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EXHIBIT 10.49
LOAN AGREEMENT
THIS LOAN AGREEMENT (this "Agreement") is made as of December 18, 1996,
by and among FFCA MORTGAGE CORPORATION, a Delaware corporation ("FFCA"), whose
address is 00000 Xxxxx Xxxxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxx 00000, CBI
RESTAURANTS, INC., a Delaware corporation ("CBI"), whose address is 0000 Xxxxx
Xxxxxx Xxxxxxxxx, Xxxxxxx, Xxxxxxxxxx 00000-0000 and CASA XXXXXX INCORPORATED, a
Texas corporation ("Casa"), whose address is 0000 Xxxxx Xxxxxx Xxxxxxxxx,
Xxxxxxx, Xxxxxxxxxx 00000-0000.
PRELIMINARY STATEMENT:
Unless otherwise expressly provided herein, all defined terms used in
this Agreement shall have the meanings set forth in Section 1. Debtor has
requested from FFCA, and applied for, the Loans to provide long-term financing
for the Premises, and for no other purpose whatsoever. Each Loan will be
evidenced by a Note and secured by a first priority security interest in the
corresponding Premises pursuant to a Deed of Trust. FFCA has committed to make
the Loans pursuant to the terms and conditions of the Commitment, this Agreement
and the other Loan Documents.
AGREEMENT:
In consideration of the mutual covenants and provisions of this
Agreement, the parties agree as follows:
1. DEFINITIONS. The following terms shall have the following
meanings for all purposes of this Agreement:
"Affiliate" means any Entity controlling, controlled by or under common
control with any other Entity.
"Casa Loan Agreement" means that certain Loan Agreement dated as of the
date hereof among FFCA, CBI and Casa Xxxxxx Texas, L.P., a Texas limited
partnership
"Closing" shall have the meaning set forth in Section 4.
"Closing Date" means the date specified as the closing date in
Section 4.
"Code" means the United States Bankruptcy Code, 11 U.S.C. Sec. 101 et
seq., as amended.
"Counsel" means legal counsel to Debtor and Guarantor, licensed in the
state(s) in which (i) the Premises are located, (ii) Debtor and/or Guarantor are
incorporated or formed and (iii) Debtor and/or Guarantor maintain principal
places of business, as selected by Debtor and Guarantor, as the case may be, and
approved by FFCA.
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"Debtor" means, collectively, Casa and CBI.
"Deed of Trust" means the deed of trust or mortgage, assignment of
rents and leases, security agreement and fixture filing to be executed by Casa
for the benefit of FFCA substantially in the form of Exhibit C attached to this
Agreement. A Deed of Trust will be executed for each Premises.
"De Minimis Amounts" means with respect to any given level of hazardous
substance or solid waste, that level or quantity of hazardous substance or solid
waste in any form or combination of forms which does not constitute a violation
of any Environmental Laws and is customarily employed in, or associated with,
similar businesses located in the applicable county in which the Premises is
located.
"Entity" shall mean any corporation, trust, limited liability company,
unincorporated organization, governmental authority or any other form of entity.
"Environmental Condition" means any condition with respect to soil,
surface waters, groundwaters, land, stream sediments, surface or subsurface
strata, ambient air and any environmental medium comprising or surrounding the
Premises, whether or not yet discovered, which could reasonably be expected to
result in any damage, loss, cost, expense, claim, demand, order or liability to
or against Debtor or FFCA by any third party (including, without limitation, any
government entity) arising under any Environmental Laws, including, without
limitation, any condition resulting from the operation of Debtor's business
and/or the operation of the business of any other property owner or operator in
the vicinity of the Premises and/or any activity or operation formerly conducted
by any person or entity on or off the Premises.
"Environmental Indemnity Agreement" means the environmental indemnity
agreement to be executed by Debtor for the benefit of FFCA substantially in the
form of Exhibit F attached to this Agreement. An Environmental Indemnity
Agreement will be executed for each Premises.
"Environmental Laws" means any present and future federal, state and
local laws, statutes, ordinances, rules, regulations and the like, as well as
common law relating to Hazardous Materials, relating to liability for or costs
of Remediation or prevention of Releases or relating to liability for or costs
of other actual or threatened danger from any Environmental Condition.
"Environmental Laws" includes, but is not limited to, the following statutes, as
amended, any successor thereto, and any regulations promulgated pursuant
thereto, and any state or local statutes, ordinances, rules, regulations and the
like addressing similar issues: the Comprehensive Environmental Response,
Compensation and Liability Act; the Emergency Planning and Community
Right-to-Know Act; the Hazardous Materials Transportation Act; the Resource
Conservation and Recovery Act (including but not limited to Subtitle I relating
to underground storage tanks); the Solid Waste Disposal Act; the Clean Water
Act; the Clean Air Act; the Toxic Substances Control Act; the Safe Drinking
Water Act; the Occupational Safety and Health Act; the Federal Water Pollution
Control Act; the Federal Insecticide, Fungicide and Rodenticide Act; the
Endangered Species Act; the National
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Environmental Policy Act; and the River and Harbors Appropriation Act.
"Environmental Laws" also includes, but is not limited to, any present and
future federal, state and local laws, statutes, ordinances, rules, regulations
and the like, as well as common law: conditioning transfer of property upon a
negative declaration or other approval of a governmental authority of the
environmental condition of the property and requiring notification or disclosure
of Releases or other environmental condition of the Premises to any governmental
authority or other person or entity, whether or not in connection with transfer
of title to or interest in property.
"Environmental Reports" means the environmental reports provided to
FFCA by Debtor with respect to each of the Premises pursuant to Section 9.E.
"Event of Default" has the meaning set forth in Section 10.
"Fee" means an underwriting, site assessment, valuation, processing and
commitment fee equal to $60,348.00.
"Guarantor" means CKE Restaurants, Inc., a Delaware corporation.
"Guaranty" means a guaranty of payment and performance substantially in
the form of Exhibit D attached to this Agreement to be executed by Guarantor for
the benefit of FFCA. A Guaranty shall be executed for each Premises.
"Hazardous Materials" means (a) any toxic substance or hazardous waste,
substance or related material, or any pollutant or contaminant; (b) radon gas,
asbestos in any form which is or could become friable, urea formaldehyde foam
insulation, transformers or other equipment which contains dielectric fluid
containing levels of polychlorinated biphenyls in excess of federal, state or
local safety guidelines, whichever are more stringent, or any petroleum product;
(c) any substance, gas, material or chemical which is or may be defined as or
included in the definition of "hazardous substances," "toxic substances,"
"hazardous materials," hazardous wastes" or words of similar import under any
Environmental Laws; and (d) any other chemical, material, gas or substance the
exposure to or release of which is or may be prohibited, limited or regulated by
any governmental or quasi-governmental entity or authority that asserts or may
assert jurisdiction over the Premises or the operations or activity at the
Premises, or any chemical, material, gas or substance that does or may pose a
hazard to the health and/or safety of the occupants of the Premises or the
owners and/or occupants of property adjacent to or surrounding the Premises.
"Loan" means the loan for each Premises described in Section 2 and in
the amount set forth in Exhibit A. Each Loan will be evidenced by a Note and
secured by a Deed of Trust.
"Loan Amount" means, with respect to each Premises, the amount set
forth in Section 2.
"Loan Documents" means, collectively, this Agreement, the Notes, the
Deeds of Trust, the Environmental Indemnity Agreements, the UCC-1 Financing
Statements, the Guaranties, the Title Matters Agreement and all other documents
executed in connection therewith or contemplated
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thereby.
"Note" means the promissory note substantially in the form of Exhibit B
attached to this Agreement to be executed by Debtor in favor of FFCA. A Note in
the corresponding Loan Amount will be executed for each Premises.
"Permitted Exceptions" means those exceptions to title approved in
writing by FFCA pursuant to Section 9 of this Agreement.
"Premises" means the parcels of real estate described in Exhibit A
attached hereto, all rights, privileges and appurtenances associated therewith,
and all buildings, fixtures and other improvements now or hereafter located
thereon (whether or not affixed to such real estate).
"Release" means any presence, release, deposit, discharge, emission,
leaking, spilling, seeping, migrating, injecting, pumping, pouring, emptying,
escaping, dumping, disposing or other movement of Hazardous Materials.
"Remediation" means any response, remedial, removal, or corrective
action, any activity to cleanup, detoxify, decontaminate, contain or otherwise
remediate any Hazardous Material, any actions to prevent, cure or mitigate any
Release, any action to comply with any Environmental Laws or with any permits
issued pursuant thereto, any inspection, investigation, study, monitoring,
assessment, audit, sampling and testing, laboratory or other analysis, or any
evaluation relating to any Hazardous Materials.
"Threatened Release" means a substantial likelihood of a Release which
requires action to prevent or mitigate damage to the soil, surface waters,
groundwaters, land, stream sediments, surface or subsurface strata, ambient air
or any other environmental medium comprising or surrounding the Premises which
may result from such Release.
"Title Company" means the title insurance company described in
Section 4.
"Title Matters Agreement" means that certain agreement dated as of the
date of this Agreement among Debtor, Guarantor and FFCA with respect to certain
title matters described therein.
"UCC-1 Financing Statements" means such UCC-1 Financing Statements as
FFCA shall require to be executed and delivered by Debtor with respect to the
Premises.
2. TRANSACTION. (a) On the terms and subject to the conditions set
forth in the Loan Documents, FFCA shall make the Loans. The Loans will be
evidenced by the Notes and secured by the Deeds of Trust. The Guarantor will
provide further security for the Loans by executing and delivering a Guaranty
with respect to each Loan. Debtor shall repay the outstanding principal amount
of the Loans together with interest thereon in the manner and in accordance with
the terms and conditions of the Notes and the other Loan Documents. The
aggregate Loan Amount shall not
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exceed $6,751,000.00, allocated among the Premises as set forth on the attached
Exhibit A. The Loans shall be advanced at the Closing in cash or its equivalent
subject to any prorations and adjustments required by this Agreement.
(b) Debtor shall have the option (the "Conversion Option") from
and after the Closing Date, subject to the conditions hereinafter set forth, to
convert the interest rate accruing under any Note from the Adjustable Rate (as
defined in the Note) to a fixed rate of interest (the "Base Interest Rate") by
providing FFCA written notice of Debtor's election ("Debtor's Notice") to
exercise the Conversion Option not less than thirty (30) days prior to such
conversion becoming effective (the "Notice Period"). The conversion shall be
effective on the first calendar day of the first month which follows the month
in which the last day of the Notice Period occurs (the "Conversion Date").
Debtor shall have the right to exercise the Conversion Option upon satisfaction
of the following conditions:
(i) Debtor shall have provided FFCA with financial statements
(either audited financial statements or, if Debtor does not
have audited financial statements, certified financial
statements) and such other information concerning itself which
FFCA requires to assess Debtor's then financial condition,
and, FFCA's investment committee shall have approved such
financial condition in its sole discretion;
(ii) There shall be no event of default under this Agreement, the
Note, the Deed of Trust or any of the other Loan Documents or
any other document further securing the Note;
(iii) Debtor shall have delivered to FFCA an amendment and
restatement of the Note in a form acceptable to FFCA to
reflect Debtor's exercise of the Conversion Option;
(iv) Debtor shall have delivered to FFCA a confirmation of the
Deed of Trust in a form acceptable to FFCA;
(v) Debtor shall have caused Title Company to deliver to FFCA an
endorsement to the Title Policy, dated as of the Conversion
Date, insuring title to the Premises in FFCA, free and clear
of all defects and encumbrances except those approved in
writing by FFCA and its counsel, with all standard exceptions
deleted to the extent permitted by law and containing:
(a) full coverage against liens of
mechanics, materialmen, laborers and any other
parties who might claim statutory or common law liens
in the Loan Amount, as updated from time to time;
(b) no survey exceptions other than
those previously approved by FFCA and FFCA's counsel
in writing;
(c) such other endorsements or
agreements which provide
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equivalent protection in the event that the foregoing
described endorsements are not available, as FFCA and
its counsel may reasonably request; and
(d) such other endorsements as FFCA
deems appropriate or necessary.
Debtor agrees to deliver or cause to be delivered such affidavits,
indemnities, notices and/or other agreements as Title Company may
require in order to provide the title insurance coverage required
pursuant to this and all other agreements between FFCA and Title
Company with respect to the subject matter of this Agreement. Title
Company shall not agree to delete from the Title Policy any exceptions
without FFCA's prior consent.
The Base Interest Rate shall be determined as of the Conversion Date
and shall be a rate of interest established by FFCA's investment committee in
its sole discretion based on the then financial condition of Debtor and such
investment committee's customary underwriting criteria then in effect.
From and after the Conversion Date, fixed equal monthly payments, based
on the amortization of the outstanding principal amount of the Note as of the
Conversion Date (including any accrued interest at the Adjustable Rate) over the
period from and after the Conversion Date until the Maturity Date (as such term
is defined in the Note) at the Base Interest Rate shall be due and payable
commencing on the first day of the calendar month following the month in which
the Conversion Date occurs and continuing on the first day of each month
thereafter until the Maturity Date, at which time the outstanding principal
balance of the Note and unpaid interest accrued at the Base Interest Rate shall
be due and payable. From and after the Conversion Date, Debtor shall have the
right to pre-pay the Note, as amended and restated, in accordance with the terms
thereof; provided, however, the foregoing is not intended to restrict Debtor's
rights of prepayment pursuant to the terms and conditions of any Note at any
time prior to the Conversion Date.
Debtor shall be responsible for the payment of all reasonable costs and
expenses incurred by Debtor and FFCA as a result of Debtor's exercise of the
Conversion Option, including, without limitation, attorneys' fees and expenses,
title insurance endorsements and charges, survey costs and the cost of
assessments and inspections of the Premises, as applicable.
3. UNDERWRITING, SITE ASSESSMENT, VALUATION, PROCESSING AND
COMMITMENT FEE. Debtor paid FFCA a portion of the Fee in the amount of
$33,755.00 pursuant to the Commitment, and such portion was deemed nonrefundable
and fully earned when received. The remainder of the Fee shall be paid at the
Closing and shall be deemed nonrefundable and fully earned upon the Closing. The
Fee constitutes FFCA's underwriting, site assessment, valuation, processing and
commitment fee. If the Closing does not occur for any reason other than a breach
or default by FFCA or the failure of FFCA to satisfy all conditions precedent
imposed upon it prior to the consummation of the transactions described in the
Commitment, FFCA shall retain the Fee (without affecting or limiting FFCA's
remedies set forth in this Agreement or in the Commitment).
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4. CLOSING. (a) The Loan shall be closed (the "Closing") within 30
days following the satisfaction of all of the terms and conditions contained in
this Agreement, but in no event shall the date of the Closing be extended beyond
December 31, 1996 (the "Closing Date"), unless such extension shall be approved
by FFCA in its sole discretion.
(b) FFCA has ordered a title insurance commitment for each Premises
from Fidelity National Title Insurance Company ("Title Company"). Prior to the
Closing Date, the parties hereto shall deposit with Title Company all documents
and moneys necessary to comply with their obligations under this Agreement.
Title Company shall not cause the transaction to close unless and until it has
received written instructions from FFCA to do so. All costs of such transaction
shall be borne by Debtor, including, without limitation, the cost of title
insurance premiums and endorsements, the attorneys' fees and expenses of Debtor,
the attorneys' fees and expenses of FFCA, the Phase I environmental reports to
be delivered pursuant to 9.E of this Agreement, FFCA's in-house inspection costs
and fees, the cost of the surveys, stamp taxes, transfer fees, escrow and
recording fees and site inspection fees for the Premises. All real and personal
property and other applicable taxes and assessments and other charges relating
to the Premises which are due and payable on or prior to the Closing Date as
well as taxes and assessments due and payable subsequent to the Closing Date but
which Title Company requires to be paid at Closing as a condition to the
issuance of the title insurance policies described in Section 9.C, shall be paid
by Debtor at or prior to the Closing, and all other taxes and assessments shall
be paid by Debtor. The closing documents shall be dated as of the Closing Date.
Debtor and FFCA hereby employ Title Company to act as escrow agent in
connection with this transaction. Debtor and FFCA will deliver to Title Company
all documents, pay to Title Company all sums and do or cause to be done all
other things necessary or required by this Agreement, in the reasonable judgment
of Title Company, to enable Title Company to comply herewith and to enable any
title insurance policies provided for herein to be issued. Title Company is
authorized to pay, from any funds held by it for FFCA's or Debtor's respective
credit all amounts necessary to procure the delivery of such documents and to
pay, on behalf of FFCA and Debtor, all charges and obligations payable by them,
respectively. Debtor will pay all charges payable by it to Title Company. Title
Company is authorized, in the event any conflicting demand is made upon it
concerning these instructions or the escrow, at its election, to hold any
documents and/or funds deposited hereunder until an action shall be brought in a
court of competent jurisdiction to determine the rights of Debtor and FFCA or to
interplead such documents and/or funds in an action brought in any such court.
Deposit by Title Company of such documents and funds, after deducting therefrom
its charges and its expenses and attorneys' fees incurred in connection with any
such court action, shall relieve Title Company of all further liability and
responsibility for such documents and funds. Title Company's receipt of this
Agreement and opening of an escrow pursuant to this Agreement shall be deemed to
constitute conclusive evidence of Title Company's agreement to be bound by the
terms and conditions of this Agreement pertaining to Title Company. Disbursement
of any funds shall be made by, certified check or wire transfer, as directed by
FFCA and Debtor. Title Company shall be under no obligation to disburse any
funds represented by check or draft, and no check or draft shall be payment to
Title Company in compliance with any of the requirements hereof, until it is
advised by the bank in which such
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check or draft is deposited that such check or draft has been honored. Title
Company is authorized to act upon any statement furnished by the holder or
payee, or a collection agent for the holder or payee, of any lien on or charge
or assessment in connection with the Premises, concerning the amount of such
charge or assessment or the amount secured by such lien, without liability or
responsibility for the accuracy of such statement. The employment of Title
Company as escrow agent shall not affect any rights of subrogation under the
terms of any title insurance policy issued pursuant to the provisions thereof.
5. REPRESENTATIONS AND WARRANTIES OF FFCA. The representations
and warranties of FFCA contained in this Section are being made to induce Debtor
to enter into this Agreement and consummate the transactions contemplated
herein, and Debtor has relied, and will continue to rely, upon such
representations and warranties from and after the execution of this Agreement
and the Closing. FFCA represents and warrants to Debtor as follows:
A. Organization of FFCA. FFCA has been duly formed, is
validly existing and has taken all necessary action to authorize the
execution, delivery and performance by FFCA of this Agreement.
B. Authority of FFCA. The person who has executed this
Agreement on behalf of FFCA is duly authorized so to do.
C. Enforceability. Upon execution by FFCA, this
Agreement shall constitute the legal, valid and binding obligation of
FFCA, enforceable against FFCA in accordance with its terms.
All representations and warranties of FFCA made in this Agreement shall
be and will remain true and complete as of the Closing Date as if made and
restated in full as of such date, and shall survive the Closing.
6. REPRESENTATIONS AND WARRANTIES OF DEBTOR. The representations
and warranties of Debtor contained in this Section are being made to induce FFCA
to enter into this Agreement and consummate the transactions contemplated
herein, and FFCA has relied, and will continue to rely, upon such
representations and warranties from and after the execution of this Agreement
and the Closing. Debtor represents and warrants to FFCA as follows:
A. Information and Financial Statements. Debtor has
delivered to FFCA financial statements (either audited financial
statements or, if Debtor does not have audited financial statements,
certified financial statements) and certain other information
concerning themselves and Guarantor, which financial statements and
other information are true, correct and complete in all material
respects; and no material adverse change has occurred with respect to
any such financial statements and other information provided to FFCA
since the date such financial statements and other information were
prepared or delivered to FFCA. Debtor understands that FFCA is relying
upon such financial statements and information. All such financial
statements were prepared in accordance with generally
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accepted accounting principles consistently applied and accurately
reflect as of the date of such financial statements the financial
condition of each individual or entity to which they pertain.
B. Organization and Authority of Debtor. (1) CBI and
Casa are duly organized, validly existing and in good standing under
the laws of Delaware and Texas, respectively, and qualified as foreign
corporations to do business in any jurisdiction where such
qualification is required, except where the failure to be qualified
will not have a material adverse effect on Debtor or the Premises. All
necessary corporate, partnership or limited liability company action
has been taken to authorize the execution, delivery and performance of
this Agreement and of the other documents, instruments and agreements
provided for herein.
(2) The persons who have executed this Agreement on
behalf of CBI and Casa are duly authorized so to do.
C. Enforceability of Documents. Upon execution and
delivery by CBI and Casa or Guarantor, respectively, this Agreement and
the other Loan Documents shall constitute the legal, valid and binding
obligations of CBI, Casa and Guarantor, respectively, enforceable
against the applicable parties in accordance with their respective
terms.
D. Litigation. There are no suits, actions,
proceedings or investigations pending or threatened against or
involving CBI, Casa, Guarantor or the Premises before any court,
arbitrator, or administrative or governmental body which could
reasonably result in any material adverse change in the contemplated
business, condition, worth or operations of CBI, Casa, Guarantor or the
Premises.
E. Absence of Breaches or Defaults. CBI, Casa and
Guarantor are not, and the authorization, execution, delivery and
performance of this Agreement and the Loan Documents will not result,
in any breach or default under any other material document, instrument
or agreement to which CBI, Casa or Guarantor is a party or by which
CBI, Casa, Guarantor, the Premises or any of the property of CBI, Casa
or Guarantor is subject or bound. The authorization, execution,
delivery and performance of this Agreement and the other Loan Documents
will not violate any applicable law, statute, regulation, rule,
ordinance, code, rule or order.
F. Utilities. At the Closing Date, the Premises will
be served by ample public utilities to permit full utilization of the
Premises for their intended purpose and all utility connection fees and
use charges which are then due and payable will have been paid in full.
G. Intended Use and Zoning; Compliance With Laws. Debtor
intends to use the Premises solely for the operation of Taco Bueno
and/or, upon prior written notice to FFCA, any other nationally or
regionally recognized chain concept restaurants, and related ingress,
egress and parking, and for no other purposes. Debtor is the owner of
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trademark and the tradename for the Taco Bueno restaurant concept. Such
intended use does not violate any zoning or other governmental
requirement applicable to the Premises. Debtor has not received notice
from any applicable governmental authority that the Premises do not
comply nor does Debtor have any reason to believe that Premises do not
comply in all material respects with all applicable statutes,
regulations, rules, ordinances, codes, licenses, permits, orders and
approvals of any governmental agencies, departments, commissions,
bureaus, boards or instrumentalities of the United States, the states
in which the Premises are located and all political subdivisions
thereof, including, without limitation, all health, building, fire,
safety and other codes, ordinances and requirements, all applicable
standards of the National Board of Fire Underwriters and the Americans
With Disabilities Act of 1990, except for violations or noncompliance
which would not have a material adverse effect on Debtor or any of the
Premises.
H. Area Development; Wetlands. No condemnation or
eminent domain proceedings affecting the Premises have been commenced
or, to the best of Debtor's knowledge, are contemplated. To the best of
Debtor's knowledge, the areas where the Premises are located have not
been declared blighted by any governmental authority. The Premises and
the real property bordering the Premises are not designated by any
applicable federal, state and/or local governmental authority as
wetlands.
I. Licenses and Permits; Access. Prior to the Closing
Date, Debtor shall have all required licenses and permits, both
governmental and private, to use and operate the Premises in the
intended manner, except for such licenses and permits which the failure
to have would not have material adverse effect on the Debtor or any of
the Premises. There are adequate rights of access to public roads and
ways available to the Premises to permit full utilization of the
Premises for their intended purposes and all such public roads and ways
have been completed and dedicated to public use.
J. Condition of Premises. As of the Closing Date, the
Premises, including the equipment located thereon, will be of good
workmanship and materials, fully equipped and operational, in good
condition and repair and free from structural defects.
K. Environmental. Debtor is fully familiar with the
present use of the Premises, and, after due inquiry, Debtor has become
generally familiar with the prior uses of the Premises. To the best of
Debtor's knowledge, without independent investigation other than a
review of the Environmental Reports, and except as described in the
Environmental Reports, no Hazardous Materials have been used, handled,
manufactured, generated, produced, stored, treated, processed,
transferred or disposed of at or on the Premises, except in compliance
with all applicable Environmental Laws, and no Release or Threatened
Release has occurred at or on the Premises except in substantial
compliance with all applicable Environmental Laws. To the best of
Debtor's knowledge, without independent investigation other than a
review of the Environmental Reports, and except as described in the
Environmental Reports, the activities, operations and business
undertaken on, at or about the Premises, including, but not limited to,
any past or ongoing alterations
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or improvements at the Premises, are and have been at all times, in
compliance in all material respects with all Environmental Laws. No
further action is required to remedy any Environmental Condition or
violation of, or to be in full compliance in all material respects
with, any Environmental Laws, and no lien has been imposed on the
Premises in any federal, state or local governmental or
quasi-governmental entity in connection with any Environmental
Condition, the violation or threatened violation of any Environmental
Laws or the presence of any Hazardous Materials on or off the Premises.
There is no pending or threatened litigation or proceeding
before any court, administrative agency or governmental body in which
any person or entity alleges the violation or threatened violation of
any Environmental Laws or the presence, Release, Threatened Release or
placement on or at the Premises of any Hazardous Materials, or of any
facts which would give rise to any such action, nor has Debtor (a)
received any notice (and Debtor has no actual or constructive
knowledge) that any governmental or quasi-governmental authority or any
employee or agent thereof has determined, threatens to determine or
requires an investigation to determine that there has been a violation
of any Environmental Laws at, on or in connection with the Premises or
that there exists a Release, Threatened Release or placement of any
Hazardous Materials on or at the Premises, or the use, handling,
manufacturing, generation, production, storage, treatment, processing,
transportation or disposal of any Hazardous Materials at or on the
Premises except in substantial compliance with all applicable
Environmental Laws; (b) received any notice under the citizen suit
provision of any Environmental Law in connection with the Premises or
any facilities, operations or activities conducted thereon, or any
business conducted in connection therewith; or (c) received any request
for inspection, request for information, notice, demand, administrative
inquiry or any formal or informal complaint or claim with respect to or
in connection with the violation or threatened violation of any
Environmental Laws or existence of Hazardous Materials relating to the
Premises or any facilities, operations or activities conducted thereon
or any business conducted in connection therewith.
L. Title to Personal Property; First Priority Lien. Upon
Closing, title to the Personal Property (as defined in the Deeds of
Trust) will be vested in Casa, free and clear of all liens,
encumbrances, charges and security interests of any nature whatsoever,
except the Permitted Exceptions. Upon Closing, FFCA shall have a first
priority lien on the Personal Property pursuant to the Deeds of Trust
and the UCC-1 Financing Statements.
M. No Other Agreements and Options. Neither CBI, Casa,
Guarantor nor the Premises are subject to any commitment, obligation,
or agreement, including, without limitation, any right of first
refusal, option to purchase or lease granted to a third party, which
could or would prevent or hinder FFCA in making the Loans or prevent or
hinder Debtor or Guarantor, as the case may be from fulfilling their
respective obligations under this Agreement or the other Loan
Documents.
N. No Mechanics' Liens. There are no outstanding
accounts payable,
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mechanics' liens, or rights to claim a mechanics' lien in favor of any
materialman, laborer, or any other person or entity in connection with
labor or materials furnished to or performed on any portion of the
Premises; no work has been performed or is in progress nor have
materials been supplied to the Premises or agreements entered into for
work to be performed or materials to be supplied to the Premises prior
to the date hereof, which will not have been fully paid for on or
before the Closing Date or which might provide the basis for the filing
of such liens against the Premises or any portion thereof.
O. No Reliance. Debtor acknowledges that FFCA did not
prepare or assist in the preparation of any of the projected financial
information used by Debtor in analyzing the economic viability and
feasibility of the transaction contemplated by this Agreement.
Furthermore, CBI and Casa acknowledge that they have not relied upon,
nor may they hereafter rely upon, the analysis undertaken by FFCA in
determining the amount of the Loans, and such analysis will not be made
available to CBI or Casa.
All representations and warranties of Casa and CBI made in this
Agreement shall be and will remain true and complete as of and subsequent to the
Closing Date as if made and restated in full as of such time and shall survive
the Closing.
7. COVENANTS. Debtor covenants to FFCA from and after the
Closing Date as follows:
A. Inspections. Debtor shall, at all reasonable
times, (i) provide FFCA and FFCA's officers, employees, agents,
advisors, attorneys, accountants, architects, and engineers with
reasonable access to the Premises, all drawings, plans, and
specifications for the Premises in possession of Debtor, all
engineering reports relating to the Premises in the possession of
Debtor, the files and correspondence relating to the Premises, and the
financial books and records, including lists of delinquencies, relating
to the ownership, operation, and maintenance of the Premises, and (ii)
allow such persons to make such inspections, tests, copies, and
verifications as FFCA considers necessary.
B. Fixed Charge Coverage Ratio. Until such time as all
of Debtor's obligations under the Notes and the other Loan Documents
are paid, satisfied and discharged in full, Debtor shall maintain an
aggregate Fixed Charge Coverage Ratio at all of the Premises of at
least 1.50:1. For purposes of this Section, the term "Fixed Charge
Coverage Ratio" shall mean with respect to the twelve month period of
time immediately preceding the date of determination, the ratio
calculated for such period of time of (a) the sum of Net Income,
Depreciation and Amortization, Interest Expense and Operating Lease
Expense, less a corporate overhead allocation in an amount equal to 5%
of Gross Sales, to (b) the sum of the FFCA Payments and the Equipment
Payment Amount.
For purposes of this Section, the following terms shall be defined as
set forth below:
"Capital Lease" shall mean any lease of any property
(whether real, personal or mixed) by Debtor with respect to
one or more of the Premises which
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lease would, in conformity with generally accepted accounting
principles consistently applied, be required to be accounted
for as a capital lease on the balance sheet of Debtor. The
term "Capital Lease" shall not include any operating lease.
"Debt" shall mean with respect to all of the Premises
and the period of determination (i) indebtedness for borrowed
money, (ii) obligations evidenced by bonds, indentures, notes
or similar instruments, (iii) obligations to pay the deferred
purchase price of property or services, (iv) obligations under
leases which should be, in accordance with generally accepted
accounting principles consistently applied, recorded as
Capital Leases, and (v) obligations under direct or indirect
guarantees in respect of, and obligations (contingent or
otherwise) to purchase or otherwise acquire, or otherwise to
assure a creditor against loss in respect of, indebtedness or
obligations of others of the kinds referred to in clauses (i)
through (iv) above.
"Depreciation and Amortization" shall mean with
respect to all of the Premises the depreciation and
amortization accruing during any period of determination with
respect to Debtor as determined in accordance with generally
accepted accounting principles consistently applied.
"Equipment Payment Amount" shall mean for any period
of determination the sum of all amounts payable during such
period of determination under all (i) leases for equipment
located at one or more of the Premises and (ii) all loans
secured by equipment located at one or more of the Premises
(other than the Loans).
"FFCA Payments" shall mean with respect to period of
determination, the sum of all amounts payable under the Notes.
"Gross Sales" shall mean the sales or other income
arising from all business conducted at all of the Premises by
Debtor during the period of determination, less sales tax and
any amounts received from not-for-profit sales of all non-food
items approved for use in connection with promotional
campaigns.
"Interest Expense" shall mean for any period of
determination, the sum of all interest accrued or which should
be accrued in respect of all Debt of Debtor allocable to one
or more of the Premises and all business operations thereon
during such period (including interest attributable to Capital
Leases), as determined in accordance with generally accepted
accounting principles consistently applied.
"Net Income" shall mean with respect to the period of
determination, the net income or net loss of Debtor allocable
to all of the Premises. In determining the amount of Net
Income, (i) adjustments shall be made for nonrecurring gains
and losses allocable to the period of determination, (ii)
deductions shall be made for, among other things, Depreciation
and Amortization, Interest Expense and Operating Lease Expense
allocable to the period of determination, and (iii) no
deductions shall
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be made for (x) income taxes or charges equivalent to income
taxes allocable to the period of determination, as determined
in accordance with generally accepted accounting principles
consistently applied, or (y) corporate overhead expense
allocable to the period of determination.
"Operating Lease Expense" shall mean the expenses
incurred by Debtor under any operating leases with respect to
one or more of the Premises and the business operations
thereon during the period of determination, as determined in
accordance with generally accepted accounting principles
consistently applied.
C. Net Worth. At all times while the Obligations (as
defined in Section 7.D of this Agreement) of Debtor and Guarantor to
FFCA pursuant to the Loan Documents are outstanding, Guarantor and
Debtor, taken as a whole with their respective consolidated
subsidiaries, shall maintain a consolidated net worth of at least
$50,000,000, as determined in accordance with GAAP (as defined in
Section 7.D of this Agreement).
D. Consolidated Funded Debt to Consolidated Total
Capitalization Ratio. At all times while the Obligations of Debtor to
FFCA pursuant to the Loan Documents are outstanding, Debtor shall cause
Guarantor to maintain a ratio of Consolidated Funded Debt to
Consolidated Total Capitalization of not more than 1.0 to 1.0. For
purposes of this Section and Section 7.C of this Agreement, the
following terms shall be defined as set forth below:
"Consolidated" refers to the consolidation of accounts in
accordance with GAAP.
"Consolidated Funded Debt" means, as of any time
determination, all Funded Debt of Guarantor and its Consolidated
subsidiaries at such time determined on a Consolidated basis.
"Consolidated Tangible Net Worth" means the excess of (i) the
total assets of Guarantor and its Consolidated subsidiaries determined
on a Consolidated basis in accordance with GAAP MINUS good will and any
other items that are classified as intangible in accordance with GAAP,
over (ii) all liabilities of Guarantor and its Consolidated
subsidiaries determined on a Consolidated basis in accordance with
GAAP.
"Consolidated Total Capitalization" means, at any time of
determination, the sum of (i) Consolidated Funded Debt, and (ii)
Consolidated Tangible Net Worth, in each case, as of such time.
"Currency Hedging Agreements" means currency swap agreements,
currency future or option contracts and other similar agreements.
"Debt" of any Person means, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all Obligations of
such Person for the deferred purchase
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price of property or services (other than trade payables not overdue by
more than 60 days incurred in the ordinary course of such Person's
business), (c) all Obligations of such Person evidenced by notes,
bonds, debentures or other similar instruments, (d) all Obligations of
such Person created or arising under any conditional sale or other
title retention agreement with respect to property acquired by such
Person (even though the rights and remedies of the seller or lender
under such agreement in the event of default are limited to
repossession or sale of such property), (e) all Obligations of such
Person as lessee under leases that have been or should be, in
accordance with GAAP, recorded as capital leases, (f) all Obligations,
contingent or otherwise, of such Person under acceptance, letter of
credit or similar facilities, (g) all Obligations of such Person to
purchase, redeem, retire, defease or otherwise make any payment in
respect of any capital stock or other ownership or profit interest or
any warrants, rights or options to acquire such capital stock, (h) all
Obligations of such Person in respect of Hedge Agreements, (i) all Debt
of others referred to in clauses (a) through (h) above guaranteed
directly or indirectly in any manner by such Person, or in effect
guaranteed directly or indirectly by such Person through an agreement
(i) to pay or purchase such Debt or to advance or supply funds for the
payment or purchase of such Debt, (ii) to purchase, sell or lease (as
lessee or lessor) property, or to purchase or sell services, primarily
for the purpose of enabling the debtor to make payment of such Debt or
to assure the holder of such Debt against loss, (iii) to supply funds
to or in any other manner invest in the debtor (including any agreement
to pay for property or services irrespective of whether such property
is received or such services are rendered) or (iv) otherwise to assure
a creditor against loss, and (j) all Debt referred to in clauses (a)
through (h) above secured by (or for which the holder of such Debt has
an existing right, contingent or otherwise, to be secured by) any lien
on property (including, without limitation, accounts and contract
rights) owned by such Person, even though such Person has not assumed
or become liable for the payment of such Debt (it being understood that
for purposes for this clause (j) the principal amount of such Debt
attributed to such Person shall be the fair market value of such
property).
"Funded Debt" of any Person means Debt in respect of all
Advances (as defined in that certain Credit Agreement, dated as of
August 1, 1996, by and among Guarantor, the financial institutions
named therein as lenders, and NationsBank Texas, N.A., as agent), in
the case of Guarantor, and all other Debt of such Person that by its
terms matures more than one year after the date of determination or
matures within one year from such date but is renewable or extendible,
at the option of such Person, to a date more than one year after such
date or arises under a revolving credit or similar agreement that
obligates the lender or lenders to extend credit during a period of
more than one year after such date, including, without limitation, all
amounts of Funded Debt of such Person required to be paid or prepaid
within one year after the date of determination.
"GAAP" means generally accepted accounting principles
consistently applied.
"Hedge Agreements" means Interest Rate Contracts and Currency
Hedging Agreements.
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"Insolvency Proceeding" means any dissolution, winding up,
liquidation, arrangement, reorganization, adjustment, protection,
relief or composition of any Person or its debts, whether voluntary or
involuntary, in any bankruptcy, insolvency, arrangement,
reorganization, receivership, relief or similar case or proceeding
under any Federal or State bankruptcy or similar law or upon an
assignment for the benefit of creditors or any other marshalling of the
assets and liabilities of any Person or otherwise.
"Interest Rate Contracts" means interest rate swap, cap or
collar agreements, interest rate future or option contracts and other
similar agreements.
"Obligations" means, with respect to any Person, any
obligations of such Person of any kind, including, without limitation,
any liability of such Person on any claim, whether or not the right of
any creditor to payment in respect of such claim is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured,
disputed, undisputed, legal, equitable, secured or unsecured, and
whether or not such claim is discharged, stayed or otherwise affected
by any Insolvency Proceeding. Without limiting the generality of the
foregoing, the Obligations of Debtor under the Loan Documents include
(a) the obligation to pay principal, interest, charges, expenses, fees,
attorneys' fees and disbursements, indemnities, taxes, insurance
premiums, impounds, late charges, default interest, damages and all
other amounts payable by Debtor under any Loan Document and (b) the
obligation to reimburse any amount in respect of any of the foregoing
that FFCA, in its sole discretion, may elect to pay or advance on
behalf of Debtor.
"Person" means an individual, partnership, limited liability
company, limited liability partnership, corporation (including a
business trust), joint stock company, trust, unincorporated
association, joint venture or other entity, or a government or any
political subdivision or agency thereof.
E. Mechanics' Liens. Debtor shall be responsible for
any and all claims for mechanics' liens and accounts payable that have
arisen or may subsequently arise due to agreements entered into for
and/or any work performed on, or materials supplied to the Premises
prior to the Closing Date; and Debtor shall and does hereby agree to
defend, indemnify and forever hold FFCA and FFCA's designees harmless
from and against any and all such mechanics' lien claims, accounts
payable or other commitments relating to the Premises.
F. Taco Bueno Intellectual Property. In the event that
Casa transfers any intellectual property rights with respect to the
Taco Bueno restaurant concept, including, without limitation, franchise
rights, licenses, trademarks or tradenames, Debtor shall provide FFCA
with a collateral assignment of such intellectual property rights
associated with the Premises, in form and substance reasonably
requested by FFCA.
8. TRANSACTION CHARACTERIZATION. This Agreement is a contract to
extend a financial
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accommodation (as such term is used in the Code) for the benefit of Debtor. It
is the intent of the parties hereto that the business relationship created by
this Agreement, the Notes, the Deeds of Trust and the other Loan Documents is
solely that of creditor and debtor and has been entered into by both parties in
reliance upon the economic and legal bargains contained in the Loan Documents.
None of the agreements contained in the Loan Documents is intended, nor shall
the same be deemed or construed, to create a partnership between Debtor and
FFCA, to make them joint venturers, to make Debtor an agent, legal
representative, partner, subsidiary or employee of FFCA, nor to make FFCA in any
way responsible for the debts, obligations or losses of Debtor.
9. CONDITIONS OF CLOSING. The obligation of FFCA to consummate
the transaction contemplated by this Agreement is subject to the fulfillment or
waiver of each of the following conditions:
A. Title. Title to the Premises shall be vested in Casa,
free of all liens, encumbrances, restrictions, encroachments and
easements, except as otherwise specifically provided herein or agreed
to in writing by FFCA ("Permitted Exceptions"), and the liens created
by the Deeds of Trust and the UCC-1 Financing Statements. Upon Closing,
FFCA will obtain a valid and perfected first priority lien upon and
security interest in the Premises.
B. Condition of Premises. FFCA shall have inspected and
approved the Premises, the Premises and the equipment located thereon
shall be in good condition and repair and of good workmanship and
materials, and the Premises shall be fully equipped and operational,
clean, orderly, sanitary, safe, well-lit, landscaped, decorated,
attractive and with a suitable layout, physical plant, traffic pattern
and location, all as determined by FFCA in its sole discretion.
C. Evidence of Title. FFCA shall have received for each
of the Premises a preliminary title report and irrevocable commitment
to insure title by means of a mortgagee's, ALTA extended coverage
policy of title insurance (or its equivalent, in the event such form is
not issued in the jurisdiction where the Premises is located) issued by
Title Company showing good and indefeasible title in the Premises in
Debtor, committing to insure FFCA's first priority lien upon and
security interest in the Premises subject only to Permitted Exceptions
and containing such endorsements as FFCA may require (to the extent
available under applicable law).
D. Survey. FFCA shall have received a current ALTA
survey of each of the Premises, the form and substance of which shall
be satisfactory to FFCA in its sole discretion. Debtor shall have
provided FFCA with evidence satisfactory to FFCA that the location of
the Premises is not within the 100-year flood plain or identified as a
special flood hazard area as defined by the Federal Insurance
Administration.
E. Environmental. FFCA shall have received a Phase I
environmental report (and a Phase II environmental report, if
necessary, as determined by FFCA in its sole discretion) for each of
the Premises, the form, substance and conclusions of which shall be
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satisfactory to FFCA in its sole discretion.
F. Compliance With Representations, Warranties and
Covenants. All obligations of Debtor under this Agreement shall have
been fully performed and complied with, and no event shall have
occurred or condition shall exist which would, upon the Closing Date,
or, upon the giving of notice and/or passage of time, constitute a
breach or default hereunder or under the Loan Documents, or any other
agreement between or among FFCA or Debtor pertaining to the subject
matter hereof, and no event shall have occurred or condition shall
exist or information shall have been disclosed by Debtor or discovered
by FFCA which has had or would have a material adverse effect on the
Premises, Debtor, Guarantor or FFCA's willingness to consummate the
transaction contemplated by this Agreement, as determined by FFCA in
its sole and absolute discretion.
G. Proof of Insurance. Debtor shall have delivered to
FFCA copies of insurance policies, showing that all insurance required
by the Loan Documents and providing coverage and limits satisfactory to
FFCA are in full force and effect.
H. Opinion of Counsel to Debtor and Guarantor. Debtor
and Guarantor shall have caused Counsel to prepare and deliver an
opinion substantially in the form attached as Exhibit E.
I. Guaranty. Debtor shall cause to be delivered to FFCA
a Guaranty executed by the Guarantor for each of the Premises.
J. Availability of Funds. FFCA presently has sufficient
funds to discharge its obligations under this Agreement. In the event
that the transaction contemplated by this Agreement does not close on
or before the Closing Date, FFCA does not warrant that it will
thereafter have sufficient funds to consummate the transaction
contemplated by this Agreement.
K. Title Matters Agreement. Debtor shall have executed
and delivered to FFCA the Title Matters Agreement.
L. Closing Documents. At or prior to the Closing Date,
FFCA, Guarantor and/or Debtor, as may be appropriate, shall execute and
deliver or cause to be executed and delivered to Title Company or FFCA,
as may be appropriate, all documents required to be delivered by this
Agreement, and such other documents, payments, instruments and
certificates, as FFCA may reasonably require in form acceptable to
FFCA.
10. DEFAULT AND REMEDIES. A. Each of the following shall be
deemed an event of default by Debtor (an "Event of Default"):
(1) If any representation or warranty of Casa or CBI is
false in any material respect when made or becomes false in any
material respect prior to the Closing Date, or,
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in the event any such representation or warranty is continuing after
the Closing, if any such representation or warranty becomes false in
any material respect at any time, or if Casa, CBI or Guarantor renders
any false statement of a material fact or account;
(2) If any principal, interest or other monetary sum due
under the Notes, the Deeds of Trust or any other Loan Document is not
paid within five days after the date when due;
(3) If Casa, CBI or Guarantor fails to observe or perform
any of the other covenants, conditions, or obligations of this
Agreement or any other Loan Document within the applicable grace or
cure period;
(4) If Casa, CBI or Guarantor becomes insolvent within
the meaning of the Code, files or notifies FFCA that it intends to file
a petition under the Code, initiates a proceeding under any similar law
or statute relating to bankruptcy, insolvency, reorganization, winding
up or adjustment of debts (collectively, an "Action"), becomes the
subject of either a petition under the Code or an Action, or is not
generally paying its debts as the same become due;
(5) If there is an event of default under the Casa Loan
Agreement or a material breach or default under any other agreement or
instrument, including, without limitation, promissory notes and
guaranties, between, among or by (a) Casa, CBI, Guarantor, or any
Affiliate of CBI, Casa or Guarantor and, or for the benefit of, (b)
FFCA or any Affiliate of FFCA; or
(6) If any event occurs or condition exists which does or
would upon the Closing Date constitute a material breach or default
under any of the Loan Documents.
B. If any Event of Default occurs pursuant to subsection
A(2) above, FFCA shall not be entitled to exercise its remedies set
forth in subsection E below unless and until FFCA shall have given
Debtor notice thereof and a period of five days from the delivery of
such notice shall have elapsed without such Event of Default being
cured.
C. FFCA shall not be entitled to exercise its remedies
set forth in subsection E below due to a default under subsection A(3)
as a result of a breach of the Fixed Charge Coverage Ratio set forth in
Section 7.B, unless and until FFCA shall have given Debtor notice
thereof and Debtor shall have failed within a period of 30 days from
the delivery of such notice to either (i) pay to FFCA the FCCR Amount
(without premium or penalty) with respect to each of those Premises for
which the Fixed Charge Coverage Ratio (with the definitions in Section
7.B modified as applicable to provide for a calculation of the Fixed
Charge Coverage Ratio for each of the Premises) is below 1.50:1 (each,
a "Subject Premises"), or (ii) prepay the Note or Notes corresponding
to the Subject Premises in whole but not in part (without premium or
penalty). For purposes of this subsection, "FCCR Amount" means that sum
of money which, when subtracted from the outstanding principal
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amount of each Note corresponding to a Subject Premises, and assuming
the resulting principal balance is reamortized over the remaining term
of such Note, will result in an adjusted Fixed Charge Coverage Ratio
for such Subject Premises of at least 1.50:1 based on the prior year's
operations. Promptly after Debtor's payment of the FCCR Amount, Debtor
and FFCA agree to execute an amendment to each such Note in form and
substance reasonably acceptable to FFCA reducing the principal amount
payable to FFCA under such Note and reamortizing the principal amount
of such Note over the then remaining term of such Note.
D. If any event occurs pursuant to subsection A(3)
subsequent to the Closing and does not involve a breach of the Fixed
Charge Coverage Ratio and does not involve the payment of any monetary
sum, is not willful or intentional, does not place any rights or
property of FFCA in immediate jeopardy, and is within the reasonable
power of Debtor to promptly cure after receipt of notice thereof, all
as determined by FFCA in its reasonable discretion, then such event
shall not constitute an Event of Default hereunder, unless otherwise
expressly provided herein, unless and until FFCA shall have given
Debtor notice thereof and a period of 30 days shall have elapsed,
during which period Debtor may correct or cure such event, upon failure
of which an Event of Default shall be deemed to have occurred hereunder
without further notice or demand of any kind. If such nonmonetary event
cannot reasonably be cured within such 30-day period, as determined by
FFCA in its reasonable discretion, and Debtor is diligently pursuing a
cure of such event, then Debtor shall have a reasonable period to cure
such event, which shall not exceed 90 days after receiving notice of
the event from FFCA. If Debtor shall fail to correct or cure such event
within such 90-day period, an Event of Default shall be deemed to have
occurred hereunder without further notice or demand of any kind.
E. Upon and during the continuance of an Event of
Default, FFCA may declare all obligations of Debtor under the Notes,
this Agreement and any other Loan Document to be due and payable, and
the same shall thereupon become due and payable without any
presentment, demand, protest, notice of intent to accelerate, notice of
acceleration or any other type of notice except as otherwise provided
herein, and Debtor hereby waives notice of intent to accelerate the
obligations secured by the Deeds of Trust. Thereafter, FFCA may
exercise, at its option, concurrently, successively or in any
combination, all remedies available at law or in equity, including
without limitation any one or more of the remedies available under the
Notes, the Deeds of Trust or any other Loan Document.
Upon and during the continuance of an Event of Default, FFCA
shall be entitled to enforce payment and performance of any obligations
under the Loan Documents and to exercise all rights and powers under
the Notes, this Agreement or under any other Loan Documents or other
agreement reasonably required by FFCA any applicable laws now or
hereafter in force, notwithstanding that some or all of such
obligations may now or hereafter be otherwise secured, whether by
mortgage, deed of trust, pledge, lien, assignment or otherwise. Neither
the acceptance of this Agreement nor its enforcement
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shall prejudice or in any manner affect FFCA's right to realize upon or
enforce any other security now or hereafter held by FFCA, it being
agreed that FFCA shall be entitled to enforce this Agreement and any
other security now or hereafter held by FFCA in such order and manner
as it may in its absolute discretion determine. No remedy herein
conferred upon or reserved to FFCA is intended to be exclusive of any
other remedy given hereunder or now or hereafter existing at law or in
equity or by statute. Every power or remedy given by any of the Loan
Documents to FFCA, or to which FFCA may be otherwise entitled, may be
exercised, concurrently or independently, from time to time and as
often as may be deemed expedient by FFCA.
11. ASSIGNMENTS. A. FFCA may assign in whole or in part its rights
under this Agreement, including, without limitation, any Transfer, Participation
and/or Securitization (all as defined in Section 13.P). In the event of any
unconditional assignment of FFCA's entire right and interest hereunder, FFCA
shall automatically be relieved, from and after the date of such assignment, of
liability for the performance of any obligation of FFCA contained herein.
B. Debtor shall not, without the prior written consent of FFCA
sell, assign, transfer, mortgage, convey, encumber or grant any easements or
other rights or interests of any kind in the Premises, any of Debtor's rights
under this Agreement or any interest in Debtor, whether voluntarily,
involuntarily or by operation of law or otherwise, including, without
limitation, by merger, consolidation, dissolution or otherwise, except as
expressly permitted by the Deeds of Trust.
12. INDEMNITY. Debtor agrees to indemnify, hold harmless and defend
FFCA and its directors, officers, shareholders, employees, successors, assigns,
agents, as applicable (collectively, the "Indemnified Parties"), from and
against any and all losses, costs, claims, liabilities, damages and expenses,
including, without limitation, reasonable attorneys' fees, and/or a breach of
any of the representations, warranties, covenants, agreements or obligations of
Debtor set forth in this Agreement. Without limiting the generality of the
foregoing, such indemnity shall include, without limitation, any engineering,
governmental inspection and reasonable attorneys' fees and expenses that the
Indemnified Parties may incur by reason of any representation set forth in this
Agreement being false in any material respect, or by reason of any investigation
or claim of any governmental agency in connection therewith.
13. MISCELLANEOUS PROVISIONS.
A. Notices. All notices, consents, approvals or other
instruments required or permitted to be given by either party pursuant
to this Agreement shall be in writing and given by (i) hand delivery,
(ii) facsimile, (iii) express overnight delivery service or (iv)
certified or registered mail, return receipt requested, and shall be
deemed to have been delivered upon (a) receipt, if hand delivered, (b)
transmission, if delivered by facsimile, (c) the next business day, if
delivered by express overnight delivery service, or (d) the third
business day following the day of deposit of such notice with the
United States Postal Service, if sent by certified or registered mail,
return receipt requested. Notices shall be
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provided to the parties and addresses (or facsimile numbers, as applicable)
specified below:
If to CBI: Xxxxxx X. Xxxxx
Chief Financial Officer
CBI Restaurants, Inc.
0000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxxxx, Xxxxxxxxxx 00000-0000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to: Xxxxxx X. Xxxxxx, Esq.
Vice President and General Counsel
CBI Restaurants, Inc.
0000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxxxx, Xxxxxxxxxx 00000-0000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
If to Casa: Xxxxxx X. Xxxxx
Chief Financial Officer
Casa Xxxxxx Incorporated
0000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxxxx, Xxxxxxxxxx 00000-0000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to: Xxxxxx X. Xxxxxx, Esq.
Vice President and General Counsel
Casa Xxxxxx Incorporated
0000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxxxx, Xxxxxxxxxx 00000-0000
Telephone: 000-0000
Telecopy: (000) 000-0000
If to FFCA: Xxxxxx X. Xxxxx, Esq.
Senior Vice President and General Counsel
FFCA Mortgage Corporation
00000 Xxxxx Xxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
B. Broker's Commission. FFCA and Debtor represent and
warrant to each other that they have dealt with no real estate or
mortgage broker, agent, finder or other
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intermediary in connection with the transactions contemplated by this
Agreement. FFCA and Debtor shall indemnify and hold each other harmless
from and against any costs, claims or expenses, including attorneys'
fees, arising out of the breach of their respective representations and
warranties contained within this Section.
C. Waiver and Amendment. No provisions of this Agreement
shall be deemed waived or amended except by a written instrument
unambiguously setting forth the matter waived or amended and signed by
the party against which enforcement of such waiver or amendment is
sought. Waiver of any matter shall not be deemed a waiver of the same
or any other matter on any future occasion.
D. Captions. Captions are used throughout this
Agreement for convenience of reference only and shall not be considered
in any manner in the construction or interpretation hereof.
E. FFCA's Liability. Notwithstanding anything to the
contrary provided in this Agreement, it is specifically understood and
agreed, such agreement being a primary consideration for the execution
of this Agreement by FFCA, that (i) there shall be absolutely no
personal liability on the part of any shareholder, director, officer or
employee of FFCA, with respect to any of the terms, covenants and
conditions of this Agreement or the other Loan Documents, (ii) Debtor
waives all claims, demands and causes of action against FFCA's
officers, directors, employees and agents in the event of any breach by
FFCA of any of the terms, covenants and conditions of this Agreement or
the other Loan Documents to be performed by FFCA and (iii) Debtor shall
look solely to the assets of FFCA for the satisfaction of each and
every remedy of Debtor in the event of any breach by FFCA of any of the
terms, covenants and conditions of this Agreement or the other Loan
Documents to be performed by FFCA, such exculpation of liability to be
absolute and without any exception whatsoever.
F. Severability. The provisions of this Agreement
shall be deemed severable. If any part of this Agreement shall be held
unenforceable, the remainder shall remain in full force and effect, and
such unenforceable provision shall be reformed by such court so as to
give maximum legal effect to the intention of the parties as expressed
therein.
G. Construction Generally. This is an agreement between
parties who are experienced in sophisticated and complex matters
similar to the transaction contemplated by this Agreement and is
entered into by both parties in reliance upon the economic and legal
bargains contained herein and shall be interpreted and construed in a
fair and impartial manner without regard to such factors as the party
which prepared the instrument, the relative bargaining powers of the
parties or the domicile of any party. Debtor and FFCA were each
represented by legal counsel competent in advising them of their
obligations and liabilities hereunder.
H. Other Documents. Each of the parties agrees to
sign such other and further
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documents as may be appropriate to carry out the intentions expressed
in this Agreement.
I. Attorneys' Fees. In the event of any judicial or
other adversarial proceeding between the parties concerning this
Agreement, the prevailing party shall be entitled to recover its
attorneys' fees and other costs in addition to any other relief to
which it may be entitled. References in this Agreement to the
attorneys' fees and/or costs of FFCA shall mean both the fees and costs
of independent outside counsel retained by FFCA with respect to this
transaction.
J. Entire Agreement. This Agreement and the other Loan
Documents, together with any other certificates, instruments or
agreements to be delivered in connection therewith, constitute the
entire agreement between the parties with respect to the subject matter
hereof, and there are no other representations, warranties or
agreements, written or oral, between Debtor and FFCA with respect to
the subject matter of this Agreement. THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT
BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS
BETWEEN THE PARTIES.
K. Forum Selection; Jurisdiction; Venue; Choice of Law.
Debtor acknowledges that this Agreement was substantially negotiated in
the State of Arizona, the Agreement was signed by FFCA in the State of
Arizona and delivered by Debtor in the State of Arizona, all payments
under the Notes will be delivered in the State of Arizona and there are
substantial contacts between the parties and the transactions
contemplated herein and the State of Arizona. For purposes of any
action or proceeding arising out of this Agreement, the parties hereto
hereby expressly submit to the jurisdiction of all federal and state
courts located in the State of Arizona and Debtor consents that it may
be served with any process or paper by registered mail or by personal
service within or without the State of Arizona in accordance with
applicable law. Furthermore, Debtor waives and agrees not to assert in
any such action, suit or proceeding that it is not personally subject
to the jurisdiction of such courts, that the action, suit or proceeding
is brought in an inconvenient forum or that venue of the action, suit
or proceeding is improper. It is the intent of the parties hereto that
all provisions of this Agreement shall be governed by and construed
under the laws of the State of Arizona and applicable laws of the
United States. To the extent that a court of competent jurisdiction
finds Arizona law inapplicable with respect to any provisions hereof,
then, as to those provisions only, the laws of the states where the
Premises are located shall be deemed to apply. Nothing in this Section
shall limit or restrict the right of FFCA to commence any proceeding in
the federal or state courts located in the states in which the Premises
are located to the extent FFCA deems such proceeding necessary or
advisable to exercise remedies available under this Agreement or the
other Loan Documents.
L. Counterparts. This Agreement may be executed in one
or more counterparts, each of which shall be deemed an original.
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M. Binding Effect. This Agreement shall be binding
upon and inure to the benefit of Debtor and FFCA and their respective
successors and permitted assigns, including, without limitation, any
United States trustee, any debtor in possession or any trustee
appointed from a private panel.
N. Survival. Except for the conditions of Closing set
forth in Sections 2 and 9, which shall be satisfied or waived as of the
Closing Date, all representations, warranties, agreements, obligations
and indemnities of Debtor and FFCA set forth in this Agreement shall
survive the Closing.
O. Waiver of Jury Trial and Punitive, Consequential,
Special and Indirect Damages. DEBTOR AND FFCA HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT EITHER MAY HAVE TO A
TRIAL BY JURY WITH RESPECT TO ANY AND ALL ISSUES PRESENTED IN ANY
ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM BROUGHT BY EITHER OF THE
PARTIES HERETO AGAINST THE OTHER OR ITS SUCCESSORS WITH RESPECT TO ANY
MATTER ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY
DOCUMENT CONTEMPLATED HEREIN OR RELATED HERETO. THIS WAIVER BY THE
PARTIES HERETO OF ANY RIGHT EITHER MAY HAVE TO A TRIAL BY JURY HAS BEEN
NEGOTIATED AND IS AN ESSENTIAL ASPECT OF THEIR BARGAIN. FURTHERMORE,
DEBTOR HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES THE RIGHT
IT MAY HAVE TO SEEK PUNITIVE, CONSEQUENTIAL, SPECIAL AND INDIRECT
DAMAGES FROM FFCA WITH RESPECT TO ANY AND ALL ISSUES PRESENTED IN ANY
ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM BROUGHT BY DEBTOR AGAINST
FFCA OR ITS SUCCESSORS WITH RESPECT TO ANY MATTER ARISING OUT OF OR IN
CONNECTION WITH THIS AGREEMENT OR ANY DOCUMENT CONTEMPLATED HEREIN OR
RELATED HERETO. THE WAIVER BY DEBTOR OF ANY RIGHT IT MAY HAVE TO SEEK
PUNITIVE, CONSEQUENTIAL, SPECIAL AND INDIRECT DAMAGES HAS BEEN
NEGOTIATED BY THE PARTIES HERETO AND IS AN ESSENTIAL ASPECT OF THEIR
BARGAIN.
P. Transfers, Participations and Securitization. A
material inducement to FFCA's willingness to complete the transactions
contemplated by the Loan Documents is Debtor's agreement that FFCA may,
at any time, sell, transfer or assign the Notes, Deeds of Trust and the
other Loan Documents, and any or all servicing rights with respect
thereto (each, a "Transfer"), or grant participations therein (each, a
"Participation"), or complete asset securitization vehicles selected by
FFCA prior to Debtor's exercise of the Conversion Option and, if
applicable, subsequent to the Debtor's exercise of the Conversion
Option, in accordance with all requirements which may be imposed by the
investors or the rating agencies involved in such securitized financing
transaction, as selected by FFCA, or which may be imposed by applicable
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securities, tax or other laws or regulations, including, without
limitation, laws relating to FFCA's status as a real estate investment
trust (each, a "Securitization").
Debtor agrees to cooperate in good faith with FFCA in
connection with any Transfer, Participation and/or Securitization,
including, without limitation, (i) providing such documents, financial
and other data, other information and materials, and the results of
third-party inspections and analysis of the Premises (the
"Disclosures") which would typically be required with respect to Debtor
and Guarantor by a purchaser, transferee, assignee, servicer,
participant, investor or rating agency involved with respect to such
Transfer, Participation and/or the Securitization, as applicable;
provided, however, Debtor shall not be required to make Disclosures of
any confidential information or any information which has not
previously been made public unless required by applicable federal or
state securities laws; and (ii) amending the terms of the transactions
evidenced by the Loan Documents to the extent necessary so as to
satisfy the requirements of purchasers, transferees, assignees,
servicers, participants, investors or selected rating agencies involved
in any such Transfers, Participations or Securitization, so long as
such amendments would not have a material adverse effect upon Debtor or
the transactions contemplated hereunder.
Debtor consents to FFCA providing the Disclosures, as well as
any other information which FFCA may now have or hereafter acquire with
respect to the Premises or the financial condition of Debtor and
Guarantor, to each purchaser, transferee, assignee, servicer,
participant, investor or rating agency involved with respect to each
Transfer, Participation and/or Securitization, as applicable. FFCA and
Debtor shall each pay their own attorneys fees and other out-of-pocket
expenses incurred in connection with the performance of their
respective obligations under this Section.
Notwithstanding the foregoing, the parties acknowledge and
agree that FFCA shall have the right to divide the Notes (and the
corresponding Loan Documents) into no more than three groups or pools
in connection with one or more Securitizations. If and to the extent
that the Notes are divided into more than one such group or pool,
Debtor shall maintain an aggregate Fixed Charge Coverage Ratio of at
least 1.50:1 for all of the Premises corresponding to the Notes in each
such group or pool in addition to maintaining an aggregate Fixed Charge
Coverage Ratio for all of the Premises as required by Section 7.B.
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IN WITNESS WHEREOF, Debtor and FFCA have entered into this Agreement as
of the date first above written.
FFCA:
FFCA MORTGAGE CORPORATION,
a Delaware corporation
By /s/Xxxxxx X. Xxxxx
--------------------------------------------
Printed Name
----------------------------------
Its Senior Vice President - General Counsel
-------------------------------------------
DEBTOR:
CBI RESTAURANTS, INC., a Delaware corporation
By /s/Xxxxxx X. Xxxxx
--------------------------------------------
Printed Name
----------------------------------
Its Chief Financial Officer
-------------------------------------------
CASA XXXXXX INCORPORATED, a Texas corporation
By /s/ Xxxxxx X. Xxxxx
--------------------------------------------
Printed Name
----------------------------------
Its Chief Financial Officer
-------------------------------------------
