WAIVER, EXTENSION AND RELEASE OF LIEN AGREEMENT
This Waiver, Extension and Release of Lien Agreement (this "Agreement"),
made as of this 26th day of January, 2001, by and among CNL APF PARTNERS, LP,
a Delaware limited partnership with an office at 000 Xxxxx Xxxxxx Xxxxxx,
Xxxxxxx, XX, 00000 (the "Lender") and PHOENIX RESTAURANT GROUP, INC.
(formerly known as DenAmerica Corp.) ("Obligor"), a Georgia corporation with
an address at 0000 X. Xxxxxxxxxx Xxxx, Xxxxx X-000, Xxxxxxxxxx, Xxxxxxx
00000.
RECITALS:
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WHEREAS, Obligor has entered into that Asset Purchase Agreement dated as
of January 5, 2001 between Obligor, as Seller, and Mountain Range
Restaurants, LLC ("MRR"), as Buyer, as amended by that First Amendment to
Asset Purchase Agreement between Obligor and Phoenix Foods, Inc., as Seller,
and MMR, as Buyer (the "Purchase Agreement"), for the sale of property (the
"Property") used in connection with 23 Denny's restaurants (the
"Restaurants") (the "Sale Transaction").
WHEREAS, the Lender is the current holder and owner of that Balloon
Promissory Note dated effective as of October 1, 1997 executed by Obligor in
favor of CNL American Properties Fund, Inc. in the original principal amount
of $8,725,000.00 ("Equipment I Note"), which is secured, in part, by a
portion of the Property.
WHEREAS, the Lender is the current holder and owner of (i) that certain
Amended and Restated Credit Agreement dated as of July 3, 1996 (as amended,
restated, supplemented or otherwise modified to the date hereof the "BP
Agreement") with certain "Banks" named therein, including Banque Paribas
("Paribas"), and all the related Loan Documents (as such term is defined in
the BP Agreement) (the BP Agreement and the Loan Documents herein
collectively, the "Credit Agreement"); (ii) that certain Omnibus Agreement
dated as of June 30, 1999, by and among the parties to the Credit Agreement
and Lender, pursuant to which assign certain rights and obligations of the
"Agent" and the "Banks" under the Credit Agreement were assigned to Lender
(herein sometimes referred to as the "Credit Assignment"); and (iii) that
Consolidated Interim Balloon Promissory Note dated June 30, 1999 from Obligor
to Lender in the original principal amount of $22,300,000.00 (the
"Consolidated Note"). The Consolidated Note was due and payable on January
31, 2000.
WHEREAS, Obligor is in default and Events of Default have occurred under
the Credit Agreement and the Consolidated Note for non-payment of amounts
due, as well as other non-compliance with covenants set forth in the Credit
Agreement and collateral documents (collectively, the "Existing Defaults").
WHEREAS, Obligor has requested that the Lender enter into this Agreement
for the purpose of facilitating the consummation of the transactions
contemplated by the Purchase Agreement.
WHEREAS, the Obligor has requested that the Lender agree to release a
substantial portion of the proceeds from the Sale Transaction that are
subject to liens and security interests of Lender (the "Proceeds Release") in
order to pay obligations of the Obligor;
WHEREAS, the proceeds from the Sale Transaction will be used to pay off
Equipment Note I and to obtain release of the liens and security interests on
the collateral securing Equipment Note I, including the Property (the
"Collateral Release"), and for other purposes.
WHEREAS, Lender is the holder and owner of that Consolidated Promissory
Note effective December 11, 1998, executed by Obligor in favor of CNL
American Properties Fund, Inc., in the amount of $4,500,000.00 ("Equipment II
Note").
WHEREAS, for the exclusive purpose of facilitating the Sale Transaction,
Lender is willing to waive the Existing Defaults and extend the maturity of
the Consolidated Note.
WHEREAS, Lender is willing to enter into this Agreement and allow such
Proceeds Release for the purposes of facilitating the sale, and allowing the
Obligor to pay bona fide obligations, but only on the conditions set forth in
this Agreement.
WHEREAS, Obligor has agreed to provide further security for payment of
Equipment Note II.
WHEREAS, Lender and Obligor intend that this Agreement set forth these
arrangements and direct that further documentation and appropriate recording
of documents be accomplished to realize the objectives set forth herein.
AGREEMENT
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NOW, THEREFORE, in consideration of the sum of Ten and No/100 Dollars
($10.00) each to the other in hand paid and the mutual agreements herein set
forth and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:
1. The above recitals are true and correct and incorporated herein.
2. The Lender waives all Existing Defaults
3. The Lender extends the maturity of the Consolidated Note until March
31, 2001.
4. At the closing of the Sale Transaction, (i) the Obligor will pay the
principal balance of the Equipment I Note, (ii) the Lender will provide the
Collateral Release and (iii) the Obligor will pay the outstanding interest
due under Equipment I Note which has accrued through December 31, 2000 and,
to the extent that there are insufficient sales proceeds from the Sale
Transaction, such accrued and unpaid interest shall be paid on or before
February 15, 2001, and the failure to pay such amount shall constitute a
default under Equipment I Note, without any further notice, demand or
opportunity to cure. All interest which accrues with respect to the
Equipment I Note from January 1, 2001 together with all remaining principal
and other amounts due under the Equipment I Note shall be due and payable
without any further notice, demand or opportunity to cure on March 31, 2001.
5. At the closing of the Sale Transaction, the Obligor will pay the
interest which has accrued with respect to the Consolidated Note through
December 31, 2000 and to the extent that there are insufficient proceeds from
the such accrued and unpaid interest shall be paid on or before February 15,
2001, and the failure to pay such amount shall constitute a default underthe
Consolidated Note, without any further notice, demand or opportunity to cure.
All interest which accrues with respect to the Consolidated Note from January
1, 2001 together with all remaining principal and other amounts due under the
Consolidated Note shall be due and payable without any further notice, demand
or opportunity to cure on March 31, 2001.
6. At the closing of the Sale Transaction, the Obligor will pay and
satisfy all principal and outstanding interest which has accrued with respect
to the Equipment II Note. To the extent that any there are insufficient
proceeds from the Sale Transaction, the balance of all principal and interest
shall be paid on or before February 15, 2001, and the failure to pay such
amount shall constitute a default under Equipment II Note, without any
further notice, demand or opportunity to cure.
7. As further security for the payment of the Equipment II Note, the
Obligor hereby covenants and agrees that the "obligations" secured, however
defined and described, are hereby modified and amended to include payment of
all principal, interest and other sums due under the Equipment II Note in:
(A) that Security Agreement dated as of March 29, 1996 among Obligor, Paribas
and the Banks as amended by that Amendment to Security Agreement, dated as of
July 1, 1996 among Obligor, Paribas and the Banks; (B) that Pledge Agreement
dated as of July 3, 1996, by and between Obligor and Paribas; (C) that
Collateral Assignment of Equipment Leases by Obligor and Paribas; (D)
Collateral Assignment of Franchisor Agreements; (E) each Leasehold Deed of
Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing
executed by Obligor that secures the Consolidated Note (the "Deeds of Trust")
(F) each Leasehold Mortgage, Assignment of Leases and Rents, Security
Agreement and Fixture Filing executed by Obligor that secures the
Consolidated Note (the "Mortgages"); (G) each Ground Leasehold Mortgage,
Assignment of Leases and Rents, Security Agreement and Fixture Filing
executed by Obligor that secures the Consolidated Note (the 'Ground Leasehold
Mortgages); and (H) all other documents under and pursuant to which Obligor
granted, conveyed, assigned, pledged, encumbered or hypothecated any other
property, real or personal, tangible or intangible, whether now owned or
hereafter aquired that secures the Consolidated Note.
8. Obligor hereby acknowledges and agrees that: (i) this Agreement is
in the best interest of the Obligor, in that among other things it will
permit Obligor and its affiliates to close the Sale Transaction, pay the
claims of the Obligor's creditors and provide the Obligor with additional
time to pay the Lender's claims as represented by Obligor to Lender; (ii)
this Agreement has been requested by the Obligor to avoid the costs, expenses
and burdens of litigation with Lender; and (iii) that the benefits that inure
to the Obligor pursuant to this Agreement and the other settlement documents
constitute substantially more than "reasonably equivalent value", as such
term is used in Section 548 of Title 11 of the United States Code (the
"Bankruptcy Code") and in
the Uniform Fraudulent Transfer Act, in exchange for the benefits to be
provided by Obligor. Obligor further represents that it has not entered into
this transaction to provide preferential treatment to the Lender in
anticipation of seeking relief under the Bankruptcy Code nor has Obligor
entered into this transaction with the actual intent to hinder, delay or
defraud any of Obligor's creditors.
9. Obligor agrees to execute documentation as Lender, within its
reasonable discretion, deems necessary, desirable, or appropriate to fulfill
or complete the intent of the parties as intended by this Agreement,
including but not limited to modifications of Deeds of Trust, Mortgages and
Ground Leasehold Mortgages that may be recorded by Lender.
10. All notices, requests and demands to or upon the respective parties
hereto to be effective shall be in writing (including by telecopy, telex, or
cable communication), and shall be deemed to have been duly given or made
when delivered by hand, or when received after being deposited in the United
States mail, postage prepaid, or, in the case of telex notice, when sent,
answer back received, or, in the case of telecopy notice, when sent, or, in
the case of a nationally recognized overnight courier service, one Business
Day after delivery to such courier service, addressed, in the case of each
party hereto, at its address specified below, or to such other address as may
be designated by any party in a written notice to the other parties hereto:
CNL APF PARTNERS, LP
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx
PHOENIX RESTAURANT GROUP, INC.
0000 X. Xxxxxxxxxx Xxxx
Xxxxx X-000
Xxxxxxxxxx, Xxxxxxx 00000
Attention: President
11. This Agreement shall be binding upon and inure to the benefit of
the parties and their respective successors and assigns.
12. This Agreement may be executed in any number of counterparts and by
the different parties thereto on separate counterparts, each of which when so
executed and delivered shall be an original, but all of which shall together
constitute one and the same instrument.
13. In case any provision in or obligation under this Agreement shall
be invalid, illegal or unenforceable in any jurisdiction, the validity,
legality and enforceability of the remaining provisions or obligations, or of
such provision or obligation in any other jurisdiction, shall not in any way
be affected or impaired thereby.
14. Obligor for itself and on behalf of its subsidiaries, hereby
remises, releases and forever discharges Lender, its affiliates, successors
and/or assigns, and all of its and their
respective officers, directors, employees, agents, attorneys and partners, of
and from any and all manner of actions, causes and causes of action
whatsoever, at law or in equity, and including, but not limited to, all
claims relating to the Notes, the Sale Transaction, and all related
obligations and transactions of the Obligor and Lender with respect to this
Agreement from the beginning of the world to the date this Agreement is
signed by the last party executing this Agreement.
15. This Agreement is not intended and shall not be construed to
benefit, modify, release or discharge any third party, and all rights as
against persons or parties not a party to this Agreement are expressly
reserved by Lender. Obligor hereby indemnifies and holds Lender harmless
from and against any claim, loss, damage, costs, charge or expense (including
attorneys' fees) whatsoever arising out of or relating to any claim by any
third party not a party to this Agreement of any alleged or purported
benefit, modification, release or discharge resulting from this Agreement.
16. No failure or delay on the part of the Lender in exercising any
right, power or privilege hereunder and no course of dealing between the
parties shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, power or privilege hereunder preclude any other or
further exercise thereof of the exercise of any other right, power or
privilege hereunder or thereunder. The rights and remedies herein expressly
provided are cumulative and not exclusive of any rights or remedies which
Lender would otherwise have. No notice to or demand on Obligor or their
successors in any case shall entitle Obligor to any other or further notice
or demand in similar or other circumstances or constitute a waiver of the
rights of the Lender to any other or further action in any circumstances
without notice or demand.
17. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAWS
OF THE STATE OF FLORIDA (WITHOUT GIVING EFFECT TO THE PRINCIPLES THEREOF
RELATING TO CONFLICTS OF LAW).
18. Any legal action or proceeding with respect to this Agreement and
any action for enforcement of any judgment in respect thereof may be brought
in the courts of the State of Florida or of the United States of America for
the Middle District of Florida, and, by execution and delivery of this
Agreement, Obligor hereby accept for itself and in respect of its property,
generally and unconditionally, the non-exclusive jurisdiction of the
aforesaid courts and appellate courts. The Obligor hereby irrevocably waives,
to the extent permitted by law, any objection which it may now or hereafter
have to the laying of venue of any of the aforesaid actions or proceedings
arising out of or in connection with this Agreement brought in the courts
referred to above and hereby further irrevocably waives and agrees not to
plead or claim in any such court that any such action or proceeding brought
in any such court has been brought in an inconvenient forum. Nothing herein
shall affect the right of Lender to commence legal proceedings or otherwise
proceed against Obligor in any other jurisdiction.
19. TO THE EXTENT PERMITTED BY APPLICABLE LAW, OBLIGOR HEREBY
IRREVOCABLY WAIVES ALL RIGHT OF TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
ALLEGED COUNTERCLAIM ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT.
Signed, sealed and delivered in the PHOENIX RESTAURANT GROUP, INC.,
Presence of the following witnesses: a Georgia corporation
/s/ Xxxx X. Xxxx
----------------------------------- By: W. Xxxxx Xxxxxx
Signature of Witness --------------------------------
President
Xxxx X. Xxxx
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Printed Name of Witness
/s/ Xxxxxxxx Xxxxxxxx
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Signature of Witness
Xxxxxxxx Xxxxxxxx
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Printed Name of Witness
Signed, sealed and delivered in the CNL APF PARTNERS, LP, a Delaware
Presence of the following witnesses: limited partnership
/s/ Xxxx X. Xxxx
---------------------------------- BY: CNL APF GP Corp., a Delaware
Signature of Witness corporation, as its general partner
Xxxx X. Xxxx
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Printed Name of Witness By: /s/ Xxxxxxx X. Xxxxx
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/s/ Xxxxxxxx Xxxxxxxx Printed Name: Xxxxxxx X. Xxxxx
---------------------------------- -----------------
Signature of Witness Title: Senior Vice President
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Xxxxxxxx Xxxxxxxx
----------------------------------
Printed Name of Witness
STATE OF ARIZONA )
) ss.
County of Maricopa )
The foregoing instrument was acknowledged before me this 26 day of
January, 2001, by Xxxxx Xxxxxx, , the President of Phoenix Restaurant Group,
Inc., a Georgia corporation, on behalf of the corporation.
/s/ Xxxxxxxx Xxxxxx
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Notary Public
My commission expires:
July 6, 2003
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STATE OF ARIZONA )
) ss.
County of Maricopa )
The foregoing instrument was acknowledged before me this 26 day of
January, 2001, by Xxxxxxx X. Xxxxx, the Senior Vice President CNL APF GP
Corp., a Delaware corporation, on behalf of the corporation, as General
Partner of CNL APF Partners, L.P., a Delaware limited partnership.
/s/ Xxxxxxxx Xxxxxx
---------------------------------------
Notary Public
My commission expires:
July 6, 2003
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