be exercised by the
Lender at any time and from time to time, whether or not all or any of the
Obligations shall be declared due and payable, and whether or not the Lender
shall have commenced any foreclosure proceeding or other action for the
enforcement of its rights and remedies under any of the Loan Documents with
respect to the Restaurant Property or any portion thereof. Any such actions
taken by the Lender shall be cumulative and concurrent and may be pursued
independently, singly, successively, together or otherwise, at such time and in
such order as the Lender may determine in its sole discretion, to the fullest
extent permitted by law, without impairing or otherwise affecting the other
rights and remedies of the Lender permitted by law, equity or contract or as
set forth herein or in the other Loan Documents. A waiver of one default or
Event of Default shall not
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be construed to be a waiver of any subsequent default or Event of Default or to
impair any remedy, right or power resulting as a consequence of such default
or Event of Default.
(b) Nothing contained herein or in any other Loan Document
shall be construed as requiring the Lender to resort to any portion of the
Restaurant Property for the satisfaction of any of the Obligations in
preference or priority to any other portion of the Restaurant Property, and the
Lender may seek such satisfaction in its absolute discretion in respect of the
Obligations.
IX. MISCELLANEOUS
SECTION 9.1 SURVIVAL. This Agreement and all covenants, agreements,
representations and warranties made herein and in the certificates delivered
pursuant hereto shall survive the making by the Lender of the Loan and the
execution and delivery to the Lender of the Note, and shall continue in full
force and effect so long as all or any of the Obligations are outstanding and
unpaid. Whenever in this Agreement any of the parties hereto is referred to,
such reference shall be deemed to include the legal representatives, successors
and assigns of such party. All covenants, promises and agreements in this
Agreement contained, by or on behalf of the Borrower, shall inure to the benefit
of the respective legal representatives, successors and assigns of the Lender.
SECTION 9.2 LENDER'S DISCRETION. Whenever pursuant to this
Agreement, the Lender exercises any right given to it to approve or disapprove,
or any arrangement or term is to be satisfactory to the Lender, the judgment of
the Lender to approve or disapprove or to decide whether arrangements or terms
are satisfactory or not satisfactory shall (except as is otherwise specifically
herein provided) be exercised in a commercially reasonable manner. Lender
agrees to exercise commercially reasonable judgement in connection with its
activities regarding the Loan and its exercise of remedies under the Loan
Documents.
SECTION 9.3 GOVERNING LAW. This Agreement and the obligations
arising hereunder shall be governed by, and construed in accordance with, the
laws of the Commonwealth of Massachusetts. To the fullest extent permitted by
law, Borrower hereby unconditionally and irrevocably waives any claim to assert
that the law of any other jurisdiction governs this Agreement, the Note, and the
other Loan Documents.
SECTION 9.4 MODIFICATION, WAIVER IN WRITING. No modification,
amendment, extension, discharge, termination or waiver of any provision of this
Agreement, or of the Note, or of any other Loan Document, nor consent to any
departure by any Borrower therefrom, shall in any event be effective unless the
same shall be in a writing signed by the party against whom enforcement is
sought, and then such waiver or consent shall be effective only in the specific
instance, and for the purpose, for which given. Except as otherwise expressly
provided herein, no notice to, or demand on the Borrower, shall entitle the
Borrower to any other or future notice or demand in the same, similar or other
circumstances.
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SECTION 9.5 DELAY NOT A WAIVER. Neither any failure nor any delay on
the part of the Lender in insisting upon strict performance of any term,
condition, covenant or agreement, or exercising any right, power, remedy or
privilege hereunder, or under the Note or under any other Loan Document, or any
other instrument given as security therefor, shall operate as or constitute a
waiver thereof, nor shall a single or partial exercise thereof preclude any
other future exercise, or the exercise of any other right, power, remedy or
privilege. In particular, and not by way of limitation, by accepting payment
after the due date of any amount payable under this Agreement, the Note or any
other Loan Document, the Lender shall not be deemed to have waived any right
either to require prompt payment when due of all other amounts due under this
Agreement, the Note or the other Loan Documents, or to declare a default for
failure to effect prompt payment of any such other amount.
SECTION 9.6 NOTICES. All notices, consents, approvals and requests
required or permitted hereunder or under any other Loan Document shall be given
in writing and shall be effective for all purposes if hand delivered or sent by
(a) certified or registered United States mail, postage prepaid, or (b)
expedited prepaid delivery service, either commercial or United States Postal
Service, with proof of attempted delivery, or (c) facsimile transmission (with
answer back acknowledged), addressed if to the Lender at its address set forth
below, and if to any Borrower, to such Borrower's address set forth below, or at
such other address and person as shall be designated from time to time by any
party hereto, as the case may be, in a written notice to the other parties
hereto in the manner provided for in this Section. A notice shall be deemed to
have been given: in the case of hand delivery, at the time of delivery; in the
case of registered or certified mail, when delivered or the first attempted
delivery on a Business Day; or in the case of expedited prepaid delivery or
facsimile, upon the first attempted delivery on a Business Day.
If to Borrower: Champps Entertainment, Inc.
000 Xxxx Xxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxx X. Xxxxxx, President
Tel: (000) 000-0000
Tel: (000) 000-0000
with a copy to: Xxxxxxxxxx & Xxxxx
1100 International Center
000 0xx Xxx Xxxxx
Xxxxxxxxxxx, XX 00000-0000
Attn: Xxxxxx West, Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
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If to Lender: DAKA International, Inc.
Xxx Xxxxxxxxx Xxxxx
00 Xxxxxxxxx Xxxx
Xxxxxxx, XX 00000-0000
Attn: Xxxxxxx X. Xxxxxxxxxxx, Xx.
General Counsel
Tel: (000) 000-0000
Fax: (000) 000-0000
with a copy to: Xxxxxxx, Procter & Xxxx
Exchange Place
Boston, MA 02109-2881
Attn: Xxxxxx Xxxxxxxx, P.C.
Tel: (000) 000-0000
Fax: (000) 000-0000
SECTION 9.7 TRIAL BY JURY. BORROWER AND LENDER, TO THE FULLEST
EXTENT THAT EACH MAY LAWFULLY DO SO, WAIVE TRIAL BY JURY IN ANY ACTION OR
PROCEEDING, INCLUDING, WITHOUT LIMITATION, ANY TORT ACTION, BROUGHT BY ANY PARTY
HERETO WITH RESPECT TO THIS AGREEMENT, THE NOTE OR THE OTHER LOAN DOCUMENTS.
SECTION 9.8 HEADINGS. The Article and/or Section headings and the
Table of Contents in this Agreement are included herein for convenience of
reference only and shall not constitute a part of this Agreement for any other
purpose.
SECTION 9.9 SEVERABILITY. Wherever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
SECTION 9.10 WAIVER OF NOTICE. The Borrower shall not be entitled to
any notices of any nature whatsoever from the Lender except with respect to
matters for which this Agreement or the other Loan Documents specifically and
expressly provide for the giving of notice by the Lender to the Borrower and
except with respect to matters for which the Borrower is not, pursuant to
applicable Legal Requirements, permitted to waive the giving of notice. The
Borrower hereby expressly waives the right to receive any notice from the Lender
with respect to any matter for which this Agreement or the other Loan Documents
do not specifically and expressly provide for the giving of notice by the Lender
to the Borrower.
SECTION 9.11 INTENTIONALLY OMITTED.
SECTION 9.12 INDEMNITY. The Borrower agrees to indemnify, pay and hold
harmless the Lender and any of its successors and/or assigns and any subsequent
holder of the Note
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(collectively the "Indemnitees"), and each of them, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgements,
suits, claims, costs, expenses and disbursements of any kind or nature
whatsoever (including, without limitation, the reasonable fees and disbursements
of counsel for such Indemnitee in connection with any investigative,
administrative or judicial proceeding commenced or threatened, whether or not
such Indemnitee shall be designated a party thereto), that may be imposed on,
incurred by, or asserted against such Indemnitee in any manner relating to or
arising out of the Loan or any information provided by or on behalf of Borrower,
or contained in any documentation approved by Borrower (collectively, the
"Indemnified Liabilities"); provided, however, that the Borrower shall not have
any obligation to an Indemnitee hereunder to the extent that such Indemnified
Liabilities arise from gross negligence, illegal acts, fraud or willful
misconduct of such Indemnitee, or from any derivative action brought by the
shareholders of Lender. To the extent that the undertaking to indemnify, pay
and hold harmless set forth in the preceding sentence may be unenforceable
because it violates any law or public policy, the Borrower shall contribute the
maximum portion that it is permitted to pay and satisfy under applicable law to
the payment and satisfaction of all Indemnified Liabilities incurred by the
Indemnitees or any of them. The Borrower hereby acknowledges and agree that
each Indemnitee is an intended third-party beneficiary of this Section 9.12 and
that each such Indemnitee has agreed to enter into the Loan Documents and to
perform its obligations thereunder, based on and in reliance upon this Section
9.12.
EXCEPT AS OTHERWISE EXPRESSLY PROVIDED HEREIN, IT IS SPECIFICALLY
INTENDED BY THE BORROWER AND THE LENDER THAT ALL INDEMNITY OBLIGATIONS AND
LIABILITY ASSUMED BY THE BORROWER HEREUNDER BE WITHOUT LIMIT AND WITHOUT REGARD
TO CAUSE OR CAUSES THEREOF, STRICT LIABILITY OF AN INDEMNIFIED PARTY, OR THE
NEGLIGENCE OF ANY PARTY OR PARTIES (INCLUDING THE LENDER) WHETHER SUCH
NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, ACTIVE OR PASSIVE. THE PARTIES
SPECIFICALLY INTEND THAT LENDER IS TO BE INDEMNIFIED AGAINST LENDER'S OWN
NEGLIGENCE EXCEPT AS OTHERWISE EXPRESSLY PROVIDED HEREIN.
All indemnities set forth herein or in any other Loan Document shall
survive the execution and delivery of this Agreement and other Loan Documents,
the making and repayment of the Loan hereunder, and the termination of this
Agreement.
SECTION 9.13 EXHIBITS INCORPORATED. The Exhibits annexed hereto are
hereby incorporated herein as a part of this Agreement with the same effect as
if set forth in the body hereof.
SECTION 9.14 OFFSETS, COUNTERCLAIMS AND DEFENSES. Any assignee of the
Lender's interest in and to this Agreement, the Note and the other Loan
Documents shall take the same free and clear of all offsets, counterclaims or
defenses which are unrelated to such documents which the Borrower may otherwise
have against any assignor of such documents, and no such unrelated counterclaim
or defense shall be interposed or asserted by the Borrower in any
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action or proceeding brought by any such assignee upon such documents and any
such right to interpose or assert any such unrelated offset, counterclaim
or defense in any such action or proceeding is hereby expressly waived by the
Borrower.
SECTION 9.15 NO JOINT VENTURE OR PARTNERSHIP. The Borrower and the
Lender intend that the relationships created hereunder and under the other Loan
Documents be solely that of borrower and lender. Nothing herein or therein is
intended to create a joint venture, partnership, tenancy-in-common, or joint
tenancy relationship between the Borrower and the Lender nor to grant the Lender
any interest in the Restaurant Property other than that of creditor or lender.
The Borrower specifically acknowledges and agree that Borrower and its
Affiliates and Lender and its Affiliates have engaged in certain other business
activities with each other and that, notwithstanding such other business
activities, Lender shall not have, and shall not be deemed to have, any
fiduciary duty or other similar obligation to Borrower hereunder or under the
other Loan Documents.
SECTION 9.16 WAIVER OF MARSHALING OF ASSETS. The Lender shall have no
obligation to marshal any assets in favor of the Borrower or any other party or
against or in payment of any or all of the obligations of the Borrower pursuant
to this Agreement, the Note or any other Loan Document. To the fullest extent
Borrower may legally do so, Borrower waives all rights to a marshaling of the
assets of the Borrower and the Borrower's Affiliates, and others with interests
in any of the Borrower, and of the Restaurant Property and other assets of the
Borrower, or to a sale in inverse order of alienation in the event of
foreclosure of the interests hereby created, and agrees not to assert any right
under any laws pertaining to the marshaling of assets, the sale in inverse order
of alienation, homestead exemption, the administration of estates of decedents,
or any other matters whatsoever to defeat, reduce or affect the right of the
Lender under the Loan Documents to a sale of any or all of the Restaurant
Property and other assets of the Borrower for the collection of the Indebtedness
without any prior or different resort for collection, or the right of the Lender
or any deed of trust trustee to the payment of the Obligations out of the
proceeds of the Restaurant Property in preference to every other claimant
whatsoever.
SECTION 9.17 WAIVER OF COUNTERCLAIM. Borrower hereby waives the right
to assert a counterclaim, other than a compulsory counterclaim, in any action or
proceeding brought against it by the Lender or its agents.
SECTION 9.18 CONFLICT; CONSTRUCTION OF DOCUMENTS. In the event of any
conflict between the provisions of this Agreement and the Note or any of the
other Loan Documents, the provisions of this Agreement shall control. The
parties hereto acknowledge that they were represented by sophisticated counsel
in connection with the negotiation and drafting of the Loan Documents and that
such Loan Documents shall not be subject to the principle of construing their
meaning against the party which drafted same.
SECTION 9.19 PRIOR AGREEMENTS. This Agreement and the other Loan
Documents contain the entire agreement of the parties hereto and thereto in
respect of the Loan, and all prior agreements among or between such parties,
whether oral or written, including, without
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limitation, any term sheets are superseded by the terms of this Agreement and
the other Loan Documents.
SECTION 9.20 USURY LAWS. It is not intended hereby to charge interest
at a rate in excess of the maximum rate permitted to be charged to Borrower
under applicable law, and if interest in excess of said maximum rate shall be
paid hereunder or under the Note, the excess shall be applied by Lender to the
reduction of the principal balance of the Loan.
SECTION 9.21 COLLATERAL ASSIGNMENT. Borrower acknowledges and
consents to the collateral assignment by Lender of any or all of the Note, this
Agreement, the Guaranty, the Stock Pledge Agreement, or any other Loan Documents
to any creditor of Lender.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their duly authorized representatives, all as of the day and
year first above written.
LENDER:
WITNESS: DAKA INTERNATIONAL, INC., a Delaware
corporation
By:
------------------------------- ----------------------------------
Name:
Title:
BORROWER:
CHAMPPS ENTERTAINMENT OF WAYZATA, INC.,
a Minnesota corporation
/s/ By: /s/ Xxxx X. Xxxxxx
------------------------------- ----------------------------------
Name: Xxxx X. Xxxxxx
Title: President
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their duly authorized representatives, all as of the day and
year first above written.
LENDER:
WITNESS: DAKA INTERNATIONAL, INC., a Delaware
corporation
By: /s/ Xxxxxxx X. Xxxxxxxxxxx, Xx.
------------------------------- ----------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxx, Xx.
Title: Sr. Vice President &
General Counsel
BORROWER:
CHAMPPS ENTERTAINMENT OF WAYZATA, INC.,
a Minnesota corporation
By:
------------------------------- ----------------------------------
Name:
Title:
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EXHIBIT A
---------
Restaurants
-----------
1. The Chammps restaurant located in the Irvine Entertainment Center,
Irvine, California, operated in the premises more particularly described
in that certain lease dated May 4, 1995 between Irvine Retail Properties
Company, as Landlord, and Chammps Entertainment, Inc., as Tenant (as the
same may be amended from time to time).
2. The Chammps restaurant to be located in Reston, Virginia, operated in
the premises more particularly described in that certain lease dated
January 23, 0000 xxxxxxx Xxxxx Xxxxxxx Development Corporation, as
Landlord, and Chammps Entertainment, Inc., as Tenant (as the same may
be amended or assigned from time to time).
