EXHIBIT 10.3
FIRST AMENDED AND RESTATED
RECEIVABLES TRANSFER AGREEMENT
by and among
PARK AVENUE RECEIVABLES CORPORATION, as an Initial Purchaser
and
FAIRWAY FINANCE CORPORATION, as an Initial Purchaser,
and
RTR FUNDING LLC,
as Transferor,
and
TRANSMEDIA NETWORK INC.,
individually and
as Servicer,
and
THE SEVERAL FINANCIAL INSTITUTIONS
PARTY HERETO
FROM TIME TO TIME,
as APA Bank Purchasers,
and
▇▇▇▇▇ ▇▇▇▇▇ ASSOCIATES, LTD.,
as Back-up Servicer,
and
THE CHASE MANHATTAN BANK,
as Administrative Agent and as Successor Servicer,
and
THE SEVERAL AGENT BANKS PARTY
HERETO FROM TIME TO TIME, as Funding Agents
Dated as of May 17, 2001
TABLE OF CONTENTS
Page
TABLE OF CONTENTS
ARTICLE I DEFINITIONS.............................................................................1
SECTION 1.1 Certain Defined Terms..........................................................1
SECTION 1.2 Other Terms....................................................................1
SECTION 1.3 Computation of Time Periods....................................................2
ARTICLE II PURCHASES AND SETTLEMENTS...............................................................2
SECTION 2.1 Facility.......................................................................2
SECTION 2.2 Transfers; Certificates; Eligible Receivables..................................2
SECTION 2.3 Selection of Tranche Periods and Tranche Rates.................................6
SECTION 2.4 PARCO Discount, Fairway Discount, Fees and Other Costs and Expenses............7
SECTION 2.5 Non-Liquidation Settlement and Reinvestment Procedures.........................8
SECTION 2.6 Liquidation Settlement Procedures.............................................10
SECTION 2.7 Fees..........................................................................12
SECTION 2.8 Protection of Ownership Interest of the Initial Purchasers and the APA
Bank Purchasers...............................................................12
SECTION 2.9 Deemed Collections; Dilution Adjustments; Application of Payments.............14
SECTION 2.10 Payments and Computations, Etc................................................14
SECTION 2.11 Reports.......................................................................15
SECTION 2.12 Collection Account; RTR Funding Account.......................................15
SECTION 2.13 Right of Setoff...............................................................16
SECTION 2.14 Sharing of Payments, Etc......................................................17
SECTION 2.15 Broken Funding................................................................17
SECTION 2.16 Conversion and Continuation of Outstanding Tranches Funded by the APA Bank
Purchasers....................................................................18
SECTION 2.17 Illegality....................................................................18
SECTION 2.18 Inability to Determine Eurodollar Rate........................................19
SECTION 2.19 Extension of Commitment Expiry Date...........................................20
ARTICLE III REPRESENTATIONS AND WARRANTIES.........................................................20
SECTION 3.1 Representations and Warranties of the Transferor..............................20
TABLE OF CONTENTS(cont'd)
Page
SECTION 3.2 Reaffirmation of Representations and Warranties by the Transferor.............24
SECTION 3.3 Representations and Warranties of the Servicer and the Back-up Servicer.......24
SECTION 3.4 Representations and Warranties of the Successor Servicer......................25
ARTICLE IV CONDITIONS PRECEDENT...................................................................26
SECTION 4.1 Conditions to Effectiveness...................................................26
SECTION 4.2 Conditions to each Transfer...................................................31
ARTICLE V COVENANTS..............................................................................32
SECTION 5.1 Affirmative Covenants of Transferor...........................................32
SECTION 5.2 Negative Covenants of the Transferor..........................................39
SECTION 5.3 Covenants of the Servicer.....................................................41
SECTION 5.4 Negative Covenants of the Servicer............................................42
SECTION 5.5 Covenants of the Back-up Servicer and the Successor Servicer..................43
ARTICLE VI ADMINISTRATION AND COLLECTIONS.........................................................44
SECTION 6.1 Appointment of Servicer.......................................................44
SECTION 6.2 Duties of Servicer............................................................45
SECTION 6.3 Rights After Designation of New Servicer......................................48
SECTION 6.4 Servicer Default..............................................................48
SECTION 6.5 Responsibilities of the Transferor and each Seller............................50
SECTION 6.6 Collection Procedures.........................................................50
SECTION 6.7 Servicer Indemnification of Indemnified Parties...............................50
SECTION 6.8 Maintenance of Property; Insurance............................................51
SECTION 6.9 Duties of the Back-Up Servicer................................................51
SECTION 6.10 Grant of License..............................................................52
SECTION 6.11 Successor Servicer Liability..................................................52
ARTICLE VII INDEMNIFICATION; EXPENSES; RELATED MATTERS.............................................53
SECTION 7.1 Indemnities by the Transferor.................................................53
SECTION 7.2 Indemnity for Reserves and Expenses...........................................56
ii
TABLE OF CONTENTS (cont'd)
Page
SECTION 7.3 Indemnity for Taxes...........................................................58
SECTION 7.4 Other Costs, Expenses and Related Matters.....................................59
ARTICLE VII I......................................................................................61
ARTICLE VIII TERMINATION EVENTS.....................................................................61
SECTION 8.1 Termination Events............................................................61
SECTION 8.2 Remedies Upon the Occurrence of a Termination Event or a Potential
Termination Event.............................................................63
ARTICLE IX THE ADMINISTRATIVE AGENT...............................................................63
SECTION 9.1 Appointment...................................................................63
SECTION 9.2 Delegation of Duties..........................................................64
SECTION 9.3 Exculpatory Provisions........................................................64
SECTION 9.4 Reliance by Administrative Agent..............................................65
SECTION 9.5 Action Upon Events of Termination and Servicer Defaults, Reports and Notices..65
SECTION 9.6 Non-Reliance on Administrative Agent..........................................66
SECTION 9.7 Indemnification...............................................................66
SECTION 9.8 Successor Administrative Agent................................................66
ARTICLE X MISCELLANEOUS..........................................................................67
SECTION 10.1 Term of Agreement.............................................................67
SECTION 10.2 Waivers; Amendments...........................................................67
SECTION 10.3 Notices.......................................................................68
SECTION 10.4 Governing Law; Submission to Jurisdiction; Integration........................71
SECTION 10.5 Severability; Counterparts....................................................71
SECTION 10.6 Successors and Assigns........................................................71
SECTION 10.7 Confidentiality...............................................................72
SECTION 10.8 No Bankruptcy Petition Against the Initial Purchasers.........................74
SECTION 10.9 Limited Recourse..............................................................74
SECTION 10.10 Characterization of the Transactions Contemplated by the Agreement............74
iii
TABLE OF CONTENTS (cont'd)
Page
SECTION 10.11 Waiver of Setoff..............................................................75
SECTION 10.12 Agent Conflict Waiver.........................................................75
SECTION 10.13 Liability of Funding Agents...................................................76
SECTION 10.14 Tax Treatment.................................................................76
iv
EXHIBITS AND ANNEX
EXHIBIT A Form of Contract
EXHIBIT B Restaurant Guidelines
EXHIBIT C List of Lock-Box Banks and Accounts
EXHIBIT D Form of Lock-Box Agreement
EXHIBIT E Form of Settlement Report
EXHIBIT F Form of Weekly Report
EXHIBIT G Form of Daily Report
EXHIBIT H Form of Transfer Certificate
EXHIBIT I List of Transferor's Actions and Suits
EXHIBIT J List of Servicer's and Back-up Servicer's Actions and Suits
EXHIBIT K Location of Records; Jurisdiction of Formation
EXHIBIT L List of Subsidiaries, Divisions and Tradenames
EXHIBIT M Form of Secretary's Certificate
EXHIBIT N Agreed Upon Procedures
EXHIBIT O Processing and Collection Policies
EXHIBIT P Form of Transfer Supplement
Annex X Schedule of Definitions
Schedule I List of Equipment and Software
Schedule II List of Tradenames, Trademarks and Service Marks
Schedule II-A List of Tradenames, Trademarks and Service Marks
Schedule III List of Initial Purchasers, APA Bank Purchasers, Funding
Agents, Facility Limit, Purchase Limits, and Commitments
v
FIRST AMENDED AND RESTATED
RECEIVABLES TRANSFER AGREEMENT
FIRST AMENDED AND RESTATED RECEIVABLES TRANSFER AGREEMENT (as
amended, supplemented or otherwise modified and in effect from time to time,
this "Agreement"), dated as of May 17, 2001, by and among RTR FUNDING LLC, a
Delaware corporation, as transferor (in such capacity, the "Transferor"),
TRANSMEDIA NETWORK INC., a Delaware corporation, individually ("TMN") and as
Servicer (in such capacity, the "Servicer"), ▇▇▇▇▇ ▇▇▇▇▇ ASSOCIATES, LTD., a New
Jersey corporation, as Back-up Servicer (the "Back-up Servicer"), PARK AVENUE
RECEIVABLES CORPORATION, a Delaware corporation ("PARCO"), FAIRWAY FINANCE
CORPORATION, a Delaware corporation ("Fairway" and together with PARCO, the
"Initial Purchasers"), the several financial institutions set forth opposite the
name of PARCO and Fairway on Schedule III (collectively, the "APA Bank
Purchasers"), the agent set forth opposite the name of each Initial Purchaser on
Schedule III and its permitted successors and assigns (in such capacity, the
"Funding Agent" with respect to each Initial Purchaser), THE CHASE MANHATTAN
BANK, a New York state banking corporation ("Chase"), as administrative agent
(in such capacity the "Administrative Agent") and as successor servicer (in such
capacity, the "Successor Servicer"). This Agreement amends and restates that
certain Receivables Transfer Agreement, dated as of December 30, 1999, by and
among the Transferor, TMN, individually and as Servicer, PARCO, the PARCO
Funding Agent and the Successor Servicer.
PRELIMINARY STATEMENTS
WHEREAS, the Transferor has sold and may in the future desire to
sell, convey, transfer and assign, from time to time, undivided percentage
interests in certain rights to receive, arrear sales, membership fees and
related assets, and the Initial Purchasers may desire to, and the APA Bank
Purchasers, if requested by their respective Initial Purchasers, shall, accept
such sale, conveyance, transfer and assignment of such undivided percentage
interests, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, the parties hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 Certain Defined Terms. Capitalized terms used herein
shall have the meanings assigned to such terms in, or incorporated by reference
into, Annex X attached hereto, which Annex X is incorporated by reference
herein.
SECTION 1.2 Other Terms. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP, consistently applied.
All terms used in Article 9 of the Relevant UCC, and not specifically defined
herein, are used herein as defined in such Article 9.
1
SECTION 1.3 Computation of Time Periods. Unless otherwise stated
in this Agreement, in the computation of a period of time from a specified date
to a later specified date, the word "from" means "from and including", the words
"to" and "until" each means "to but excluding", and the word "within" means
"from and excluding a specified date and to and including a later specified
date."
ARTICLE II
PURCHASES AND SETTLEMENTS
SECTION 2.1 Facility. Upon the terms and subject to the
conditions set forth herein and in the other Transaction Documents prior to the
Termination Date, (x) the Transferor may, at its option, sell, convey, transfer
and assign to the Administrative Agent on behalf of the Active Purchasers and
(y) the Administrative Agent may, on behalf of the Initial Purchasers and acting
at the direction of each such Initial Purchaser (or its related Funding Agent),
respectively (prior to the occurrence of an Initial Purchaser Termination Event
with respect to each such Initial Purchaser), and the Administrative Agent
shall, on behalf of the APA Bank Purchasers in any Purchaser Group (following
the occurrence of an Initial Purchaser Termination Event with respect to the
related Initial Purchaser in such Purchaser Group or in the event such related
Initial Purchaser elects not to accept such sale, conveyance, transfer and
assignment subject, in the case of the PARCO APA Banks, to Section 2.2 of the
PARCO Asset Purchase Agreement and, in the case of the Fairway APA Banks,
subject to all of the provisions and restrictions set forth herein and in the
other Transaction Documents), accept such sale, conveyance, transfer and
assignment from the Transferor of, in either case, without recourse except as
provided herein, undivided percentage ownership interests in the Receivables,
together with the related Contract, Related Security, Collections and Proceeds
with respect thereto, from time to time. Pursuant to Section 9.1 of this
Agreement, the Administrative Agent shall act as agent on behalf of the Initial
Purchasers, the APA Bank Purchasers, and the Funding Agents, as applicable, with
respect to such undivided percentage ownership interest, including but not
limited to acting as a secured party hereunder on behalf of the Initial
Purchasers, the APA Bank Purchasers and the Funding Agents. By accepting any
sale, conveyance, transfer and assignment hereunder, none of the Administrative
Agent, nor the Initial Purchasers, nor the APA Bank Purchasers, nor any Funding
Agent assumes or shall have any obligations or liability under any of the
Contracts, all of which shall remain the obligations and liabilities of the
Sellers.
SECTION 2.2 Transfers; Certificates; Eligible Receivables.
(a) Incremental Transfers. Upon the terms and
subject to the conditions set forth herein and in the other Transaction
Documents prior to the Termination Date, (x) the Transferor may, at its
option from time to time on a Weekly Settlement Report Date, sell,
convey, transfer and assign to the Administrative Agent on behalf of the
Active Purchasers and (y) the Administrative Agent may, on behalf of the
Initial Purchasers and acting at the direction of each such Initial
Purchaser (or its related Funding Agent), respectively (prior to the
occurrence of an Initial Purchaser Termination Event with respect to
each such Initial Purchaser), and the Administrative
2
Agent shall, on behalf of the APA Bank Purchasers in any Purchaser Group
(following the occurrence of a Initial Purchaser Termination Event with
respect to the related Initial Purchaser in such Purchaser Group or in
the event such related Initial Purchaser elects not to accept such sale,
conveyance, transfer and assignment, subject in the case of the PARCO
APA Banks, to Section 2.2 of the PARCO Asset Purchase Agreement), accept
such sale, conveyance, transfer and assignment from the Transferor of,
in either case, without recourse except as provided herein, undivided
percentage ownership interests in the Receivables, together with the
related Contract, Related Security, Collections and Proceeds with
respect thereto (each, an "Incremental Transfer"); provided that after
giving effect to each Incremental Transfer, (A) the Aggregate Net
Investment shall not exceed the Facility Limit; (B) in the case of PARCO
and the PARCO APA Banks, the aggregate outstanding PARCO Facility Net
Investment shall not exceed the PARCO Purchase Limit, (C) in the case of
Fairway and the Fairway APA Banks, the aggregate outstanding Fairway Net
Investment shall not exceed the Fairway Purchase Limit and (D) the
Fairway Net Investment shall be equal to the PARCO Net Investment; and,
provided further, that the conditions set forth in Section 4.2 shall
have been satisfied before giving effect to any such Incremental
Transfer.
The Transferor shall, by notice to the Administrative Agent
and each Funding Agent given by telecopy, offer to sell, convey, transfer and
assign to the Active Purchasers undivided percentage ownership interests in the
Receivables, related Contracts, Related Security, Collections and Proceeds with
respect thereto not later than 1:00 p.m. (New York time) (i) prior to the
occurrence of an Initial Purchaser Termination Event, if the Transferor requests
a CP Tranche(s), two (2) Business Days prior to the proposed date of any
Incremental Transfer, (ii) after the occurrence of an Initial Purchaser
Termination Event or in the event an Initial Purchaser elects not to accept such
sale, conveyance, transfer and assignment, if the Transferor requests a BR
Tranche(s) from the APA Bank Purchasers, on the Business Day prior to the
proposed date of any Incremental Transfer, and (iii) after the occurrence of an
Initial Purchaser Termination Event or in the event an Initial Purchaser elects
not to accept such sale, conveyance, transfer and assignment, if the Transferor
requests that any portion of the Aggregate Net Investment related to such
Incremental Transfer is to be allocated by the APA Bank Purchasers to a
Eurodollar Tranche, three (3) Business Days prior to the proposed date of any
Incremental Transfer. Upon receipt of funds from the related Initial Purchaser
or APA Bank Purchasers, as applicable, the Funding Agents will make such funds
available to the Transferor by 4:00 p.m. (New York time) on the proposed date of
any Incremental Transfer. Each such notice shall specify (x) the amount of the
proposed increase to the Aggregate Net Investment; (y) the desired Transfer
Price (which shall be at least $1,000,000 for each Purchaser Group or integral
multiples of $100,000 in excess thereof) or, to the extent that the then
available unused portion of the Facility Limit is less than such amount, such
lesser amount equal to such available portion of the Facility Limit; and (z) the
desired date of such Incremental Transfer. Upon its receipt of notice thereof
from the Transferor, each applicable Funding Agent will promptly notify the
applicable Initial Purchasers and/or the applicable APA Bank Purchasers, as
applicable, of the applicable Funding Agent's receipt of any request for an
Incremental Transfer to be made to such Person. At its option, each Initial
Purchaser shall accept or reject any such offer by notice given to the
Transferor, the Administrative Agent and the applicable Funding Agent by
telephone or telecopy.
3
Each request for an Incremental Transfer shall be made by the
Transferor to each Purchaser Group, ratably, as applicable, in accordance with
the applicable Purchase Limit of each such Purchaser Group.
Each notice of proposed Transfer shall be irrevocable and
binding on the Transferor, and the Transferor shall indemnify the Administrative
Agent, the Initial Purchasers and the APA Bank Purchasers against any loss or
expense reasonably incurred by the Administrative Agent, the Initial Purchasers,
the PARCO APA Banks and the Fairway APA Banks, either directly or indirectly, as
a result of any failure by the Transferor to complete such Incremental Transfer,
including, without limitation, any loss (including loss of anticipated profits)
or expense incurred by the Administrative Agent, the Initial Purchasers, the
PARCO APA Banks and the Fairway APA Banks, either directly or indirectly, by
reason of the liquidation or reemployment of funds acquired by the Initial
Purchasers, the PARCO APA Banks or the Fairway APA Banks (including, without
limitation, funds obtained by issuing Commercial Paper or promissory notes,
obtaining deposits as loans from third parties and reemployment of funds) for
the Initial Purchasers, the PARCO APA Banks or the Fairway APA Banks, as
applicable, to fund such Incremental Transfer.
On the date of the initial Incremental Transfer the
Administrative Agent shall deliver written confirmation to the Transferor of the
cash portion of the Transfer Price (as provided by the Funding Agents). On the
date of the initial Incremental Transfer, the Transferor shall deliver to the
Administrative Agent (and the Administrative Agent shall deliver to each
applicable Funding Agent) the Transfer Certificate in the form of Exhibit H
hereto (the "Transfer Certificate"). The Administrative Agent shall indicate the
amount of the initial Incremental Transfer allocated to each applicable Initial
Purchaser or APA Bank Purchaser, as the case may be, together with the date
thereof on the grid attached to the Transfer Certificate. On the date of each
subsequent Incremental Transfer, the Administrative Agent shall send written
confirmation to the Transferor of the cash portion of the Transfer Price (as
provided by the Funding Agents). As provided by each Funding Agent to the
Administrative Agent, the Administrative Agent shall record on the grid attached
to the Transfer Certificate or record in a similar manner on its administrative
system the amount of the Incremental Transfer together with the date thereof as
well as any decrease in the Aggregate Net Investment, PARCO Facility Net
Investment, and Fairway Net Investment (each as reported by each respective
Funding Agent). The Transfer Certificate shall evidence the Incremental
Transfers; provided, however, that the failure of the Administrative Agent to so
evidence any Incremental Transfer shall not affect the validity of any
Incremental Transfer. Following each Incremental Transfer, each Funding Agent
shall deposit to the Transferor's account at the location indicated in Section
10.3 hereof, in immediately available funds, an amount equal to the cash portion
(as provided on such date by the related Purchaser) of the Transfer Price for
such Incremental Transfer made to the Initial Purchasers or the APA Bank
Purchasers, as applicable.
(b) Reinvestment Transfers. Upon the terms and
subject to the conditions set forth herein and in the other Transaction
Documents, on each Business Day occurring after the initial Incremental
Transfer hereunder and prior to the Termination Date, subject to the
immediately succeeding sentence, (i) the Transferor
4
hereby agrees to sell, convey, transfer and assign to the Administrative
Agent, on behalf of the Active Purchasers, and (ii) the Administrative
Agent, on behalf of the Active Purchasers shall (subject, in the case of
any PARCO APA Bank Purchaser, to Section 2.2 of the PARCO Asset Purchase
Agreement) agree to purchase from the Transferor undivided percentage
ownership interests in each and every Receivable, together with Related
Security, Collections and Proceeds with respect thereto, to the extent
that Collections are available in the RTR Funding Account for such
reinvestment Transfer in accordance with Section 2.5 hereof. In the case
of any reinvestment Transfer on behalf of any Initial Purchaser, if such
Initial Purchaser (a "Declining Conduit Purchaser") has provided notice
(a "Declining Notice") to its Funding Agent, the Administrative Agent
and the Servicer that an Initial Purchaser Termination Event has
occurred with respect to such Initial Purchaser or that such Initial
Purchaser no longer wishes Collections with respect to any portion of
the Aggregate Net Investment funded or maintained by it to be
reinvested, then such Initial Purchaser's percentage of such remaining
Collections shall not be reinvested and shall instead be held in trust
for the benefit of such Initial Purchaser and deposited into the
Collection Account and shall on the next succeeding Settlement Date be
paid to the applicable Funding Agent for the benefit of any such
Declining Conduit Purchaser to reduce the portion of the Aggregate Net
Investment attributable to such Initial Purchaser; provided, that solely
for the purpose of determining any such Declining Conduit Purchaser's
ratable share of such Collections, such Initial Purchaser's portion of
the Aggregate Net Investment shall be deemed to remain constant from the
date of the provision of the Declining Notice until the date such
Initial Purchaser's portion of the Aggregate Net Investment has been
paid in full; it being understood that on and after the Termination Date
or on and after the occurrence and continuation of a Termination Event
or a Potential Termination Event, such Declining Conduit Purchaser's
portion of the Net Investment shall be recalculated taking into account
amounts received by such Initial Purchaser in respect of this sentence
and thereafter Collections shall be set aside pursuant to Section 2.6
for such Initial Purchaser ratably with each other Purchaser hereunder
and applied pursuant to Section 2.6 in respect of its portion of the Net
Investment (as so recalculated); provided, however, that notwithstanding
anything in this paragraph to the contrary, each of the parties hereto
hereby agree that the portion of the Aggregate Net Investment funded or
maintained by the Purchasers in the Fairway Purchaser Group shall at all
times be equal to the portion of the Aggregate Net Investment funded or
maintained by the Purchasers in the PARCO Purchaser Group. The
Transferor agrees to maintain, at all times prior to the Termination
Date, a Net Receivables Balance in an amount at least sufficient to
maintain the Percentage Factor at an amount not greater than the Maximum
Percentage Factor.
(c) All Transfers. Subject to the terms and
conditions set forth herein and in the other Transaction Documents, each
Transfer shall constitute a purchase by the Administrative Agent, on
behalf of the applicable Initial Purchasers and APA Bank Purchasers, as
applicable, of undivided percentage ownership interests in each and
5
every Receivable, together with related Contracts, Related Security,
Collections and Proceeds with respect thereto, then existing, as well as
in each and every Receivable, together with related Contracts, Related
Security, Collections and Proceeds with respect thereto, which arises at
any time after the date of such Transfer. The Initial Purchasers', the
PARCO APA Banks' (following the occurrence of a PARCO Termination Event
or in the event PARCO elects not to accept a sale, conveyance, transfer
and assignment from the Transferor hereunder or after any other Purchase
but in each case subject to Section 2.2 of the PARCO Asset Purchase
Agreement) and the Fairway APA Banks' (following the occurrence of a
Fairway Termination Event or in the event that Fairway elects not to
accept a sale, conveyance, transfer and assignment from the transferor
hereunder or after any other Purchase) aggregate undivided percentage
ownership interest in the Receivables, together with the Related
Security, Collections and Proceeds with respect thereto, shall equal the
Percentage Factor in effect from time to time.
(d) Percentage Factor. The Percentage Factor shall
be initially computed as of the opening of business of the Servicer on
the date of the initial Incremental Transfer hereunder. Thereafter,
until the Termination Date, the Percentage Factor shall be automatically
recomputed as of the close of business of the Servicer on each day
(other than a day after the Termination Date). The Percentage Factor
shall remain constant from the time as of which any such computation or
recomputation is made until the time as of which the next such
recomputation, if any, shall be made. At all times on and after the
Termination Date until the date on which the Aggregate Net Investment
has been reduced to zero and all accrued PARCO Discount, Fairway
Discount, Servicing Fees and all other Aggregate Unpaids have been paid
in full, the Percentage Factor shall be fixed and shall remain at 100%.
Following any assignment of any portion of PARCO's interest in the
Transferred Interest to a PARCO APA Bank pursuant to the PARCO Asset
Purchase Agreement or any transfer of a portion of the Transferred
Interest to a PARCO APA Bank hereunder, the PARCO Funding Agent shall,
on each Business Day, calculate PARCO's and each applicable PARCO APA
Bank's pro rata interest in the Percentage Factor based on the PARCO
Purchase Limit and the PARCO APA Bank Commitment, and regularly report
thereon to PARCO and the PARCO APA Banks (with copies thereof to the
Transferor and the Administrative Agent). Following the assignment of
any portion Fairway's interest in the Transferred Interest to a Fairway
APA Bank pursuant to the Fairway Asset Purchase Agreement or any
transfer of a portion of the Transferred Interests to a Fairway APA Bank
hereunder, the Fairway Funding Agent shall, on each Business Day,
calculate Fairway's and each applicable Fairway APA Bank's pro rata
interest in the Percentage Factor, based on the Fairway Purchase Limit
and the Fairway APA Bank Commitment and regularly report thereon to
Fairway and the Fairway APA Banks (with copies thereof to the Transferor
and the Administrative Agent).
SECTION 2.3 Selection of Tranche Periods and Tranche Rates.
(a) Transferred Interest Held by Initial Purchasers
Prior to the Termination Date. At all times hereafter, but prior to the
Termination Date and not with respect to any portion of the Facility
Interest held by any of the APA Bank Purchasers, the Funding Agent for
each applicable Initial Purchaser, on behalf of such
6
Initial Purchaser, shall select all Tranche Periods and Tranche Rates
applicable to such Initial Purchaser's portion of the Facility Interest.
(b) Transferred Interest Held by Initial Purchasers
Following the Termination Date. At all times on and after the
Termination Date, with respect to any portion of the Transferred
Interest which shall not have been transferred to the APA Bank
Purchasers, the BR Tranche and the Base Rate plus 2.00% shall apply to
each Initial Purchaser's portion of the Aggregate Net Investment.
(c) Transferred Interest Held by the APA Bank
Purchasers Prior to the Termination Date. At all times with respect to
any portion of the Transferred Interest transferred to the APA Bank
Purchasers (or any of them) pursuant to this Agreement or any Asset
Purchase Agreement, but prior to the Termination Date, the initial
Tranche Period applicable to such portion of the Aggregate Net
Investment allocable thereto shall be a period of not greater than three
(3) days, and the related Tranche shall be a BR Tranche. Thereafter (but
prior to the Termination Date or the occurrence and continuation of a
Potential Termination Event), with respect to such portion, and with
respect to any other portion of the Transferred Interest held by the APA
Bank Purchasers (or any of them), the Tranche Period applicable thereto
shall be, at the Transferor's option, either a BR Tranche or a
Eurodollar Tranche. The Transferor shall give the Administrative Agent
and each Funding Agent irrevocable notice by telephone of the new
requested Tranche Period no later than 1:00 P.M. (New York Time) (i) if
the Transferor requests a BR Tranche, on the day of the expiration of
any then existing Tranche Period and (ii) if the Transferor requests a
Eurodollar Tranche, three (3) Business Days prior to the expiration of
any then existing Tranche Period. Any Tranche Period maintained by any
APA Bank Purchaser which is outstanding on the Termination Date shall
end on the Termination Date.
(d) Transferred Interest Held by the APA Bank
Purchasers After the Termination Date. At all times on and after the
Termination Date, the Base Rate plus 2.00% and the BR Tranche shall
apply to any portion of the Transferred Interest which shall have been
owned by, or transferred to, the APA Bank Purchasers (or any of them).
SECTION 2.4 PARCO Discount, Fairway Discount, Fees and Other
Costs and Expenses. Notwithstanding the limitation on recourse under Section 2.1
hereof, the Transferor shall pay, as and when due in accordance with this
Agreement and the other Transaction Documents, all fees hereunder, PARCO
Discount, Fairway Discount, Servicing Fees, the Successor Servicer Fees and
other Aggregate Unpaids. On each Settlement Date and on the last day of each
Tranche Period (with respect to any portion of the Aggregate Net Investment
funded by any Purchaser at any time by reference to a rate other than the CP
Rate or Base Rate), the Transferor shall pay in the manner set forth in Sections
2.5, 2.6 and 2.10 to each applicable Funding Agent, on behalf of the Purchaser
in each such Funding Agent's Purchaser Group, an amount equal to the accrued and
unpaid PARCO Discount and Fairway Discount, as the case may be, for the
immediately preceding Settlement Period or such Tranche Period, as applicable;
provided that (i) in the event of any repayment or prepayment
7
of a BR Tranche or a Eurodollar Tranche, accrued PARCO Discount and Fairway
Discount, as the case may be, on the principal amount repaid or prepaid shall be
payable on the date of such repayment or prepayment and (ii) in the event of any
conversion of a BR Tranche or a Eurodollar Tranche, accrued interest on such BR
Tranche or Eurodollar Tranche shall be payable on the effective date of such
conversion. PARCO Discount and Fairway Discount, as the case may be, shall
accrue with respect to each Tranche on each day including the first day through
the last day of the Tranche Period related thereto.
Nothing in this Agreement or the other Transaction Documents
shall limit in any way the obligations of the Transferor to pay the amounts set
forth in this Section 2.4.
SECTION 2.5 Non-Liquidation Settlement and Reinvestment
Procedures.
(a) Prior to setting aside the Percentage Factor of
Collections received by the Transferor, the Sellers or the Servicer or
deposited into a Lock-Box Account or the Collection Account on or prior
to such day, the Servicer shall on each day after the Original Closing
Date but prior to the Termination Date, and provided that no Termination
Event or Potential Termination Event shall have occurred and be
continuing, out of Collections deposited in the Collection Account, set
aside and hold in trust an amount equal to all taxes and tips due and
owing to a Restaurant and not previously paid to such Restaurant or
deposited into such Restaurant's account by a Credit Card Processor, any
portion of Arrear Sales due and owing to a Restaurant, unpaid Processing
Fees and Rebates related to such Collections. On each day, the Servicer
shall remit to TMN such portion of Collections set aside to pay any
taxes and tips related to Collections, any portion of Arrear Sales due
and owing to a Restaurant, any Processing Fees and the Rebates.
(b) On each day after the date of any Incremental
Transfer but prior to the Termination Date, and provided that no
Termination Event or Potential Termination Event shall have occurred and
be continuing, the Servicer shall set aside and hold in trust for each
applicable Funding Agent, ratably, on behalf of the Purchasers in such
Funding Agent's Purchaser Group, as applicable (or deposit into the
Collection Account if so required pursuant to Section 2.12 hereof), an
amount equal to the Percentage Factor of Collections received by the
Transferor, the Sellers or the Servicer or deposited into a Lock-Box
Account or the Collection Account on or prior to such day and not
previously accounted for or applied (including, but not limited to,
pursuant to Section 2.5(a)) (the "Paid Percentage Factor"). In addition,
on each day after the date of any Incremental Transfer but prior to the
Termination Date, and provided that no Termination Event or Potential
Termination Event shall have occurred and be continuing, the Servicer
shall, out of the Paid Percentage Factor of Collections set aside or
deposited into the Collection Account on or prior to such day and not
previously applied or accounted for: (i) set aside and hold in trust for
the Initial Purchasers and the APA Bank Purchasers, as applicable, an
amount equal to all PARCO Discount, Fairway Discount, the Program Fee,
the Successor Servicer Fee and the Servicing Fee accrued through such
day and not so previously set aside or paid, (ii) out of the Paid
Percentage Factor of Collections remaining after application of
8
Collections as provided in clause (i) of this Section 2.5(b), transfer
to the RTR Funding Account, for the benefit of the Initial Purchasers
and/or the APA Bank Purchasers, as applicable, an amount equal to the
amount that the Transferor's rights to receive balance has been reduced
on such day arising from the Percentage Factor of Collections, to be
applied to the purchase of additional undivided percentage interests in
each Receivable pursuant to Section 2.2(b) and Section 2.12(b) hereof,
and (iii) set aside and hold in trust for the Initial Purchasers and the
APA Bank Purchasers, as applicable, an amount equal to the Percentage
Factor of Collections remaining after application of Collections as
provided in clauses (i) and (ii) of this Section 2.5(b).
(c) On each Settlement Date or, if applicable, in
connection with any Tranche funded or maintained by any Purchaser that
does not end on a Settlement Date, on the last day of each Tranche
Period, from the amounts set aside as described in clause (i) of the
second sentence of subsection 2.5(b), the Servicer shall transfer to
each applicable Funding Agent, ratably, for the benefit of the
Purchasers within such Funding Agent's Purchaser Group, an amount equal
to the accrued and unpaid PARCO Discount or Fairway Discount, as the
case may be, for the immediately preceding Settlement Period or such
Tranche Period, if applicable. In addition, on each Settlement Date,
from the amounts set aside as described in clause (i) of the second
sentence of subsection 2.5(b), the Servicer shall transfer to (i) each
Funding Agent, an amount equal to the accrued and unpaid Program Fee for
the related Settlement Period, (ii) the Successor Servicer's Account, an
amount equal to the accrued and unpaid Successor Servicer Fee for the
related Settlement Period and (iii) to its own account, an amount equal
to the accrued and unpaid Servicing Fee for the related Settlement
Period. Each Funding Agent, upon its receipt of such amounts, shall
distribute such amounts to the Initial Purchasers and/or the APA Bank
Purchasers entitled thereto as set forth above; provided that if a
Funding Agent shall have insufficient funds to pay all of the above
amounts in full on any such date, such Funding Agent shall notify the
Transferor and the Transferor shall immediately pay to such Funding
Agent, from funds previously paid to the Transferor, an amount equal to
such insufficiency.
(d) The Servicer shall remit to the Transferor, on
each Weekly Settlement Report Date prior to the Termination Date, and
provided that no Termination Event or Potential Termination Event shall
have occurred and be continuing, upon the Administrative Agent's and
each Funding Agent's receipt of the Weekly Report for such date and with
the Administrative Agent's and each Funding Agent's prior approval, such
portion of Collections not allocated to (i) the Initial Purchasers and
the APA Bank Purchasers (excluding amounts set aside pursuant to Section
2.5(b)(iii) hereof which are available to be released to the Transferor
in accordance with this Section 2.5(d)), (ii) the Servicer as payment of
the Servicing Fee, (iii) the Successor Servicer as payment of the
Successor Servicer Fee, or (iv) pay pursuant to Section 2.5(a) any taxes
and tips related to Collections, any portion of Arrear Sales due and
owing to a Restaurant, any Processing Fees and the Rebates. So long as
all of the above amounts are paid in full on the day due, such
Collections remitted to the Transferor are available to pay any
Transferor Subordinated Obligation then due and owing and for other
ordinary business purposes of the Transferor.
9
Each Funding Agent, upon receipt of such amounts in its
respective Funding Account, shall distribute such amounts to the Initial
Purchasers and/or the applicable APA Bank Purchasers entitled thereto as set
forth above; provided that if the Funding Agent shall have insufficient funds to
pay all of the above amounts in full on any such date, the Funding Agent shall
notify the Transferor and the Transferor shall, subject to the priorities for
payment, if applicable, set forth in Section 2.6, immediately pay to the Funding
Agent an amount equal to such insufficiency.
SECTION 2.6 Liquidation Settlement Procedures.
(a) If at any time on or prior to the Termination
Date, the Percentage Factor is greater than the Maximum Percentage
Factor, then the Transferor shall immediately transfer to each
applicable Funding Agent, ratably, for the benefit of the Purchasers
within such Funding Agent's Purchaser Group, in the manner set forth in
Section 2.10 from previously received Collections that have been
released to or set aside for the Transferor pursuant to Section 2.5, an
amount that will result in a Percentage Factor less than or equal to the
Maximum Percentage Factor. Unless otherwise agreed to in writing by each
Funding Agent, such amount shall be applied to reduce each Purchaser's
outstanding portion of the Aggregate Net Investment, ratably with
respect to each such Purchaser.
(b) On the Termination Date and on each day
thereafter, and on each day on which a Termination Event or Potential
Termination Event has occurred and is continuing, the Servicer shall in
the following priority (i) set aside and hold in trust out of
Collections an amount equal to all taxes and tips due and owing to a
Restaurant and not previously paid to such Restaurant or deposited into
such Restaurant's account by a Credit Card Processor, any portion of
Arrear Sales due and owing to a Restaurant and unpaid Processing Fees,
(ii) set aside and hold in trust out of Collections an amount equal to
Rebates related to such Collections, (iii) set aside and hold in trust
for the each applicable Funding Agent for the ratable benefit of the
Purchasers, as applicable (or deposit into the Collection Account if so
required pursuant to Section 2.12 hereof), the Percentage Factor of all
Collections received by the Transferor, the Sellers or the Servicer or
deposited into a Lock-Box Account or the Collection Account on such day,
and (iv) set aside and hold in trust for the Transferor such portion of
Collections deposited in the Collection Account not allocated pursuant
to clauses (i)-(iii) above or pursuant to Section 2.5. On each day, the
Servicer shall remit to TMN such portion of Collections set aside to pay
any taxes and tips related to Collections, any portion of Arrear Sales
due and owing to a Restaurant, any Processing Fees and the Rebates. On
the Termination Date or the day on which a Termination Event or
Potential Termination Event occurs, the Servicer shall transfer to each
applicable Funding Agent for the ratable benefit of the Purchasers, as
applicable, any amounts set aside for the Purchasers pursuant to Section
2.5.
(c) On each Settlement Date and/or on the last day
of each Tranche Period, as applicable, to occur on or after the
Termination Date or during the continuation of a Termination Event or a
Potential Termination Event, the Servicer
10
shall transfer to each applicable Funding Agent for the ratable benefit
of the Purchasers in such Funding Agent's Purchaser Group, as applicable
(it being understood that any amount distributed pursuant to this
Agreement to any Funding Agent on any such Settlement Date or last day
of any Tranche Period, as applicable, shall be solely the portion of
Collections then held and available to be distributed to the Purchasers
hereunder that represent the ratable portion of such Collections of each
Purchaser in such Funding Agent's Purchaser Group (based on Net
Investment plus accrued and unpaid interest)), or solely with respect to
clause (iv) below, to the Successor Servicer's Account, the amounts so
set aside for the Purchasers pursuant to Section 2.6(b)(iii) but not to
exceed the sum of (i) the accrued PARCO Discount for the immediately
preceding Settlement Period or such Tranche Period, as applicable, (ii)
the accrued and unpaid Fairway Discount for the previous Settlement
Period or such Tranche Period, as applicable, (iii) the Aggregate Net
Investment, (iv) the accrued and unpaid Successor Servicer Fee and (v)
all other Aggregate Unpaids. On such day, the Servicer shall, from the
amounts set aside for the Purchasers pursuant to the preceding sentence
which remain after payment in full of the aforementioned amounts,
deposit to the Servicer's account, the accrued Servicing Fee for the
immediately preceding Settlement Period or such Tranche Period. If there
shall be insufficient funds on deposit for the Servicer to distribute
funds in payment in full of the aforementioned amounts, the Servicer
shall distribute funds first, (1) in payment of the accrued PARCO
Discount for the account of the PARCO Funding Agent for the benefit of
PARCO and/or the PARCO APA Banks, as applicable, and (2) in payment of
the accrued Fairway Discount for the account of the Fairway Funding
Agent for the benefit of Fairway and/or the Fairway APA Banks; provided
that the payments in (1) and (2) shall be payable ratably based on the
Net Investment (plus accrued and unpaid interest thereon) of each such
Person at such time; second, if the Transferor, TMN or any Affiliate of
the Transferor or TMN is not then the Servicer, to the Servicer's
account, in payment of the Servicing Fee payable to the Servicer; third,
in reduction of the Aggregate Net Investment allocated to the
immediately preceding Settlement Period or any Tranche Period ending on
such date; fourth, in ratable payment of all fees payable by the
Transferor hereunder; fifth in payment of the Aggregate Net Investment
of each Purchaser hereunder, ratably based on the Net Investment (plus
accrued and unpaid interest thereon) of each such Person at such time
until the Aggregate Net Investment has been reduced to zero; sixth, in
ratable payment of all other Aggregate Unpaids (including, but not
limited to, all Transferor Subordinated Obligations owed by the
Transferor to the Funding Agents, the Initial Purchasers and the APA
Bank Purchasers and the Administrative Agent pursuant to Sections 7.1,
7.2, 7.3 and 7.4); and seventh, if the Transferor, TMN or any Affiliate
of the Transferor or TMN is the Servicer, to its account as Servicer, in
payment of the Servicing Fee payable to such Person as Servicer;
provided, that payment of the Servicing Fee pursuant to this seventh
clause shall be considered a Transferor Subordinated Obligation. Each
Funding Agent, upon its receipt of such amounts in the applicable
Funding Agent's account (as designated to the Servicer for receipt of
such Collections), shall distribute such amounts to the Initial
Purchasers and the APA Bank Purchasers entitled thereto as set forth
above; provided that if such Funding Agent shall have insufficient funds
to pay all of the above amounts in full on any such date, such Funding
Agent shall pay such amounts in the order of
11
priority set forth above and, with respect to any such category above
for which such Funding Agent shall have insufficient funds to pay all
amounts owing on such date, ratably to each applicable Purchaser within
its Purchaser Group based on each such Person's Net Investment (plus
accrued and unpaid interest thereon) at such time among all such Persons
entitled to payment thereof.
(d) Following the date on which the Aggregate Net
Investment has been reduced to zero and all accrued PARCO Discount,
Fairway Discount, Servicing Fees, Successor Servicer Fees and all other
Aggregate Unpaids have been paid in full, (i) the Servicer shall
recompute the Percentage Factor, (ii) the Administrative Agent, on
behalf of the Initial Purchasers and the APA Bank Purchasers, shall be
considered to have reconveyed to the Transferor all of the Initial
Purchasers' and the APA Bank Purchasers' right, title and interest in,
to and under the Receivables and Related Security, Collections and
Proceeds with respect thereto, (iii) the Servicer shall pay to the
Transferor any remaining Collections set aside and held by the Servicer
pursuant to Section 2.6(b)(iv) and (iv) the Administrative Agent, on
behalf of the Initial Purchasers and the APA Bank Purchasers, shall
execute and deliver to the Transferor, at the Transferor's expense, such
documents or instruments as are necessary to terminate the Initial
Purchasers' and the APA Bank Purchasers' respective interests in the
Receivables and Related Security, Collections and Proceeds with respect
thereto. Any such documents shall be prepared by or on behalf of the
Transferor. On the last day of each Tranche Period, the Servicer shall
remit to the Transferor such portion of Collections set aside for the
Transferor pursuant to this Section 2.6.
SECTION 2.7 Fees. Notwithstanding any limitation on recourse
contained in this Agreement, the Transferor shall pay the following
non-refundable fees:
(a) On the Settlement Date of each month, to each
Funding Agent, solely for the benefit of the related Initial Purchaser
in such Funding Agent's Purchaser Group, the Program Fee.
(b) On the Settlement Date of each month, to Chase,
the Successor Servicer Fee.
(c) On the Amendment Effective Date, to each Funding
Agent, solely for its own account, the Structuring Fee.
SECTION 2.8 Protection of Ownership Interest of the Initial
Purchasers and the APA Bank Purchasers.
(a) The Transferor, TMN and each other Seller each
agree that it will, from time to time, at its sole expense, promptly
execute and deliver all instruments and documents and take all actions
as may be necessary or as the Administrative Agent or any Funding Agent
may reasonably request in order to perfect or protect the Transferred
Interest or to enable the Administrative Agent, on behalf of the Initial
Purchasers, the APA Bank Purchasers and the Funding Agents, to exercise
or enforce any of their respective rights hereunder. Without limiting
the foregoing, the
12
Transferor, TMN and each other Seller will, upon the request of the
Administrative Agent or any Funding Agent, on behalf of the Initial
Purchasers or any of the APA Bank Purchasers, in order to accurately
reflect this purchase and sale transaction, (x) execute and file such
financing or continuation statements or amendments thereto or
assignments thereof (as permitted pursuant to Section 9.6 hereof) as may
be requested by the Administrative Agent or any Funding Agent for the
benefit of the Initial Purchasers and the APA Bank Purchasers and (y)
▇▇▇▇ its respective master data processing records with a legend
describing the conveyance to the Transferor (in the case of TMN and each
other Seller) and the Administrative Agent for the benefit of the
Initial Purchasers, the Funding Agents and the APA Bank Purchasers, of
the Transferred Interest as reasonably requested by the Administrative
Agent or any Funding Agent. The Transferor, TMN and each other Seller
shall, upon the reasonable request of the Administrative Agent or any
Funding Agent, obtain such additional search reports as the
Administrative Agent or any Funding Agent, for the benefit of the
Initial Purchasers, the Funding Agents and the APA Bank Purchasers,
shall reasonably request. To the fullest extent permitted by applicable
law, the Administrative Agent shall be permitted to sign and file
continuation statements and amendments thereto and assignments thereof
without the Transferor's, TMN's or any other Seller's signature. Carbon,
photographic or other reproduction of this Agreement or any financing
statement shall be sufficient as a financing statement. Neither the
Transferor, TMN nor any other Seller shall change its respective name,
identity or corporate structure (within the meaning of Section 9-402(7)
of the Relevant UCC), nor relocate its respective chief executive office
or any office where Records are kept unless it shall have: (i) given the
Administrative Agent and each Funding Agent at least thirty (30) days'
prior notice thereof and (ii) prepared at Transferor's, TMN's or such
other Seller's expense, as applicable, and delivered to the
Administrative Agent all financing statements, instruments and other
documents necessary to preserve and protect the Transferred Interest or
reasonably requested by the Administrative Agent or any Funding Agent in
connection with such change or relocation. Any filings under the
Relevant UCC or otherwise that are occasioned by such change in name or
location shall be made at the expense of Transferor, TMN or such other
Seller, as applicable.
(b) The Servicer shall instruct all Credit Card
Processors and each Restaurant (or its designee) to cause all
Collections to be deposited directly into a Lock-Box Account. Any
Lock-Box Account maintained by a Lock-Box Bank pursuant to the related
Lock-Box Agreement shall be owned by the Transferor; provided, however,
that any such Lock-Box Account shall be under the exclusive dominion and
control of the Administrative Agent (for the benefit of the Purchasers)
which is hereby granted to the Administrative Agent by TMN and the
Transferor. The Servicer shall be permitted to give instructions to the
Lock-Box Banks for so long as neither a Servicer Default nor any other
Termination Event has occurred hereunder. The Servicer shall not add any
bank as a Lock-Box Bank to those listed on Exhibit C attached hereto
unless such bank has entered into a Lock-Box Agreement. The Servicer
shall not terminate any bank as a Lock-Box Bank unless the
Administrative Agent and each Funding Agent shall have received fifteen
(15) days' prior notice of such termination. If the Transferor, a Seller
or the Servicer receives any Collections,
13
the Transferor, such Seller or the Servicer, as applicable, shall
immediately, but in any event within one (1) Business Day of receipt,
remit such Collections to the Collection Account.
SECTION 2.9 Deemed Collections; Dilution Adjustments;
Application of Payments.
(a) If on any day the Administrative Agent or any
Funding Agent notifies the Transferor or the Transferor discovers that
any of the representations or warranties in Article III is untrue with
respect to a Receivable in any material respect as of the date such
representation or warranty was made, then the Transferor shall be deemed
to have received on such day a Collection of such Receivable in full and
the Transferor shall, on such day, pay to the Servicer an amount equal
to the Outstanding Balance of such Receivable and such amount shall be
allocated and applied by the Servicer as a Collection allocable to the
Transferred Interest in accordance with Section 2.5 or 2.6 hereof, as
applicable. The Aggregate Net Investment shall be reduced by the
aggregate amount of such payments actually received by the Funding
Agents. Simultaneously with any such payment by the Transferor, the
Administrative Agent, on behalf of the Initial Purchasers and the APA
Bank Purchasers, as the case may be, shall convey all of its right,
title and interest in such Receivable and Related Security with respect
thereto to the Transferor, and shall take all action reasonably
requested by the Transferor to effectuate such conveyance.
(b) If on any day the Outstanding Balance of a
Receivable an interest in which has been sold by the Transferor
hereunder is reduced as a result of any dilution factor, any billing
adjustment or other adjustment ("Dilution Adjustment"), then the
Transferor shall be deemed to have received on such day a Collection of
such Receivable in the amount of such Dilution Adjustment. Any such
amount shall be applied by the Servicer as a Collection in accordance
with Section 2.5 or 2.6 hereof. The Aggregate Net Investment shall be
reduced by the amount of such payment actually received by the Funding
Agents.
(c) Any payment by a Restaurant in respect of any
indebtedness owed by it to the Transferor, TMN or any other Seller
shall, except as otherwise specified by such Restaurant or otherwise
required by contract or law and unless otherwise instructed by the
Initial Purchasers, be applied as a Collection of any Receivable of such
Restaurant included in the Transferred Interest (starting with the
oldest such Receivable) to the extent of any amounts then due and
payable thereunder before being applied to any other receivable or other
indebtedness of such Restaurant.
SECTION 2.10 Payments and Computations, Etc. All amounts to be
paid or deposited by the Transferor or the Servicer hereunder shall be paid or
deposited in accordance with the terms hereof no later than 11:00 A.M. (New York
time) on the day when due in immediately available funds; if such amounts are
payable to the Initial Purchasers or the APA Bank Purchasers they shall be paid
or deposited in an account (in each case, a "Funding Account") designated by the
applicable Funding Agent to the Transferor and the Servicer or such other
account designated by such Funding Agent from time to time. No later
14
than 4:30 P.M. (New York time) on the date of any Incremental Transfer
hereunder, the Initial Purchasers and/or or the APA Bank Purchasers, as
applicable, will make available to the Transferor, in immediately available
funds, the amount of such Incremental Transfer on such day by remitting such
amount to an account of the Transferor specified in the related notice of
Transfer, or if not specified in such notice, to the Transferor's account
identified in Section 10.3. The Transferor shall, to the extent permitted by
law, pay to the applicable Funding Agent, ratably (based on the Net Investment,
plus accrued and unpaid interest thereon of each Purchaser in such Funding
Agent's Purchaser Group) for the benefit of the applicable Initial Purchaser or
APA Bank Purchasers upon demand, interest on all amounts not paid or deposited
when due hereunder at a rate equal to 2% per annum plus the applicable Base Rate
for such Purchase Group on the share of such amounts allocable to such Purchaser
Group. All computations of PARCO Discount, Fairway Discount, interest and all
per annum fees hereunder shall be made on the basis of a year of 360 days (or,
in the case of PARCO Discount and Fairway Discount calculated at the Base Rate,
a year of 365 or 366 days, as applicable) for the actual number of days
(including the first but excluding the last day) elapsed. Any computations by
the Administrative Agent or a Funding Agent of amounts payable by the Transferor
hereunder shall be binding upon the Transferor absent manifest error. Promptly
upon receipt of any amounts due and owing to the Initial Purchasers, the Funding
Agents and the APA Bank Purchasers hereunder on any Business Day, the applicable
Funding Agent shall, by no later than 3:00 p.m. (New York time), remit such
amounts in immediately available funds to such Persons by depositing such
amounts in the applicable account of such Person, until otherwise notified in
writing by such Person.
SECTION 2.11 Reports. The Servicer shall prepare and forward to
the Administrative Agent, the Back-up Servicer, the Successor Servicer and each
Funding Agent (i) on the Settlement Report Date of each month, a Settlement
Report as of the end of the last day of the immediately preceding Settlement
Period, (ii) on each Weekly Settlement Report Date, a Weekly Report as of the
end of the last day of the immediately preceding Weekly Settlement Period, (iii)
on the date of any Incremental Transfer, prior to such Incremental Transfer, a
Daily Report and (iv) as soon as reasonably practicable, from time to time, such
other information as the Administrative Agent or any Funding Agent may
reasonably request.
SECTION 2.12 Collection Account; RTR Funding Account.
(a) There shall be established on the day of the
initial Incremental Transfer hereunder and maintained, for the benefit
of the Administrative Agent, the Funding Agents, the Initial Purchasers
and the APA Bank Purchasers, a segregated account (the "Collection
Account") identified on Exhibit C hereto, bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of
the Administrative Agent, the Initial Purchasers, the Funding Agents and
the APA Bank Purchasers. The Servicer shall deposit all Collections into
the Collection Account within one Business Day of (i) deposit thereof
into a Lock-Box Account or (ii) receipt thereof by the Transferor, a
Seller or the Servicer. Funds on deposit in the Collection Account shall
be invested by the Administrative Agent in Permitted Investments
selected by the Servicer that will mature so that such funds will be
available prior to the last day of each successive Tranche Period or
each Settlement
15
Date, as applicable, following such investment. On each Settlement Date
or on the last day of each Tranche Period, as applicable, all interest
and earnings (net of losses and investment expenses) on funds on deposit
in the Collection Account shall be retained in the Collection Account
and be available to make any payments required to be made hereunder
(including PARCO Discount and Fairway Discount) by the Transferor. On
the date on which the Aggregate Net Investment is zero and all accrued
PARCO Discount, Fairway Discount, Servicing Fees, Successor Servicer
Fees and all other Aggregate Unpaids have been paid in full, any funds
remaining on deposit in the Collection Account shall be paid to the
Transferor.
(b) There shall also be established on the day of
the initial Incremental Transfer hereunder and maintained, for the
benefit of the Administrative Agent on behalf of the Initial Purchasers,
the Funding Agents and the APA Bank Purchasers, a segregated account
(the "RTR Funding Account"), bearing a designation clearly indicating
that the funds deposited therein are held for the benefit of the
Administrative Agent on behalf of the Initial Purchasers, the Funding
Agents and the APA Bank Purchasers. Prior to the Termination Date, and
provided that no Termination Event or Potential Termination Event shall
have occurred and be continuing, the Servicer shall transfer from the
Collection Account to the RTR Funding Account all Collections required
to be deposited into the RTR Funding Account in accordance with Section
2.5(b)(ii) hereof. Funds on deposit in the RTR Funding Account shall be
(i) advanced by the Servicer to Restaurants pursuant to Contracts under
the Registered Card Program and Private Label Program and thus,
reinvested by the Servicer, on behalf of the Initial Purchasers and the
APA Bank Purchasers, in Eligible Receivables in accordance with Sections
2.2(b) and 2.5(b)(ii) hereof and (ii) to the extent such amounts are not
advanced to Restaurants under the Registered Card Program and Private
Label Program, invested by the Servicer in Permitted Investments that
will mature so that such funds will be available prior to each
Settlement Date and/or the last day of each successive Tranche Period,
as applicable, following such investment. On each Weekly Settlement
Report Date subsequent to receipt of the Weekly Report by the
Administrative Agent and each Funding Agent, all interest and earnings
(net of losses and investment expenses) on funds on deposit in the RTR
Funding Account shall be transferred to the Collection Account to be
applied in accordance with Section 2.5 and Section 2.6 hereof. In
addition, on and after the Termination Date or during the continuation
of a Potential Termination Event, all other amounts on deposit in the
RTR Funding Account shall be transferred daily to the Collection Account
to be applied in accordance with Section 2.6 hereof.
SECTION 2.13 Right of Setoff. The Administrative Agent, each
Initial Purchaser and each APA Bank Purchaser are hereby authorized (in addition
to any other rights it may have) at any time after the occurrence of the
Termination Date, or during the continuation of a Termination Event or Potential
Termination Event, to set-off, appropriate and apply (without presentment,
demand, protest or other notice which are hereby expressly waived) any deposits
and any other indebtedness held or owing by the Administrative Agent, each
Initial Purchaser or each APA Bank Purchaser to, or for the account of, the
Transferor
16
against the amount of the Aggregate Unpaids or other expenses incurred in
connection with the Facility owing by the Transferor to such Person (even if
contingent or unmatured).
SECTION 2.14 Sharing of Payments, Etc. If the Initial
Purchasers, any PARCO APA Bank or any Fairway APA Bank (for purposes of this
Section 2.14 only, being a "Recipient") shall obtain any payment (whether
voluntary, involuntary, through the exercise of any right of setoff, or
otherwise) on account of any interest in the Transferred Interest owned by it in
excess of its ratable share of payments (based on the Net Investment of such
Purchaser plus accrued and unpaid interest thereon) on account of any interest
in the Transferred Interest obtained by the Initial Purchasers, the PARCO APA
Banks and/or the Fairway APA Banks entitled thereto, such Recipient shall
forthwith purchase from the Initial Purchasers and/or the PARCO APA Banks and/or
the Fairway APA Banks entitled to a share of such amount participations in the
percentage interests owned by such Persons as shall be necessary to cause such
Recipient to share the excess payment ratably with each such other Person
entitled thereto; provided, however, that if all or any portion of such excess
payment is thereafter recovered from such Recipient, such purchase from each
such other Person shall be rescinded and each such other Person shall repay to
the Recipient the purchase price paid by such Recipient for such participation
to the extent of such recovery, together with an amount equal to such other
Person's ratable share (according to the proportion of (a) the amount of such
other Person's required payment to (b) the total amount so recovered from the
Recipient) of any interest or other amount paid or payable by the Recipient in
respect of the total amount so recovered.
SECTION 2.15 Broken Funding. In the event of (i) the payment
of any principal of any Eurodollar Tranche other than on the last day of the
Eurodollar Tranche Period applicable thereto (including as a result of the
occurrence of the Termination Date or an optional prepayment of a Eurodollar
Tranche), (ii) the conversion of any Eurodollar Tranche other than on the last
day of the related Eurodollar Tranche Period, or (iii) any failure to borrow,
convert, continue or prepay any Eurodollar Tranche on the date specified in any
notice delivered pursuant hereto, then, in any such event, the Transferor shall
compensate the applicable APA Bank Purchasers (whether such APA Bank Purchaser
acquires such Tranche, or portion thereof, pursuant to this Agreement or any
Asset Purchase Agreement) for the loss, cost and expense attributable to such
event. Such loss, cost or expense to any APA Bank Purchaser shall be deemed to
include an amount determined by such APA Bank Purchaser to be the excess, if
any, of (x) the amount of Fairway Discount or PARCO Discount, as applicable,
which would have accrued on the principal amount of such Eurodollar Tranche had
such event not occurred, at the Eurodollar Rate that would have been applicable
to such Eurodollar Tranche, for the period from the date of such event to the
last day of the Eurodollar Tranche Period (or, in the case of a failure to
borrow, convert or continue, for the period that would have been the related
Eurodollar Tranche Period), over (y) the amount of interest which would accrue
on such principal amount for such period at the interest rate which such APA
Bank Purchaser would bid were it to bid, at the commencement of such period, for
dollar deposits of a comparable amount and period from other banks in the
interbank eurodollar market. Within forty-five (45) days after any APA Bank
Purchaser hereunder receives actual knowledge of any of the events specified in
this Section 2.15, a certificate of such APA Bank Purchaser setting forth any
amount or amounts that such APA Bank Purchaser is entitled to
17
receive pursuant to this Section 2.15 and the reason(s) therefor shall be
delivered to the Transferor by the applicable Funding Agent and shall be
conclusive absent manifest error. The Transferor shall pay to the applicable
Funding Agent on behalf of each such APA Bank Purchaser the amount shown as due
on any such certificate within ten (10) days after receipt thereof.
SECTION 2.16 Conversion and Continuation of Outstanding
Tranches Funded by the APA Bank Purchasers. Prior to the occurrence of the
Termination Date or a Potential Termination Event, (a) each BR Tranche hereunder
may, at the option of the Transferor, be converted to a Eurodollar Tranche and
(b) each Eurodollar Tranche may, at the option of the Transferor, be continued
as a Eurodollar Tranche or converted to a BR Tranche. If the Termination Date
has occurred or a Potential Termination Event has occurred and is continuing,
then (i) no outstanding Tranche funded by the APA Bank Purchasers may be
converted to, or continued as, a Eurodollar Tranche and (ii) unless repaid, each
Eurodollar Tranche shall be converted to a BR Tranche on the last day of the
Tranche Period related thereto. For any such conversion or continuation, the
Transferor shall give the Administrative Agent and each applicable Funding Agent
irrevocable notice (each, a "Conversion/Continuation Notice") of such request
not later than 12:30 P.M. (New York time) (i) in the case of a conversion of a
BR Tranche into a Eurodollar Tranche, or a continuation of a Eurodollar Tranche
as a Eurodollar Tranche, three (3) Business Days before the date of such
conversion or continuation, as applicable, and (ii) following the Termination
Date or the occurrence and continuation of a Potential Termination Event, in the
case of a conversion of a Eurodollar Tranche into a BR Tranche or a continuation
of a BR Tranche as a BR Tranche, on the Business Day of such conversion. If a
Conversion/Continuation Notice has not been timely delivered with respect to any
BR Tranche or Eurodollar Tranche, such Funding shall be automatically continued
as, or converted to, a BR Tranche. Each Conversion/Continuation Notice shall
specify (a) the requested date (which shall be a Business Day) of such
conversion or continuation, (b) the aggregate amount and rate option applicable
to the Tranche which is to be converted or continued and (c) the amount and rate
option(s) of Tranche(s) into which such Tranche is to be converted or continued.
SECTION 2.17 Illegality.
(a) Notwithstanding any other provision herein, if,
after the Amendment Effective Date, the adoption of any Law or bank
regulatory guideline or any amendment or change in the interpretation of
any existing or future Law or bank regulatory guideline by any Official
Body charged with the administration, interpretation or application
thereof, or the compliance with any directive of any Official Body (in
the case of any bank regulatory guideline, whether or not having the
force of Law), shall make it unlawful for any APA Bank Purchaser to
acquire or maintain a Eurodollar Tranche as contemplated by this
Agreement, (i) the Administrative Agent on behalf of such APA Bank
Purchaser shall, within forty-five (45) days after receiving actual
knowledge thereof, deliver a certificate to the Transferor (with a copy
to the applicable Funding Agent) setting forth the basis for such
illegality, which certificate shall be conclusive absent manifest error,
(ii) the commitment of such APA Bank Purchaser hereunder to make any
portion of a
18
Eurodollar Tranche as such, continue any portion of a Eurodollar Tranche
as such and convert a BR Tranche to a Eurodollar Tranche shall forthwith
be canceled, and such cancellation shall remain in effect so long as the
circumstance described above exists, and (iii) such APA Bank Purchaser's
portion of any Eurodollar Tranche then outstanding shall be converted
automatically to a BR Tranche on the last day of the related Eurodollar
Tranche Period, or within such earlier period as required by law.
If any such conversion of a portion of a Eurodollar Tranche
occurs on a day which is not the last day of the related Eurodollar Tranche
Period, the Transferor shall, pursuant to Section 2.15, pay to the applicable
Funding Agent on behalf of such APA Bank Purchaser such amounts, if any, as may
be required to compensate such APA Bank Purchaser. If circumstances subsequently
change so that it is no longer unlawful for an affected APA Bank Purchaser to
acquire or to maintain a portion of a Eurodollar Tranche as contemplated
hereunder, such APA Bank Purchaser will, as soon as reasonably practicable after
such APA Bank Purchaser knows of such change in circumstances, notify the
Transferor, the Administrative Agent and the applicable Funding Agent, and upon
receipt of such notice, the obligations of such APA Bank Purchaser to acquire or
maintain its acquisition of portions of Eurodollar Tranches or to convert its
portion of a BR Tranche into portions of Eurodollar Tranches shall be
reinstated.
(b) Each APA Bank Purchaser agrees that, upon the
occurrence of any event giving rise to the operation of Section 2.17(a)
with respect to such APA Bank Purchaser, it will, if requested by the
Transferor and to the extent permitted by law or by the relevant
Official Body, endeavor in good faith to change the office at which it
books its portions of Eurodollar Tranches hereunder if such change would
make it lawful for such APA Bank Purchaser to continue to acquire or to
maintain its acquisition of portions of Eurodollar Tranches hereunder;
provided, however, that such change may be made in such manner that such
APA Bank Purchaser, in its sole determination, suffers no unreimbursed
cost or expense or any other disadvantage whatsoever.
SECTION 2.18 Inability to Determine Eurodollar Rate. If, prior
to the first day of any Eurodollar Tranche Period:
(1) the applicable Funding Agent (or any APA Bank Purchaser)
shall have determined (which determination in the absence of manifest
error shall be conclusive and binding upon the Transferor) that, by
reason of circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining the Eurodollar Rate for
such Eurodollar Tranche Period; or
(2) a Funding Agent shall have received notice from one or
more APA Bank Purchasers in its Purchaser Group that the Eurodollar Rate
determined or to be determined for such Eurodollar Tranche Period will
not adequately and fairly reflect the cost to such APA Bank Purchasers
(as conclusively certified by such APA Bank Purchasers) of purchasing or
maintaining their affected portions of Eurodollar Tranches during such
Eurodollar Tranche Period;
19
then, in either such event, the applicable Funding Agent shall give telecopy or
telephonic notice thereof (confirmed in writing) to the Administrative Agent,
the Transferor and the APA Bank Purchasers in its Purchaser Group as soon as
practicable (but, in any event, within forty-five (45) days after such
determination or notice, as applicable) thereafter. Until such notice has been
withdrawn by such Funding Agent, no further Eurodollar Tranches shall be made.
The applicable Funding Agent agrees to withdraw any such notice as soon as
reasonably practicable after such Funding Agent is notified of a change in
circumstances which makes such notice inapplicable.
SECTION 2.19 Extension of Commitment Expiry Date. The Transferor
may advise the Administrative Agent and each Funding Agent in writing of its
desire to extend the Commitment Expiry Date of any Purchaser Group for an
additional 364 days, provided such request is made not more than 90 days prior
to, and not less than 60 days prior to, the then current Commitment Expiry Date
for such Purchaser Group. The Administrative Agent shall notify the Transferor
in writing, within 45 days after its receipt of such request by the Transferor,
whether the Purchasers or any of them are agreeable to such extension (it being
understood that the Purchasers may accept or decline such a request in their
sole discretion and on such terms as they may elect) and, to the extent the
Purchasers are agreeable, the Transferor, the Administrative Agent, the Funding
Agents and the Purchasers shall enter into such documents (including any
amendments necessary to reduce the Purchase Limit and Commitment of such
Purchaser Group or otherwise) as the Purchasers may reasonably deem necessary or
appropriate to reflect such extension, and all reasonable costs and expenses
incurred by the Purchaser, the Administrative Agent and the Funding Agents in
connection therewith (including reasonable attorneys' costs) shall be paid by
the Transferor; it being understood that the failure of the Administrative Agent
to so notify the Transferor as set forth above shall not be deemed to be a
consent to such request for extension.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1 Representations and Warranties of the Transferor.
The Transferor hereby represents and warrants to the Administrative Agent, each
Funding Agent, the Back-up Servicer, the Successor Servicer, each Initial
Purchaser and each APA Bank Purchaser that:
(a) Corporate Existence and Power. The Transferor is
a limited liability company duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization and has all
limited liability company power and all material governmental licenses,
authorizations, consents and approvals required to carry on its business
in each jurisdiction in which its business is now conducted. The
Transferor is duly qualified to do business in, and is in good standing
in, every other jurisdiction in which the nature of its business
requires it to be so qualified, except where the failure to be so
qualified or in good standing would not have a Material Adverse Effect.
20
(b) Corporate and Governmental Authorization;
Contravention. The execution, delivery and performance by the Transferor
of this Agreement and the other Transaction Documents to which the
Transferor is a party (i) are within the Transferor's limited liability
company powers, (ii) have been duly authorized by all necessary limited
liability company action, (iii) require no action by or in respect of,
or filing with, any Official Body or official thereof (except as
contemplated by Section 2.8 hereof or as have been taken or filed), (iv)
do not contravene, or constitute a default under, any provision of
applicable Law or of the Certificate of Formation or Limited Liability
Company Agreement of the Transferor or of any agreement or other
instrument binding upon the Transferor, or (v) result in the creation or
imposition of any Adverse Claim on the assets of the Transferor or any
of its Subsidiaries (except as contemplated by Section 2.8 hereof).
(c) Binding Effect. Each of this Agreement and the
other Transaction Documents to which the Transferor is a party
constitutes, and the Transfer Certificate, upon payment of the Transfer
Price set forth therein, will constitute the legal, valid and binding
obligation of the Transferor, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, insolvency, moratorium or
other similar laws affecting the rights of creditors generally and
general equitable principles (whether considered in a proceeding at law
or in equity).
(d) Perfection. Immediately preceding each Transfer
hereunder, the Transferor shall be the owner of all of the Receivables,
free and clear of all Adverse Claims. On or prior to each Transfer and
each recomputation of the Transferred Interest, all financing statements
and other documents required to be recorded or filed in order to perfect
and protect the Transferred Interest against all creditors of, and
purchasers from, the Transferor and each Seller will have been duly
filed in each filing office necessary for such purpose, and all filing
fees and taxes, if any, payable in connection with such filings shall
have been paid in full.
(e) Accuracy of Information. All information
heretofore furnished by or on behalf of the Transferor (including,
without limitation, the Settlement Reports, the Weekly Reports, the
Daily Reports, any other reports delivered pursuant to Section 2.11
hereof and the Transferor's financial statements) to the Administrative
Agent, any Initial Purchaser, any APA Bank Purchaser or any Funding
Agent for purposes of, or in connection with, this Agreement and the
other Transaction Documents are, and all such information hereafter
furnished by or on behalf of the Transferor to the Administrative Agent,
any Initial Purchaser, any APA Bank Purchaser or any Funding Agent will
be, true and accurate in every material respect, on the date such
information is stated or certified; provided, however, that a breach of
the representation or warranty set forth in this clause (e) shall not
give rise to a Termination Event unless such breach shall continue to be
unremedied for a period of three (3) Business Days after the date on
which such information was due to be delivered.
21
(f) Tax Status. The Transferor has filed all tax
returns (Federal, State and local) required to be filed by it and has
paid or made adequate provision for the payment of all taxes,
assessments and other governmental charges.
(g) Action, Suits. Except as set forth in Exhibit I
hereof, there are no actions, suits or proceedings pending or, to the
knowledge of the Transferor threatened, against or affecting the
Transferor or any Affiliate of the Transferor or their respective
properties, in or before any court, arbitrator or other body, which may,
individually or in the aggregate, have a Material Adverse Effect or that
involve this Agreement or the transactions contemplated hereby.
(h) Use of Proceeds. No proceeds of any Transfer
will be used by the Transferor to acquire any security in any
transaction which is subject to Section 13 or 14 of the Securities
Exchange Act of 1934, as amended.
(i) Place of Business; Jurisdiction of Formation.
The principal place of business and chief executive office of the
Transferor are located at the address of the Transferor indicated in
Section 10.3 hereof, the jurisdiction in which the Transferor was formed
is listed on Exhibit K, and the offices where the Transferor keeps all
its Records, are located at the address(es) described on Exhibit K or
such other locations notified to the Administrative Agent and the
Funding Agents in accordance with Section 2.8 hereof in jurisdictions
where all action required by Section 2.8 hereof has been taken and
completed.
(j) Good Title. Upon each Transfer and each
recomputation of the Transferred Interest, the Administrative Agent, on
behalf of the Initial Purchasers and the APA Bank Purchasers, shall
acquire (A) a valid and perfected first priority undivided percentage
ownership interest to the extent of the Transferred Interest or (B) a
first priority perfected security interest in each Receivable that
exists on the date of such Transfer and recomputation and in the Related
Security, Collections and Proceeds with respect thereto, in either case
free and clear of any Adverse Claim.
(k) Tradenames, Etc. As of the Amendment Effective
Date: (i) the Transferor has only the subsidiaries and divisions listed
on Exhibit L hereto; and (ii) the Transferor has, within the last five
(5) years, operated only under the tradenames identified in Exhibit L
hereto, and, within the last five (5) years, has not changed its name,
merged with or into or consolidated with any other corporation or been
the subject of any proceeding under ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code
(Bankruptcy), except as disclosed in Exhibit L hereto.
(l) Nature of Receivables. Each Receivable (i)
represented by the Transferor or the Servicer to be an Eligible
Receivable (including in any Settlement Report, Weekly Report, Daily
Report or other report delivered pursuant to Section 2.11 hereof) or
(ii) included in the calculation of the Net Receivables Balance in fact
satisfies at such time the definition of "Eligible Receivable".
22
(m) Coverage Requirement; Amount of Receivables. The
Percentage Factor does not exceed the Maximum Percentage Factor. As of
April 28, 2001, the Aggregate Outstanding Balance of the Receivables in
existence was $76,390,454 and the Net Receivables Balance was
$63,357,444.
(n) Restaurant Guidelines. Since December 1, 1999,
there have been no material changes in the Restaurant Guidelines, other
than as permitted hereunder.
(o) Collections and Servicing. Since December 1,
1999, there has been no material adverse change in the ability of the
Servicer (to the extent it is TMN, the Transferor or any Subsidiary or
Affiliate of any of the foregoing) to service and collect the
Receivables.
(p) No Termination Event or Potential Termination
Event. No event has occurred and is continuing and no condition exists
which constitutes a Termination Event or a Potential Termination Event.
(q) Not an Investment Company. The Transferor is
not, and is not controlled by, an "investment company" within the
meaning of the Investment Company Act of 1940, as amended, or is exempt
from all provisions of such Act.
(r) ERISA. Each of the Transferor and its ERISA
Affiliates is in compliance in all material respects with ERISA, and no
lien exists in favor of the Pension Benefit Guaranty Corporation on any
of the Receivables.
(s) Lock-Box Accounts. The names and addresses of
all the Lock-Box Banks, together with the account numbers of the
Lock-Box Accounts at such Lock-Box Banks, are specified in Exhibit C
hereto (or at such other Lock-Box Banks and/or with such other Lock-Box
Accounts as have been notified to the Administrative Agent and each
Funding Agent and for which Lock-Box Agreements have been executed in
accordance with Section 2.8(b) hereof and delivered to the Servicer, the
Administrative Agent and each Funding Agent). All Credit Card Processors
and each Restaurant (or its designee) have been instructed to cause
payment to be made to a Lock-Box Account, and only Collections are
deposited into a Lock-Box Account; provided, however, that the deposit
of cash or cash proceeds other than Collections into a Lock-Box Account
shall not give rise to a Termination Event unless the Transferor, a
Seller or the Servicer shall have failed to segregate or cause to be
segregated any such cash or cash proceeds from Collections within two
(2) Business Days of the deposit or credit to any Lock-Box Account.
(t) Bulk Sales. No transaction contemplated hereby
or by the Receivables Purchase Agreement requires compliance with any
"bulk sales" act or similar law.
(u) Transfers Under Receivables Purchase Agreement.
Each Receivable which has been transferred to the Transferor by the
Sellers has been
23
purchased by the Transferor from the Sellers pursuant to, and in
accordance with, the terms of the Receivables Purchase Agreement.
(v) Preference; Voidability. The Transferor shall
have given reasonably equivalent value to the applicable Seller in
consideration for the transfer to the Transferor of the Receivables and
Related Security, Collections and Proceeds with respect thereto from the
applicable Seller, and each such transfer shall not have been made for
or on account of an antecedent debt owed by the applicable Seller to the
Transferor.
SECTION 3.2 Reaffirmation of Representations and Warranties by
the Transferor. On each day that a Transfer is made hereunder, the Transferor,
by accepting the proceeds of such Transfer, whether delivered to the Transferor
pursuant to Section 2.2(a) or Section 2.5 hereof, shall be deemed to have
certified that all representations and warranties described in Section 3.1
hereof are true and correct on and as of such day as though made on and as of
such day.
SECTION 3.3 Representations and Warranties of the Servicer and
the Back-up Servicer.
The Servicer (so long as the Successor Servicer has not been
appointed Servicer hereunder) and the Back-up Servicer each represents and
warrants (solely as to itself) to the Administrative Agent, each Initial
Purchaser, each APA Bank Purchaser, each Funding Agent and the Successor
Servicer as of the date it becomes a Servicer or Back-up Servicer, as
applicable, hereunder that:
(a) Corporate Existence and Power. The Servicer and
the Back-up Servicer are corporations duly organized, validly existing
and in good standing under the laws of their respective jurisdiction of
incorporation and have all corporate power and all material governmental
licenses, authorizations, consents and approvals required to carry on
their business in each jurisdiction in which their business is now
conducted, except where the failure to obtain such licenses,
authorizations, consents and approvals would not have a Material Adverse
Effect. The Servicer and the Back-up Servicer are duly qualified to do
business in, and are in good standing in, every other jurisdiction in
which the nature of its business requires them to be so qualified,
except where the failure to be so qualified or in good standing would
not have a Material Adverse Effect.
(b) Corporate and Governmental Authorization;
Contravention. The execution, delivery and performance by the Servicer
and the Back-up Servicer of this Agreement (i) are within the Servicer's
and the Back-up Servicer's corporate powers, (ii) have been duly
authorized by all necessary corporate action on the Servicer's and the
Back-up Servicer's part, (iii) require no action by or in respect of, or
filing with, any Official Body or official thereof (except for the
filing of UCC financing statements as required by this Agreement or as
have been taken or filed and, with respect to filings other than UCC
financing statements, filings where the failure to file will not have a
Material Adverse Effect), (iv) do not contravene, or constitute a
default under, any provision of applicable Law or of the organizational
documents of the Servicer or the
24
Back-up Servicer, or of any agreement or other material instrument
binding upon the Servicer or the Back-up Servicer, except where such
contravention or default would not have a Material Adverse Effect, or
(v) result in the creation or imposition of any Adverse Claim on the
assets of the Servicer or the Back-up Servicer or any of their
Affiliates (except those created by this Agreement).
(c) Binding Effect. This Agreement constitutes the
legal, valid and binding obligations of the Servicer and the Back-up
Servicer, enforceable in accordance with its terms, subject to
applicable bankruptcy, insolvency, moratorium or other similar laws
affecting the rights of creditors generally and general equitable
principles (whether considered in a proceeding at law or in equity).
(d) Action, Suits. Except as set forth in Exhibit J
hereto, there are no actions, suits or proceedings pending, or to the
knowledge of the Servicer or the Back-up Servicer, threatened, against
the Servicer or the Back-up Servicer, or any Affiliate of the Servicer
or the Back-up Servicer, or their respective properties, in or before
any court, arbitrator or other body, which may, individually or in the
aggregate, have a Material Adverse Effect.
SECTION 3.4 Representations and Warranties of the Successor
Servicer. The Successor Servicer represents and warrants to the Administrative
Agent, each Initial Purchaser, each APA Bank Purchaser and each Funding Agent as
of the date it becomes a Successor Servicer hereunder that:
(a) Corporate Existence. The Successor Servicer is a
banking corporation validly existing under the laws of the State of New
York.
(b) Corporate Power and Authorization. The Successor
Servicer has the requisite power and authority to execute and deliver
this Agreement and perform its obligations under this Agreement, and has
taken all necessary action to authorize the execution, delivery and
performance by it of this Agreement.
(c) Binding Effect. The Agreement has been duly
executed and delivered by the Successor Servicer, and constitutes a
legal, valid and binding obligation of the Successor Servicer
enforceable against the Successor Servicer in accordance with its terms,
except that certain of such obligations may be enforceable solely
against the Transferred Interests and except that such enforcement may
be limited by bankruptcy, insolvency, reorganization, moratorium,
liquidation, or other similar laws affecting the enforcement of
creditors' rights generally, and by concepts of materiality,
reasonableness, good faith and fair dealing (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
25
ARTICLE IV
CONDITIONS PRECEDENT
SECTION 4.1 Conditions to Effectiveness. This Agreement shall
become effective on the first day on which the Administrative Agent, each
Funding Agent, on behalf of the Initial Purchasers and the APA Bank Purchasers,
and the Successor Servicer, as applicable, shall have received the following
documents, instruments and fees, all of which shall be in a form and substance
reasonably acceptable to the Administrative Agent, each Funding Agent and the
Successor Servicer:
(a) A Certificate of the Secretary of the Transferor
in substantially the form of Exhibit M hereto certifying (i) the names
and signatures of the officers and employees authorized on its behalf to
execute this Agreement and any other documents to be delivered by it
hereunder (on which Certificate the Administrative Agent, the Funding
Agents, the Initial Purchasers, the APA Bank Purchasers and the
Successor Servicer may conclusively rely until such time as the
Administrative Agent, the Funding Agents, on behalf of the Initial
Purchasers and the APA Bank Purchasers, and the Successor Servicer shall
receive from the Transferor a revised Certificate meeting the
requirements of this clause (a)(i)), (ii) a copy of the Transferor's
Certificate of Formation, certified by the Secretary of State of the
State of Delaware, (iii) a copy of the Transferor's Limited Liability
Company Agreement, (iv) a copy of resolutions of the Board of Directors
of the Transferor approving this transaction and (v) certificates of the
Secretaries of State of the States of Delaware and Florida certifying
the Transferor's good standing under the laws of the States of Delaware
and Florida, respectively.
(b) A Certificate of the Secretary of TMN in
substantially the form of Exhibit M hereto certifying (i) the names and
signatures of the officers and employees authorized on its behalf to
execute this Agreement and any other documents to be delivered by it
hereunder (on which Certificate the Administrative Agent, the Funding
Agents, the Initial Purchasers, the APA Bank Purchasers, and the
Successor Servicer may conclusively rely until such time as the
Administrative Agent, the Funding Agents, on behalf of the Initial
Purchasers and the APA Bank Purchasers, and the Successor Servicer shall
receive from TMN a revised Certificate meeting the requirements of this
clause (b)(i)), (ii) a copy of TMN's Certificate of Incorporation,
certified by the Secretary of State of the State of Delaware, (iii) a
copy of TMN's By-Laws, (iv) a copy of resolutions of the Board of
Directors of TMN approving this transaction and (v) certificates of the
Secretaries of State of the State of Delaware and Florida certifying
TMN's good standing under the laws of the State of Delaware and Florida,
respectively.
(c) A Certificate of the Secretary of iDine in
substantially the form of Exhibit M hereto certifying (i) the names and
signatures of the officers and employees authorized on its behalf to
execute the Receivables Purchase Agreement and any other documents to be
delivered by it thereunder (on which Certificate the
26
Administrative Agent, the Initial Purchasers, the Funding Agents, the
APA Bank Purchasers, and the Successor Servicer may conclusively rely
until such time as the Administrative Agent, the Funding Agents, on
behalf of the Initial Purchasers and the APA Bank Purchasers, and the
Successor Servicer shall receive from iDine a revised Certificate
meeting the requirements of this clause (c)(i)), (ii) a copy of iDine's
Certificate of Incorporation, certified by the Secretary of State of the
State of Delaware, (iii) a copy of iDine's By-Laws, (iv) a copy of
resolutions of the Board of Directors of iDine approving this
transaction and (v) certificates of the Secretaries of State of the
State of Delaware, New York and Florida certifying iDine's good standing
under the laws of the State of Delaware, New York and Florida,
respectively.
(d) A Certificate of the Secretary of Service
Company in substantially the form of Exhibit M hereto certifying (i) the
names and signatures of the officers and employees authorized on its
behalf to execute the Receivables Purchase Agreement and any other
documents to be delivered by it thereunder (on which Certificate the
Administrative Agent, the Initial Purchasers, the Funding Agents, the
APA Bank Purchasers and the Successor Servicer may conclusively rely
until such time as the Administrative Agent, the Funding Agents, on
behalf of the Initial Purchasers and the APA Bank Purchasers, and the
Successor Servicer shall receive from Service Company a revised
Certificate meeting the requirements of this clause (d)(i)), (ii) a copy
of Service Company's Certificate of Incorporation, certified by the
Secretary of State of the State of Delaware, (iii) a copy of Service
Company's By-Laws, (iv) a copy of resolutions of the Board of Directors
of Service Company approving this transaction and (v) certificates of
the Secretaries of State of the State of Delaware and Florida certifying
Service Company's good standing under the laws of the State of Delaware
and Florida, respectively.
(e) A Certificate of the Secretary of the Back-up
Servicer in substantially the form of Exhibit M hereto certifying (i)
the names and signatures of the officers and employees authorized on its
behalf to execute this Agreement and any other documents to be delivered
by it hereunder (on which Certificate the Administrative Agent, the
Initial Purchasers, the Funding Agents, the APA Bank Purchasers, and the
Successor Servicer may conclusively rely until such time as the
Administrative Agent, the Funding Agents, on behalf of the Initial
Purchasers and the APA Bank Purchasers, and the Successor Servicer shall
receive from the Back-up Servicer a revised Certificate meeting the
requirements of this clause (e)(i)), (ii) a copy of the Back-up
Servicer's Certificate of Incorporation, certified by the Secretary of
State of the State of Delaware, (iii) a copy of the Back-up Servicer's
By-Laws, (iv) a copy of resolutions of the Board of Directors of the
Back-up Servicer approving this transaction and (v) certificates of the
Secretaries of State of the States of Delaware and Florida certifying
the Back-up Servicer's good standing under the laws of the States of
Delaware and Florida, respectively.
(f) [Reserved]
27
(g) Executed copies of the Lockbox Agreements
relating to each of the Lock-Box Banks and the Lock-Box Accounts and
Collection Account Agreement relating to the Collection Account and
Collection Account Bank.
(h) An opinion of ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP,
special counsel to the Transferor and the Sellers, addressed to the
Administrative Agent, the Initial Purchasers, the Funding Agents, the
APA Bank Purchasers, and the Successor Servicer, in form and substance
reasonably acceptable to the Administrative Agent, the Funding Agents
and the Successor Servicer, regarding substantive consolidation in the
event of a bankruptcy of a Seller and such other matters as the
Administrative Agent, the Funding Agents and the Successor Servicer may
reasonably request.
(i) An opinion of ▇▇▇▇▇▇, ▇▇▇▇▇ & Bockius LLP,
special counsel to the Transferor and the Sellers, addressed to the
Administrative Agent, the Initial Purchasers, the Funding Agents, the
APA Bank Purchasers, and the Successor Servicer, in form and substance
reasonably acceptable to the Administrative Agent, the Funding Agents
and the Successor Servicer, regarding "true sale" between each Seller
and the Transferor in the event of a bankruptcy of a Seller and such
other matters as the Administrative Agent, the Funding Agents and the
Successor Servicer may reasonably request.
(j) [Reserved]
(k) An opinion of ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP,
special counsel to the Transferor and each Seller, addressed to the
Administrative Agent, the Initial Purchasers, the Funding Agents, the
APA Bank Purchasers, and the Successor Servicer, in form and substance
reasonably acceptable to the Administrative Agent, the Funding Agents
and the Successor Servicer, regarding the validity, perfection and
priority of the security interest granted by each Seller to the
Transferor and such other matters as the Administrative Agent, the
Funding Agents and the Successor Servicer may reasonably request.
(l) An opinion of ▇▇▇▇▇▇, ▇▇▇▇▇ & Bockius LLP,
special counsel to the Transferor and each Seller, addressed to the
Administrative Agent, the Initial Purchasers, the Funding Agents, the
APA Bank Purchasers, and the Successor Servicer, in form and substance
reasonably acceptable to the Administrative Agent, the Funding Agents
and the Successor Servicer, regarding the validity, perfection and
priority of the security interest granted by the Transferor to the
Administrative Agent, on behalf of the Initial Purchasers and the APA
Bank Purchasers, and such other matters as the Administrative Agent, the
Funding Agents and the Successor Servicer may reasonably request.
(m) An opinion of ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP,
special counsel to the Transferor and each Seller, addressed to the
Administrative Agent, the Initial Purchasers, the Funding Agents, the
APA Bank Purchasers, and the Successor Servicer, in form and substance
reasonably acceptable to the Administrative Agent, the Funding Agents
and the Successor Servicer, regarding the enforceability of the
28
Transaction Documents to which each is a party and such other matters as
the Administrative Agent, the Funding Agents and the Successor Servicer
may reasonably request.
(n) An opinion of the general counsel of TMN,
addressed to the Administrative Agent, the Initial Purchasers, the
Funding Agents, the APA Bank Purchasers, and the Successor Servicer, in
form and substance reasonably acceptable to the Administrative Agent,
the Funding Agents and the Successor Servicer, as to such corporate
matters with respect to the Transferor, TMN and each other Seller as the
Administrative Agent, the Funding Agents and the Successor Servicer may
reasonably request.
(o) An executed copy of this Agreement and each
other Transaction Document to be executed by the Transferor, TMN and
each other Seller.
(p) For delivery to the Fairway Funding Agent only,
an executed copy of the Fairway Liquidity Asset Purchase Agreement.
(q) Evidence that the Structuring Fee has been paid
to each Funding Agent.
(r) (i) A Weekly Report dated as of the most recent
Weekly Settlement Report Date immediately preceding the date of this
Agreement and (ii) a Settlement Report for the most recent Settlement
Period preceding the date of this Agreement.
(s) The executed Fee Letters and payment of all fees
required to be paid on the date of this Agreement, and reimbursement of
the Administrative Agent, the Funding Agents, the Initial Purchasers and
the APA Bank Purchasers for all costs and expenses of the closing of the
transaction (including legal fees and costs) subject to the maximum
amounts agreed upon.
(t) The following financial information of TMN and
its Subsidiaries: (i) audited financial statements prepared in
accordance with GAAP on a consolidated and consolidating basis
(consolidating statements need not be audited by such accountants) for
the period October 1, 1999 through September 30, 2000 and (ii)
consolidated and consolidating unaudited financial statements for the
fiscal quarter ended March 31, 2001.
(u) Evidence of the establishment of the Collection
Account and the RTR Funding Account.
(v) A letter from S&P confirming its rating of each
Initial Purchaser's Commercial Paper or that such rating will not be
withdrawn or downgraded after giving effect to this Agreement and the
transactions contemplated hereby.
29
(w) A letter from ▇▇▇▇▇'▇ confirming its rating of
each Initial Purchaser's Commercial Paper or that such rating will not
be withdrawn or downgraded after giving effect to this Agreement and the
transactions contemplated hereby.
(x) A Certificate of a Responsible Officer of each
Seller and a Responsible Officer of the Transferor certifying that the
representations and warranties of each Seller set forth in Section 4.1
of the Receivables Purchase Agreement and the Transferor set forth in
Section 3.1 hereof are true and correct in all material respects as of
the date of this Agreement.
(y) [Reserved]
(z) [Reserved]
(aa) A Certificate of a Responsible Officer of the
Transferor certifying that after giving effect to the transactions
contemplated hereby, the Transferor shall have outstanding no
indebtedness or preferred stock other than (i) financing under the
Facility and (ii) other indebtedness as agreed upon by the
Administrative Agent, the Funding Agents and the APA Bank Purchasers.
(bb) An explicit "A" rating from S&P of the
transactions contemplated hereby.
(cc) [Reserved]
(dd) Satisfactory review by the Administrative Agent,
each Funding Agent and the Successor Servicer of the Servicer and the
Back-up Servicer.
(ee) Customary legal opinions from special counsel to
the Servicer and the Back-up Servicer, in form and substance reasonably
acceptable to the Administrative Agent, each Funding Agent and the
Successor Servicer, addressed to the Administrative Agent, the Funding
Agents, the Initial Purchasers, the APA Bank Purchasers and the
Successor Servicer, regarding substantive consolidation in the event of
bankruptcy of either the Servicer or the Back-up Servicer and such other
matters as the Administrative Agent, the Funding Agents or the Successor
Servicer may reasonably request.
(ff) [Reserved]
(gg) An executed copy of the Master License
Agreement.
(hh) An executed copy of the Trademark License
Agreement.
(ii) An executed copy of each Trademark Assignment.
(jj) [Reserved]
30
(kk) [Reserved]
(ll) An executed copy of the Memorandum of
Confirmation.
(mm) Such other documents, instruments, certificates
and opinions as the Administrative Agent, the Funding Agents or the
Successor Servicer shall reasonably request.
SECTION 4.2 Conditions to each Transfer. The right of the
Transferor to sell Transferred Interests pursuant to Section 2.2 and the
obligation, if any, of the Initial Purchasers and the APA Bank Purchasers to
purchase such Transferred Interests is subject to the conditions that on the
applicable Transfer Date:
(a) no Termination Event or Potential Termination
Event shall have occurred and then be continuing;
(b) the Termination Date shall not have occurred;
(c) the representations and warranties set forth in
Section 3.1 and Section 4.1 of the Receivables Purchase Agreement shall
be true and correct in all material respects on and as of such date
(except to the extent such representations and warranties relate solely
to an earlier date, and then as of such earlier date);
(d) Executed copies of proper financing statements
(Form UCC-1 or UCC-3, as applicable), dated a date reasonably near to
the date hereof, naming the Transferor as the debtor and the
Administrative Agent (for the benefit of the Initial Purchasers, the
Funding Agents, the Fairway APA Banks and the PARCO APA Banks) as
secured party, and other similar instruments or documents as may be
necessary or, in the reasonable opinion of the Administrative Agent and
each Funding Agent, desirable under the Relevant UCC of all appropriate
jurisdictions or any comparable Law to perfect the Administrative
Agent's (for the benefit of the Initial Purchasers, the Funding Agents
and the APA Bank Purchasers) security interest in all Receivables,
Related Security, Collections and Proceeds with respect thereto;
(e) Executed copies of proper financing statements
(Form UCC-1 or UCC-3, as applicable), dated a date reasonably near to
the date hereof, naming each Seller as debtor/seller, the Transferor as
secured party/purchaser, and the Administrative Agent (for the benefit
of the Initial Purchasers, the Funding Agents, the Fairway APA Banks and
the PARCO APA Banks), as assignee of the secured party/purchaser, and
other similar instruments or documents as may be necessary or, in the
reasonable opinion of the Administrative Agent or any Funding Agent,
desirable under the Relevant UCC of all appropriate jurisdictions or any
comparable Law to perfect the Transferor's ownership or security
interest in all Receivables, Related Security, Collections and Proceeds
with respect thereto;
(f) Executed copies of proper financing statements
(Form UCC-1), dated a date reasonably near to the Original Closing Date,
naming the Originator as
31
debtor/seller, TMN as secured party/purchaser, and the Transferor, as
assignee of the secured party/purchaser, and other similar instruments
or documents as may be necessary or, in the reasonable opinion of the
Administrative Agent or any Funding Agent, desirable under the Relevant
UCC of all appropriate jurisdictions or any comparable Law to perfect
TMN's ownership or security interest in all Receivables, Related
Security, Collections and Proceeds with respect thereto;
(g) Executed copies of proper financing statements
(Form UCC-3), if any, necessary to terminate all security interests and
other rights of any person in Receivables previously granted by the
Transferor;
(h) Executed copies of proper financing statements
(Form UCC-3) necessary to terminate all security interests and other
rights of any person in Receivables previously granted by any Seller and
any Originator;
(i) Certified copies of request for information or
copies (Form UCC-11) (or a similar search report certified by parties
reasonably acceptable to the Administrative Agent and the Funding
Agents), dated a date reasonably near the date hereof, listing all
effective financing statements which name the Transferor, any Seller and
the Originator (under their respective present names and any previous
names) as seller or debtor and which are filed in jurisdictions in which
the filings were made pursuant to items (d), (e) and (f) above together
with copies of such financing statements (none of which shall cover any
Receivables or Contracts unless released in accordance with paragraph
(g) or (h) above);
(j) (i) the Facility must be rated at least "A" by
S&P on the date of the initial Incremental Transfer (the "Required
Rating") and the Required Rating shall not have been reduced or
withdrawn as of any subsequent Transfer Date and (ii) on the date of the
initial Incremental Transfer, the rating of each Initial Purchaser's
outstanding Commercial Paper shall not be withdrawn or downgraded after
giving effect to such Incremental Transfer;
(k) A Daily Report shall have been delivered to the
Administrative Agent, each Funding Agent and the Successor Servicer; and
(l) the Administrative Agent, each Funding Agent and
the Successor Servicer shall have received such other approvals,
opinions or documents as either the Administrative Agent, such Funding
Agent or the Successor Servicer may reasonably request.
ARTICLE V
COVENANTS
SECTION 5.1 Affirmative Covenants of Transferor. At all times
from the date hereof to the later to occur of (i) the Termination Date and (ii)
the date on which the Aggregate Net Investment has been reduced to zero, all
accrued PARCO Discount, Fairway
32
Discount, Servicing Fees, Successor Servicer Fees and all other Aggregate
Unpaids shall have been paid in full, in cash, unless the Administrative Agent
and each Funding Agent shall otherwise consent in writing (which consent shall
be obtained by the Administrative Agent):
(a) Financial Reporting. The Transferor will, and
will cause TMN and each of TMN's Subsidiaries to, maintain, for itself
and each of its respective Subsidiaries, a system of accounting
established and administered in accordance with GAAP, and furnish to the
Administrative Agent, each Funding Agent and the Successor Servicer (and
with respect to clause (vi) below, each Rating Agency):
(i) Annual Reporting. Within one hundred
(100) days after the close of the Transferor's and TMN's fiscal
years, (x) audited financial statements, prepared in accordance
with GAAP on a consolidated and consolidating basis
(consolidating statements need not be audited by such
accountants) for TMN and its Subsidiaries, including balance
sheets as of the end of such period, related statements of
operations, shareholder's equity and cash flows, accompanied by
an unqualified audit report certified by independent certified
public accountants, reasonably acceptable to the Administrative
Agent and each Funding Agent, prepared in accordance with GAAP
and any management letter prepared by said accountants and by a
certificate of said accountants that, in the course of the
foregoing, nothing has come to their attention to cause such
accountants to believe that any Termination Event or Potential
Termination Event has occurred, or if, in the opinion of such
accountants, any Termination Event or Potential Termination
Event shall exist, stating the nature and status thereof and (y)
unaudited financial statements for the Transferor certified by
its senior financial officer.
(ii) Quarterly Reporting. Within fifty (50)
days after the close of the first three (3) quarterly periods of
each of the Transferor's and TMN's fiscal years, for (x) the
Transferor and (y) TMN and its Subsidiaries, in each case,
consolidated and consolidating unaudited balance sheets as at
the close of each such period and consolidated and consolidating
related statements of operations, shareholder's equity and cash
flows for the period from the beginning of such fiscal year to
the end of such quarter, all certified by its senior financial
officer.
(iii) Compliance Certificate. Together with
the financial statements required hereunder, a compliance
certificate signed by the Transferor's or TMN's, as applicable,
chief financial officer stating that (x) the attached financial
statements have been prepared in accordance with GAAP and
accurately reflect the financial condition of the Transferor or
TMN, as applicable, and (y) to the best of such Person's
knowledge, no Termination Event or Potential Termination Event
exists, or if any Termination Event or Potential Termination
Event exists, stating the nature and status thereof.
(iv) Shareholders Statements and Reports.
Promptly upon the furnishing thereof to the members of the
Transferor or shareholders of TMN
33
(but in any event within two (2) Business Days of such
delivery), copies of all financial statements, reports and proxy
statements so furnished.
(v) S.E.C. Filings. Promptly upon the filing
thereof (but in any event within two (2) Business Days of such
filing), TMN shall notify the Administrative Agent, each Funding
Agent and the Successor Servicer of all registration statements
and annual, quarterly, monthly or other regular reports which
TMN or any Affiliate files with the Securities and Exchange
Commission.
(vi) Notice of Termination Events or
Potential Termination Events. As soon as possible and in any
event within one (1) Business Day after the Transferor obtains
knowledge of the occurrence of each Termination Event or each
Potential Termination Event, a statement of the chief financial
officer or chief accounting officer of the Transferor setting
forth details of such Termination Event or Potential Termination
Event and the action which the Transferor proposes to take with
respect thereto.
(vii) Change in Restaurant Guidelines and Debt
Ratings. Within ten (10) Business Days after the date any
material change in or amendment to the Restaurant Guidelines is
made (subject to subsection 5.2(c) herein), a copy of the
Restaurant Guidelines then in effect indicating such change or
amendment. Within five (5) days after the date of any change in
the Transferor's or TMN's public or private debt ratings, if
any, a written certification of the Transferor's or TMN's public
and private debt ratings after giving effect to any such change.
(viii) Restaurant Guidelines. Within ninety
(90) days after the close of each of TMN's and the Transferor's
fiscal years, a complete copy of the Restaurant Guidelines then
in effect.
(ix) ERISA. Promptly after the filing or
receiving thereof, copies of all reports and notices with
respect to any Reportable Event (as defined in Article IV of
ERISA) which the Transferor, any Seller or any ERISA Affiliate
of the Transferor or any Seller files under ERISA with the
Internal Revenue Service, the Pension Benefit Guaranty
Corporation or the U.S. Department of Labor or which the
Transferor, any Seller or any ERISA Affiliates of the Transferor
or any Seller receives from the Internal Revenue Service, the
Pension Benefit Guaranty Corporation or the U.S. Department of
Labor.
(x) Rebate Options. Concurrently with any
delivery of financial statements after the close of the second
and fourth quarterly periods of each of TMN's fiscal years, a
list of the Rebate options together with the number of Members
entitled to each Rebate.
34
(xi) Other Information. Such other
information (including non-financial information) as the
Administrative Agent, any Funding Agent or the Successor
Servicer may from time to time reasonably request with respect
to any Seller, the Transferor or any Subsidiary of any of the
foregoing.
(b) Conduct of Business. The Transferor will carry
on and conduct its business in substantially the same manner and in
substantially the same fields of enterprise as it is presently conducted
and do all things necessary to remain duly organized, validly existing
and in good standing as a domestic limited liability company in its
jurisdiction of incorporation and to maintain all requisite authority to
conduct its business in each jurisdiction in which its business is
conducted to the extent that the failure to maintain such would have a
Material Adverse Effect.
(c) Compliance with Laws. The Transferor will, and
will cause each Seller and each of the Transferor's and the Seller's
Affiliates to, comply with all Laws to which it or its respective
properties may be subject, except where the failure to so comply would
not have a Material Adverse Effect.
(d) Furnishing of Information and Inspection of
Records. The Transferor will, and will cause TMN and each other Seller
to, furnish to the Administrative Agent, each Funding Agent and the
Successor Servicer from time to time such information with respect to
the Receivables as the Administrative Agent, such Funding Agent or the
Successor Servicer may reasonably request, including, without
limitation, listings identifying the Restaurant and the Outstanding
Balance for each Receivable, together with an aging of Receivables. The
Transferor will, and will cause TMN and each other Seller to, at any
time and from time to time during regular business hours and upon
reasonable notice permit the Administrative Agent, each Funding Agent
and the Successor Servicer, or their agents or representatives, (i) to
examine and make copies of and abstracts from all Records and (ii) to
visit the offices and properties of the Transferor, TMN or any other
Seller, as applicable, for the purpose of examining such Records, and to
discuss matters relating to Receivables or the Transferor's, TMN's or
any other Seller's performance hereunder and under the other Transaction
Documents to which such Person is a party with any of the officers,
directors, employees or independent public accountants of the
Transferor, TMN or any other Seller, as applicable, having knowledge of
such matters.
(e) Keeping of Records and Books of Account. The
Transferor will, and will cause TMN and each other Seller to, maintain
and implement administrative and operating procedures (including,
without limitation, an ability to recreate records evidencing
Receivables in the event of the destruction of the originals thereof),
and keep and maintain, all documents, books, records and other
information reasonably necessary or advisable for the collection of all
Receivables (including, without limitation, records adequate to permit
the daily identification of each new Receivable and all Collections of
and adjustments to each existing Receivable). The Transferor will, and
will cause TMN and each other Seller to, give the Administrative Agent,
each Funding Agent and the Successor Servicer prompt notice of any
material change in the
35
administrative and operating procedures of the Transferor, TMN or such
other Seller, as applicable, referred to in the previous sentence.
(f) Performance and Compliance with Receivables and
Contracts. The Transferor, at its expense, will, and will cause each
Seller to, timely and fully perform and comply with all material
provisions, covenants and other promises required to be observed by the
Transferor or such Seller under the Contracts related to the
Receivables; provided, however, that a breach of the covenant set forth
in this clause (f) shall not give rise to a Termination Event unless
such breach shall continue to be unremedied for a period of three (3)
Business Days after the earlier of (i) the date on which a Responsible
Officer of the Transferor or a Seller has knowledge of such failure to
fully perform and comply and (ii) the date on which written notice of
such failure to fully perform and comply has been given to the
Transferor or the applicable Seller.
(g) Restaurant Guidelines. The Transferor will, and
will cause TMN and each other Seller to, comply in all material respects
with the Restaurant Guidelines in regard to each Receivable and the
related Contract; provided, however, that a breach of the covenant set
forth in this clause (g) shall not give rise to a Termination Event
unless such breach shall continue to be unremedied for a period of three
(3) Business Days after the earlier of (i) the date on which a
Responsible Officer of the Transferor or a Seller has knowledge of such
failure to comply and (ii) the date on which written notice of such
failure to comply has been given to the Transferor or the applicable
Seller.
(h) Collections. The Transferor shall, and shall
cause TMN and each other Seller to, instruct all Credit Card Processors
and each Restaurant (or its designee) to cause all Collections to be
deposited directly to a Lock-Box Account.
(i) Collections Received. The Transferor shall, and
shall cause TMN and each other Seller to, hold in trust, and deposit
immediately (but in any event no later than one Business Day following
its receipt thereof) to a Lock-Box Account all Collections received from
time to time by the Transferor, TMN or any other Seller, as the case may
be. The Transferor agrees not to deposit or otherwise credit or cause or
permit to be so deposited or credited to such account cash or cash
proceeds other than Collections of Receivables; provided, however that
the deposit of cash or cash proceeds other than Collections into a
Lock-Box Account shall not give rise to a Termination Event unless the
Transferor, a Seller or the Servicer shall have failed to segregate or
cause to be segregated any such cash or cash proceeds from Collections
within two (2) Business Days of the deposit or credit to any Lock-Box
Account.
(j) Sale Treatment. The Transferor will not, and
will not permit any Seller to, account for (including for accounting
purposes), or otherwise treat, the transactions contemplated by the
Receivables Purchase Agreement in any manner other than as a sale of
Receivables by a Seller to the Transferor. In addition, the Transferor
shall, and shall cause each Seller to, disclose (in a footnote or
otherwise) in all of its respective financial statements (including any
such financial statements consolidated
36
with any other Persons' financial statements) the existence and nature
of the transaction contemplated hereby and by the Receivables Purchase
Agreement and the interest of the Transferor (in the case of each
Seller's financial statements), the Initial Purchasers and the APA Bank
Purchasers in the Receivables and Related Security, Collections and
Proceeds with respect thereto.
(k) Enforcement of Receivables Purchase Agreement.
The Transferor shall use its best efforts to enforce all rights held by
it under the Receivables Purchase Agreement and shall not waive any
breach of any covenant contained in Section 5.1 thereunder without the
prior written consent of the Administrative Agent and each Funding Agent
(to be obtained by the Administrative Agent).
(l) Separate Existence. The Transferor shall at all
times:
(i) maintain its own deposit account or
accounts, separate from those of any Affiliate, with commercial
banking institutions and ensure that the funds of the Transferor
will not be diverted to any other Person or for other than
corporate uses of the Transferor, nor will such funds be
commingled with the funds of any Seller, TMN or any subsidiary
or Affiliate of a Seller or TMN;
(ii) to the extent that it shares the same
officers or other employees as any of its stockholders or
Affiliates, the salaries of and the expenses related to
providing benefits to such officers and other employees shall be
fairly allocated among such entities, and each such entity shall
bear its fair share of the salary and benefit costs associated
with all such common officers and employees;
(iii) to the extent that it jointly contracts
with any of its stockholders or Affiliates to do business with
vendors or service providers or to share overhead expenses, the
costs incurred in so doing shall be allocated fairly among such
entities, and each such entity shall bear its fair share of such
costs. To the extent that the Transferor contracts or does
business with vendors or service providers where the goods and
services provided are partially for the benefit of any other
Person, the costs incurred in so doing shall be fairly allocated
to or among such entities for whose benefit the goods or
services are provided, and each such entity shall bear its fair
share of such costs;
(iv) enter into all material transactions
between the Transferor and any of its Affiliates, whether
currently existing or hereafter entered into, only on an arm's
length basis, it being understood and agreed that the
transactions contemplated in the Transaction Documents meet the
requirements of this clause (iv);
(v) maintain office space separate from the
office space of each Seller and their Affiliates and, to the
extent that the Transferor and any of its stockholders or
Affiliates have offices in the same location, there shall be a
37
fair and appropriate allocation of overhead costs among them,
and each such entity shall bear its fair share of such expenses;
(vi) issue separate unaudited financial
statements prepared not less frequently than quarterly and
prepared in accordance with GAAP;
(vii) conduct its affairs strictly in
accordance with its organizational documents and observe all
necessary, appropriate and customary corporate formalities,
including, but not limited to, holding all regular and special
stockholders' and directors' meetings appropriate to authorize
all corporate action, keeping separate and accurate minutes of
its meetings, passing all resolutions or consents necessary to
authorize actions taken or to be taken, and maintaining accurate
and separate books, records and accounts, including, but not
limited to, payroll and intercompany transaction accounts;
(viii) not assume or guarantee any of the
liabilities of any Seller or any Affiliate thereof;
(ix) take, or refrain from taking, as the
case may be, all other actions that are necessary to be taken or
not to be taken in order to comply with this Section 5.1(l); and
(x) will comply with all assumptions made in
the ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP's "true sale" and
"non-consolidation" opinions, each dated as of the Amendment
Effective Date.
(m) Preservation of License. The Transferor will do
or cause to be done all things necessary to preserve and maintain the
License against the claims of all Persons (other than those Persons to
whom the License or similar licenses have also been granted).
(n) Use and Enforcement of License. The Transferor
will do or cause to be done all things necessary to use and enforce the
License to facilitate the servicing and collection of the Receivables
and the Related Security upon the occurrence of a Termination Event or
Potential Termination Event. Additionally, the Transferor shall not
contest the applicable Purchasers' right, title and interest in, to and
under any tradenames, trademarks and/or service marks sold, assigned,
transferred and conveyed by any Seller to the Purchaser pursuant to
Section 2.1(e) of the Receivables Purchase Agreement and subsequently
conveyed by the Transferor to the Administrative Agent on behalf of the
applicable Purchasers pursuant to Section 2.1 of this Agreement.
(o) Statements of Use. Within fifteen (15) days
after the first use in interstate commerce of any trademark, tradename
or service ▇▇▇▇ listed on Schedule II-A, the Transferor shall file a
"statement of use" with the United States Patent and Trademark Office
("PTO") relating to such trademark, tradename or service ▇▇▇▇ and
38
shall use its best efforts to obtain the acceptance of such "statement
of use" by the PTO thereafter.
(p) Compliance with Terms. The Transferor shall
comply with all the requirements of the Trademark License Agreement and
the Master License Agreement.
SECTION 5.2 Negative Covenants of the Transferor. At all times
from the date hereof to the later to occur of (i) the Termination Date and (ii)
date on which the Aggregate Net Investment has been reduced to zero and all
accrued PARCO Discount, Fairway Discount, Servicing Fees, Successor Servicer
Fees and all other Aggregate Unpaids shall have been paid in full, unless the
Administrative Agent and each Funding Agent shall otherwise consent in writing
(which consent shall be obtained by the Administrative Agent):
(a) No Sales, Liens, Etc. Except as otherwise
provided herein and in the Receivables Purchase Agreement, the
Transferor will not, and will not permit any Seller to, sell, assign (by
operation of law or otherwise) or otherwise dispose of, or create any
Adverse Claim upon (or the filing of any financing statement) or with
respect to (x) any of the Receivables, Related Security, Collections or
Proceeds with respect thereto, (y) any inventory or goods, the sale of
which may give rise to a Collection, or (z) any Lock-Box Account (or the
Collection Account) to which any Collections of any Receivable are sent,
or assign any right to receive income in respect thereof.
(b) No Extension or Amendment of Receivables. Except
as otherwise permitted in Section 6.2 hereof, the Transferor will not,
and will not permit any Seller to, extend, amend or otherwise modify the
terms of any Receivable, or amend, modify or waive any term or condition
of any Contract related thereto unless such amendment, modification or
waiver shall not materially adversely affect the collectibility of such
Receivable.
(c) No Change in Business or Restaurant Guidelines.
The Transferor will not, and will not permit any Seller to, make any
change in the character of its business or in the Restaurant Guidelines,
which change would, in either case, impair the collectibility of any
Receivable or otherwise have a Material Adverse Effect.
(d) No Mergers, Etc. The Transferor will not,
without the prior written consent of each Funding Agent (which consent
shall be obtained by the Administrative Agent) and the Required
Participants, and except as otherwise permitted pursuant to the
Receivables Purchase Agreement, permit any Seller to, (i) consolidate or
merge with or into any other Person, or (ii) sell, lease or transfer all
or substantially all of its assets to any other Person.
(e) Change in Payment Instructions to Restaurants;
Deposits to Lock-Box Accounts. The Transferor will not, and will not
permit TMN or any other Seller to, add or terminate any bank as a
Lock-Box Bank or any account as a Lock-Box Account to or from those
listed in Exhibit C hereto or make any change in its
39
instructions to Credit Card Processors or Restaurants (or their
designees) regarding payments to be made to any Lock-Box Account, unless
(i) such instructions are to deposit such payments to another existing
Lock-Box Account or (ii) the Administrative Agent and each Funding Agent
shall have received written notice of such addition, termination or
change at least thirty (30) days prior thereto and the Administrative
Agent and each Funding Agent shall have received a Lock-Box Agreement
executed by each new Lock-Box Bank or an existing Lock-Box Bank with
respect to each new Lock-Box Account, as applicable. The Transferor will
not, and will not permit TMN, any other Seller or the Originator to,
deposit or otherwise credit, or cause or permit to be so deposited or
credited, to any Lock-Box Account cash or cash proceeds other than
Collections of Receivables.
(f) Change of Name, Etc. The Transferor will not,
and will not permit a Seller to, change its name, identity or structure
or the location of its chief executive office, unless at least ten (10)
days prior to the effective date of any such change the Transferor or
Seller, as applicable, delivers to the Administrative Agent, each
Funding Agent and the Servicer (i) such documents, instruments or
agreements, executed by the Transferor or Seller, as applicable, as are
necessary to reflect such change and to continue the perfection of the
Administrative Agent's (on behalf of the Initial Purchasers and the APA
Bank Purchasers) ownership interests or security interests in the
Receivables and Related Security, Collections and Proceeds with respect
thereto and (ii) new or revised Lock-Box Agreements executed by the
Lock-Box Banks which reflect such change and enable the Administrative
Agent to continue to exercise its rights contained in Section 2.8
hereof.
(g) Amendment to Receivables Purchase Agreement. The
Transferor will not, and will not permit any Seller to, amend, modify,
or supplement the Receivables Purchase Agreement, except with the prior
written consent of the Administrative Agent and each Funding Agent; nor
shall the Transferor take, or permit any Seller to take, any other
action under the Receivables Purchase Agreement that shall have a
material adverse effect on the Administrative Agent, any Funding Agent,
any Initial Purchaser or any APA Bank Purchaser or which is inconsistent
with the terms of this Agreement.
(h) Other Debt. Except as provided for herein, the
Transferor will not create, incur, assume or suffer to exist any
indebtedness whether current or funded, or any other liability other
than (i) indebtedness of the Transferor representing fees, expenses and
indemnities arising hereunder or under the Receivables Purchase
Agreement for the Purchase Price of the Receivables under the
Receivables Purchase Agreement, and (ii) other indebtedness incurred in
the ordinary course of its business in an amount not to exceed $9,850 at
any one time outstanding.
(i) ERISA Matters. The Transferor will not, and will
not permit any Seller to, (i) engage or permit any of its respective
ERISA Affiliates to engage in any prohibited transaction (as defined in
Section 4975 of the Code and Section 406 of ERISA) for which an
exemption is not available or has not previously been obtained
40
from the U.S. Department of Labor; (ii) permit to exist any accumulated
funding deficiency (as defined in Section 302(a) of ERISA and Section
412(a) of the Code) or funding deficiency with respect to any Benefit
Plan other than a Multiemployer Plan; (iii) fail to make any payments to
any Multiemployer Plan that the Transferor, any Seller or any ERISA
Affiliate of the Transferor or any Seller is required to make under the
agreement relating to such Multiemployer Plan or any law pertaining
thereto; (iv) terminate any Benefit Plan so as to result in any
liability; or (v) permit to exist any occurrence of any reportable event
described in Title IV of ERISA which represents a material risk of a
liability to the Transferor, any Seller, or any ERISA Affiliate of the
Transferor or any Seller under ERISA or the Code, if such prohibited
transactions, accumulated funding deficiencies, payments, terminations
and reportable events occurring within any fiscal year of the Transferor
and any Seller, in the aggregate, involve a payment of money or an
incurrence of liability by the Transferor, any Seller or any ERISA
Affiliate of the Transferor or any Seller.
(j) Payment to Sellers. With respect to any
Receivable sold by a Seller to the Transferor, the Transferor shall, and
shall cause each Seller to, effect such sale under, and pursuant to the
terms of, the Receivables Purchase Agreement, including, without
limitation, the payment by the Transferor either in cash to or by a
capital contribution from such Seller of an amount equal to the Purchase
Price for such Receivable as required by the terms of the Receivables
Purchase Agreement.
(k) Capital Structure and Business. The Transferor
will not without the prior written consent of the Administrative Agent
and each Funding Agent (which consent shall be obtained by the
Administrative Agent) and Rating Confirmation (i) make any changes in
any of its business objectives, purposes or operations that could have
or result in a Material Adverse Effect or (ii) amend, supplement or
otherwise modify its organizational documents in a manner that could
have or result in a Material Adverse Effect.
(l) Election to Terminate License Upon Rejection. In
the event TMN or any other Seller becomes a debtor in a proceeding under
the Bankruptcy Code, if any such debtor determines to reject the License
in accordance with Bankruptcy Code Section 365, the Transferor will not
elect under Bankruptcy Code Section 365(n)(1)(A) to treat the License as
terminated.
SECTION 5.3 Covenants of the Servicer. At all times from the
date hereof to the later to occur of (i) the Termination Date and (ii) date on
which the Aggregate Net Investment has been reduced to zero and, all accrued
PARCO Discount, Fairway Discount, Servicing Fees, Successor Servicer Fees and
all other Aggregate Unpaids shall have been paid in full, unless the
Administrative Agent and each Funding Agent shall otherwise consent in writing
(which consent shall be obtained by the Administrative Agent):
(a) Restaurant Guidelines. The Servicer will comply
in all material respects with the Restaurant Guidelines in regard to
each Receivable and the related Contract.
41
(b) Collections Received. The Servicer shall hold in
trust, and deposit as soon as reasonably practicable (but in any event
no later than one (1) Business Day following its receipt thereof) to the
Collection Account all Collections received from time to time by the
Servicer.
(c) Notice of Termination Events, Potential
Termination Events or Servicer Defaults. As soon as possible, and in any
event within one (1) Business Day after the Servicer obtains knowledge
of the occurrence of each Termination Event, Potential Termination Event
or Servicer Default, the Servicer will furnish to the Administrative
Agent, each Funding Agent and each Rating Agency a written statement of
a Responsible Officer of the Servicer setting forth details of such
Termination Event, Potential Termination Event or Servicer Default, and
the action which the Servicer, the Transferor or a Seller proposes to
take with respect thereto.
(d) Conduct of Business. The Servicer will do all
things necessary to remain duly incorporated, validly existing and in
good standing as a domestic corporation in its jurisdiction of
incorporation and maintain all requisite authority to conduct its
business in each jurisdiction in which its business is conducted to the
extent that the failure to maintain such would have a Material Adverse
Effect.
(e) Compliance with Laws. The Servicer will comply
in all material respects with all Laws with respect to the Receivables.
(f) Further Information. The Servicer shall furnish
or cause to be furnished to the Administrative Agent, the Successor
Servicer and each Funding Agent such other information relating to the
Receivables and readily available public information regarding the
financial condition of the Servicer as soon as reasonably practicable,
and in such form and detail, as the Administrative Agent, the Successor
Servicer and such Funding Agent may reasonably request.
SECTION 5.4 Negative Covenants of the Servicer. At all times
from the date hereof to the later to occur of (i) the Termination Date and (ii)
date on which the Aggregate Net Investment has been reduced to zero and, all
accrued PARCO Discount, Fairway Discount, Servicing Fees, Successor Servicer
Fees and all other Aggregate Unpaids shall have been paid in full, unless the
Administrative Agent and each Funding Agent shall otherwise consent in writing
(which consent shall be obtained by the Administrative Agent):
(a) No Sales, Liens, Etc. Except as otherwise
provided herein and in the Receivables Purchase Agreement, the Servicer
will not sell, assign (by operation of law or otherwise) or otherwise
dispose of, or create any Adverse Claim upon (or the filing of any
financing statement) or with respect to (x) any of the Receivables,
Related Security, Collections or Proceeds with respect thereto, (y) any
inventory or goods, the sale of which may give rise to a Collection, or
(z) any Lock-Box Account to which any Collections of any Receivable are
sent, or assign any right to receive income in respect thereof.
42
(b) Consolidations, Mergers and Sales of Assets. The
Servicer (so long as the Successor Servicer has not been appointed as
Servicer hereunder) shall not without the prior written consent of each
Funding Agent and the Required Participants (which consent shall be
obtained by the Administrative Agent and shall not be unreasonably
withheld) (i) consolidate or merge with or into any other Person or (ii)
sell, lease or otherwise transfer all or substantially all of its assets
to any other Person; provided that the Servicer may consolidate or merge
with another Person if (A)(1) the Servicer is the corporation surviving
such consolidation or merger or (2) the Person into or with whom the
Servicer is merged or consolidated is an Affiliate and the surviving
corporation assumes in writing all duties and liabilities of the
Servicer hereunder and (B) immediately after and giving effect to such
consolidation or merger, no Termination Event or Potential Termination
Event shall have occurred and be continuing.
(c) Lock-Box Accounts. Except as permitted pursuant
to Sections 2.5 and 2.12 of this Agreement or as otherwise permitted
under the Transaction Documents, the Servicer shall not make, or cause
or permit any other Person to make any transfer of funds on deposit in a
Lock-Box Account.
(d) Other Debt. Except as provided for herein or
under the other Transaction Documents, the Servicer (or if Transmedia is
no longer the Servicer hereunder, Transmedia) will not create, incur,
assume or suffer to exist Indebtedness whether current or funded, which
in the aggregate exceeds $5,000,000 at any one time outstanding.
SECTION 5.5 Covenants of the Back-up Servicer and the Successor
Servicer. The Back-up Servicer and the Successor Servicer each hereby agrees
(solely as to itself) that during the term of this Agreement:
(a) Compliance With Agreements and Applicable Laws.
The Back-up Servicer and the Successor Servicer shall perform each of
its obligations under this Agreement in good faith and comply with all
material requirements of any Law or any provision of any Contract or any
related agreement applicable to its performance of such obligations;
(b) Access to Records, Discussions with Officers and
Accountants. The Back-up Servicer and following the Termination Date and
the appointment of the Successor Servicer as Servicer pursuant to
Section 6.1, the Servicer shall, upon the reasonable written request of
the Servicer (as to the Back-up Servicer), the Administrative Agent, any
Funding Agent, the Successor Servicer (as to the Back-up Servicer), any
Initial Purchaser or any APA Bank Purchaser, permit the Servicer (as to
the Back-up Servicer), the Administrative Agent, any Funding Agent, the
Successor Servicer (as to the Back-up Servicer), any Initial Purchaser
or any APA Bank Purchaser, as the case may be, or their representative
authorized designees (i) to inspect during normal business hours the
books and records of the Back-up Servicer or the Servicer, respectively,
as they may relate to the Receivables and the Related Security and the
obligations of the Back-up Servicer and the Servicer, respectively,
under this
43
Agreement and (ii) to visit the offices and properties of the Back-up
Servicer or the Servicer, respectively, for the purpose of examining
such records, and to discuss matters related to Receivables or the
Back-up Servicer's or the Servicer's, respectively, performance
hereunder with any of the officers, directors, employees or independent
public accountants of the Back-up Servicer or Servicer, respectively,
having knowledge of such matters; and
(c) Software Licenses and Landlord Waivers. Within
thirty (30) days of the Amendment Effective Date, the Back-up Servicer
will (i) deliver to the Successor Servicer executed copies of software
licenses or sublicenses, in a form reasonably acceptable to the
Administrative Agent and each Funding Agent, which grant to the
Successor Servicer the right to utilize any of the software owned or
licensed by the Back-up Servicer that is necessary or desirable to
perform the collection and administrative functions to be performed by
the Successor Servicer under the Transaction Documents and (ii) deliver
to the Successor Servicer executed copies of any landlord waivers in a
form reasonably acceptable to the Successor Servicer, that may be
necessary to grant to the Successor Servicer access to any leased
premises of the Back-up Servicer for which the Successor Servicer may
require access to perform the collection and administrative functions to
be performed by the Successor Servicer under the Transaction Documents.
ARTICLE VI
ADMINISTRATION AND COLLECTIONS
SECTION 6.1 Appointment of Servicer.
(a) The servicing, administering and collection of
the Receivables shall be conducted by such Person (the "Servicer") so
designated from time to time in accordance with this Section 6.1. Until
the Administrative Agent, with the consent or at the direction of the
Funding Agents, gives notice to TMN of the designation of a new Servicer
pursuant to this Section 6.1, TMN is hereby designated as, and hereby
agrees to perform the duties and obligations of, the Servicer pursuant
to the terms hereof. The Servicer may not delegate any of its rights,
duties or obligations hereunder, or designate a substitute Servicer,
without the prior written consent of the Administrative Agent and each
Funding Agent; provided that TMN shall be permitted to delegate its
duties hereunder to any of its Affiliates or their agents and may use
subservicers, but such delegation shall not relieve TMN of its duties
and obligations hereunder. The Administrative Agent (with the consent or
at the direction of the Funding Agents) shall, after the occurrence of a
Servicer Default or any other Termination Event, designate as Servicer
the Back-up Servicer to succeed TMN. The Back-up Servicer hereby agrees
to perform the duties and obligations of the Servicer pursuant to the
terms hereof. In the event the Back-up Servicer is unable to accept the
appointment or to perform such duties and obligations of the Servicer,
the Successor Servicer shall, notwithstanding any other provision set
forth herein, use reasonable efforts to act as the Servicer and shall
use reasonable efforts to perform, or to engage a
44
third party to perform, the duties and obligations of the Servicer
pursuant to the terms hereof. Chase shall be entitled to the Successor
Servicer Fee in its capacity as Successor Servicer prior to acting in
the capacity as Servicer. Following a Servicer Default or a Termination
Event, the Administrative Agent may (with the consent or at the
direction of the Funding Agents) notify any Credit Card Processor or
Restaurant of the designation of the Back-up Servicer or, if applicable,
the Successor Servicer as Servicer.
After the occurrence of a Servicer Default or any other
Termination Event, the Servicer and the Transferor each hereby
irrevocably authorize and grant to each of the Back-up Servicer and the
Successor Servicer an irrevocable power-of-attorney to take any and all
steps in the Servicer's or the Transferor's name and on behalf of the
Servicer or the Transferor that are necessary or desirable to perform
its duties hereunder, including collecting amounts due under the
Receivables, including without limitation, endorsing the Servicer's name
on checks and other instruments representing Collections and enforcing
the Receivables and related Contracts. This power-of-attorney is coupled
with an interest.
(b) The Back-up Servicer shall not resign from the
obligations and duties hereby imposed on it except upon determination
that (i) the performance of its duties hereunder is no longer
permissible under applicable Law and (ii) there is no reasonable action
which the Back-up Servicer could take to make the performance of its
duties hereunder permissible under applicable Law. Any such
determination permitting the resignation of the Back-up Servicer shall
be evidenced as to clause (i) above by an opinion of counsel to the
Back-up Servicer to such effect addressed and delivered to, and in a
form reasonably acceptable to, the Administrative Agent, each Funding
Agent and the Successor Servicer. No such resignation shall become
effective until a replacement Back-up Servicer shall have assumed the
responsibilities and obligations of the Back-up Servicer in accordance
with this Article VI. The Administrative Agent, each Funding Agent and
the Successor Servicer shall be entitled to any fees and expenses
(including the fees and expenses of outside agents and counsel) incurred
in connection with the transition of servicing from the Servicer to
another Person.
(c) If the Successor Servicer shall become legally
unable to perform its obligations hereunder, it shall be entitled to
petition a court of competent jurisdiction to appoint a Successor
Servicer. The Successor Servicer may also resign upon receiving prior
consent of the Administrative Agent and each Funding Agent, which
consent shall not be unreasonably withheld. Notwithstanding anything
contained herein, Chase may resign as Successor Servicer if Chase is no
longer acting as Administrative Agent and PARCO Funding Agent.
SECTION 6.2 Duties of Servicer.
(a) The Servicer shall take or cause to be taken all
such action as may be reasonably necessary or advisable to collect each
Receivable from time to time, all in accordance with applicable Laws,
with reasonable care and diligence, and in
45
accordance with the Restaurant Guidelines. Each of the Transferor, the
Administrative Agent, the Initial Purchasers and the APA Bank
Purchasers, hereby appoints as its agent the Servicer, from time to time
designated pursuant to Section 6.1 hereof, to enforce its respective
rights and interests in and under the Receivables and Related Security,
Collections and Proceeds with respect thereto. To the extent permitted
by applicable Law, each of the Transferor, TMN (to the extent not then
acting as Servicer hereunder) and each other Seller hereby grants to any
Servicer appointed hereunder an irrevocable power of attorney to take in
the Transferor's and/or each Seller's name and on behalf of the
Transferor or a Seller any and all steps necessary or desirable, in the
reasonable determination of the Servicer, to collect all amounts due
under any and all Receivables, including, without limitation, endorsing
the Transferor's and/or a Seller's name on checks and other instruments
representing Collections and enforcing such Receivables and the related
Contracts. The Servicer shall set aside for the account of the
Transferor and the Purchasers their respective allocable shares of the
Collections of Receivables in accordance with Sections 2.5 and 2.6
hereof. The Servicer shall segregate and deposit to each Funding
Account, for the benefit of the Purchasers within each Funding Agent's
Purchaser Group, each such Purchaser's allocable share of Collections of
Receivables when required pursuant to Article II hereof. The Servicer
and TMN agree that prior to making any material change in the Restaurant
Guidelines in effect on the Amendment Effective Date, they shall give at
least ten (10) Business Days' prior written notice to each Rating
Agency, the Administrative Agent, each Funding Agent and the Transferor
of such changes; provided, however, that in the case of any material
change in its Restaurant Guidelines made pursuant to any Requirement of
Law as to which it is unable to give ten (10) Business Days' prior
written notice, then the Servicer and TMN shall give written notice to
each Rating Agency, the Administrative Agent, each Funding Agent and the
Transferor of such changes as soon as reasonably practicable prior to
the implementation of such changes. If TMN or the Servicer changes the
Restaurant Guidelines to lengthen the standard time (currently six (6)
months) in which Credits from any Restaurant are expected to be used,
such change shall be deemed to be a material adverse change. In the
event that any such changes (except changes that are necessary under any
Requirement of Law) could reasonably be expected to materially and
adversely affect the rights of the Initial Purchasers or the APA Bank
Purchasers, then such changes shall not become effective without the
prior written consent of each Funding Agent and the Required
Participants, which consent shall be obtained by the Administrative
Agent. The Transferor shall deliver to the Servicer and the Servicer
shall hold in trust for the Transferor, the Initial Purchasers, the
Administrative Agent, the Funding Agents and the APA Bank Purchasers, in
accordance with their respective interests, all Records which evidence
or relate to Receivables, Related Security or Collections.
Notwithstanding anything to the contrary contained herein, following the
occurrence of a Termination Event and during the continuation of a
Potential Termination Event, the Administrative Agent, with the consent
or at the direction of the Funding Agents, shall have the absolute and
unlimited right to direct the Servicer (whether the Servicer is TMN or
any other Person) to commence or settle any legal action to enforce
collection of any Receivable or to foreclose upon or repossess any
Related Security. The Servicer shall not make the Administrative Agent,
the Successor Servicer, any Initial Purchaser, any Funding
46
Agent or any of the APA Bank Purchasers a party to any litigation
without the prior written consent of such Person.
(b) The Servicer shall, as soon as practicable
following receipt thereof, turn over to the Transferor any collections
of any indebtedness of any Person which is not on account of a
Receivable. If the Servicer is not the Transferor, TMN or an Affiliate
of the Transferor or TMN, the Servicer, by giving three (3) Business
Days' prior written notice to the Administrative Agent and each Funding
Agent, may revise the Servicing Fee, provided that such revised
Servicing Fee shall be a reasonable fee agreed upon by the Servicer, the
Administrative Agent and each Funding Agent on an arms-length basis
reflecting rates and terms prevailing at such time. The Servicer, if
other than the Transferor or TMN or an Affiliate of the Transferor or
TMN, shall as soon as practicable upon demand, deliver to TMN all
Records in its possession which evidence or relate to indebtedness of a
Restaurant which is not a Receivable.
(c) On or before ninety (90) days after the end of
each fiscal year of the Servicer, beginning with the fiscal year ending
September 30, 2001, the Servicer shall cause a firm of independent
public accountants acceptable to the Administrative Agent, the Funding
Agents and the Successor Servicer at the expense of the Transferor (who
may also render other services to the Servicer, the Transferor, TMN or
any Affiliates of any of the foregoing) to furnish a report to the
Administrative Agent, the Funding Agents and the Successor Servicer
performing such agreed upon procedures with respect to the Servicer's
servicing procedures and internal control system as may be reasonably
requested by the Administrative Agent, any Funding Agent or the
Successor Servicer. The scope of the review shall be as put forth in
Exhibit N hereto.
The Servicer shall cause such firm of nationally recognized
independent certified public accountants to furnish such report to the
Administrative Agent and each Funding Agent using generally accepted auditing
standards to the effect that they have compared the mathematical calculations of
each amount set forth in five Weekly Reports and three Settlement Statements in
a sample randomly chosen during such annual period and delivered by the Servicer
pursuant to Section 2.11 during the period covered by such report with the
Servicer's computer reports that were the source of such amounts and that on the
basis of such comparison, such accountants are of the opinion that such amounts
are in agreement, except for such exceptions as they believe to be immaterial
and such other exceptions as shall be set forth in such report.
(d) Notwithstanding anything to the contrary
contained in this Article VI, the Servicer, if not the Transferor, TMN
or any Affiliate of the Transferor or TMN, shall have no obligation to
collect, enforce or take any other action described in this Article VI
with respect to any indebtedness that is not included in the Transferred
Interest other than to deliver to the Transferor the collections and
documents with respect to any such indebtedness as described in Section
6.2(b) hereof.
47
SECTION 6.3 Rights After Designation of New Servicer. At any
time following the designation of a Servicer pursuant to Section 6.1 hereof:
(i) The Administrative Agent may, with the
consent of the Funding Agents, or shall, at the direction of the
Funding Agents and the Required Participants, direct that
payment of all amounts payable under any Receivable be made
directly to the Administrative Agent or its designee for the
benefit of the Funding Agents, the Initial Purchasers and the
APA Bank Purchasers.
(ii) The Transferor shall, at the
Administrative Agent's request (which request shall be made only
with the consent or at the direction of the Funding Agents) and
at the Transferor's expense, give notice of the Initial
Purchasers', the Transferor's and/or the APA Bank Purchasers'
ownership of Receivables to each Credit Card Processor and each
Restaurant (or its designee) and direct that payments be made
directly to the Administrative Agent or its designee (for the
benefit of the Purchasers).
(iii) The Transferor shall, at the
Administrative Agent's request (which request shall be made only
with the consent or at the direction of the Funding Agents), (A)
assemble all of the Records, and shall make the same available
to the Administrative Agent, any Funding Agent or their
respective designee at a place selected by the Administrative
Agent, any Funding Agent or their respective designee, and (B)
segregate all cash, checks and other instruments received by it
from time to time constituting Collections of Receivables in a
manner acceptable to the Administrative Agent and each Funding
Agent and shall, promptly upon receipt, remit all such cash,
checks and instruments, duly endorsed or with duly executed
instruments of transfer, to the Administrative Agent or its
designee (for the benefit of the Purchasers).
(iv) The Transferor and each Seller hereby
authorize the Administrative Agent (for the benefit of the
Purchasers) to take any and all steps in the Transferor's or any
Seller's name and on behalf of the Transferor and any Seller
necessary or desirable, in the reasonable determination of the
Administrative Agent, with the consent or at the direction of
the Funding Agents, to collect all amounts due under any and all
Receivables, including, without limitation, endorsing the
Transferor's or any Seller's name on checks and other
instruments representing Collections and enforcing such
Receivables and the related Contracts.
SECTION 6.4 Servicer Default. The occurrence of any one or more
of the following events shall constitute a Servicer default (each, a "Servicer
Default"):
(a) (i) the Servicer or the Back-up Servicer or, to
the extent that the Transferor, TMN or any Affiliate of the Transferor
or TMN is then acting as Servicer, the Transferor, TMN or such
Affiliate, as applicable, shall fail to observe or perform any term,
covenant or agreement hereunder (other than as referred to in clause
(ii) of
48
this Section 6.4(a)) or under any of the other Transaction Documents to
which such Person is a party or by which such Person is bound, and such
failure shall remain unremedied for eight (8) Business Days following
the earlier to occur of receipt of notice thereof by the Servicer or the
Back-up Servicer, as applicable, from the Administrative Agent or a
Funding Agent or discovery thereof by the Servicer or the Back-up
Servicer, as applicable, or (ii) the Servicer or the Back-up Servicer
or, to the extent that the Transferor, TMN or any Affiliate of the
Transferor or TMN is then acting as Servicer, the Transferor, TMN or
such Affiliate, as applicable, shall fail to make any payment or deposit
required to be made by it hereunder when due or the Servicer shall fail
to observe or perform any term, covenant or agreement on the Servicer's
part to be performed under Section 2.8(b) hereof; or
(b) any representation, warranty, certification or
statement made by the Servicer or the Back-up Servicer or the
Transferor, TMN or any Affiliate of the Transferor or TMN (in the event
that the Transferor, TMN or such Affiliate is then acting as the
Servicer) in this Agreement, the Receivables Purchase Agreement or in
any of the other Transaction Documents or in any certificate or report
delivered by it pursuant to any of the foregoing shall prove to have
been incorrect in any material respect when made or deemed made;
provided, however, that (i) to the extent any breach of any such
representation or warranty may be cured within eight (8) Business Days,
the Servicer or the Back-up Servicer, as applicable, shall have eight
(8) Business Days following the earlier to occur of receipt of notice
thereof by the Servicer or the Back-up Servicer, as applicable, from the
Administrative Agent or a Funding Agent or discovery thereof by the
Servicer or the Back-up Servicer, as applicable, to make such
representation and warranty true and correct in all material respects,
and (ii) if any such representation and warranty relates to a Receivable
for which the Transferor has paid to the Servicer an amount equal to the
Outstanding Balance of such Receivable pursuant to Section 2.9(a)
hereof, then the breach of such representation or warranty shall not
give rise to a Servicer Default under this subsection (b); or
(c) (i) failure of the Servicer or any of its
Affiliates to pay when due any amounts due under any agreement under
which any Indebtedness greater than $1,000,000 is governed; or (ii) the
default by the Servicer or any of its Affiliates in the performance of
any term, provision or condition contained in any agreement under which
any Indebtedness greater than $1,000,000 was created or is governed,
regardless of whether such event is an "event of default" or "default"
under any such agreement; or (iii) any Indebtedness of the Servicer or
any of its Affiliates greater than $1,000,000 shall be declared to be
due and payable or required to be prepaid (other than by a regularly
scheduled payment) by reason of a breach or default of same prior to the
scheduled date of maturity thereof; or
(d) any Event of Bankruptcy shall occur with respect
to the Servicer or any of its Affiliates or the Back-up Servicer or any
of its Affiliates; or
(e) there shall have occurred any material adverse
change in the operations of the Servicer since the end of last fiscal
year ending prior to the date of its
49
appointment as Servicer hereunder or any other event shall have occurred
which, in the commercially reasonably judgment of the Administrative
Agent, any Funding Agent or the Successor Servicer, materially and
adversely affects the Servicer's ability to either collect or account
for the Receivables or to perform under this Agreement.
SECTION 6.5 Responsibilities of the Transferor and each Seller.
Anything herein to the contrary notwithstanding, the Transferor shall, and/or
shall cause each Seller to, (i) perform all of each Seller's obligations under
the Contracts related to the Receivables to the same extent as if interests in
such Receivables had not been sold hereunder and under the Receivables Purchase
Agreement and the exercise by the Administrative Agent, any Funding Agent, any
Initial Purchaser or any APA Bank Purchaser of their rights hereunder and under
the Receivables Purchase Agreement shall not relieve the Transferor or such
Seller from such obligations and (ii) pay when due any taxes, including without
limitation, any sales taxes payable in connection with the Receivables and their
creation and satisfaction. Neither the Administrative Agent, nor any Funding
Agent, nor any Initial Purchaser, nor any APA Bank Purchaser shall have any
obligation or liability with respect to any Receivable or related Contracts, nor
shall it be obligated to perform any of the obligations of a Seller, the
Originator or the Transferor thereunder.
SECTION 6.6 Collection Procedures. On or before the Original
Closing Date, the Servicer, each Seller and the Transferor shall have
established and shall maintain thereafter the system of collecting and
processing Collections of Receivables set forth in Exhibit O attached hereto, as
such Exhibit may be amended, supplemented or modified with the prior written
consent of the Administrative Agent and each Funding Agent.
SECTION 6.7 Servicer Indemnification of Indemnified Parties. The
Servicer shall indemnify and hold harmless the Indemnified Parties, from and
against any loss, liability, expense, damage or injury suffered or sustained
solely by reason of any breach by the Servicer of any of its representations,
warranties or covenants contained in this Agreement, including any judgment,
award, settlement, reasonable attorneys' fees and other costs or expenses
reasonably incurred in connection with the defense of any actual action,
proceeding or claim; provided, however, that (i) the Servicer shall not
indemnify any Indemnified Party if such acts or omissions were attributable to
fraud, gross negligence or willful misconduct by such Indemnified Party and (ii)
neither the Servicer nor any of the directors, officers, employees or agents of
the Servicer in its capacity as Servicer shall be under any liability to the
Indemnified Parties for any action taken or for refraining from the taking of
any action in good faith in its capacity as Servicer pursuant to this Agreement;
provided, further, however that the immediately preceding proviso shall not
protect the Servicer or any such director, officer, employee or agent against
any liability which would otherwise be imposed by reason of willful misfeasance,
bad faith or gross negligence in the performance of duties or by reason of
reckless disregard of obligations and duties hereunder. The Servicer and any
director, officer, employee or agent of the Servicer may rely in good faith on
any document of any kind prima facie properly executed and submitted by any
Person (other than the Servicer or an Affiliate of the Servicer) respecting any
matters arising hereunder. Any indemnification pursuant to this Section shall be
had only from the assets of the Servicer and shall not be payable from
Collections, except to the extent such Collections
50
are released to the Servicer in accordance with Sections 2.5 and 2.6. The
provisions of such indemnity shall run directly to and be enforceable by such
Indemnified Parties and shall survive the resignation or removal of the Servicer
or any Indemnified Party and shall survive the termination of this Agreement.
Without limiting the foregoing, each Seller, by transferring interests in the
Receivables to the Transferor, the Transferor, by transferring interests in the
Receivables to the Administrative Agent, for the benefit of the Initial
Purchasers and/or the APA Bank Purchasers, and the Administrative Agent on
behalf of the Initial Purchasers and the APA Bank Purchasers, by acquiring such
interest in the Receivables, acknowledges that each Seller has transferred and
the Transferor, and the Administrative Agent, on behalf of the Initial
Purchasers and the APA Bank Purchasers, as applicable, have assumed all risk of
payment and collection with respect thereto.
SECTION 6.8 Maintenance of Property; Insurance. The Servicer
will (i) keep all property and assets useful and necessary in its business as
Servicer in good working order and condition (normal wear and tear excepted),
(ii) maintain, with financially sound and reputable insurance companies,
insurance on all its property and assets necessary in its business as Servicer
in at least such amounts and against at least such risks (and with such risk
retention) as are usually insured against in the same general area by companies
of established repute engaged in the same or a similar business and reasonably
satisfactory to the Administrative Agent and each Funding Agent, (iii) furnish
to the Transferor, the Administrative Agent and each Funding Agent upon written
request, full information as to the insurance carried, (iv) within five days of
receipt of notice from any insurer, furnish the Transferor, the Administrative
Agent and each Funding Agent with a copy of any notice of cancellation or
material change in coverage from that existing on the Amendment Effective Date
and (v) forthwith, furnish the Transferor, the Administrative Agent and each
Funding Agent with notice of any cancellation or nonrenewal of coverage by the
Servicer. The Servicer will (A) maintain disaster recovery systems and back-up
computer and other information management systems that, in the Servicer's
reasonable judgment, are sufficient to protect its business as Servicer against
material interruption or loss in the event of damage to, or loss or destruction
of, its primary computer and information management systems and (B) furnish to
the Transferor, the Administrative Agent and each Funding Agent, upon written
request, full information as to such disaster recovery systems and back-up
computer and information management systems.
SECTION 6.9 Duties of the Back-Up Servicer. The Back-up Servicer
shall, for the benefit of the Administrative Agent, each Funding Agent and the
Successor Servicer, (i) receive daily data from the Servicer relating to the
Receivables, the Restaurants, Collections and the Members' Credit Card Accounts;
(ii) keep and maintain all such data received and all other records,
correspondence and documents necessary or desirable for the servicing of the
Receivables; (iii) maintain its existing computer system and any other
information management systems necessary for servicing the Receivables; and (iv)
provide the Administrative Agent, each Funding Agent, the Successor Servicer,
each Initial Purchaser and each APA Bank Purchaser and their respective
representatives access to offices of the Back-up Servicer used in connection
with performing its duties hereunder and to the documentation in its possession
regarding the Receivables, such access being afforded without charge but only
(1) upon two Business Days prior notice, (2) during normal business
51
hours, and (3) subject to the Back-up Servicer's normal security and
confidentiality procedures. All fees of the Back-up Servicer in connection with
its duties hereunder (the "Back-up Servicer Fees") shall be paid by TMN out of
TMN's own funds as agreed upon between TMN and the Back-up Servicer.
SECTION 6.10 Grant of License. For the purpose of enabling the
Back-up Servicer and the Successor Servicer to perform the functions of
servicing and collecting the Receivables upon a Servicer Default, the Servicer
and each Seller hereby (i) assigns, to the extent permitted, to the Back-up
Servicer and the Successor Servicer and shall be deemed to assign to the Back-up
Servicer and the Successor Servicer all rights owned or hereinafter acquired by
any Seller or the Servicer (by license, sublicense, lease, easement or
otherwise) in and to any equipment together with a copy of any software listed
on Schedule I hereto, (ii) agrees to use its best efforts to assist the Back-up
Servicer and the Successor Servicer to arrange licensing agreements with all
software vendors and other applicable persons in a manner and to the extent
reasonably appropriate to effectuate the servicing of the Receivables, and (iii)
deliver to the Back-up Servicer and the Successor Servicer executed copies of
any landlord waivers in a form reasonably acceptable to the Back-up Servicer and
the Successor Servicer, that may be necessary to grant to the Back-up Servicer
and the Successor Servicer access to any leased premises of any of the Servicer
for which the Back-up Servicer or the Successor Servicer may require access to
perform the collection and administrative functions to be performed by the
Back-up Servicer or the Successor Servicer under the Transaction Documents.
SECTION 6.11 Successor Servicer Liability. The Successor
Servicer offers no representations concerning, and shall have no liability
hereunder with respect to, the collectability, enforceability or other
characteristics of the Receivables as such. Notwithstanding any other provision
of this Agreement, the Successor Servicer shall not be liable hereunder for (a)
any act taken or any omission by the Successor Servicer acting in good faith in
conformity with the written consent or approval of the Administrative Agent, the
Funding Agents, the Transferor, the Servicer, the Initial Purchasers, the APA
Bank Purchasers or the Back-up Servicer or (b) the Successor Servicer's
performance (or lack of performance) under this Agreement, except with regard to
acts or omissions of the Successor Servicer constituting gross negligence, bad
faith, willful misfeasance or recklessness.
The Successor Servicer shall have no responsibility, shall not
be in default and shall incur no liability hereunder (i) for any act or failure
to act by any third party, including the Administrative Agent, the Funding
Agents, the Transferor, the Servicer, the Initial Purchasers, the APA Bank
Purchasers or the Back-up Servicer or for any inaccuracy or omission in a notice
or communication received by the Successor Servicer from any third party or (ii)
which is due to or results from the invalidity or unenforceability of any
Receivable or noncompliance of the underlying Contract with applicable Law or
the breach or the inaccuracy of any representation or warranty made with respect
to any Receivable. Without limiting the foregoing, any liability of the
Successor Servicer under or in connection with this Agreement shall be limited
to direct damages caused as a result of its gross negligence or willful
misconduct and the Successor Servicer shall in no event have any liability for
any special, indirect, or consequential loss or damage of any kind whatsoever
(including, but not
52
limited to lost profits), even if the Successor Servicer has been advised of the
likelihood of such loss or damage and regardless of the form of action.
The Successor Servicer undertakes to perform such duties and
only such duties as are required by this Agreement. The Successor Servicer shall
not have any duties or responsibilities except those expressly set forth in this
Agreement or be a trustee for or have any fiduciary obligation to any party
hereto.
None of the provisions of this Agreement shall require the
Successor Servicer to expend or risk its own funds or otherwise to incur any
liability, financial or otherwise, in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers if it shall have
reasonable grounds for believing that repayment of such funds or indemnity
satisfactory to it against such risk or liability is not assured to it.
The Successor Servicer may conclusively rely and shall be fully
protected in acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval or other paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties.
The Successor Servicer may consult with counsel and the advice
or any opinion of counsel shall be full and complete authorization and
protection in respect of any action taken or omitted by it hereunder in good
faith and in accordance with such advice or opinion of counsel.
The Successor Servicer shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, entitlement
order, approval or other paper or document.
The Successor Servicer may act through agents, attorneys,
nominees and custodians and shall not be liable for the actions or omissions of
such agents, attorneys, nominees and custodians appointed with due care.
ARTICLE VII
INDEMNIFICATION; EXPENSES; RELATED MATTERS
SECTION 7.1 Indemnities by the Transferor. Without limiting any
other rights which the Administrative Agent, the Funding Agents, the Initial
Purchasers, the Successor Servicer, the Fairway APA Banks or the PARCO APA Banks
may have hereunder or under applicable Law, the Transferor hereby agrees to
indemnify the Administrative Agent, the Initial Purchasers, the Funding Agents,
the Fairway APA Banks, the PARCO APA Banks and the Successor Servicer and any
successors and permitted assigns and their respective officers, directors,
agents and employees (collectively, "Indemnified Parties" and each, an
"Indemnified Party") from and against any and all damages, losses, claims,
liabilities, costs and expenses, including, without limitation, reasonable
attorneys' fees and disbursements (all of the foregoing being collectively
referred to as "Indemnified Amounts") awarded against or incurred by any of them
in any action or proceeding between the Transferor and any of the
53
Indemnified Parties or between any of the Indemnified Parties and any third
party or otherwise arising out of or as a result of this Agreement, the other
Transaction Documents, the ownership, either directly or indirectly, by the
Administrative Agent, any Initial Purchaser, any Funding Agent, or any APA Bank
Purchaser of the Transferred Interest or any of the other transactions
contemplated hereby or thereby, excluding, however, (i) Indemnified Amounts to
the extent resulting from gross negligence or willful misconduct on the part of
such Indemnified Party or (ii) recourse (except as otherwise specifically
provided in this Agreement) for uncollectible Receivables; provided that any
Indemnified Amounts owed under this Section 7.1 shall be payable in accordance
with Sections 2.5 and 2.6 and shall be Transferor Subordinated Obligations.
Without limiting the generality of the foregoing, the Transferor shall indemnify
each Indemnified Party for Indemnified Amounts relating to or resulting from:
(a) any representation or warranty made by the
Transferor or any officers of the Transferor under this Agreement, any
of the other Transaction Documents, any Settlement Report, any Weekly
Report, any Daily Report or any other written information or report
delivered by the Transferor pursuant hereto or thereto, which shall have
been false or incorrect in any material respect when made or deemed
made;
(b) the failure by the Transferor to comply in any
material respect with any applicable Law, with respect to any Receivable
or the related Contract, or the nonconformity in any material respect of
any Receivable or the related Contract with any such applicable Law;
(c) any dispute, claim, offset or defense (other
than discharge in bankruptcy) of a Restaurant to the payment of any
Receivable (including, without limitation, a defense based on such
Receivable or the related Contract not being the legal, valid and
binding obligation of such Restaurant enforceable against it in
accordance with its terms), or any other claim resulting from the sale
of merchandise or provision of services related to such Receivable or
the furnishing or failure to furnish such merchandise or services;
(d) any products liability claim or personal injury
or property damage suit or other similar or related claim or action of
whatever sort arising out of or in connection with merchandise which is
the subject of any Receivable;
(e) the failure by the Transferor to comply in any
material respect with any term, provision or covenant contained in this
Agreement or any of the other Transaction Documents to which it is a
party or to perform any of its respective duties under the Contracts;
(f) the failure of the Transferor to pay when due
any taxes, including without limitation, sales, excise or personal
property taxes payable in connection with any of the Receivables;
54
(g) any repayment by any Indemnified Party of any
amount previously distributed in reduction of Aggregate Net Investment
which such Indemnified Party believes in good faith is required to be
made;
(h) the commingling by the Transferor of Collections
of Receivables at any time with other funds to the extent not otherwise
permitted pursuant to this Agreement and the other Transaction
Documents;
(i) any investigation, litigation, preparation for
litigation, proceeding, audit, dispute or disagreement related to this
Agreement, any of the other Transaction Documents, the use of proceeds
of Transfers by the Transferor, the ownership of Transferred Interests,
or any Receivable, Related Security or Contract;
(j) the failure of any Lock-Box Bank to remit any
amounts held in the Lock-Box Accounts pursuant to the instructions of
the Servicer, the Transferor, TMN or the Administrative Agent (to the
extent such Person is entitled to give such instructions in accordance
with the terms hereof and of any applicable Lock-Box Agreement) whether
by reason of the exercise of set-off rights or otherwise;
(k) any failure of the Transferor to give reasonably
equivalent value to any Seller in consideration of the purchase by the
Transferor from any Seller of any Receivable, or any attempt by any
Person to void, rescind or set-aside any such transfer under statutory
provisions or common law or equitable action, including, without
limitation, any provision of the Bankruptcy Code;
(l) any action taken by the Transferor in the
enforcement or collection of any Receivable; provided, that the
Transferor shall not be liable for Indemnified Amounts attributable to
the fraud, gross negligence or willful misconduct of any Servicer in the
enforcement or collection of any Receivable if such Servicer is not the
Transferor, TMN or any Affiliate of the Transferor or TMN; or
(m) any failure by the Transferor to complete an
Incremental Transfer following the receipt by the Administrative Agent
and/or any Funding Agent of notice of a proposed Transfer from the
Transferor pursuant to Section 2.2 due to no fault of the Administrative
Agent, the Initial Purchasers, the Funding Agents or the APA Bank
Purchasers;
provided, however, that if the Initial Purchasers enter into agreements for the
purchase of interests in receivables from one or more Other Transferors, the
Initial Purchasers shall ratably allocate such Indemnified Amounts related to
the Initial Purchasers' program documents to the Transferor and each Other
Transferor; and provided, further, that if such Indemnified Amounts are
attributable to the Transferor and not attributable to any Other Transferor, the
Transferor shall be solely liable for such Indemnified Amounts or if such
Indemnified Amounts are attributable to Other Transferors and not attributable
to the Transferor, such Other Transferors shall be solely liable for such
Indemnified Amounts.
55
SECTION 7.2 Indemnity for Reserves and Expenses.
(a) If after the date hereof, the adoption of any
Law or bank regulatory guideline or any amendment or change in the
interpretation of any existing or future Law or bank regulatory
guideline by any Official Body charged with the administration,
interpretation or application thereof, or the compliance with any
directive of any Official Body (in the case of any bank regulatory
guideline, whether or not having the force of Law), other than Laws,
interpretations, guidelines or directives relating to Taxes:
(i) shall impose, modify or deem applicable
any reserve, special deposit or similar requirement (including,
without limitation, any such requirement imposed by the Board of
Governors of the Federal Reserve System) against assets of,
deposits with or for the account of, or credit extended by, any
Indemnified Party or shall impose on any Indemnified Party or on
the United States market for certificates of deposit or the
London interbank market any other condition affecting this
Agreement, the other Transaction Documents, the ownership,
maintenance or financing of the Transferred Interest, the
Receivables or payments of amounts due hereunder or its
obligation to advance funds hereunder or under the other
Transaction Documents; or
(ii) imposes upon any Indemnified Party any
other expense (including, without limitation, reasonable
attorneys' fees and expenses, and expenses of litigation or
preparation therefor in contesting any of the foregoing) with
respect to this Agreement, the other Transaction Documents, the
ownership, maintenance or financing of any portion of the
Transferred Interest, the Receivables or payments of amounts due
hereunder or its obligation to advance funds hereunder or
otherwise in respect of this Agreement or the other Transaction
Documents,
and the result of any of the foregoing is to increase the cost to such
Indemnified Party with respect to this Agreement, the other Transaction
Documents, the ownership, maintenance or financing of any portion of the
Transferred Interest, the Receivables, the obligations hereunder or the funding
of any Purchases hereunder or under the other Transaction Documents, by an
amount reasonably deemed by such Indemnified Party to be material, then, within
ten (10) Business Days after demand by such Indemnified Party through its
Funding Agent or the Administrative Agent, the Transferor or TMN shall pay to
the applicable Funding Agent, for the benefit of such Indemnified Party, such
additional amount or amounts as will compensate such Indemnified Party for such
increased cost or reduction; provided that no such amount shall be payable with
respect to any period commencing more than two hundred and seventy (270) days
prior to the date the Administrative Agent or such Funding Agent first notifies
the Transferor or TMN of its intention to demand compensation therefor under
this Section 7.2(a); provided further that if such change in Law giving rise to
such increased costs or reductions is retroactive, then such 270-day period
shall be extended to include the period of retroactive effect thereof. In making
demand hereunder, the applicable Indemnified Party shall submit to
56
the Transferor a certificate as to such increased costs incurred which shall
provide in detail the basis for such claim.
(b) if any Indemnified Party shall have determined
that after the date hereof, the adoption of any applicable Law or bank
regulatory guideline regarding capital adequacy, or any change therein,
or any change in the interpretation thereof by any Official Body, or any
directive regarding capital adequacy (in the case of any bank regulatory
guideline, whether or not having the force of Law) of any such Official
Body, has or would have, due to an increase in the amount of capital
required to be maintained by such Indemnified Party, the effect of
reducing the rate of return on capital of such Indemnified Party (or its
parent) as a consequence of such Indemnified Party's obligations
hereunder or with respect hereto to a level below that which such
Indemnified Party (or its parent) could have achieved but for such
adoption, change, request or directive (taking into consideration its
policies with respect to capital adequacy) by an amount reasonably
deemed by such Indemnified Party to be material, then from time to time,
within ten (10) Business Days after demand by such Indemnified Party
through its Funding Agent or the Administrative Agent, the Transferor or
TMN shall pay to the applicable Funding Agent, for the benefit of such
Indemnified Party, such additional amount or amounts as will compensate
such Indemnified Party (or its parent) for such reduction; provided that
no such amount shall be payable with respect to any period commencing
more than two hundred and seventy (270) days prior to the date the
Administrative Agent or such Funding Agent first notifies the Transferor
or TMN of its intention to demand compensation therefor under this
Section 7.2(b); provided further that if such change in Law, giving rise
to such increased costs or reductions is retroactive, then such 270-day
period shall be extended to include the period of retroactive effect
thereof. In making demand hereunder, the applicable Indemnified Party
shall submit to the Transferor a certificate as to such increased costs
incurred which shall provide in detail the basis for such claim.
(c) Anything in this Section 7.2 to the contrary
notwithstanding, if the Initial Purchasers enter into agreements for the
acquisition of interests in receivables from one or more Other
Transferors, the Initial Purchasers shall ratably allocate the liability
for any amounts under this Section 7.2 ("Section 7.2 Costs") to the
Transferor and TMN and each Other Transferor; provided, however, that if
such Section 7.2 Costs are attributable to the Transferor or TMN and not
attributable to any Other Transferor, the Transferor and TMN shall be
solely liable for such Section 7.2 Costs or if such Section 7.2 Costs
are attributable to Other Transferors and not attributable to the
Transferor or TMN, such Other Transferors shall be solely liable for
such Section 7.2 Costs.
(d) all amounts owed by the Transferor pursuant to
this Section 7.2 shall be payable in accordance with Sections 2.5 and
2.6 and shall be Transferor Subordinated Obligations. Any amounts owed
by TMN pursuant to this Section shall be had only from the assets of TMN
and shall not be payable from Collections, except to the extent such
Collections are released to TMN in accordance with Sections 2.5 and 2.6.
57
SECTION 7.3 Indemnity for Taxes.
(a) All payments made by the Transferor, any Seller
or the Servicer to the Funding Agents for the benefit of the Initial
Purchasers and the APA Bank Purchasers under this Agreement and any
other Transaction Document shall be made free and clear of, and without
deduction or withholding for or on account of, any present or future
income, stamp or other taxes, levies, imposts, duties, charges, fees,
deductions or withholdings, now or hereafter imposed, levied, collected,
withheld or assessed by any Official Body, excluding (i) taxes imposed
on the net or branch income of the Administrative Agent or any other
Indemnified Party, however denominated, and (ii) franchise taxes imposed
on the net or branch income of the Administrative Agent or any other
Indemnified Party and (iii) taxes imposed as a result of the failure of
the Administrative Agent or such Indemnified Party to comply with the
requirements of subsection 7.3(b) hereof if it is not incorporated under
the laws of the United States of America or a State thereof or the
District of Columbia, in each case imposed: (1) by the United States or
any political subdivision or taxing authority thereof or therein; (2) by
any jurisdiction under the laws of which the Administrative Agent or
such Indemnified Party or lending office is organized or in which its
lending office is located, managed or controlled or in which its
principal office is located or any political subdivision or taxing
authority thereof or therein; or (3) by reason of any connection between
the jurisdiction imposing such tax and the Administrative Agent, such
Indemnified Party or such lending office other than a connection arising
solely from this Agreement or any other Transaction Document or any
transaction hereunder or thereunder (all such non-excluded taxes,
levies, imposts, duties, charges, fees, deductions or withholdings,
collectively or individually, "Taxes"). If any such Taxes are required
to be withheld from any amounts payable to the Administrative Agent or
any Indemnified Party hereunder, the amounts so payable to the
Administrative Agent or such Indemnified Party shall be increased to the
extent necessary to yield to the Administrative Agent or such
Indemnified Party (after payment of all Taxes) all amounts payable
hereunder at the rates or in the amounts specified in this Agreement and
the other Transaction Documents. The Transferor or TMN shall indemnify
the Administrative Agent or any such Indemnified Party for the full
amount of any such Taxes within thirty (30) days after the date of
written demand therefor by the Administrative Agent. All amounts owed by
the Transferor pursuant to this Section 7.3(a) shall be payable in
accordance with Sections 2.5 and 2.6 and shall be Transferor
Subordinated Obligations. Any amounts owed by TMN or the Servicer
pursuant to this Section shall be had only from the assets of TMN or the
Servicer, as applicable, and shall not be payable from Collections,
except to the extent such Collections are released to TMN or the
Servicer, as applicable, in accordance with Sections 2.5 and 2.6.
(b) Each Indemnified Party that is not incorporated
under the laws of the United States of America or a State thereof or the
District of Columbia shall:
(i) deliver to the Transferor and the
Administrative Agent (A) two duly completed copies of IRS Form
1001 or Form 4224, or successor
58
applicable form, as the case may be, and (B) an IRS Form ▇-▇▇▇▇,
▇-▇▇▇▇ or W-9, or successor applicable form, as the case may be;
(ii) deliver to the Transferor and the
Administrative Agent two (2) further copies of any such form or
certification on or before the date that any such form or
certification expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recent
form previously delivered by it to the Transferor; and
(iii) obtain such extensions of time for
filing and complete such forms or certifications as may
reasonably be requested by the Transferor or the Administrative
Agent;
unless, in any such case, an event (including, without limitation, any change in
treaty, law or regulation) has occurred prior to the date on which any such
delivery would otherwise be required which renders all such forms inapplicable
or which would prevent such Indemnified Party from duly completing and
delivering any such form with respect to it, and such Indemnified Party so
advises the Transferor and the Administrative Agent. Each such Indemnified Party
so organized shall certify (i) in the case of an IRS Form 1001 or IRS Form 4224
(or successor applicable form), that it is entitled to receive payments under
this Agreement and the other Transaction Documents without deduction or
withholding of any United States federal income taxes and (ii) in the case of an
IRS Form W-8BEN, IRS Form W-8ECI or IRS Form W-9 (or successor applicable form),
that it is entitled to an exemption from United States backup withholding tax.
Each Person that is an Initial Purchaser or Participant under the Transaction
Documents, or which otherwise becomes a party to this Agreement as a PARCO APA
Bank or a Fairway APA Bank, shall, prior to the effectiveness of such
assignment, participation or addition, as applicable, be required to provide all
of the forms and statements required pursuant to this Section 7.3.
SECTION 7.4 Other Costs, Expenses and Related Matters.
(a) The Transferor agrees, upon receipt of a written
invoice, to pay or cause to be paid, and to save the Administrative
Agent, the Initial Purchasers, the Funding Agents, the Fairway APA
Banks, the PARCO APA Banks and the Successor Servicer harmless against
liability for the payment of, all reasonable out-of-pocket expenses
(including, without limitation, reasonable attorneys', accountants' and
other third parties' fees and expenses, any filing fees and expenses
incurred by officers or employees of the Administrative Agent, the
Initial Purchasers, the Fairway APA Banks, the PARCO APA Banks, the
Successor Servicer and/or the Funding Agents) or intangible, documentary
or recording taxes incurred by or on behalf of the Administrative Agent,
any Initial Purchaser, any Fairway APA Bank, any PARCO APA Bank, the
Successor Servicer and any Funding Agent (i) in connection with the
negotiation, execution, delivery and preparation of this Agreement, the
other Transaction Documents and any documents or instruments delivered
pursuant hereto and thereto and the transactions contemplated hereby or
thereby (including, without limitation, the perfection or protection of
the Transferred Interest) and (ii) from time to time upon receipt of
prior written notice thereof from the Administrative Agent, any
59
Initial Purchaser, any Funding Agent, the Successor Servicer, any PARCO
APA Bank or any Fairway APA Bank, as applicable (a) relating to any
amendments, waivers or consents under this Agreement and the other
Transaction Documents, or (b) arising in connection with the
Administrative Agent's, any Initial Purchaser's, any Fairway APA Bank's,
any PARCO APA Bank's, the Successor Servicer's or any Funding Agent's
enforcement or preservation of rights (including, without limitation,
the perfection and protection of the Transferred Interest under this
Agreement) (all of such amounts, collectively, "Transaction Costs"). All
Transaction Costs owed by the Transferor pursuant to this Section 7.4(a)
shall be payable in accordance with Section 2.5 and 2.6 and shall be
Transferor Subordinated Obligations.
(b) The Transferor shall pay the applicable Funding
Agent, for the account of the Initial Purchasers and the APA Bank
Purchasers, as applicable, on demand any Early Collection Fee due on
account of the reduction of a Tranche on any day prior to the last day
of its Tranche Period.
(c) The Administrative Agent will within forty-five
(45) days after receipt of notice of any event occurring after the date
hereof which will entitle an Indemnified Party to compensation pursuant
to this Article VII, notify the Transferor and TMN in writing. Any
notice by the Administrative Agent or any Funding Agent claiming
compensation under this Article VII and setting forth the additional
amount or amounts to be paid to it hereunder shall be conclusive in the
absence of manifest error, provided that such claim is made in good
faith and on a reasonable basis. In determining such amount, the
Administrative Agent, any Funding Agent or any applicable Indemnified
Party may use any reasonable averaging and attributing methods.
(d) If any Seller is required to pay any additional
amount to any Purchaser pursuant to Sections 7.2 or 7.3, then such
Purchaser shall use reasonable efforts (which shall not require such
Purchaser to incur an unreimbursed loss or unreimbursed cost or expense
or otherwise take any action inconsistent with its internal policies or
legal or regulatory restrictions or suffer any disadvantage or burden
reasonably deemed by it to be significant) (A) to file any certificate
or document reasonably requested in writing by such Seller or (B) to
assign its rights and delegate and transfer its obligations hereunder to
another of its offices, branches or affiliates, if such filing or
assignment would reduce amounts payable pursuant to Sections 7.2 or 7.3,
as the case may be, in the future.
60
ARTICLE VIII
TERMINATION EVENTS
SECTION 8.1 Termination Events. The occurrence of any one or
more of the following events shall constitute a Termination Event:
(a) the Transferor, any Seller or the Servicer shall
fail to make any payment or deposit to be made by it hereunder or under
any of the Transaction Documents and such failure shall continue for one
(1) Business Day after the date such payment or deposit became due
hereunder or thereunder; or
(b) any representation, warranty, certification or
statement made by the Transferor or any Seller in this Agreement, any
other Transaction Document to which it is a party or in any other
document delivered pursuant hereto or thereto shall prove to have been
incorrect in any material respect when made or deemed made; provided,
however, that if any such representation, warranty, certification or
statement relates to a Receivable for which the Transferor has paid to
the Servicer an amount equal to the Outstanding Balance of such
Receivable pursuant to Section 2.9(a) hereof, then the breach of such
representation or warranty shall not give rise to a Termination Event
under this subsection (b); or
(c) Failure on the part of any Seller or the
Transferor to observe or perform in any material respect any other term,
covenant or agreement in this Agreement or any other Transaction
Document; or
(d) (i) failure of the Transferor, any Seller, or
any Affiliate of the Transferor or any Seller to pay when due any
amounts due under any agreement to which any such Person is a party and
under which any Indebtedness greater than $1,000,000 is governed; or
(ii) the default by the Transferor, any Seller or any Affiliate of the
Transferor or any Seller in the performance of any term, provision or
condition contained in any agreement to which any such Person is a party
and under which any Indebtedness owing by the Transferor, any Seller or
any Affiliate of the Transferor or any Seller greater than $1,000,000
was created or is governed, regardless of whether such event is an
"event of default" or "default" under any such agreement; or (iii) any
Indebtedness owing by the Transferor, any Seller or any Affiliate of the
Transferor or any Seller greater than $1,000,000 shall be declared to be
due and payable or required to be prepaid (other than by a regularly
scheduled payment) by reason of a breach or default of same prior to the
date of maturity thereof; or
(e) any Event of Bankruptcy shall occur with respect
to the Transferor, any Seller, or any Affiliate of either the Transferor
or any Seller; or
(f) the Administrative Agent, on behalf of the
Funding Agents, the Initial Purchasers and the APA Bank Purchasers,
shall, for any reason, fail or cease to have a valid and perfected first
priority ownership or security interest in the
61
Receivables and Related Security, Collections and Proceeds with respect
thereto, free and clear of any Adverse Claims; or
(g) a Servicer Default shall have occurred; or
(h) the Purchase Termination Date shall have
occurred under the Receivables Purchase Agreement; or
(i) (A) without obtaining the prior written consent
of the Administrative Agent, the Funding Agents and the Required
Participants, the Transferor or any Seller shall enter into any
transaction or merger whereby it is not the surviving entity or (B) a
Change of Control shall occur; or
(j) there shall have occurred any material adverse
change in the operations of the Transferor or any Seller since the
Amendment Effective Date, or any other Material Adverse Effect shall
have occurred; or
(k) the institution of any litigation, arbitration
proceedings or governmental proceeding involving any Seller or the
Transferor or the Receivables which would be reasonably probable to have
a Material Adverse Effect; or
(l) (i) the Percentage Factor exceeds the Maximum
Percentage Factor unless the Transferor deposits to the Funding Accounts
on the next Business Day, for the benefit of the Initial Purchasers
and/or the APA Bank Purchasers, as applicable, from previously received
Collections that have been released to or set aside for the Transferor
pursuant to Section 2.5 hereof, an amount that brings the Percentage
Factor to less than or equal to the Maximum Percentage Factor or
increases the balance of the Receivables on the next Business Day so as
to reduce the Percentage Factor to less than or equal to 100%; or (ii)
the Aggregate Net Investment shall exceed the Facility Limit; or
(m) the two week rolling average of Weekly Net Sales
shall decline by an amount greater than 15%; or
(n) the Advance Rate shall be less than 60.0%; or
(o) (i) the average years of employment by the
Sellers of the Sellers' sales employees (excluding administrative staff)
is less than 2.0 years; or (ii) the aggregate number of the Sellers'
sales employees shall be less than 50; or
(p) the minimum net worth of TMN and its
Consolidated Subsidiaries (as defined in accordance with GAAP) is less
than $24,000,000; or
(q) one or more judgments for the payment of money
in an aggregate amount in excess of $2,000,000 shall be rendered against
the Transferor, a Seller, the Servicer or their subsidiaries or any
combination thereof and the same shall remain undischarged for a period
of thirty (30) consecutive days during which
62
execution shall not be effectively stayed, or any action shall be
legally taken by a judgment creditor to attach or levy upon any assets
of the Transferor, a Seller, the Servicer or their subsidiaries to
enforce any such judgment; or
(r) the Servicer shall fail to deliver to the
Administrative Agent, each Funding Agent and the Successor Servicer an
accurate and timely report required to be delivered by it under the
terms of the Transaction Documents within three (3) Business Days of
(i) with respect to any Settlement Report or Weekly Report, when such
report was due or (ii) with respect to any other report, receipt by the
Servicer of written notice from the Administrative Agent, any Funding
Agent or the Successor Servicer that such report is due.
SECTION 8.2 Remedies Upon the Occurrence of a Termination Event
or a Potential Termination Event.
(a) Upon the occurrence of any Termination Event or
a Potential Termination Event, the Administrative Agent shall, at the
direction of either Funding Agent, by notice to the Transferor and the
Servicer, declare the Termination Date to have occurred, provided,
however, that in the case of any event described in Section 8.1(e),
8.1(f), 8.1(l)(i) and 8.1(l)(ii) above, the Termination Date shall be
deemed to have occurred automatically upon the occurrence of such event.
At all times after the occurrence of a Termination Event or Potential
Termination Event pursuant to Section 8.2(a), (i) the PARCO Base Rate
plus 2.00% shall be the Tranche Rate applicable to the PARCO Facility
Net Investment for all existing and future Tranches and (ii) the Fairway
Base Rate plus 2.00% shall be payable with respect to the Fairway Net
Investment.
(b) In addition, if a Termination Date is declared
hereunder, (i) the Administrative Agent shall promptly notify the
Transferor in writing that it has declared a Termination Date and that
it will be exercising the remedies specified in this Section 8.2, (ii)
the Administrative Agent, on behalf of the Funding Agents, the Initial
Purchasers and the APA Bank Purchasers, shall have all of the rights and
remedies provided to a secured creditor or a purchaser of accounts under
the Relevant UCC by applicable law in respect thereto, (iii) the
Facility Limit shall be reduced as of each calendar date thereafter to
equal the Aggregate Net Investment as of such date, (iv) the Percentage
Factor shall be increased to 100%, and (v) each Commitment shall be
reduced as of each calendar date thereafter, to equal its Pro Rata Share
of the Aggregate Net Investment as of such date.
ARTICLE IX
THE ADMINISTRATIVE AGENT
SECTION 9.1 Appointment. Each Initial Purchaser, APA Bank
Purchaser and Funding Agent hereby irrevocably designates and appoints Chase as
Administrative Agent hereunder, and authorizes the Administrative Agent to take
such action on its behalf under the provisions of this Agreement and to exercise
such powers and perform such duties as are
63
expressly delegated to the Administrative Agent by the terms of this Agreement,
together with such other powers as are reasonably incidental thereto, unless
otherwise directed by the Funding Agents and the Required Participants. To the
extent the Administrative Agent takes any such action, the Transferor, each
Seller and the Servicer, in dealing with the Administrative Agent, shall have
the right to assume such approval has been obtained and such direction is being
followed absent actual knowledge to the contrary. Notwithstanding any provision
to the contrary elsewhere in this Agreement, the Administrative Agent shall not
have any duties or responsibilities, except those expressly set forth herein, or
any fiduciary relationship with any Initial Purchaser, APA Bank Purchaser or
Funding Agent, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities on the part of the Administrative Agent shall be read
into this Agreement or the other Transaction Documents or shall otherwise exist
against the Administrative Agent. In performing its functions and duties
hereunder, the Administrative Agent shall act solely as the agent of the Initial
Purchasers, the APA Bank Purchasers and the Funding Agents under the Transaction
Documents, and the Administrative Agent does not assume, nor shall be deemed to
have assumed, any obligation or relationship of trust or agency with or for any
such Person.
SECTION 9.2 Delegation of Duties. The Administrative Agent may
execute any of its duties under this Agreement by or through its subsidiaries,
affiliates, agents or attorneys-in-fact and shall be entitled to advice of
counsel concerning all matters pertaining to such duties. The Administrative
Agent shall not be responsible for the negligence or misconduct (other than the
gross negligence or willful misconduct) of any agents or attorneys-in-fact
selected by it with reasonable care.
SECTION 9.3 Exculpatory Provisions. (a) Notwithstanding any
provision of this Agreement or any other Transaction Document: (i) the
Administrative Agent shall not have any obligations under this Agreement or any
other Transaction Document other than those specifically set forth herein and
therein, and no implied obligations of the Administrative Agent shall be read
into this Agreement or any other Transaction Document; and (ii) in no event
shall the Administrative Agent be liable under or in connection with this
Agreement or any other Transaction Document for indirect, special, or
consequential losses or damages of any kind, including lost profits, even if
advised of the possibility thereof and regardless of the form of action by which
such losses or damages may be claimed. Neither the Administrative Agent nor any
of its respective directors, officers, agents or employees shall be liable for
any action taken or omitted to be taken in good faith by it or them under or in
connection with this Agreement or any other Transaction Document, except for its
or their own gross negligence or willful misconduct. Without limiting the
foregoing, the Administrative Agent (a) may consult with legal counsel
(including counsel for the Initial Purchasers, the APA Bank Purchasers and the
Funding Agents), independent public accountants and other experts selected by it
and shall not be liable for any action taken or omitted to be taken in good
faith by it in accordance with the advice of such counsel, accountants or
experts, (b) shall not be responsible to the Initial Purchasers, the APA Bank
Purchasers, the Funding Agents, the Sellers or the Servicer for any statements,
warranties or representations (other than its own statements) made in or in
connection with this Agreement or the other Transaction Documents, (c) shall not
be responsible to the Initial Purchasers, the APA Bank Purchasers, the Funding
Agents, the Sellers or the Servicer for the due execution,
64
legality, validity, enforceability, genuineness, sufficiency or value of this
Agreement or the other Transaction Documents (other than the legality, validity,
enforceability or genuineness of its own execution, authorization and
performance hereof and thereof), (d) shall incur no liability under or in
respect of any of the Commercial Paper or other obligations of the Initial
Purchasers or the APA Bank Purchasers under this Agreement or the other
Transaction Documents and (e) shall incur no liability under or in respect of
this Agreement or the other Transaction Documents by acting in good faith upon
any notice (including notice by telephone), consent, certificate or other
instrument or writing (which may be by facsimile) believed by it to be genuine
and signed or sent by the proper party or parties. Notwithstanding anything else
herein or in the other Transaction Documents, it is agreed that where the
Administrative Agent may be required under this Agreement or the other
Transaction Documents to give notice of any event or condition or to take any
action as a result of the occurrence of any event or the existence of any
condition, the Administrative Agent agrees to give such notice or take such
action only to the extent that it has actual knowledge of the occurrence of such
event or the existence of such condition, and shall incur no liability for any
failure to give such notice or take such action in the absence of such
knowledge. All notices, documents and reports received by the Administrative
Agent hereunder or under the other Transaction Documents shall, to the extent
not otherwise so provided by the Transferor, the Servicer or any Seller, be
promptly provided by the Administrative Agent to each Funding Agent, by
facsimile or mail as deemed appropriate by the Administrative Agent.
SECTION 9.4 Reliance by Administrative Agent. The Administrative
Agent shall in all cases be entitled to rely, and shall be fully protected in
relying, in good faith, upon any note, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to each of the Initial Purchasers, the Funding Agents and
the APA Bank Purchasers), independent accountants and other experts selected by
the Administrative Agent. The Administrative Agent shall in all cases be fully
justified in failing or refusing to take any action in good faith under this
Agreement, any other Transaction Document or any other document furnished in
connection herewith or therewith unless it shall first receive such advice or
concurrence of the Funding Agents, as it deems appropriate, or it shall first be
indemnified to its satisfaction by the Funding Agents or otherwise against any
and all liability, cost and expense which may be incurred by it by reason of
taking or continuing to take any such action. The Administrative Agent shall in
all cases be fully protected in acting, or in refraining from acting, in good
faith under this Agreement, the other Transaction Documents or any other
document furnished in connection herewith or therewith in accordance with a
request of the Funding Agents, and such request and any action taken or failure
to act pursuant thereto shall be binding upon the Funding Agents, the Initial
Purchasers and the APA Bank Purchasers.
SECTION 9.5 Action Upon Events of Termination and Servicer
Defaults, Reports and Notices. If not otherwise specifically provided for herein
or in any other Transaction Document, to the extent the Administrative Agent is
entitled to consent to or withhold its consent of any waiver or amendment of
this Agreement or other Transaction
65
Documents in accordance with the terms hereof or thereof or otherwise take
action upon the occurrence of a Termination Event or a Servicer Default, the
Administrative Agent shall (i) give prompt notice to the Funding Agents of any
such waiver, amendment, Termination Event or Servicer Default of which it is
aware and (ii) take such action with respect to such waiver, amendment,
Termination Event or Servicer Default as shall be directed by all Funding Agents
(unless the direction of the Required Participants is also expressly required
with respect to a specific provision).
SECTION 9.6 Non-Reliance on Administrative Agent. Each of the
parties hereto expressly acknowledges that neither the Administrative Agent, nor
any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates has made any representations or warranties to it and that no act by
the Administrative Agent hereafter taken, including, without limitation, any
review of the affairs of either the Sellers or the Servicer, shall be deemed to
constitute any representation or warranty by the Administrative Agent. Except as
expressly provided herein, the Administrative Agent shall not have any duty or
responsibility to provide any Person other than each Funding Agent, each Initial
Purchaser or each APA Bank Purchaser with any credit or other information
concerning the business, operations, property, prospects, financial and other
condition or creditworthiness of the Sellers, the Servicer, the Initial
Purchasers, the APA Bank Purchasers or the Funding Agents which may come into
the possession of the Administrative Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates.
SECTION 9.7 Indemnification. The APA Bank Purchasers agree to
indemnify the Administrative Agent and its officers, directors, employees,
representatives and agents (to the extent not reimbursed by the Transferor, the
Servicer or any Seller under the Transaction Documents, and without limiting the
obligation of such Persons to do so in accordance with the terms of the
Transaction Documents), on a pro rata basis, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever (including,
without limitation, the reasonable fees and disbursements of counsel for the
Administrative Agent or the affected Person in connection with any
investigative, administrative or judicial proceeding commenced or threatened,
whether or not the Administrative Agent or such affected Person shall be
designated a party thereto) that may at any time be imposed on, incurred by or
asserted against the Administrative Agent or such affected Person as a result
of, or arising out of, or in any way related to or by reason of, any of the
transactions contemplated hereunder or under the Transaction Documents or any
other document furnished in connection herewith or therewith (but excluding any
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting solely from the gross
negligence or willful misconduct of the Administrative Agent or such affected
Person).
SECTION 9.8 Successor Administrative Agent. The Administrative
Agent may, upon five (5) days' notice to each Funding Agent (with a copy to the
Transferor and the Servicer), and the Administrative Agent will, at the
direction of the Required Participants, resign as Administrative Agent;
provided, in either case, that a Funding Agent or an APA Bank Purchaser agrees
to become the successor Administrative Agent hereunder in accordance with the
next sentence with the approval of the Required Participants. If the
66
Administrative Agent shall resign as Administrative Agent under this Agreement,
then the Required Participants during such period shall appoint from among the
Funding Agents or the APA Bank Purchasers a successor agent, whereupon such
successor agent shall succeed to the rights, powers and duties of the
Administrative Agent, and the term "Administrative Agent" shall mean such
successor agent, effective upon its acceptance of such appointment and its
delivery of a duly executed counterpart of this Agreement and an acknowledgment
to each Funding Agent, and the former Administrative Agent's rights, powers and
duties as Administrative Agent shall be terminated, without any other or further
act or deed on the part of such former Administrative Agent or any of the
parties to this Agreement. After the retiring Administrative Agent's resignation
hereunder as Administrative Agent, the provisions of this Article IX shall inure
to its benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement. Notice of the appointment of a
successor Administrative Agent shall be provided by the new Administrative Agent
to the Transferor and the Servicer.
ARTICLE X
MISCELLANEOUS
SECTION 10.1 Term of Agreement. This Agreement shall terminate
on the date following the Termination Date upon which the Aggregate Net
Investment has been reduced to zero, and all accrued PARCO Discount, Fairway
Discount, Servicing Fees, Successor Servicer Fees and all other Aggregate
Unpaids have been paid in full, in each case, in cash; provided, however, that
(i) the rights and remedies of the Administrative Agent, each Funding Agent,
each Initial Purchaser and each APA Bank Purchaser with respect to any
representation and warranty made or deemed to be made by the Transferor pursuant
to this Agreement, (ii) the indemnification and payment provisions of each Asset
Purchase Agreement, (iii) the indemnification provisions in Section 6.6 and
Article VII hereof, and (iv) the agreements set forth in Section 10.8 and 10.9
hereof, shall be continuing and shall survive any termination of this Agreement.
SECTION 10.2 Waivers; Amendments. No failure or delay on the
part of the Administrative Agent, any Funding Agent, or any Purchaser in
exercising any power, right or remedy under this Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any such power,
right or remedy preclude any other further exercise thereof or the exercise of
any other power, right or remedy. The rights and remedies herein provided shall
be cumulative and nonexclusive of any rights or remedies provided by law. Any
provision of this Agreement may be amended, waived, supplemented or otherwise
modified if, but only if, such amendment, waiver, supplement or other
modification is in writing and is signed by the Transferor, the Servicer, each
Funding Agent and the Required Participants and, if such amendment is material
(as determined by any Funding Agent) the Rating Agencies, to the extent required
by the terms and provisions of the commercial paper program of any Initial
Purchaser, have provided in writing confirmation that such amendment will not
result in a reduction or withdrawal of the rating of any such Initial
Purchaser's Commercial Paper; provided that the consent of all of the Purchasers
hereto shall be required for any amendment, waiver, modification or supplement
relating to (i) the definitions of
67
"Eligible Receivables," "Termination Date," "Required Participants," "Percentage
Factor," "Maximum Percentage Factor," and any defined terms incorporated herein,
(ii) the reduction or postponement of the time for payment of any fee or other
amount payable to or on behalf of such Purchasers or (iii) this Section 10.2.
SECTION 10.3 Notices. Except as provided below, all
communications and notices provided for hereunder shall be in writing (including
telecopy or electronic facsimile transmission or similar writing) and shall be
given to the other party at its address or telecopy number set forth below or at
such other address or telecopy number as such party may hereafter specify for
the purposes of notice to such party. Each such notice or other communication
shall be effective (i) if given by telecopy, when such telecopy is transmitted
to the telecopy number specified in this Section 10.3 and confirmation is
received, (ii) if given by mail three (3) Business Days following such posting,
postage prepaid, U.S. certified or registered, (iii) if given by overnight
courier, one (1) Business Day after deposit thereof with a national overnight
courier service, or (iv) if given by any other means, when received at the
address specified in this Section 10.3. However, anything in this Section 10.3
to the contrary notwithstanding, the Transferor hereby authorizes the
Administrative Agent and each Funding Agent, as applicable, to effect Transfers,
Tranche Period and Tranche Rate selections based on telephonic notices made by
any Person which the Administrative Agent or such Funding Agent in good faith
believes to be acting on behalf of the Transferor. The Transferor agrees to
deliver promptly to the Administrative Agent or such Funding Agent a written
confirmation of each telephonic notice signed by an authorized officer of
Transferor. However, the absence of such confirmation shall not affect the
validity of such notice. If the written confirmation differs in any material
respect from the action taken by the Administrative Agent or such Funding Agent,
the records of the Administrative Agent or such Funding Agent shall govern
absent manifest error.
If to the Initial Purchasers:
PARK AVENUE RECEIVABLES CORPORATION
c/o Global Securitization Services, LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
(with a copy to the PARCO Funding Agent)
FAIRWAY FINANCE CORPORATION
c/o Lord Securities Corporation
Two ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
68
(with a copy to the Fairway Funding Agent)
If to the Transferor:
RTR FUNDING LLC
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Payment Information:
The Chase Manhattan Bank
ABA: ▇▇▇▇▇▇▇▇▇
Account: 323-884571
Reference: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
with a copy to:
▇▇▇▇▇▇, ▇▇▇▇▇ & BOCKIUS, LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to TMN:
TRANSMEDIA NETWORK INC.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇, LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
69
If to the Back-up Servicer:
▇▇▇▇▇ ▇▇▇▇▇ ASSOCIATES, LTD.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the PARCO Funding Agent or the Successor Servicer:
THE CHASE MANHATTAN BANK
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇
Capital Markets Fiduciary Services
PARCO Administration
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Fairway Funding Agent:
BMO ▇▇▇▇▇▇▇ ▇▇▇▇▇ Corp.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Administrative Agent:
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇
Structural Finance Services
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the PARCO APA Banks, at their respective addresses set forth in
the PARCO Asset Purchase Agreement.
70
If to the Fairway APA Banks, to the Fairway Funding Agent or at such
address otherwise notified to the parties hereto.
SECTION 10.4 Governing Law; Submission to Jurisdiction;
Integration.
(a) This Agreement shall be governed by, and
construed in accordance with the laws of the State of New York. Each of
the parties hereto hereby submits to the nonexclusive jurisdiction of
the United States District Court for the Southern District of New York
and of any New York state court sitting in The City of New York for
purposes of all legal proceedings arising out of or relating to this
Agreement or the transactions contemplated hereby. Each of the parties
hereto hereby irrevocably waives, to the fullest extent it may
effectively do so, any objection which it may now or hereafter have to
the laying of the venue of any such proceeding brought in such a court
and any claim that any such proceeding brought in such a court has been
brought in an inconvenient forum. Nothing in this Section 10.4 shall
affect the right of the Administrative Agent, the Funding Agents, the
Successor Servicer, the Initial Purchasers or the APA Bank Purchasers to
bring any action or proceeding against the Transferor, the Originator,
any Seller, the Servicer, the Back-up Servicer or their respective
properties in the courts of other jurisdictions.
(b) Each of the parties hereto hereby waives any
right to have a jury participate in resolving any dispute, whether
sounding in contract, tort or otherwise among any of them arising out
of, connected with, relating to or incidental to the relationship
between them in connection with this Agreement or the other Transaction
Documents.
(c) This Agreement contains the final and complete
integration of all prior expressions by the parties hereto with respect
to the subject matter hereof and shall constitute the entire Agreement
among the parties hereto with respect to the subject matter hereof
superseding all prior oral or written understandings.
SECTION 10.5 Severability; Counterparts. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which when taken together shall constitute one and the same
Agreement. Any provisions of this Agreement which are prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
SECTION 10.6 Successors and Assigns.
(a) This Agreement shall be binding on the parties
hereto and their respective successors and assigns; provided, however,
that neither the Transferor, TMN nor any Seller may assign any of its
rights or delegate any of its duties hereunder or under any of the other
Transaction Documents to which it is a party without the prior
71
written consent of the Administrative Agent and each Funding Agent
(which consent shall be obtained by the Administrative Agent). No
provision of this Agreement shall in any manner restrict the ability of
any Initial Purchaser or any APA Bank Purchaser to assign, participate,
grant security interests in, or otherwise transfer any portion of the
Transferred Interest. Without limiting the foregoing, PARCO or Fairway
may, in one or a series of transactions, transfer all or any portion of
its portion of the Transferred Interest, and its rights and obligations
under the Transaction Documents to any Conduit Assignee.
(b) Each APA Bank Purchaser may assign to one or
more Persons (each an "Assignee APA Bank Purchaser"), reasonably
acceptable to the Transferor, the Administrative Agent and the related
Funding Agent a portion of the Commitment of each such APA Bank
Purchaser pursuant to a supplement hereto, substantially in the form of
Exhibit P with any changes as have been approved by the parties thereto
(a "Transfer Supplement"), executed by each such Assignee APA Bank
Purchaser, the assignor APA Bank Purchasers, and the Administrative
Agent. Any such assignment by the APA Bank Purchasers pursuant to this
paragraph cannot be for an amount less than the lesser of (i)
$10,000,000 and (ii) such assignor APA Bank Purchaser's Commitment or
Pro Rata Share of the applicable Net Investment. Upon (i) the execution
of the Transfer Supplement, (ii) delivery of an executed copy thereof to
the Transferor and the Administrative Agent, and (iii) solely to the
extent such assignor APA Bank Purchaser has any Net Investment
outstanding, payment by the Assignee APA Bank Purchaser to the assignor
APA Bank Purchaser of the agreed purchase price, such assignor APA Bank
Purchaser shall be released from their respective obligations hereunder
to the extent of such assignment and such Assignee APA Bank Purchaser
shall for all purposes herein be an APA Bank Purchaser party hereto and
shall have all the rights and obligations of an APA Bank Purchaser
hereunder to the same extent as if it were an original party hereto. The
amount of the Commitment of the assignor APA Bank Purchaser allocable to
such Assignee APA Purchaser shall be equal to the amount of the portion
of the Commitment of the assignor APA Bank Purchaser transferred,
regardless of the purchase price paid therefor. The Transfer Supplement
shall be an amendment hereof only to the extent necessary to reflect the
addition of such Assignee APA Purchaser as an "APA Bank Purchaser" and
any resulting adjustment of the assignor APA Bank Purchaser's
Commitment.
SECTION 10.7 Confidentiality.
(a) Each of the Transferor, TMN, the Back-up
Servicer and each other Seller shall maintain, and shall cause each
officer, employee and agent of itself and its Affiliates to maintain,
the confidentiality of the Transaction Documents and all other
confidential proprietary information with respect to the Administrative
Agent, the Initial Purchasers, the Funding Agents, the APA Bank
Purchasers and the Successor Servicer and each of their respective
businesses obtained by them in connection with the structuring,
negotiation and execution of the transactions contemplated herein and in
the other Transaction Documents, except for information that has become
publicly available or information disclosed (i) to legal counsel,
accountants and other
72
professional advisors to the Transferor, TMN, the Back-up Servicer, any
other Seller and their Affiliates, (ii) as required by law, regulation,
the requirements of the New York Stock Exchange or legal process or
(iii) in connection with any legal or regulatory proceeding to which the
Transferor, TMN, the Back-up Servicer, any other Seller or any of their
Affiliates is subject. Each of the Transferor, TMN, the Back-up Servicer
and each other Seller hereby consents to the disclosure of any
non-public information with respect to it received by the Administrative
Agent, any Initial Purchaser, any APA Bank Purchaser, any Funding Agent
or the Successor Servicer to (i) the Administrative Agent, any Initial
Purchaser, any APA Bank Purchaser, any Funding Agent or the Successor
Servicer, (ii) legal counsel, accountants and other professional
advisors to the Administrative Agent, any Initial Purchaser, any APA
Bank Purchaser, any Funding Agent or the Successor Servicer, (iii) as
required by law, regulation or legal process, (iv) in connection with
any legal or regulatory proceeding to which the Administrative Agent,
any Initial Purchaser, any APA Bank Purchaser, any Funding Agent or the
Successor Servicer or any of their Affiliates is subject, (v) any
nationally recognized rating agency providing a rating or proposing to
provide a rating to an Initial Purchaser's Commercial Paper, (vi) any
placement agent which proposes to offer and sell an Initial Purchaser's
Commercial Paper, (vii) any provider of an Initial Purchaser's
program-wide liquidity or credit support facilities, (viii) any
potential APA Bank Purchaser or (ix) any Participant or potential
Participant; provided, that the Administrative Agent, any Initial
Purchaser, any APA Bank Purchaser, any Funding Agent or the Successor
Servicer, as the case may be, shall advise any such recipient of
information that the information they receive is non-public information
and may not be disclosed or used for any other purposes other than that
for which it is disclosed to such recipient without the prior written
consent of TMN.
(b) Each of the Administrative Agent, the Funding
Agents, the APA Bank Purchasers, the Initial Purchasers and the
Successor Servicer shall maintain, and shall cause each officer,
employee and agent of itself and its Affiliates to maintain, the
confidentiality of the Transaction Documents and all other confidential
proprietary information with respect to the Transferor, TMN, the Back-up
Servicer, any other Seller and their Affiliates and each of their
respective businesses obtained by them in connection with the
structuring, negotiation and execution of the transactions contemplated
herein and in the other Transaction Documents, except for information
that has become publicly available or information disclosed (i) to legal
counsel, accountants and other professional advisors to the
Administrative Agent, any Initial Purchaser, any APA Bank Purchaser, any
Funding Agent or the Successor Servicer or their Affiliates, (ii) as
required by law, regulation or legal process, (iii) in connection with
any legal or regulatory proceeding to which the Administrative Agent,
any Initial Purchaser, any APA Bank Purchaser, any Funding Agent or the
Successor Servicer or any of their Affiliates is subject, (iv) any
nationally recognized rating agency providing a rating or proposing to
provide a rating to any Initial Purchaser's Commercial Paper, (v) any
placement agent which proposes to offer and sell any Initial Purchaser's
Commercial Paper, (vi) any provider of any Initial Purchaser's
program-wide liquidity or credit support facilities, (vii) any potential
APA Bank Purchaser or (viii) any Participant or potential Participant.
73
SECTION 10.8 No Bankruptcy Petition Against the Initial
Purchasers. Each of the Transferor, TMN, the Back-up Servicer, the Successor
Servicer and each other Seller hereby covenants and agrees that, prior to the
date which is one year and one day after the payment in full of all outstanding
Commercial Paper or other indebtedness of an Initial Purchaser, it will not
institute against, or join any other Person in instituting against, such Initial
Purchaser any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings or other similar proceeding under the laws of the United States or
any State of the United States.
SECTION 10.9 Limited Recourse. Notwithstanding anything to the
contrary contained herein, the obligations of an Initial Purchaser under this
Agreement are solely the corporate obligations of such Initial Purchaser and, in
the case of obligations of such Initial Purchaser other than Commercial Paper,
shall be payable at such time as funds are actually received by, or are
available to, such Initial Purchaser in excess of funds necessary to pay in full
all outstanding Commercial Paper and, to the extent funds are not available to
pay such obligations, the claims relating thereto shall not constitute a claim
against such Initial Purchaser but shall continue to accrue. Each party hereto
agrees that the payment of any claim (as defined in Section 101 of Title 11 of
the Bankruptcy Code) of any such party shall be subordinated to the payment in
full of all Commercial Paper.
No recourse under any obligation, covenant or agreement of the
Initial Purchasers contained in this Agreement shall be had against any
incorporator, stockholder, officer, director, member, manager, employee or agent
of the Initial Purchasers, the Administrative Agent, the Funding Agents, the
Manager or any of their Affiliates (solely by virtue of such capacity) by the
enforcement of any assessment or by any legal or equitable proceeding, by virtue
of any statute or otherwise; it being expressly agreed and understood that this
Agreement is solely a corporate obligation of the Initial Purchasers, and that
no personal liability whatever shall attach to or be incurred by any
incorporator, stockholder, officer, director, member, manager, employee or agent
of the Initial Purchasers, the Administrative Agent, the Funding Agents, the
Manager or any of their Affiliates (solely by virtue of such capacity) or any of
them under or by reason of any of the obligations, covenants or agreements of
the Initial Purchasers contained in this Agreement, or implied therefrom, and
that any and all personal liability for breaches by the Initial Purchasers of
any of such obligations, covenants or agreements, either at common law or at
equity, or by statute, rule or regulation, of every such incorporator,
stockholder, officer, director, member, manager, employee or agent is hereby
expressly waived as a condition of and in consideration for the execution of
this Agreement; provided that the foregoing shall not relieve any such Person
from any liability it might otherwise have as a result of fraudulent actions
taken or fraudulent omissions made by them.
SECTION 10.10 Characterization of the Transactions Contemplated
by the Agreement. It is the intention of the parties that the transactions
contemplated hereby constitute the sale of the Transferred Interest, conveying
good title thereto free and clear of any Adverse Claims to the Initial
Purchasers, the APA Bank Purchasers and the Funding Agents, and that the
Transferred Interest not be part of the Transferor's estate in the event of an
insolvency. If, notwithstanding the foregoing, the transactions contemplated
hereby should
74
be deemed a financing, the parties intend that the Transferor shall be deemed to
have granted to the Administrative Agent, on behalf of the Initial Purchasers,
the APA Bank Purchasers and the Funding Agents, and the Transferor hereby grants
to the Administrative Agent, on behalf of the Initial Purchasers, the APA Bank
Purchasers and the Funding Agents, to secure the Aggregate Unpaids a first
priority perfected and continuing security interest in all of the Transferor's
right, title and interest in, to and under (i) the Receivables, together with
Related Security, Collections and Proceeds with respect thereto, (ii) all monies
from time to time on deposit in the Collection Account, RTR Funding Account and
any Lock-Box Account, (iii) the Receivables Purchase Agreement with respect to
the Receivables and with respect to any obligations thereunder of any Seller or
the Servicer with respect to the Receivables, and (iv) the patent, copyright,
tradename, trademark or other intellectual property or other property rights or
interests listed on Exhibit A to the Trademark License Agreement, Schedules I
and II hereof and Schedule I to the Receivables Purchase Agreement, whether
acquired by license, sublicense, lease, easement, assignment, purchase or
otherwise, in and to any computer hardware, software and any other media in
which any licensed or sublicensed items may be stored or recorded and to all
computer and automatic machinery and programs used for the compilation or
printout thereof, useful or necessary for the performance of the functions of
servicing and collecting the Receivables and Related Security, and that this
Agreement shall constitute a security agreement under applicable Law. The
Transferor hereby assigns to the Administrative Agent, on behalf of the Initial
Purchasers, the APA Bank Purchasers and the Funding Agents, all of its rights
and remedies under the Receivables Purchase Agreement with respect to the
Receivables and with respect to any obligations thereunder of any Seller with
respect to the Receivables. The Transferor agrees that it shall not give any
consent or waiver required or permitted to be given under the Receivables
Purchase Agreement without the prior consent of the Administrative Agent and
each Funding Agent.
SECTION 10.11 Waiver of Setoff. Each of the Administrative
Agent, the Funding Agents, the Transferor, the Servicer, the Back-up Servicer,
the Successor Servicer and each Seller hereby waives any right of setoff it may
have or to which it may be entitled under this Agreement from time to time
against the Initial Purchasers or their assets.
SECTION 10.12 Agent Conflict Waiver. Each of the Administrative
Agent and the Funding Agents, respectively, acts in various capacities with
respect to the maintenance and administration of the commercial paper program of
its related Initial Purchaser (including, acting as administration agent for
such Initial Purchaser, issuing and paying agent for such Initial Purchaser's
Commercial paper, provider of other backup facilities for such Initial
Purchaser, and provider of other services or facilities from time to time, the
"Agent Roles"). Each of the parties hereto hereby acknowledges and consents to
any and all Agent Roles, waives any objections it may have to any actual or
potential conflict of interest caused by any such Funding Agent acting as the
Funding Agent for its related Initial Purchaser or as a related APA Bank
Purchaser or as a liquidity or credit support provider under such Initial
Purchaser's commercial paper program and acting as or maintaining any of the
Agent Roles, and agrees that in connection with any Agent Role, such Funding
Agent or Administrative Agent, as the case may be, may take, or refrain from
taking, any action which it in its discretion deems appropriate.
75
SECTION 10.13 Liability of Funding Agents. Notwithstanding any
provision of this Agreement: (i) the Funding Agents shall not have any
obligations under this Agreement other than those specifically set forth herein,
and no implied obligations of the Funding Agents shall be read into this
Agreement; and (ii) in no event shall the Funding Agents be liable under or in
connection with this Agreement for indirect, special, or consequential losses or
damages of any kind, including lost profits, even if advised of the possibility
thereof and regardless of the form of action by which such losses or damages may
be claimed. Neither the Funding Agents nor any of their directors, officers,
agents or employees shall be liable for any action taken or omitted to be taken
in good faith by it or them under or in connection with this Agreement, except
for its or their own gross negligence or willful misconduct. Without limiting
the foregoing, the Funding Agents (a) may consult with legal counsel (including
counsel for the Initial Purchasers), independent public accountants and other
experts selected by them and shall not be liable for any action taken or omitted
to be taken in good faith by them in accordance with the advice of such counsel,
accountants or experts, (b) shall not be responsible to the Administrative
Agent, the Initial Purchasers, the Transferor, any Seller, the Servicer, the
Back-up Servicer or the Successor Servicer for any statements, warranties or
representations made in or in connection with this Agreement or the other
Transaction Documents, (c) shall not be responsible to the Administrative Agent,
the Initial Purchasers, the Transferor, any Seller, the Servicer, the Back-up
Servicer or the Successor Servicer for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or the other
Transaction Documents, (d) shall incur no liability under or in respect of any
of the Commercial Paper or other obligations of the Initial Purchasers under
this Agreement or the other Transaction Documents and (e) shall incur no
liability under or in respect of this Agreement or the other Transaction
Documents by acting upon any notice (including notice by telephone), consent,
certificate or other instrument or writing (which may be by facsimile) believed
by them to be genuine and signed or sent by the proper party or parties.
Notwithstanding anything else herein or in the other Transaction Documents, it
is agreed that where the Funding Agents may be required under this Agreement or
the other Transaction Documents to give notice of any event or condition or to
take any action as a result of the occurrence of any event or the existence of
any condition, the Funding Agents agree to give such notice or take such action
only to the extent that they have actual knowledge of the occurrence of such
event or the existence of such condition, and shall incur no liability for any
failure to give such notice or take such action in the absence of such
knowledge.
SECTION 10.14 Tax Treatment. The Transferor has entered into
this Agreement with the intention that, for Federal, State and local income,
single business and franchise tax purposes, the Incremental Transfers will
qualify as indebtedness of the Transferor secured by the Receivables, Related
Security, Collections and Proceeds with respect thereto. Each of the parties
hereto agree to treat the Incremental Transfers for Federal, State and local
income, single business and franchise tax purposes as indebtedness of the
Transferor.
76
IN WITNESS WHEREOF, the parties hereto have executed and
delivered this First Amended and Restated Receivables Transfer Agreement as of
the date first written above.
PARK AVENUE RECEIVABLES
CORPORATION, as an Initial Purchaser
By:
-----------------------------------------
Name:
-----------------------------------------
Title:
-----------------------------------------
FAIRWAY FINANCE CORPORATION,
as an Initial Purchaser,
By:
-----------------------------------------
Name:
-----------------------------------------
Title:
-----------------------------------------
RTR FUNDING LLC, as Transferor
By:
-----------------------------------------
Name:
-----------------------------------------
Title:
-----------------------------------------
TRANSMEDIA NETWORK INC., individually
and as Servicer
By:
-----------------------------------------
Name:
-----------------------------------------
Title:
-----------------------------------------
▇▇▇▇▇ ▇▇▇▇▇ ASSOCIATES, LTD., as Back-
up Servicer
By:
-----------------------------------------
Name:
-----------------------------------------
Title:
-----------------------------------------
BMO ▇▇▇▇▇▇▇ ▇▇▇▇▇ CORP., as Fairway
Funding Agent
By:
-----------------------------------------
Name:
-----------------------------------------
Title:
-----------------------------------------
By:
-----------------------------------------
Name:
-----------------------------------------
Title:
-----------------------------------------
THE CHASE MANHATTAN BANK, as
PARCO Funding Agent
By:
-----------------------------------------
Name:
-----------------------------------------
Title:
-----------------------------------------
THE CHASE MANHATTAN BANK, as a
PARCO APA Bank
By:
-----------------------------------------
Name:
-----------------------------------------
Title:
-----------------------------------------
THE CHASE MANHATTAN BANK, as
Successor Servicer
By:
-----------------------------------------
Name:
-----------------------------------------
Title:
-----------------------------------------
BANK OF MONTREAL,
as a Fairway APA Bank
By:
-----------------------------------------
Name:
-----------------------------------------
Title:
-----------------------------------------
THE CHASE MANHATTAN BANK, as
Administrative Agent
By:
---------------------------------------
Name:
---------------------------------------
Title:
---------------------------------------
SCHEDULE III
LIST OF INITIAL PURCHASERS, APA BANK PURCHASERS, FUNDING AGENTS,
FACILITY LIMIT, PURCHASE LIMITS AND COMMITMENTS
APA Bank Purchase
Initial Purchaser Purchaser Funding Agent Limit Commitment
----------------- --------- ------------- ----- ----------
Park Avenue Receivables The Chase The Chase $ 40,000,000 $ 40,000,000
Corporation Manhattan Bank Manhattan Bank Chase's
Commitment
Fairway Finance Bank of Montreal BMO ▇▇▇▇▇▇▇ ▇▇▇▇▇ Corp. $ 40,000,000 $ 40,000,000
Corporation Bank of
Montreal's
Commitment
Facility Limit = $80,000,000
SIII-1
ANNEX X
"Active Purchasers" shall mean any of (i) prior to an occurrence of a
PARCO Termination Event, PARCO, (ii) following an occurrence of a PARCO
Termination Event or in the event PARCO elects not to accept a sale, conveyance,
transfer and assignment from the Transferor pursuant to the Receivables Transfer
Agreement, the PARCO APA Banks, (iii) prior to a Fairway Termination Event,
Fairway, and (iv) following an occurrence of a Fairway Termination Event or in
the event Fairway elects not to accept a sale, conveyance and assignment from
the Transferor pursuant to the Receivables Transfer Agreement, the Fairway APA
Banks.
"Adjusted Liquidity Price" shall have the meaning given such term in
the PARCO Asset Purchase Agreement.
"Administrative Agent" shall mean Chase, as administrative agent on
behalf of the Initial Purchasers, the PARCO APA Banks, the Fairway APA Banks and
the Funding Agents, and its permitted successors and assigns in such capacity.
"Advance Rate" shall mean, on any day, a percentage calculated as set
forth on Schedule I attached hereto.
"Advance Ratio" shall mean an amount equal to the quotient of (a) the
product of (i) Average Weekly Net Sales, times (ii) 52, times (iii) 90%, divided
by (b) Net Receivables Balance.
"Adverse Claim" shall mean a lien, security interest, charge or
encumbrance, or other right or claim in, of or on any Person's assets or
properties in favor of any other Person (including any UCC financing statement
or any similar instrument filed against such Person's assets or properties),
other than a Permitted Encumbrance.
"Affected APA Bank" shall have the meaning specified in Section 5.5(c)
of the PARCO Asset Purchase Agreement.
"Affected Party" shall mean each of the following persons: each
Initial Purchaser, each Funding Agent, the Administrative Agent, each PARCO APA
Bank, each Fairway APA Bank and each Affiliate of the foregoing persons.
"Affiliate" shall mean, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with, such Person. A Person shall be deemed to control another
Person if the controlling Person possesses, directly or indirectly, the power to
direct or cause the direction of the management or policies of the controlled
Person, whether through ownership of voting stock, by contract or otherwise.
"Agent Roles" shall have the meaning specified in Section 10.12 of the
Receivables Transfer Agreement.
"Aggregate Commitment" shall mean, at any time, the sum of the
Commitments then in effect, as set forth in Schedule III to the Receivables
Transfer Agreement.
"Aggregate Net Investment" shall mean an amount equal to the sum of
the PARCO Facility Net Investment and the Fairway Net Investment.
"Aggregate Unpaids" shall mean, at any time, an amount equal to the
sum of (i) the aggregate accrued and unpaid PARCO Discount with respect to all
Tranche Periods at such time, (ii) the aggregate accrued and unpaid Fairway
Discount at such time, (iii) the Aggregate Net Investment at such time, (iv) any
Indemnified Amounts and (v) all other amounts owed (whether due or accrued)
hereunder by the Transferor or TMN to each Initial Purchaser and the APA Bank
Purchasers at such time.
"Amendment Effective Date" shall mean May 17, 2001.
"APA Bank Purchasers" shall mean the PARCO APA Banks and the Fairway
APA Banks.
"Arrear Sales" shall mean all cash collections and other cash proceeds
received in connection with the Registered Card Program or the Private Label
Program, as applicable from a Restaurant that has no outstanding Receivables
under the Registered Card Program or the Private Label Program, as applicable.
"Asset Purchase Agreement" shall mean (i) the PARCO Asset Purchase
Agreement or (ii) the Fairway Asset Purchase Agreement, as applicable.
"Assigned Rights" shall have the meaning specified in Section 9.5(a)
of the Receivables Purchase Agreement.
"Average Weekly Net Sales" shall mean an amount equal to the quotient
of (a) the sum of Weekly Net Sales for the most recent 26 successive Weekly
Settlement Periods, inclusive of the most recently completed Weekly Settlement
Period, divided by (b) 26.
"Back-up Servicer" shall mean ▇▇▇▇▇ ▇▇▇▇▇ & Associates, Ltd., and its
permitted successors and assigns in such capacity.
"Back-up Servicer Fee" shall have the meaning specified in Section 6.9
of the Receivables Transfer Agreement.
"Bankruptcy Code" shall mean United States Code (Bankruptcy).
"Base Rate" or "BR" shall mean the PARCO Base Rate or Fairway Base
Rate, as applicable.
"Benefit Plan" shall mean any employee benefit plan as defined in
Section 3(3) of ERISA in respect of which the Transferor, a Seller or any ERISA
Affiliate of the Transferor or a
2
Seller is, or at any time during the immediately preceding six (6) years was, an
"employer" as defined in Section 3(5) of ERISA.
"BR Tranche" shall mean a PARCO BR Tranche or a Fairway BR Tranche, as
applicable.
"BR Tranche Period" shall mean a PARCO BR Tranche Period or a Fairway
BR Tranche Period, as applicable.
"Business Day" shall mean (i) with respect to any matters relating to
the Eurodollar Rate, a day on which banks are open for business in The City of
New York and on which dealings in Dollars are carried on in the London interbank
market and (ii) for all other purposes, any day other than a Saturday, Sunday or
other day on which banking institutions or trust companies in the State of New
York generally or The City of New York or Miami, Florida are authorized or
obligated by law, executive order or governmental decree to be closed.
"Capitalized Lease" of a Person shall mean any lease of property by
such Person as lessee which would be capitalized on a balance sheet of such
Person prepared in accordance with GAAP.
"Change of Control" shall mean that at any time following the
Amendment Effective Date:
(i) more than fifty percent (50%) of the members of the Board of
Directors of TMN who were members on the Amendment Effective Date, shall
have resigned or been removed or replaced, (a) other than as a result of
death, disability or change in personal circumstances, and (b) treating any
such members who are replaced by members designated by Samstock or other
▇▇▇▇ Affiliates as having not resigned or been removed or replaced for this
purpose; or
(ii) any Person or "Group" (as defined in Section 13(d)(3) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")), but
excluding (a) ▇▇▇▇ Affiliates, (b) any employee benefit or stock ownership
plans of TMN and (c) members of the Board of Directors (or their successors
having been designated by Samstock or other ▇▇▇▇ Affiliates) and executive
officers of TMN as of the Amendment Effective Date, members of the
immediate families of such members and executive officers, and family
trusts and partnerships established by or for the benefit of any of the
foregoing individuals, shall have acquired more than fifty percent (50%) of
the Combined Voting Power of all Company Voting Securities, after taking
such acquisition into account; provided, that TMN's purchase after the
Amendment Effective Date, of any Company Voting Securities outstanding on
the Amendment Effective Date, which results in one or more of TMN's
shareholders of record as of the Amendment Effective Date, having
"beneficial ownership" (as defined in Regulation 13D-G under the Exchange
Act) of more than fifty percent (50%) of the Combined Voting Power of all
Company Voting Securities shall not constitute an acquisition under the
Transaction Documents;
3
(iii) ▇▇▇▇ Affiliates collectively shall not have beneficial
ownership of at least twenty percent (20%) of the Combined Voting Power of
all Company Voting Securities, other than as a result of the Company's
issuance of Company Voting Securities either in a rights offering to all
Company shareholders, to third parties for strategic business purposes or
pursuant to another form of capital financing; or
(iv) any Seller shall transfer any portion of its membership
interest in the Transferor to a Person who is not a Seller.
Capitalized terms used and not otherwise defined in this definition of
"Change of Control" shall have the meanings ascribed to such terms in that
certain Second Amended and Restated Investment Agreement, dated June 30, 1999,
among TMN, Samstock, L.L.C. and certain other parties, as such agreement existed
on the Amendment Effective Date (the "Investment Agreement"). The phrase
"designated by Samstock" used herein, in addition to its ordinary meaning, shall
have the meaning ascribed to it in Section 4.3 of the Investment Agreement.
"Chase" shall mean The Chase Manhattan Bank, in its individual
capacity, and its successors and assigns.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and
the rules and regulations promulgated thereunder.
"Collection Account" shall mean the account, established by the
Administrative Agent, for the benefit of PARCO, Fairway and the APA Bank
Purchasers, pursuant to Section 2.12(a) of the Receivables Transfer Agreement.
"Collection Account Agreement" shall mean the Collection Account
Agreement, dated as of the Amendment Effective Date, by and among the
Transferor, the Servicer, the Collection Account Bank, the Administrative Agent,
the PARCO Funding Agent and the Fairway Funding Agent.
"Collection Account Bank" shall mean The Chase Manhattan Bank as the
holder of the Collection Account, or any successor bank that enters into a
collection account agreement satisfactory to each of the Funding Agents.
"Collections" shall mean, collectively, (i) with respect to any
Receivable, all cash collections and other cash proceeds of such Receivable,
including, without limitation, all Finance Charges, if any, cash proceeds of
Related Security with respect to such Receivable, Dilution Adjustments and
Deemed Collections, (ii) Arrear Sales and (iii) Membership Fees.
"Commercial Paper" shall mean the short-term promissory notes of the
Initial Purchasers issued by the Initial Purchasers in the United States
commercial paper market.
4
"Commitment Expiry Date" shall mean the Fairway Commitment Expiry Date
and/or the PARCO Commitment Expiry Date, as applicable.
"Commitments" shall mean each of the PARCO APA Bank Commitments and
the Fairway APA Bank Commitments.
"Conduit Assignee" shall mean any special purpose vehicle issuing
indebtedness in the commercial paper market that is administered by (i) Chase,
with respect to PARCO's Purchaser Group and (ii) BMO ▇▇▇▇▇▇▇ ▇▇▇▇▇ Corp., with
respect to Fairway's Purchaser Group.
"Consent to Assignment" shall mean the Consent to Assignment, dated as
of June 30, 1999, signed on behalf of the Originator.
"Contract" shall mean, with respect to a Restaurant, an agreement
governing the purchase of Meals and Credits under the Registered Card Program or
Private Label Program between a Seller or any Affiliate of a Seller and such
Restaurant and any agreement with any other Person guaranteeing such agreement.
"Contributed Receivables" shall have the meaning specified in Section
3.2(a) of the Receivables Purchase Agreement.
"Conversion/Continuation Notice" shall have the meaning specified in
Section 2.16 of the Receivables Transfer Agreement.
"CP Rate" shall mean the PARCO CP Rate or the Fairway CP Rate, as
applicable.
"CP Tranche" shall mean a PARCO CP Tranche or a Fairway CP Tranche, as
applicable.
"CP Tranche Period" shall mean a PARCO CP Tranche Period or Fairway CP
Tranche Period, as applicable.
"Credit Card Processors" shall mean any Person who has entered into an
agreement with TMN, the Transferor or any Affiliate of TMN or the Transferor to
acquire, process and settle credit card transactions against Members' Credit
Card Accounts in connection with the purchase of Meals by a Member under the
Registered Card Program or the Private Label Program.
"Credits" shall mean any Meal credits under the Registered Card
Program or Private Label Program purchased by a Seller or any Affiliate of a
Seller pursuant to a Contract with a Restaurant.
"Daily Report" shall mean a report, in substantially the form attached
to the Receivables Transfer Agreement as Exhibit G or in such other form as is
mutually agreed to by
5
the Transferor, the Administrative Agent and the Funding Agents pursuant to
Section 2.11 of the Receivables Transfer Agreement.
"DALC" shall mean the Dining a la Card trade name and service ▇▇▇▇.
"DALC Purchase" shall mean the purchase by TMN of certain Receivables
and related assets from the Originator pursuant to the Originator Receivables
Purchase Agreement prior to the Original Closing Date.
"Deemed Collections" shall mean any Collections on any Receivable
deemed to have been received pursuant to subsection 2.9(a) of the Receivables
Transfer Agreement.
"Defaulted Receivable" shall mean a Receivable: (i) as to which no
Credits have been used within the immediately preceding fourteen (14) weeks;
provided, however, that if a Receivable relates to an initial advance made to a
Start-up Restaurant, such Receivable shall not be characterized as a "Defaulted
Receivable" prior to the fourteenth week of such Restaurant's operations; (ii)
as to which an Event of Bankruptcy has occurred and is continuing with respect
to the Restaurant which is the obligor with respect thereto; (iii) which has
been identified by the Transferor, a Seller or the Servicer as uncollectible; or
(iv) which, in accordance with the Restaurant Guidelines, has been or should be
written off as uncollectible.
"Defaulting PARCO APA Bank" shall have the meaning assigned to
"Defaulting APA Bank" in subsection 2.2(b) of the PARCO Asset Purchase
Agreement.
"Designated Restaurant" shall mean, at any time, each Restaurant;
provided, however, that any Restaurant shall cease to be a Designated Restaurant
upon notice to the Transferor from the Administrative Agent (with the consent or
at the direction of the Funding Agents), delivered at any time.
"Dilution Adjustment" shall have the meaning specified in Section
2.9(b) of the Receivables Transfer Agreement.
"Dollars" or "$" shall mean the lawful currency of the United States.
"Early Collection Fee" shall mean, for any Tranche Period during which
the portion of the PARCO Facility Net Investment and/or Fairway Net Investment
that was allocated to such Tranche Period is reduced for any reason whatsoever,
the excess, if any, of (i) the additional PARCO Discount and/or Fairway
Discount, as the case may be, that would have accrued during such Tranche Period
if such reductions had not occurred, minus (ii) the income, if any, received by
the recipient of such reductions from investing the proceeds of such reductions.
"Eligible Receivable" shall mean, at any time, any Receivable owing by
an Eligible Restaurant:
6
(i) which has been (a) originated by a Seller, (b) if originated by the
Originator, sold by such Originator to TMN pursuant to the Originator
Receivables Purchase Agreement prior to the Original Closing Date, (c)
if owned by TNI, sold by TNI to TMN pursuant to the Receivables Sale
Agreement prior to the Original Closing Date and (d) subsequently sold
to the Transferor pursuant to (and in accordance with) the Receivables
Purchase Agreement, and to which the Transferor has good title
thereto, free and clear of all Adverse Claims;
(ii) which (together with the Collections and Related Security related
thereto) has been the subject of either (A) a valid transfer and
assignment from the Transferor to the Administrative Agent, on behalf
of the Initial Purchasers and the APA Bank Purchasers, of all of the
Transferor's right, title and interest therein or (B) the grant of a
first priority perfected security interest therein (and in the
Collections and Related Security related thereto), in each case
effective until the termination of the Receivables Transfer Agreement;
(iii) which is not a Defaulted Receivable at the time of the initial
creation of an interest of the Administrative Agent on behalf of the
Initial Purchasers and the APA Bank Purchasers therein;
(iv) which is an "account" or "general intangible" within the meaning of
Article 9 of the Relevant UCC;
(v) which is denominated and required to be settled only in Dollars in the
United States;
(vi) which, arises under a Contract that, together with the Receivable
related thereto, is in full force and effect and constitutes the
legal, valid and binding obligation of the related Restaurant,
enforceable against such Restaurant in accordance with its terms,
except as may be limited by (a) bankruptcy, insolvency,
reorganization, moratorium or similar Laws relating to or affecting
creditors' rights generally and (b) general principles of equity,
including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing and the possible
unavailability of specific performance, regardless of whether
considered in a proceeding at equity or at law;
(vii) which, together with the Contract related thereto, does not
contravene in any material respect any Laws applicable thereto
(including, without limitation, Laws relating to truth in lending,
fair credit billing, fair credit reporting, equal credit opportunity,
fair debt collection practices and privacy) and with respect to which
no part of the Contract related thereto is in violation of any such
Law in any material respect;
7
(viii) which (A) satisfies in all material respects all applicable
requirements of the Restaurant Guidelines and (B) is assignable
without the consent of, or notice to, the Restaurant thereunder;
(ix) which was either acquired prior to the Original Closing Date or
generated in the ordinary course of a Seller's business;
(x) the Restaurant of which has been directed to cause all payments to be
made to a Lock-Box Account with respect to which there shall be a
Lock-Box Agreement in effect;
(xi) as to which the Administrative Agent (with the consent or at the
direction of the Funding Agents) has not notified the Transferor that
such Receivable or class of Receivables is not acceptable for purchase
hereunder because of the nature of the business of the Restaurant or
because of a potential conflict of interest between the interests of
the Transferor or a Seller, on the one hand, and any Initial
Purchaser, any APA Bank Purchaser or any of their Affiliates, on the
other hand; provided, that any such Receivable or class of Receivables
identified by the Administrative Agent (with the consent or at the
direction of the Funding Agents) will remain an "Eligible Receivable"
for a period of fifteen (15) days following the receipt of such notice
from the Administrative Agent;
(xii) the assignment of which under the Originator Receivables Purchase
Agreement by the Originator to TMN, if applicable, under the
Receivables Sale Agreement by TNI to TMN, if applicable, and the
subsequent assignment of which under the Receivables Purchase
Agreement by a Seller to the Transferor and the assignment of which
under the Receivables Transfer Agreement by the Transferor to the
Administrative Agent on behalf of the Initial Purchasers and the APA
Bank Purchasers does not violate, conflict or contravene any
applicable Laws or any contractual or other restriction, limitation or
encumbrance;
(xiii) which has not been compromised, adjusted or modified (including by
the extension of time for payment or the granting of any discounts,
allowances or credits) other than in accordance with the Restaurant
Guidelines;
(xiv) which is not subjected to any litigation, dispute, right of offset,
counterclaim or other defense, the effect of which would materially
adversely affect the Administrative Agent's, an Initial Purchaser's or
an APA Bank Purchaser's rights under the Transaction Documents with
respect to such Receivable;
(xv) which, if the Restaurant of such Receivable is a Start-up Restaurant,
the majority owner of such Restaurant must be affiliated with at least
one other Eligible Restaurant participating in the Registered Card
Program or Private Label Program;
8
(xvi) to the extent that the Outstanding Balance thereof, together with the
Outstanding Balance of all other Receivables with the same Eligible
Restaurant (or an affiliated Eligible Restaurant) as such Receivable,
does not exceed 1.75% (or, if the Restaurant related to such
Receivable is a Special Restaurant, the Special Restaurant
Concentration Factor) of the aggregate Outstanding Balance of all
Eligible Receivables; and
(xvii) if the Restaurant of such Receivable is a Start-up Restaurant, to
the extent that the Outstanding Balance thereof, together with the
Outstanding Balance of all other Receivables with Start-up Restaurants
as obligors, does not exceed 5.0% of the aggregate Outstanding Balance
of all Eligible Receivables.
"Eligible Restaurant" will include but is not limited to, each
Restaurant in respect of a Receivable that satisfies the following eligibility
criteria:
(i) the Restaurant is not an Affiliate of the Sellers, the Transferor, the
Originator or TNI;
(ii) the Restaurant is located in the United States or a U.S. territory;
(iii) the Restaurant is not a government or governmental subdivision or
agency;
(iv) the Restaurant is not the subject of any proceedings under the
Bankruptcy Code, any insolvency law or any other law for the relief of
debtors; and
(v) the Restaurant has had activity/usage in the prior twelve weeks
(provided, that such limitation shall not apply to a Start-up
Restaurant prior to the 91st day of such Start-up Restaurant's
operations).
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended, supplemented or otherwise modified and in effect from time to
time, and the rules and regulations promulgated thereunder.
"ERISA Affiliate" shall mean, with respect to any Person, (i) any
corporation which is a member of the same controlled group of corporations
(within the meaning of Section 414(b) of the Code (as in effect from time to
time, the "Code")) as such Person; (ii) a trade or business (whether or not
incorporated) under common control (within the meaning of Section 414(c) of the
Code) with such Person; or (iii) a member of the same affiliated service group
(within the meaning of Section 414(n) of the Code) as such Person, any
corporation described in clause (i) above or any trade or business described in
clause (ii) above.
"Eurodollar Rate" shall mean the PARCO Eurodollar Rate or the Fairway
Eurodollar Rate, as applicable.
9
"Eurodollar Tranche" means a PARCO Eurodollar Tranche or a Fairway
Eurodollar Tranche, as applicable.
"Eurodollar Tranche Period" shall mean a PARCO Eurodollar Tranche
Period or a Fairway Eurodollar Tranche Period, as applicable.
"Event of Bankruptcy" shall mean, with respect to any Person, (i) that
such Person (a) shall generally not pay its debts as such debts become due or
(b) shall admit in writing its inability to pay its debts generally or (c) shall
make a general assignment for the benefit of creditors; (ii) any proceeding
shall be instituted by or against such Person seeking to adjudicate it as
bankrupt or insolvent, or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment of a
receiver, trustee or other similar official for it or any substantial part of
its property and, in the case of a proceeding instituted by a party other than
such Person, such proceeding shall continue undismissed, unstayed and in effect
for a period of sixty (60) consecutive days or (iii) if such Person is a
corporation, such Person or any Subsidiary shall take any corporate action to
authorize any of the actions set forth in the preceding clauses (i) or (ii).
"Facility" shall mean the purchase by the Initial Purchasers or the
APA Bank Purchasers of Transferred Interests from the Transferor pursuant to the
Receivables Transfer Agreement in exchange for the Transfer Price.
"Facility Limit" shall mean $80,000,000; provided that such amount may
not at any time exceed the result of the Aggregate Commitment at any time in
effect; provided, further, that from and after the Termination Date, the
Facility Limit shall at all times equal the Aggregate Net Investment.
"Fairway" shall mean Fairway Finance Corporation, a Delaware
corporation, and its successors and assigns.
"Fairway APA Banks" shall mean the persons listed as such on the
signature pages to the Receivables Transfer Agreement and the Persons which from
time to time may become a party to the Receivables Transfer Agreement as Fairway
APA Banks, in accordance with the terms thereof.
"Fairway APA Bank Commitment" shall mean, with respect to any or all
Fairway APA Banks, the amount set forth on Schedule I attached to the
Receivables Transfer Agreement equal at all times to 100% of the Fairway APA
Banks' Pro Rata Share of the Facility Limit, as the same may be reduced from
time to time in accordance with the Receivables Transfer Agreement; provided
that at all times the Fairway APA Bank Commitment shall equal the PARCO APA Bank
Commitment.
"Fairway Asset Purchase Agreement" shall mean that certain Liquidity
Asset Purchase Agreement, dated as of May , 2001, by and among the Fairway
----
Funding Agent,
10
the Fairway APA Banks and Fairway, as the same may from time to time be amended,
supplemented or otherwise modified and in effect.
"Fairway Base Rate" shall mean, with respect to the Fairway Purchaser
Group, for any day, a fluctuating interest rate per annum as shall be in effect
from time to time, which rate shall be at all times equal to the higher of: (x)
the rate of interest most recently announced by Bank of Montreal at its branch
in Chicago, Illinois as its prime commercial rate for United States loans made
in the United States and (y) 1.50% per annum above the latest Federal Funds
Rate.
"Fairway BR Tranche" shall mean a Tranche as to which Fairway Discount
is calculated at the Fairway Base Rate.
"Fairway BR Tranche Period" shall mean, with respect to a Fairway BR
Tranche after a Fairway Termination Event or in the event Fairway elects not to
accept a sale, conveyance, transfer and assignment from the Transferor pursuant
to the Receivables Transfer Agreement or after any other Fairway Purchase, a
period of one (1) day. If such Fairway BR Tranche Period would end on a day
which is not a Business Day, such Fairway BR Tranche Period shall end on the
next succeeding Business Day.
"Fairway CP Rate" shall mean for any Tranche Period, with respect to
any CP Tranche funded or maintained by Fairway, to the extent Fairway funds such
Tranche for such Tranche Period by issuing Commercial Paper, a rate per annum
equal to the sum of (i) the rate (or if more than one rate, the weighted average
of the rates) at which Commercial Paper issued to fund such Tranche may be sold
by any placement agent or commercial paper dealer selected by the Fairway
Funding Agent; provided, that if the rate (or rates) as agreed between any such
agent or dealer and the Fairway Funding Agent with regard to any Tranche Period
for such portion of Net Investment is a discount rate (or rates), then such rate
shall be the rate (or if more that one rate, the weighted average of the rates)
resulting from converting such discount rate (or rates) to an interest-bearing
equivalent rate per annum, plus (ii) the commissions and charges charged by such
placement agent or commercial paper dealer with respect to such Commercial
Paper, expressed as a percentage of such face amount and converted to an
interest-bearing equivalent rate per annum. Notwithstanding anything in the
Receivables Transfer Agreement to the contrary, the Transferor agrees that any
amounts payable to Fairway in respect of Fairway Discount for any Settlement
Period or Tranche Period, as the case may be, with respect to any Tranche funded
by Fairway at the CP Rate shall include an amount equal to the portion of the
face amount of the outstanding Commercial Paper issued to fund or maintain such
Tranche that corresponds to the portion of the proceeds of such Commercial Paper
that was used to pay the interest component of maturing Commercial Paper issued
to fund or maintain such Tranche, to the extent that Fairway had not received
payments of interest in respect of such interest component prior to the maturity
date of such maturing Commercial Paper. For purposes of the foregoing sentence,
the "interest component" of Commercial Paper equals the excess of the face
amount thereof over the net proceeds received by Fairway from the issuance of
Commercial Paper, except that if such Commercial Paper is issued on an
interest-bearing basis its "interest-
11
component" will equal the amount of interest accruing on such Commercial Paper
through its maturity.
"Fairway CP Tranche" shall mean a Tranche as to which Fairway Discount
is calculated at the Fairway CP Rate.
"Fairway CP Tranche Period" shall mean, with respect to each portion
of the Aggregate Net Investment funded or maintained by Fairway through the
issuance of Commercial Paper:
(a) initially the period commencing on the date of any purchase or
transfer pursuant to Section 2.2 and ending such number of days as the Fairway
Funding Agent shall select, up to 90 days after such date; and
(b) thereafter each period commencing on the last day of the
immediately preceding Fairway CP Tranche Period for any Fairway CP Tranche and
ending such number of days (not to exceed 90 days) as the Fairway Funding Agent
shall select; provided, that
(i) any Fairway CP Tranche Period (other than of one day) which
would otherwise end on a day which is not a Business Day shall be
extended to the next succeeding Business Day;
(ii) in the case of any Fairway CP Tranche Period of one day, (A)
if such Fairway CP Tranche Period is the initial Fairway CP Tranche
Period for a purchase or transfer pursuant to Section 2.2, such
Fairway CP Tranche Period shall be the day of such purchase or
transfer; (B) any subsequently occurring Fairway CP Tranche Period
which is one day shall, if the immediately preceding Fairway CP
Tranche Period is more than one day, be the last day of such
immediately preceding Fairway CP Tranche Period, and, if the
immediately preceding Fairway CP Tranche Period is one day, be the day
next following such immediately preceding Fairway CP Tranche Period;
and (C) if such Fairway CP Tranche Period occurs on a day immediately
preceding a day which is not a Business Day, such Fairway CP Tranche
Period shall be extended to the next succeeding Business Day; and
(iii) in the case of any Fairway CP Tranche Period of any Fairway
CP Tranche which commences before the Termination Date and would
otherwise end on a date occurring after the Termination Date, such
Fairway CP Tranche Period shall end on such Termination Date and the
duration of each Fairway CP Tranche Period which commences on or after
the Termination Date shall be of such duration as shall be selected by
the Fairway Funding Agent.
"Fairway Commitment Expiry Date" shall mean the earliest to occur of
(i) the date on which all amounts due and owing to Fairway and the Fairway APA
Banks under the Receivables Transfer Agreement and the other Transaction
Documents have been indefeasibly
12
paid in full (as certified by the Fairway Funding Agent), (ii) a Termination
Date (not including pursuant to clause (iii) of the definition of Termination
Date), and (iii) May 16, 2002 (as may be extended for an additional 364 days
from time to time in writing by Fairway, the Fairway Funding Agent and the
Fairway APA Banks).
"Fairway Discount" shall mean, with respect to any Tranche Period
pertaining to Fairway or the Fairway APA Banks:
(TR x TNI x AD)
---------------
YD
Where:
TR = the Fairway Tranche Rate applicable to such Tranche Period;
TNI = the portion of the Fairway Facility Net Investment allocated
to such Tranche Period and such Fairway Tranche Rate;
AD = the actual number of days during such Tranche Period; and
YD = either (i) if the Fairway Tranche Rate is the Fairway CP Rate
or the Fairway Eurodollar Rate, 360 or (ii) if the Fairway
Tranche Rate is the Fairway Base Rate, 365 or 366, as
applicable;
provided, however, that no provision of the Receivables Transfer
Agreement shall require the payment or permit the collection of Fairway Discount
in excess of the maximum amount permitted by applicable law; and provided,
further, that Fairway Discount shall not be considered paid by any distribution
if, at any time, such distribution is rescinded or must be returned for any
reason.
"Fairway Eurodollar Rate" shall mean, with respect to any Eurodollar
Tranche funded or maintained by any APA Bank Purchaser in Fairway's Purchaser
Group (or any liquidity or credit support provider of Fairway), 1.25% plus a
rate per annum equal to the sum (rounded upwards, if necessary, to the next
higher 1/100 of 1%) of (i) the rate obtained by dividing (A) the applicable
LIBOR Rate by (B) a percentage equal to 100% minus the reserve percentage used
for determining the maximum requirement as specified in Regulation D (including,
without limitation, any marginal, emergency, supplemental, special or other
reserves) that is applicable to the Fairway Funding Agent (or the Fairway APA
Banks or other liquidity and/or credit support providers) during the related
Settlement Period or Tranche Period in respect of eurocurrency or eurodollar
funding, lending or liabilities (or, if more than one percentage shall be so
applicable, the daily average of such percentage for those days in such
Settlement Period or Tranche Period during which any such percentage shall be
applicable) plus (ii) the then daily net annual assessment rate (rounded
upwards, if necessary, to the nearest 1/100 of 1%) as estimated by the Fairway
Funding Agent for determining the current annual assessment payable by the
13
Fairway Funding Agent to the Federal Deposit Insurance Corporation in respect of
eurocurrency or eurodollar funding, lending or liabilities.
"Fairway Eurodollar Tranche" shall mean a Tranche as to which Fairway
Discount is calculated at the Fairway Eurodollar Rate.
"Fairway Eurodollar Tranche Period" shall mean, with respect to a
Fairway Eurodollar Tranche, following a Fairway Termination Event or in the
event Fairway elects not to accept a sale, conveyance, transfer and assignment
from the Transferor pursuant to the Receivables Transfer Agreement, or after any
other Fairway Purchase but prior to the Termination Date, a period of up to
three (3) months requested by the Transferor and agreed to by the Fairway
Funding Agent commencing on a Business Day requested by the Transferor and
agreed to by the Fairway Funding Agent; provided, however, that if such Fairway
Eurodollar Tranche Period would expire on a day which is not a Business Day,
such Fairway Eurodollar Trance Period shall expire on the next succeeding
Business Day; provided, further, that if such Fairway Eurodollar Tranche Period
would expire on (a) a day which is not a Business Day but is a day of the month
after which no further Business Day occurs in such month, such Fairway
Eurodollar Tranche Period shall expire on the next preceding Business Day or (b)
a Business Day for which there is no numerically corresponding day in the
applicable subsequent calendar month, such Fairway Eurodollar Tranche Period
shall expire on the last Business Day of such month.
"Fairway Funding Account" means that certain segregated deposit
account established by the Fairway Funding Agent established for the purpose of
depositing all funds paid by the Transferor or the Servicer to the Fairway
Funding Agent on behalf of (a) Fairway and/or (b) the Fairway APA Banks.
"Fairway Funding Agent" means BMO ▇▇▇▇▇▇▇ ▇▇▇▇▇ Corp., in its capacity
as funding agent for the benefit of Fairway and the Fairway APA Banks, and any
of their respective successors and assigns under the Receivables Transfer
Agreement and the Transaction Documents.
"Fairway Interest" means on any day, the portion of the beneficial
interest of Fairway in the Receivables and Related Security, Collections and
Proceeds with respect thereto, which beneficial interest shall equal the product
of (i) the Percentage Factor on such day multiplied by (ii) the quotient of (A)
the Fairway Net Investment on such day divided by (B) the Aggregate Net
Investment on such day multiplied by (iii) the Outstanding Balance of all
Receivables.
"Fairway LIBOR" shall mean, with respect to any Eurodollar Tranche
funded or maintained by any Purchaser in Fairway's Purchaser Group (or any
liquidity or credit support provider of Fairway), the rate at which deposits in
dollars are offered to the Fairway Funding Agent (or the Fairway APA Banks or
other liquidity and/or credit support providers) in the London interbank market
at approximately 11:00 A.M. (London time) two (2) Business Days before the first
day of the related Settlement Period or Tranche Period, as the case may be, in
an
14
amount approximately equal to the Eurodollar Tranche to which the Eurodollar
Rate is to apply and for a period of time approximately equal to the applicable
Settlement Period or Tranche Period.
"Fairway Net Investment" shall mean an amount equal to the result of:
(i) the sum of cash amounts paid to the Transferor by Fairway and the Fairway
APA Banks for each Incremental Transfer minus (ii) the aggregate amount of
Collections received and applied by the Fairway Funding Agent to reduce such
Fairway Net Investment pursuant to Section 2.5, 2.6 or 2.9 of the Receivables
Transfer Agreement; provided that the Fairway Net Investment shall be restored
and reinstated in the amount of any Collections so received and applied if, at
any time, the distribution of such Collections is rescinded or must otherwise be
returned for any reason.
"Fairway Purchase" shall mean any assignment by Fairway to the Fairway
APA Banks of all or a portion of its right, title and interest in and to the
Transferred Assets pursuant to the Fairway Asset Purchase Agreement.
"Fairway Purchase Limit" means, at any time, the lesser of (i) the
amount set forth on Schedule III attached to the Receivables Transfer Agreement
and (ii) the aggregate of Commitments of all then existing Fairway APA Bank
Purchasers with respect to the Receivables Transfer Agreement (after giving
effect to any such Fairway APA Banks whose Commitment expires and is not renewed
on any Fairway Commitment Expiry Date); provided, however, that at all times on
and after the Termination Date, the "Fairway Purchase Limit" means the aggregate
outstanding Fairway Net Investment.
"Fairway Termination Event" means the providers of Fairway's program
liquidity and/or letter of credit facilities shall have given notice that a
commercial paper "stop issuance" event, if any, has occurred under their
respective agreements with Fairway.
"Fairway Tranche Rate" means (i) for any Fairway CP Tranche and any
Fairway CP Tranche Period prior to the occurrence of a Fairway Termination
Event, the Fairway CP Rate, (ii) for any Fairway Eurodollar Tranche and any
Fairway Eurodollar Tranche Period following the occurrence of a Fairway
Termination Event or any other Fairway Purchase but prior to Termination Date,
the Fairway Eurodollar Rate and (iii) for any Fairway BR Tranche and any Fairway
BR Tranche Period, the Fairway Base Rate. Notwithstanding anything in the
immediately preceding sentence to the contrary the "Fairway Tranche Rate" for
any Tranche funded or maintained by any Purchasers in the Fairway Purchaser
Group on and after the occurrence of any Termination Event or the Termination
Date shall be the Fairway Base Rate plus 2.00%.
"Federal Funds Rate" shall mean, for any day, an interest rate per
annum equal to (a) the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or (b) if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 11:00 A.M. (New
York time)
15
on such day on such transactions received by the applicable Funding Agent from
three (3) Federal funds brokers of recognized standing selected by the
applicable Funding Agent in its sole discretion.
"Fee Letter" shall mean each letter agreement, between TMN, the
Transferor, the Administrative Agent and each applicable Funding Agent,
respectively, for the benefit of the Initial Purchasers and the APA Bank
Purchasers within such Funding Agent's Purchaser Group with respect to the fees
to be paid by the Transferor under the Transaction Documents in each case, as
amended, supplemented or otherwise modified and in effect from time to time.
"Finance Charges" shall mean, with respect to a Contract, any finance,
interest, late or similar charges owing by an Eligible Restaurant pursuant to
such Contract.
"Funding Account" shall have the meaning set forth in Section 2.10 of
the Receivables Transfer Agreement.
"Funding Agent" shall mean each of the PARCO Funding Agent and the
Fairway Funding Agent. Except where the context otherwise requires, any
reference to the "Funding Agents" shall be deemed a reference to each Funding
Agent.
"GAAP" shall mean generally accepted accounting principles set forth
in the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such accounting profession, which are in effect as of the date of
the Receivables Transfer Agreement.
"Incremental Transfer" shall have the meaning specified in subsection
2.2(a) of the Receivables Transfer Agreement.
"iDine" shall mean iDine Restaurant Group Inc., and its successors and
permitted assigns.
"Indebtedness" shall mean, with respect to any Person, such Person's
(i) obligations for borrowed money, (ii) obligations representing the deferred
purchase price of property other than accounts payable arising in the ordinary
course of such Person's business on terms customary in the trade, (iii)
obligations, whether or not assumed, secured by liens or payable out of the
proceeds or production from property now or hereafter owned or acquired by such
Person, (iv) obligations which are evidenced by notes, acceptances, or other
instruments, (v) Capitalized Lease obligations and (vi) obligations for which
such Person is obligated pursuant to a guaranty.
"Indemnified Amounts" shall have the meaning specified in Section 7.1
of the Receivables Transfer Agreement.
16
"Indemnified Parties" shall have the meaning specified in Section 7.1
of the Receivables Transfer Agreement.
"Initial Purchaser Termination Event" shall mean a Fairway Termination
Event or a PARCO Termination Event, as applicable.
"Initial Purchasers" shall mean PARCO and Fairway.
"Insurance Proceeds" shall mean any amounts paid pursuant to any
insurance policies covering any Restaurant with respect to its Contract other
than proceeds of such insurance policies used to purchase replacement property
in accordance with the Restaurant Guidelines.
"Law" shall mean any law (including common law), constitution,
statute, treaty, regulation, rule, ordinance, order, injunction, writ, decree or
award of any Official Body.
"LIBOR Rate" shall mean the Fairway LIBOR and/or the PARCO LIBOR Rate,
as applicable.
"License" shall mean the licenses granted to the Administrative Agent
(for the benefit of the Purchasers), the Back-up Servicer and the Successor
Servicer pursuant to Section 6.10 of the Receivables Transfer Agreement and the
Trademark License Agreement.
"Lock-Box Account" shall mean an account maintained by the Transferor
at a Lock-Box Bank for the purpose of receiving Collections from Receivables.
"Lock-Box Agreement" shall mean an agreement between the Transferor
and a Lock-Box Bank in substantially the form of Exhibit D to the Receivables
Transfer Agreement.
"Lock-Box Bank" shall mean each of the banks set forth in Exhibit C to
the Receivables Transfer Agreement, and such banks as may be added thereto or
deleted therefrom pursuant to Section 2.8 of the Receivables Transfer Agreement.
"Manager" shall mean Global Securitization Services, LLC, a Delaware
limited liability company.
"▇▇▇▇" shall mean those trademarks and tradenames identified in
Exhibit A to the Trademark License Agreement.
"Master License Agreement" shall mean the Master License Agreement,
dated as of December 30, 1999, by and among the Transferor, TMN, iDine and
Service Company.
"Master License Termination Agreement" shall mean the Termination
Agreement, dated as of December 30, 1999, by and among TNI Funding, TMN, iDine
and Service Company.
17
"Material Adverse Effect" shall mean any event or condition which
would have a material adverse effect on (i) the collectibility of the
Receivables, (ii) the condition (financial or otherwise), businesses or
properties of the Transferor, TMN or any other Seller, (iii) the ability of the
Transferor, TMN or any other Seller to perform its respective obligations under
the Transaction Documents to which it is a party and (iv) the interests of the
Administrative Agent, any Funding Agent, any Initial Purchaser or any APA Bank
Purchaser under the Transaction Documents.
"Maximum Percentage Factor" shall mean 100%.
"Meals" shall mean food and beverages.
"Member Agreements" shall mean all of the agreements executed by
Members in connection with the Registered Card Program or Private Label Program,
as applicable, in which Members either register or use their Members' Credit
Card Accounts with a Restaurant and the Originator, a Seller or any of its
Affiliates and receive Rebates in connection with the food and beverages
purchased by such Members at Restaurants.
"Members" shall mean Persons who are parties to the Member Agreements.
"Members' Credit Card Accounts" shall mean the Members' Visa,
MasterCard, Novus Enterprises and American Express Card accounts which have been
specified by the Members as the accounts to be charged when the Members purchase
food and beverages at Restaurants utilizing the Registered Card Program or the
Private Label Program.
"Membership Fees" shall mean all membership fees paid by Members
pursuant to the Member Agreements in connection with the Registered Card Program
or Private Label Program.
"Memorandum of Confirmation" shall mean the Memorandum of
Confirmation, dated as of May 17, 2001, made by the Transferor to the
Administrative Agent for the benefit of the Initial Purchasers and the APA Bank
Purchasers.
"Moody's" shall mean ▇▇▇▇▇'▇ Investors Service, Inc., and its
successors and assigns.
"Multiemployer Plan" shall mean a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA which is or was at any time during the current year
or the immediately preceding five years contributed to by the Transferor, TMN,
any other Seller or any ERISA Affiliate of the Transferor, TMN or any other
Seller on behalf of its employees.
"Net Investment" shall mean either of the PARCO Facility Net
Investment or the Fairway Net Investment.
18
"Net Receivables Balance" shall mean, at any time, the Outstanding
Balance of the Eligible Receivables at such time, as reduced by the aggregate
Outstanding Balance of all Eligible Receivables which are Defaulted Receivables;
provided that Arrear Sales and Membership Fees shall not be included for the
purposes of calculating the Net Receivables Balance.
"Non-Defaulting PARCO APA Bank" shall have the meaning assigned to
"Non-Defaulting APA Bank" in subsection 2.2(b) of the Asset Purchase Agreement.
"Official Body" shall mean any government or political subdivision or
any agency, authority, bureau, central bank, commission, department or
instrumentality of any such government or political subdivision, or any court,
tribunal, grand jury or arbitrator, in each case whether foreign or domestic.
"Original Closing Date" shall mean December 30, 1999.
"Originator" shall mean Signature Card, Inc., an Indiana corporation.
"Originator Receivables Purchase Agreement" shall mean that certain
Asset Purchase Agreement, dated as of March 17, 1999, by and among the
Originator, as a seller thereunder, and TMN, as purchaser thereunder, as the
same may be amended, supplemented or otherwise modified and in effect from time
to time.
"Other Transferor" shall mean any Person, other than the Transferor,
that has entered into a receivables purchase agreement, receivables transfer
agreement, loan agreement or funding agreement with PARCO or Fairway, as the
case may be.
"Outstanding Balance" shall mean, with respect to any Receivable at
any time, the then outstanding principal amount thereof representing Dollars
advanced by the Originator, a Seller or its Affiliates to a Restaurant,
excluding any accrued and outstanding Finance Charges related thereto.
"PARCO" shall mean the Park Avenue Receivables Corporation, a Delaware
corporation, and its successors and assigns.
"PARCO Administrative Agent" shall mean The Chase Manhattan Bank, as
administrative agent on behalf of PARCO, and its permitted successors and
assigns in such capacity.
"PARCO APA Bank Commitment" shall mean, with respect to any or all
PARCO APA Banks, the amount set forth on Schedule III attached to the
Receivables Transfer Agreement equal at all times to 100% of the PARCO APA
Banks' Pro Rata Share of the Facility Limit, as the same may be reduced from
time to time in accordance with Section 2.5 or subsection 5.5(c) of the PARCO
Asset Purchase Agreement; provided that at all times the PARCO APA Bank
Commitment shall equal the Fairway APA Bank Commitment.
19
"PARCO APA Bank Interest" shall have the meaning assigned to "APA Bank
Interest" in the PARCO Asset Purchase Agreement.
"PARCO APA Bank Purchase Percentage" shall have the meaning assigned
to "APA Bank Purchaser Percentage" in the PARCO Asset Purchase Agreement.
"PARCO APA Banks" shall mean the Persons listed on Annex I to the
PARCO Asset Purchase Agreement (including, without limitation, Chase), and the
Persons which from time to time may become a party to the PARCO Asset Purchase
Agreement in accordance with Section 5.5(c) thereof.
"PARCO Asset Purchase Agreement" shall mean that certain Amended and
Restated Asset Purchase Agreement, dated as of May 17, 2001, by and among the
PARCO Funding Agent, the PARCO APA Banks and PARCO, as the same may from time to
time be amended, supplemented or otherwise modified and in effect.
"PARCO Base Rate" shall mean, a rate per annum equal to the greater of
(i) the prime rate of interest announced by the PARCO Funding Agent from time to
time, changing when and as said prime rate changes (such rate not necessarily
being the lowest or best rate charged by the PARCO Funding Agent) and (ii) the
sum of (A) 1.50% and (B) the rate equal to the weighted average of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published for such day (or, if such day is
not a Business Day, for the next preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day that is a
Business Day, the average of the quotations for such day for such transactions
received by the PARCO Funding Agent from three (3) Federal funds brokers of
recognized standing selected by it.
"PARCO BR Tranche" shall mean a Tranche as to which PARCO Discount is
calculated at the PARCO Base Rate.
"PARCO BR Tranche Period" shall mean, with respect to a PARCO BR
Tranche after a PARCO Termination Event or in the event PARCO elects not to
accept a sale, conveyance, transfer and assignment from the Transferor pursuant
to the Receivables Transfer Agreement or after any other PARCO Purchase, a
period of one (1) day. If such PARCO BR Tranche Period would end on a day which
is not a Business Day, such PARCO BR Tranche Period shall end on the next
succeeding Business Day.
"PARCO Commitment Expiry Date" shall mean the earliest to occur of (i)
the date on which all amounts due and owing to PARCO and the PARCO APA Banks
under the Receivables Transfer Agreement and the other Transaction Documents
have been indefeasibly paid in full (as certified by the PARCO Funding Agent)
and the PARCO APA Bank Commitments have been reduced to zero pursuant to Section
2.5 of the PARCO Asset Purchase Agreement and (ii) May 16, 2002 (as may be
extended for an additional 364 days from time to time in writing by PARCO, the
PARCO Funding Agent and the PARCO APA Banks).
20
"PARCO CP Rate" shall mean, with respect to any PARCO CP Tranche
Period, the rate equivalent to the weighted average of (i) the weighted average
of the discount rates on all of PARCO's Commercial Paper issued at a discount
and outstanding during the related PARCO CP Tranche Period, converted to an
annual yield-equivalent rate on the basis of a 360-day year, which rates shall
include dealer fees and commissions and (ii) the weighted average of the annual
interest rates payable on all interest-bearing PARCO Commercial Paper
outstanding during the related PARCO CP Tranche Period, on the basis of a
360-day year, which rates shall include dealer fees and commissions; provided,
that to the extent that the Facility is funded by a specific issuance of PARCO's
Commercial Paper, the "PARCO CP Rate" shall equal the rate or weighted average
of the rates applicable to such issuance.
"PARCO CP Tranche" shall mean a Tranche as to which PARCO Discount is
calculated at the PARCO CP Rate.
"PARCO CP Tranche Period" shall mean, with respect to a PARCO CP
Tranche, a Settlement Period.
"PARCO Discount" means, with respect to any Tranche Period pertaining
to PARCO or the PARCO APA Banks:
(TR x TNI x AD)
---------------
YD
Where:
TR = the PARCO Tranche Rate applicable to such Tranche Period;
TNI = the portion of the PARCO Facility Net Investment allocated to
such Tranche Period;
AD = the actual number of days during such Tranche Period; and
YD = either (i) if the PARCO Tranche Rate is the PARCO CP Rate or the
PARCO Eurodollar Rate, 360 or (ii) if the PARCO Tranche Rate is
the PARCO Base Rate, 365 or 366, as applicable;
provided, however, that no provision of the Receivables Transfer Agreement shall
require the payment or permit the collection of PARCO Discount in excess of the
maximum amount permitted by applicable law; and provided, further, that PARCO
Discount shall not be considered paid by any distribution if, at any time, such
distribution is rescinded or must be returned for any reason.
"PARCO Eurodollar Rate" shall mean, with respect to any PARCO
Eurodollar Tranche Period, a rate which is 1.25% in excess of a rate per annum
equal to the sum (rounded upwards, if necessary, to the next higher 1/100 of 1%)
of (i) the rate obtained by dividing (A) the
21
applicable PARCO LIBOR Rate by (B) a percentage equal to 100% minus the reserve
percentage used for determining the maximum reserve requirement as specified in
Regulation D (including, without limitation, any marginal, emergency,
supplemental, special or other reserves) that is applicable to the PARCO Funding
Agent during such PARCO Eurodollar Tranche Period in respect of eurocurrency or
eurodollar funding, lending or liabilities (or, if more than one percentage
shall be so applicable, the daily average of such percentage for those days in
such PARCO Eurodollar Tranche Period during which any such percentage shall be
applicable) plus (ii) the then daily net annual assessment rate (rounded
upwards, if necessary, to the nearest 1/100 of 1%) as estimated by the PARCO
Funding Agent for determining the current annual assessment payable by the PARCO
Funding Agent to the Federal Deposit Insurance Corporation in respect of
eurocurrency or eurodollar funding, lending or liabilities.
"PARCO Eurodollar Tranche" shall mean a Tranche as to which PARCO
Discount is calculated at the PARCO Eurodollar Rate.
"PARCO Eurodollar Tranche Period" shall mean, with respect to a PARCO
Eurodollar Tranche, following a PARCO Termination Event or in the event PARCO
elects not to accept a sale, conveyance, transfer and assignment from the
Transferor pursuant to the Receivables Transfer Agreement, or after any other
PARCO Purchase but prior to the Termination Date, a period of up to three (3)
months requested by the Transferor and agreed to by the PARCO Funding Agent
commencing on a Business Day requested by the Transferor and agreed to by the
PARCO Funding Agent; provided, however, that if such PARCO Eurodollar Tranche
Period would expire on a day which is not a Business Day, such PARCO Eurodollar
Tranche Period shall expire on the next succeeding Business Day; provided,
further, that if such PARCO Eurodollar Tranche Period would expire on (a) a day
which is not a Business Day but is a day of the month after which no further
Business Day occurs in such month, such PARCO Eurodollar Tranche Period shall
expire on the next preceding Business Day or (b) a Business Day for which there
is no numerically corresponding day in the applicable subsequent calendar month,
such PARCO Eurodollar Tranche Period shall expire on the last Business Day of
such month.
"PARCO Facility Interest" shall mean, on any day, the portion of the
beneficial interest of PARCO and/or the PARCO APA Banks in the Receivables and
Related Security, Collections and Proceeds with respect thereto, which
beneficial interest shall equal the product of (i) the Percentage Factor on such
day multiplied by (ii) the quotient of (A) the PARCO Facility Net Investment on
such day divided by (B) the Aggregate Net Investment on such day multiplied by
(iii) the Outstanding Balance of all Receivables.
"PARCO Facility Net Investment" shall mean an amount equal to the
result of: (i) the sum of cash amounts paid to the Transferor by PARCO and/or
the PARCO APA Banks for each Incremental Transfer minus (ii) the aggregate
amount of Collections received and applied by the PARCO Funding Agent to reduce
such PARCO Facility Net Investment pursuant to Section 2.5, 2.6 or 2.9 of the
Receivables Transfer Agreement; provided that the PARCO Facility Net Investment
shall be restored and reinstated in the amount of any Collections so received
and
22
applied if, at any time, the distribution of such Collections is rescinded or
must otherwise be returned for any reason.
"PARCO Funding Agent" shall mean Chase, in its capacity as funding
agent for the benefit of PARCO and the PARCO APA Banks, and any successor and
assigns thereto.
"PARCO Insolvency Event" shall mean the occurrence of any one or more
of the following: (i) any proceeding shall have been instituted by PARCO seeking
to adjudicate it as bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief or composition of it
or its debts under any law relating to bankruptcy, insolvency or reorganization
or relief of debtors, or seeking the entry of any order for relief or the
appointment of a receiver, trustee or other similar official for it or any
substantial part of its property, or (ii) any proceeding of the type described
in the foregoing clause (i) shall be instituted against PARCO and shall have
remained undismissed for a period of sixty (60) consecutive days, or an order
granting relief requested in any such proceeding shall be entered.
"PARCO Interest" shall have the meaning specified in the PARCO Asset
Purchase Agreement.
"PARCO LIBOR Rate" shall mean, with respect to any PARCO Eurodollar
Tranche Period, the rate at which deposits in dollars are offered to the PARCO
Funding Agent, in the London interbank market at approximately 11:00 A.M.
(London time) two (2) Business Days before the first day of such PARCO
Eurodollar Tranche Period in an amount approximately equal to the PARCO
Eurodollar Tranche to which the PARCO Eurodollar Rate is to apply and for a
period of time approximately equal to the applicable PARCO Eurodollar Tranche
Period.
"PARCO Net Investment" shall have the meaning specified in the PARCO
Asset Purchase Agreement.
"PARCO Purchase" shall mean any assignment by PARCO to the PARCO APA
Banks of all or a portion of its right, title and interest in and to the
Transferred Assets pursuant to Section 2.1 of the PARCO Asset Purchase
Agreement.
"PARCO Purchase Amount" shall have the meaning assigned to "Purchase
Amount" in the PARCO Asset Purchase Agreement.
"PARCO Purchase Date" shall have the meaning assigned to "Purchase
Date" in the PARCO Asset Purchase Agreement.
"PARCO Purchase Limit" means, at any time, the amount set forth on
Schedule III attached to the Receivables Transfer Agreement; provided, however,
that at all times on and after the Termination Date, the "PARCO Purchase Limit"
means the aggregate outstanding PARCO Facility Net Investment, as reduced
pursuant to the terms of the PARCO Asset Purchase Agreement.
23
"PARCO Purchase Percentage" shall have the meaning assigned to
"Purchase Percentage" in the PARCO Asset Purchase Agreement.
"PARCO Purchase Price" shall have the meaning assigned to "Purchase
Price" in the PARCO Asset Purchase Agreement.
"PARCO Purchase Price Deficit" shall have the meaning specified in
subsection 2.2(b) of the PARCO Asset Purchase Agreement.
"PARCO Sale Notice" shall have the meaning assigned to the term "Sale
Notice" in the PARCO Asset Purchase Agreement.
"PARCO Termination Event" means the providers of PARCO's program
liquidity and/or letter of credit facilities shall have given notice that an
event of default has occurred and is continuing under their respective
agreements with PARCO.
"PARCO Tranche Rate" means (i) for any PARCO CP Tranche and any PARCO
CP Tranche Period prior to the occurrence of a PARCO Termination Event, the
PARCO CP Rate, (ii) for any PARCO Eurodollar Tranche and any PARCO Eurodollar
Tranche Period following the occurrence of a PARCO Termination Event or any
other PARCO Purchase but prior to a Termination Date, the PARCO Eurodollar Rate
and (iii) for any PARCO BR Tranche and any PARCO BR Tranche Period following a
Termination Date, the occurrence of a PARCO Termination Event or any other PARCO
Purchase, the PARCO Base Rate. Notwithstanding anything in the immediately
preceding sentence to the contrary the "PARCO Tranche Rate" for any Tranche
funded or maintained by any Purchasers in the PARCO Purchaser Group on and after
the occurrence of any Termination Event or the Termination Date shall be the
PARCO Base Rate plus 2.00%.
"PARCO Transfer Supplement" shall have the meaning specified in
subsection 5.5(c) of the PARCO Asset Purchase Agreement.
"Participant" shall have the meaning specified in subsection 5.5(b) of
the PARCO Asset Purchase Agreement.
"Pay-Off Letters" shall mean, collectively, (i) that certain Pay-Off
Letter, dated December 30, 1999, between TMN and Chase, evidencing the
termination of the Credit Agreement and the payment in full of all of TMN's
obligations thereunder, and (ii) that certain Termination Agreement, dated as of
December 30, 1999, by and among TMN, iDine, Service Company, TNI Funding, TNI,
Chase, as trustee and collateral agent and each of the noteholders under the TNI
Securitization Facility, evidencing the termination of the TNI Securitization
Facility and the payment in full of all of TNI's obligations thereunder.
"Percentage Factor" shall mean the fraction (expressed as a
percentage) computed on any date of determination as follows: (i) the result of
(a)(1) the Aggregate Net Investment minus (2) all amounts deposited into the
Funding Accounts by the Transferor or the Servicer
24
pursuant to the first sentence of Section 2.6 of the Receivables Transfer
Agreement that have not been applied by the applicable Purchasers in reduction
of the Aggregate Net Investment, divided by (b) the Advance Rate, divided by
(ii) the sum of (a) the Net Receivables Balance on such date plus (b) the amount
on deposit in the RTR Funding Account.
The Percentage Factor shall be calculated by the Servicer on the day
of the initial Incremental Transfer hereunder. Thereafter, until the Termination
Date, the Servicer shall recompute the Percentage Factor at the time of each
Incremental Purchase pursuant to Section 2.2(a) of the Receivables Transfer
Agreement and as of the close of business on each Business Day and report such
recomputations to the Administrative Agent and each Funding Agent in the Weekly
Report, Settlement Report and as otherwise requested by the Administrative Agent
or any Funding Agent. The Percentage Factor shall remain constant from the time
as of which any such computation or recomputation is made until the time as of
which the next such recomputation shall be made, notwithstanding any additional
Receivables arising, any Incremental Transfer made pursuant to such subsection
2.2(a) or any reinvestment Transfer made pursuant to subsection 2.2(b) and 2.5
of the Receivables Transfer Agreement during any period between computations of
the Percentage Factor. The Percentage Factor shall remain constant at 100% at
all times on and after the Termination Date until such time as the applicable
Funding Agent, on behalf of each Initial Purchaser and each APA Bank Purchaser,
shall have received the Aggregate Unpaids, in cash, at which time the Percentage
Factor shall be recomputed in accordance with Section 2.6 of the Receivables
Transfer Agreement.
"Permitted Encumbrance" means any of the following:
(i) liens, charges or other encumbrances for taxes and assessments which
are not yet due and payable;
(ii) liens of or resulting from any judgment or award, the time for the
appeal or petition for rehearing of which shall not have expired, or
in respect of which the Transferor and/or a Seller shall at any time
in good faith be prosecuting an appeal or proceeding for a review and
with respect to which adequate reserves or other appropriate
provisions are being maintained in accordance with GAAP;
(iii) liens, charges or other encumbrances or priority claims incidental to
the conduct of business or the ownership of properties and assets
(including mechanics', carriers', repairers', warehousemen's and
statutory landlords' liens) and deposits, pledges or liens to secure
statutory obligations, surety or appeal bonds or other liens of like
general nature incurred in the ordinary course of business and not in
connection with the borrowing of money, provided in each case, the
obligation secured is not overdue, or, if overdue, is being contested
in good faith by appropriate actions or proceedings and with respect
to which adequate reserves or other appropriate provisions are being
maintained in accordance with GAAP;
(iv) liens, charges or encumbrances in favor of the Administrative Agent,
any Initial Purchaser, any APA Bank Purchaser or any Funding Agent in
each case arising in
25
connection with the transactions contemplated by the Receivables
Transfer Agreement; and
(v) imperfections in title not material in amount and which, individually
or in the aggregate, do not materially interfere with the rights
hereunder of the Administrative Agent, any Initial Purchaser, any APA
Bank Purchaser or any Funding Agent in the Receivables.
"Permitted Investments" shall mean any of the following (a) negotiable
instruments or securities represented by instruments in bearer or registered or
in book-entry form which evidence (i) obligations fully guaranteed by the United
States of America; (ii) time deposits in, or bankers acceptances issued by, any
depositary institution or trust company incorporated under the laws of the
United States of America or any state thereof and subject to supervision and
examination by Federal or state banking or depositary institution authorities;
provided, however, that at the time of investment or contractual commitment to
invest therein, the certificates of deposit or short-term deposits, if any, or
long-term unsecured debt obligations (other than such obligation whose rating is
based on collateral or on the credit of a Person other than such institution or
trust company) of such depositary institution or trust company shall have a
credit rating from ▇▇▇▇▇'▇ and S&P of at least P-1 and "A-1", respectively, in
the case of the certificates of deposit or short-term deposits, or a rating not
lower than one of the two highest investment categories granted by ▇▇▇▇▇'▇ and
by S&P (iii) certificates of deposit having, at the time of investment or
contractual commitment to invest therein, a rating from ▇▇▇▇▇'▇ and S&P of at
least P-1 and "A-1", respectively; or (iv) investments in money market funds
rated in the highest investment category or otherwise approved in writing by
▇▇▇▇▇'▇ and S&P (b) demand or time deposits in any depositary institution or
trust company referred to in (a)(ii) above; (c) commercial paper (having
original or remaining maturities of no more than 30 days) having, at the time of
investment or contractual commitment to invest therein, a credit rating from
▇▇▇▇▇'▇ and S&P of at least P-1 and "A-1", respectively; (d) Eurodollar time
deposits having a credit rating from ▇▇▇▇▇'▇ and S&P of at least P-1 and "A-1",
respectively; (e) repurchase agreements involving any of the Permitted
Investments described in clauses (a)(i), (a)(iii) and (d) of this definition so
long as the other party to the repurchase agreement has at the time of
investment therein, a rating from ▇▇▇▇▇'▇ and S&P of at least P-1 and "A-1",
respectively; and (f) any other investment permitted by each of the Funding
Agent, ▇▇▇▇▇'▇ and S&P.
"Person" shall mean any corporation, limited liability company,
natural person, firm, joint venture, partnership, trust, unincorporated
organization, enterprise, government or any department or agency of any
government.
"Placement Agent" shall mean Chase Securities Inc.
"Potential Termination Event" shall mean an event which but for the
lapse of time or the giving of notice, or both, would unavoidably constitute a
Termination Event.
"Private Label Program" shall mean a program operated by TMN or any
other Seller pursuant to which Members receive Rebates in connection with food
and beverage
26
purchases at Restaurants by using their Transmedia Card in accordance with the
terms of the related Member Agreements.
"Proceeds" shall mean "proceeds" as defined in Section 9-306(1) of the
Relevant UCC.
"Processing Fee" shall mean the amount charged by Credit Card
Processors to which a receipt related to the purchase of food and beverages at
Restaurants by Members is sent for processing.
"Program Fee" shall have the meaning specified in the applicable Fee
Letter.
"Pro Rata Share" shall mean, on any date of determination with respect
to any APA Bank Purchaser, the ratio (expressed as a percentage) of such APA
Bank Purchaser's Commitment to the Aggregate Commitment; provided, that on any
date after the Termination Date the Pro Rata Share of any APA Bank Purchaser
shall be such APA Bank Purchaser's Pro Rata Share on the Termination Date.
"Purchase Discount" shall mean, on any Business Day on which
Receivables are sold by a Seller to the Transferor pursuant to the Receivables
Purchase Agreement, an amount, calculated in good faith by the Transferor, equal
to 0.015.
"Purchase Limit" shall mean each of the PARCO Purchase Limit and the
Fairway Purchase Limit.
"Purchase Price" shall (i) with respect to the Receivables Purchase
Agreement, have the meaning set forth in Section 3.1 of the Receivables Purchase
Agreement, and (ii) with respect to the PARCO Asset Purchase Agreement, have the
meaning given such term therein.
"Purchase Price Deficit" shall have the meaning specified in
subsection 2.2(b) of the PARCO Asset Purchase Agreement.
"Purchase Termination Date" shall have the meaning specified in
Section 8.1 of the Receivables Purchase Agreement.
"Purchased Receivables" shall have the meaning specified in subsection
3.2(a) of the Receivables Purchase Agreement.
"Purchaser" shall mean any Initial Purchaser and/or APA Bank
Purchaser, as applicable.
"Purchaser Group" means for each Initial Purchaser, such Initial
Purchaser, its related APA Bank Purchasers and its Funding Agent.
27
"Rating Agency" shall mean ▇▇▇▇▇'▇, S&P and any other nationally
recognized statistical rating organization from which a rating for the
Commercial Paper was requested by PARCO and is currently in effect.
"Rating Confirmation" shall mean, with respect to any action, that
each Rating Agency shall have notified the Transferor, the Servicer and the
applicable Funding Agent in writing that such action will not result in a
reduction, qualification or withdrawal of the rating of the Facility or the then
current rating of the Commercial Paper or any other debt securities, rated at
the request of the Initial Purchasers, by each such Rating Agency.
"Rebate" shall mean the cash rebate or mileage or other credits to
which Members are entitled under the Member Agreements.
"Receivable" shall mean (a) all outstanding rights to receive and
indebtedness (including, but not limited to, Arrear Sales) owed to a Seller by a
Restaurant under a Contract which was sold by the Originator to TMN pursuant to
the Originator Receivables Purchase Agreement, sold by TNI to TMN pursuant to
the Receivables Sale Agreement, or originated or acquired by a Seller or its
Affiliates under the Registered Card Program or Private Label Program, and, in
either case, subsequently sold by a Seller to the Transferor pursuant to the
Receivables Purchase Agreement, whether constituting an account, chattel paper,
instruments, investment property or general intangible, including, without
limitation, all (i) rights to receive Meals or Credits in respect thereof under
the Registered Card Program or Private Label Program purchased by the
Originator, TNI, a Seller or any Affiliate thereof from any Restaurant pursuant
to any Contract, (ii) rights of the Originator, TNI, a Seller or any Affiliate
thereof to, in and under any Contract with a Restaurant, and (iii) rights of the
Originator, TNI, a Seller or any Affiliate thereof whether now existing or
hereafter arising, to recover payments from a Restaurant's account in connection
with the purchase of Meals by any Member at such Restaurant and (b) all
Membership Fees owed by a Member to a Seller and sold by a Seller to the
Transferor pursuant to the Receivables Purchase Agreement.
Notwithstanding the foregoing, once a Receivable has been deemed
collected pursuant to Section 2.9 of the Receivables Transfer Agreement (and the
Funding Agent on behalf of each Purchaser in such Funding Agent's Purchaser
Group, has received such amounts relating to such deemed collection), it shall
no longer constitute a Receivable under the Receivables Transfer Agreement.
"Receivables Purchase Agreement" shall mean the First Amended and
Restated Receivables Purchase Agreement, dated as of May 17, 2001, by and among
TMN, iDine and Service Company, each as sellers, and the Transferor, as
purchaser, as such agreement may be amended, supplemented or otherwise modified
and in effect from time to time.
"Receivables Sale Agreement" shall mean the Receivables Sale
Agreement, dated as of December 30, 1999, by and among TNI, as a seller, and
TMN, as purchaser, as such agreement may be amended, supplemented or otherwise
modified and in effect from time to time.
28
"Receivables Transfer Agreement" shall mean the First Amended and
Restated Receivables Transfer Agreement, dated as of May 17, 2001, by and among
the Transferor, TMN, individually and as servicer, the Back-up Servicer, the
Successor Servicer, PARCO, the PARCO APA Banks, the PARCO Funding Agent,
Fairway, the Fairway Funding Agent, and the Fairway APA Banks, as such agreement
may be amended, supplemented or otherwise modified and in effect from time to
time.
"Recipient" shall have the meaning specified in Section 2.14 of the
Receivables Transfer Agreement.
"Records" shall mean all Contracts and other documents, books, records
and other information (including, without limitation, computer programs, tapes,
disks, punch cards, data processing software and related property and rights)
maintained with respect to Receivables and the related Restaurants.
"Registered Card Program" shall mean a program operated by TMN or any
other Seller pursuant to which Members receive Rebates in connection with food
and beverage purchases at Restaurants by registering or using their Members'
Credit Card Accounts in accordance with terms of the Member Agreements.
"Related Security" shall mean, with respect to any Receivable, all of
a Seller's and Transferor's right, title and interest in, to and under:
(a) all other accounts, contract rights, chattel paper, instruments,
Records, general intangibles and other obligations of any
Restaurant with respect to any Receivable or related Contract,
now or hereafter existing, whether or not arising out of or in
connection with the sale or lease of goods or the rendering of
services and the right to payment of any Receivables, Credits or
other obligations of a Restaurant, Member or from any Members'
Credit Card Accounts with respect to any of the foregoing;
(b) all other security interests or liens and property subject
thereto from time to time, if any, purporting to secure payment
of such Receivable, whether pursuant to the Contract related to
such Receivable or otherwise, together with all financing
statements signed by a Restaurant describing any collateral
securing such Receivable;
(c) all guarantees, indemnities, warranties, insurance (and proceeds
and premium refunds thereof) or other agreements or arrangements
of any kind from time to time supporting or securing payment of
such Receivable whether pursuant to the Contract related to such
Receivable or otherwise;
(d) (i) in the case of the Transferor, all rights and remedies of TMN
under the Originator Receivables Purchase Agreement with respect
to the Receivables, together with all financing statements filed
by TMN against
29
the Originator in connection therewith and (ii) in the case of
the Administrative Agent for the benefit of the Initial
Purchasers and the APA Bank Purchasers, all rights and remedies
of the Transferor under the Receivables Purchase Agreement,
together with all financing statements filed by the Transferor
against the Seller in connection therewith; and
(e) all Proceeds of any of the foregoing.
"Relevant UCC" shall mean, with respect to any State, the Uniform
Commercial Code as from time to time in effect in such State.
"Required Participants" shall mean PARCO, the PARCO APA Banks, Fairway
and the Fairway APA Banks having Pro Rata Shares in the aggregate equal to 100%
or, if the Commitments have been terminated, having a Net Investment equal to
100% of the Aggregate Net Investment; provided that the Commitment of any
Defaulting PARCO APA Bank or any Defaulting Fairway APA Bank that has not paid
all amounts due and owing by it in respect of Purchases it was obligated to make
shall not be included in the Commitments for purposes of this definition.
"Requirements of Law" shall mean, as to any Person, the organizational
documents of such Person, and any law, treaty, rule or regulation or
determination of an arbitrator or a court or other Official Body, in each case
applicable to or binding upon such Person or any of its property or to which
such Person or any of its property is subject.
"Responsible Officer" shall mean, with respect to any Person, the
Chairman, the President, the Controller, any Vice President, the Secretary, the
Treasurer, or any other officer of such Person customarily performing functions
similar to those performed by any of the above-designated officers and also,
with respect to a particular matter any other officer to whom such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject.
"Restaurant" shall mean, with respect to any Contract, the Person or
Persons obligated to provide Credits or make payments with respect to such
Contract, including any guarantor thereof.
"Restaurant Guidelines" shall mean the Sellers' and the Servicer's
policies and procedures relating to the operation of its business, including,
without limitation, the policies and procedures for determining charge-offs, the
purchase of Credits from Restaurants and the terms relating to the maintenance
of Restaurant accounts and collection of Receivables, as set forth on Exhibit B
attached to the Receivables Transfer Agreement and as in effect on the Original
Closing Date.
"RTR Funding Account" shall mean the account, established by the
Administrative Agent, for the benefit of the Initial Purchasers and the APA Bank
Purchasers pursuant to subsection 2.12(b) of the Receivables Transfer Agreement.
30
"Scheduled Commitment Termination Date" shall mean May 16, 2002 (as
may be extended for an additional 364 days from time to time in writing by the
Administrative Agent, the Initial Purchasers, and the APA Banks).
"Section 7.2 Costs" shall have the meaning specified in subsection
7.2(c) of the Receivables Transfer Agreement.
"Sellers" shall mean TMN, iDine and Service Company, and each of their
successors and permitted assigns.
"Service Company" shall mean Transmedia Service Company Inc., and its
successors and permitted assigns.
"Servicer" shall mean, at any time, the Person then authorized
pursuant to Section 6.1 of the Receivables Transfer Agreement to service,
administer and collect Receivables.
"Servicer Default" shall have the meaning specified in Section 6.4 of
the Receivables Transfer Agreement.
"Servicing Fee" shall mean the fees payable by the Transferor to the
Servicer in an amount equal to the Servicing Fee Percentage multiplied by the
amount of the aggregate Outstanding Balance of the Receivables. Such fee shall
accrue from the date of the initial purchase of an interest by the Initial
Purchasers and APA Bank Purchasers, as applicable, in the Receivables to the
later of the Termination Date or the date on which the Percentage Factor is
reduced to zero. On or prior to the Termination Date, and provided that no
Potential Termination Event shall have occurred and be continuing, such fee
shall be payable only from Collections pursuant to, and subject to the priority
of payments set forth in, Section 2.5 of the Receivables Transfer Agreement.
After the Termination Date or during the continuation of a Potential Termination
Event, such fee shall be payable only from Collections pursuant to, and subject
to the priority of payments set forth in, Section 2.6 of the Receivables
Transfer Agreement.
"Servicing Fee Percentage" shall mean 7.5% per annum.
"Settlement Date" shall mean the tenth day of each calendar month
(beginning in July 2001) immediately succeeding a Settlement Period or, if such
day is not a Business Day, the next succeeding Business Day.
"Settlement Period" shall mean (i) with respect to the initial
Settlement Period, the period of days from and including the Amendment Effective
Date to and including June 30, 2001 and (ii) with respect to each Settlement
Period thereafter, the period of days from and including the first day of a
calendar month to and including the last day of such calendar month.
"Settlement Report" shall mean a report, in substantially the form
attached to the Receivables Transfer Agreement as Exhibit E or in such other
form as is mutually agreed to by the Transferor, the Administrative Agent and
each Funding Agent, delivered by the Servicer to
31
the Administrative Agent and each Funding Agent pursuant to Section 2.11 of the
Receivables Transfer Agreement.
"Settlement Report Date" shall mean the Business Day of each calendar
month that is two Business Days prior to the Settlement Date of such calendar
month.
"Special Restaurant" shall mean, at any time, each Designated
Restaurant specified by the Administrative Agent (with the consent or at the
direction of each Funding Agent) as a Special Restaurant; provided, however,
that any Special Restaurant shall cease to be a Special Restaurant upon written
notice to TMN, the Transferor, the Initial Purchasers, the APA Bank Purchasers,
the Funding Agents and the Rating Agencies from the Administrative Agent (with
the consent or at the direction of each Funding Agent), delivered at any time.
"Special Restaurant Concentration Factor" shall mean, on any day, a
percentage specified by the Administrative Agent (with the consent or at the
direction of each Funding Agent) in a written notice to TMN, the Transferor, the
Initial Purchasers, the APA Bank Purchasers and the Rating Agencies.
"Standard & Poor's" or "S&P" shall mean Standard & Poor's Ratings
Services, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., and its successors and
assigns.
"Start-up Restaurant" shall mean any newly opened Restaurant which has
operated for less than six months.
"Structuring Fee" shall have the meaning specified in the applicable
Fee Letter.
"Subsidiary" of a Person shall mean any Person more than 50% of the
outstanding voting interests of which shall at any time be owned or controlled,
directly or indirectly, by such Person or by one or more Subsidiaries of such
Person or any similar business organization which is so owned or controlled.
"Successor Servicer" shall mean Chase, and its permitted successors
and assigns in such capacity.
"Successor Servicer Fee" shall mean initially with respect to any
Settlement Period, $1,000.00 or the pro rata portion thereof if such Settlement
Period is less than a full calendar month, or such amount as may be agreed upon
from time to time by TMN and the Successor Servicer with the consent of the
Funding Agents.
"Successor Servicer's Account" shall mean an account designated by the
Successor Servicer to the Servicer into which the Successor Servicer Fee shall
be deposited.
"Taxes" shall have the meaning specified in subsection 7.3(a) of the
Receivables Transfer Agreement.
32
"Termination Date" shall mean the earliest of (i) the Business Day
designated by the Transferor to the Initial Purchasers as the Termination Date
at any time following the later of (A) repayment in full of the Aggregate Net
Investment then outstanding or (B) thirty (30) days' written notice by the
Transferor to the Initial Purchasers, (ii) the day upon which a Termination Date
is declared or automatically occurs relating to a Termination Event or Potential
Termination Event pursuant to subsection 8.2(a) of the Receivables Transfer
Agreement, (iii) two (2) Business Days prior to the PARCO Commitment Expiry Date
or the Fairway Commitment Expiry Date, or (iv) the Purchase Termination Date.
"Termination Event" shall mean an event described in Section 8.1 of
the Receivables Transfer Agreement.
"TMN" shall mean Transmedia Network Inc., a Delaware corporation, and
its successors and permitted assigns.
"TMNI" shall mean TMNI International Incorporated, a Delaware
corporation.
"TNI" shall mean TNI Funding Company I, LLC, a Delaware limited
liability company.
"TNI Funding" shall mean TNI Funding I, Inc., a Delaware corporation.
"Trademark Assignments" shall mean collectively (i) the Trademark
Assignment, dated as of December 30, 1999, by TMN in favor of the Transferor,
(ii) the Trademark Assignment, dated as of December 30, 1999, by TNI Funding in
favor of Service Company and (iii) the Trademark Assignment, dated as of
December 30, 1999, by Service Company in favor of the Transferor.
"Trademark License Agreement" shall mean the Amended and Restated
Trademark License Agreement, dated as of May 17, 2001, by and among the
Transferor, the Administrative Agent, the Successor Servicer and the Back-up
Servicer, as such agreement may be amended, supplemented or otherwise modified
and in effect from time to time.
"Trademark Security Interest Release" shall mean the Security Interest
Release, dated as of December 30, 1999, by TNI and Chase in favor of TNI
Funding.
"Tranche" shall mean with respect to any Purchaser and/or Purchaser
Group a portion of the Aggregate Net Investment allocated to a Tranche Period
pursuant to Section 2.3 of the Receivables Transfer Agreement.
"Tranche Period" shall mean a CP Tranche Period, a BR Tranche Period
or a Eurodollar Tranche Period.
33
"Tranche Rate" shall mean the applicable PARCO Tranche Rate and/or the
Fairway Tranche Rate, as applicable; provided that after a Termination Event the
Tranche Rate shall equal the applicable Base Rate plus 2%.
"Transaction Costs" shall have the meaning specified in subsection
7.4(a) of the Receivables Transfer Agreement.
"Transaction Documents" shall mean, collectively, the Receivables Sale
Agreement, the Receivables Transfer Agreement, the Receivables Purchase
Agreement, the Originator Receivables Purchase Agreement, the PARCO Asset
Purchase Agreement, the Fee Letters, the Lock-Box Agreements and all of the
other instruments, documents, certificates and other agreements executed and
delivered by a Seller, TNI, the Transferor or the Originator in connection with
any of the foregoing, in each case, as the same may be amended, restated,
supplemented or otherwise modified from time to time.
"Transfer" shall mean a conveyance, transfer and assignment by the
Transferor to the Administrative Agent on behalf of the Initial Purchasers, the
PARCO APA Banks or the Fairway APA Banks of an undivided percentage ownership
interest in Receivables, together with Related Security, Collections and
Proceeds with respect thereto, pursuant to, and in accordance with, the
Receivables Transfer Agreement (including, without limitation, as a result of
any reinvestment of Collections in Transferred Interests pursuant to subsection
2.2(b) and 2.5 of the Receivables Transfer Agreement).
"Transfer Certificate" shall have the meaning specified in subsection
2.2(a) of the Receivables Transfer Agreement.
"Transfer Date" shall mean, with respect to each Transfer, the
Business Day on which such Transfer is made.
"Transfer Price" shall mean, with respect to any Incremental Transfer,
the amount paid to the Transferor by each Initial Purchaser, the PARCO APA Banks
or the Fairway APA Banks, as applicable, as described in the applicable Transfer
Certificate. The Transfer Price for any Transfer shall be equal to the product
of (i) the Net Receivables Balance of Receivables transferred in any Incremental
Transfer, times (ii) the Advance Rate.
"Transferor" shall mean RTR Funding LLC, a Delaware limited liability
company, and its successors and permitted assigns.
"Transferor Subordinated Obligation" shall mean any payment obligation
or other liability designated as such in the Receivables Transfer Agreement,
each of which payment obligations and other liabilities shall (i) be
subordinated and subject to the prior payment in full of all Transferor
Unsubordinated Obligations then due, (ii) be made solely from funds available to
the Transferor that are not required to be applied to Transferor Unsubordinated
Obligations then due and (iii) not constitute a general recourse claim against
the Transferor, but only a claim
34
against the Transferor to the extent of funds available to the Transferor after
satisfying all Transferor Unsubordinated Obligations then due.
"Transferor Unsubordinated Obligations" shall mean all payment
obligations and other liabilities of the Transferor under the Receivables
Transfer Agreement that are not designated as Transferor Subordinated
Obligations.
"Transferred Interest" shall mean, on any date of determination, an
undivided percentage ownership interest of the Initial Purchasers and/or the APA
Bank Purchasers, as applicable, in (i) each and every then outstanding
Receivable, (ii) all Related Security with respect to each such Receivable,
(iii) all Collections with respect thereto, and (iv) other Proceeds of the
foregoing, which undivided ownership interest shall be equal to the Percentage
Factor at such time, and only at such time (without regard to prior
calculations). The Transferred Interest in each Receivable, together with
Related Security, Collections and Proceeds with respect thereto, shall at all
times be equal to the Transferred Interest in each other Receivable, together
with Related Security, Collections and Proceeds with respect thereto. To the
extent that the Transferred Interest shall decrease as a result of a
recalculation of the Percentage Factor, the Administrative Agent, on behalf of
the Initial Purchasers and/or the APA Bank Purchasers, as applicable, shall be
considered to have reconveyed to the Transferor an undivided percentage
ownership interest in each Receivable, together with Related Security,
Collections and Proceeds with respect thereto, in an amount equal to such
decrease such that, in each case, the Transferred Interest in each Receivable
shall be equal to the Transferred Interest in each other Receivable.
"Transferred Receivables" shall have the meaning specified in
subsection 3.2(a) of the Receivables Purchase Agreement.
"UCC" shall mean, with respect to any jurisdiction, the Uniform
Commercial Code as the same may be enacted and in effect in such jurisdiction
from time to time.
"Unaccrued PARCO Discount" shall have the meaning given to the term
"Unaccrued Discount" in the PARCO Asset Purchase Agreement.
"U.S." or "United States" means the United States of America and its
territories.
"Weekly Net Sales" shall mean an amount equal to (a) the total gross
sales for a Weekly Settlement Period, exclusive of Arrear Sales, minus (b) the
aggregate amount of Rebates for such Weekly Settlement Period.
"Weekly Report" shall mean a report, in substantially the form
attached to the Receivables Transfer Agreement as Exhibit F or in such other
form as is mutually agreed to by the Transferor, the Administrative Agent and
each Funding Agent, delivered by the Servicer to the Administrative Agent
pursuant to Section 2.11 of the Receivables Transfer Agreement.
"Weekly Settlement Period" shall mean the period of days from and
including the Sunday of any calendar week to and including the Saturday of the
same calendar week.
35
"Weekly Settlement Report Date" shall mean each Tuesday of each
calendar week or, if such day is not a Business Day, the next succeeding
Business Day.
36
Schedule I
Advance Rate
Advance Rate Advance Ratio
------------ -------------
62% 1.06
64% 1.10
66% 1.15
68% 1.19
70% 1.24
72% 1.29
74% 1.33
76% 1.38
78% 1.44
80% 1.49
82% 1.54
84% 1.67
86% 1.83
88% 2.04
90% 2.11
The percentage constituting the "Advance Rate" is to be calculated as follows:
(i) Calculate the "Advance Ratio" (as defined in Annex X hereto).
(ii) Identify between which of the two figures listed in the second column of
the grid set forth above the Advance Ratio calculated in (i) falls. For the
purposes of the formula set forth in (iii) below, (a) the higher of the two
figures will be "X" and the lower of the two figures will be "Y" and (b)
the Advance Rate percentage in the first column of the grid corresponding
to "X" will be "A" and the Advance Rate percentage in the first column of
the grid corresponding to "Y" will be "B".
(iii)(a) Subtract the Advance Ratio in (i) from X ("R")
(b) Subtract Y from X ("S")
(c) Divide R by S ("T")
(d) Multiply T by 0.02 ("U")
(e) Subtract U from A
(f) The difference between U and A equals the applicable "Advance Rate"
SI-1