MERIDIAN FINANCIAL CORPORATION
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
March 28, 1997
RTM Financial Services, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Dear ▇▇. ▇▇▇▇▇:
This letter agreement (this "Agreement") sets forth the terms of the
business relationship agreed upon between RTM Financial Services, Inc. ("RTM")
and Meridian Financial Corporation (the "Company").
1. The Company hereby retains RTM, and RTM agrees to be retained by the
Company, to provide services to the Company, on the terms set forth herein, for
a term (the "Term") commencing on the date hereof and ending on the earlier of
the occurrence of a Liquidity Event (as defined in the Executive Share
Agreement, defined in Paragraph 6 hereof) or the termination of this Agreement
pursuant to Paragraph 8 hereof. RTM agrees to cause all services hereunder to
be provided by ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (the "Designated Consultant"). During the
Term, RTM agrees to cause the Designated Consultant to devote approximately 50%
of his business time and effort (but in no event less than approximately 20
hours per week on average over the Term) (i) to assist the Company in
originating leases of restaurant equipment and, to a lesser extent, leases of
other types of equipment, real estate mortgages and other financing
transactions (each a "Financing Transaction") and arranging for the sale of
Financing Transactions by the Company to third parties ("Sale Transactions")
("Transaction Services"), (ii) to assist the Company in obtaining long-term
debt financing to fund Financing Transactions ("Funding Arrangements")
("Funding Services") and (iii) to provide consulting services relating to
strategic planning and other matters as defined from time to time by the Board
of Directors of the Company (the "Board of Directors") ("Consulting Services").
RTM further agrees that during the Term, it will devote its best efforts (and
will cause the Designated Consultant to devote his best efforts) to the
fulfillment of RTM's obligations under this Agreement and do nothing (and cause
the Designated Consultant to do nothing) which either RTM or the Designated
Consultant knows or should know will harm, in any way, the business or
reputation of the Company. RTM and the Designated Consultant shall be free to
engage in other business activities to the extent that such activities do not
adversely affect the performance of, and are not inconsistent with, RTM's
duties to the Company under this Agreement and are not in competition with the
business of the Company. Notwithstanding anything in this Agreement to the
contrary, neither RTM nor the Designated Consultant shall have any authority to
bind the Company with respect to any Sale Transaction or the origination of any
Financing Transaction and the Company shall have no obligation to effect any
Sale Transaction or the origination of any Financing Transaction, nor any
liability to RTM or the Designated Consultant for Commissions (as defined in
Paragraph 2 hereof) or otherwise for any failure to effect any Sale Transaction
or the origination of any Financing Transaction.
2. As compensation for RTM's services under this Agreement: (a) the
Company will (i) pay to RTM (x) a fee of $3,750 per calendar month for
Consulting Services (the "Consulting Fee"), payable in advance on the first day
of each calendar month during the Term, and (y) commissions pursuant to
Paragraph 3 hereof in connection with Sale Transactions ("Sales Commissions"),
subject to the provisions of Paragraph 7 hereof, (z) commissions pursuant to
Paragraph 3 hereof in connection with Funding Arrangements ("Funding
Commissions"; together with Sales Commissions, "Commissions"), subject to the
provisions of Paragraph 7 hereof, and (ii) issue to RTM common shares of the
Company ("Common Shares") pursuant to Paragraph 5 hereof, subject to the
conditions set forth in Paragraph 5 hereof; (b) the Purchasers (as defined in
Paragraph 6 hereof) and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ("▇▇▇▇▇") will cause Executive Shares
(as defined in the Executive Share Agreement) to be delivered to RTM, subject
to the conditions set forth in Paragraph 6 hereof; and (c) RTM shall be
entitled to purchase the RTM Shares (as defined in Paragraph 4 hereof), subject
to the terms of Paragraph 4 hereof. In addition to the Consulting Fee, the
Company shall pay to RTM $3,750 on the first day of each calendar month during
the Term as an advance against Commissions ("Commission Advances") and shall
reimburse RTM for its out-of-pocket expenses incurred in the performance of its
duties hereunder upon submission of appropriate invoices and vouchers in
accordance with the Company's policies in effect from time to time.
3. (a) Upon the consummation by the Company of a Sale Transaction
during the Term in which the purchaser was introduced to the Company by RTM or,
as provided in Paragraph 3(d), upon the consummation by the Company of a Sale
Transaction after the Term, RTM shall be entitled to a Sales Commission
(payable in accordance with Paragraph 7) as follows:
(ii) if the gross proceeds to the Company from such Sale
Transaction (the "Sale Proceeds") are less than $1,000,000 or if such Sale
Transaction involves a Financing Transaction for restaurant equipment
entered into in the ordinary course of the Company's business (whether or
not the Sale Proceeds are less than $1,000,000), RTM shall be entitled to
a Sales Commission in an amount equal to 1.5% of the Sale Proceeds;
(iii) if the Sale Proceeds are $1,000,000 or more and such Sale
Transaction does not involve a Financing Transaction for restaurant
equipment entered into in the ordinary course of the Company's business,
RTM shall be entitled to a Sales Commission in an amount determined as
follows: (x) if the difference between the Sale Proceeds and the Company
Financing Transaction Basis (as defined below) (the "Spread") is $80,000
or less, RTM shall be entitled to a Sales Commission in an amount equal
to 50% of the Spread; (y) if the Spread is greater than $80,000, but less
than $100,000, RTM shall be entitled to a Sales Commission in an amount
equal to $40,000; and (z) if the Spread is $100,000 or more, RTM shall be
entitled to a Sales Commission in an amount equal to 40% of the Spread.
"Company Financing Transaction Basis", with respect to any Sale
Transaction, means the book value of the Financing Transaction sold
pursuant to such Sale Transaction, as reflected on the books of the
Company in accordance with industry practice.
(b) If any Sale Transaction involves the sale of more than one
Financing Transaction (e.g., multiple leases, whether or not related, bundled
for sale as a group), each Financing Transaction shall be considered as a
separate Sale Transaction for purposes of determining the amount of Sales
Commission payable pursuant to Paragraph 3(a).
(c) Upon the consummation by the Company of a Funding Arrangement
(including the satisfaction of all conditions to funding thereunder) during the
Term in which the funding party was introduced to the Company by RTM or, as
provided in Paragraph 3(d), upon the consummation by the Company of a Funding
Arrangement after the Term, RTM shall be entitled to a Funding Commission equal
to 1% of the initial maximum aggregate amount available to the Company under
the terms of such Funding Arrangement.
(d) This Agreement contemplates that RTM will, among other things,
assist in (i) arranging Sale Transactions by introducing the Company to
purchasers who are expected to buy Financing Transactions ("Transaction
Purchasers") and (ii) arranging Funding Arrangements by introducing the Company
to parties who are expected to provide Funding Arrangements ("Funding
Sources"). If RTM has introduced the Company to a Transaction Purchaser during
the Term and the Company consummates a Sale Transaction with such Transaction
Purchaser during the Term or within six (6) months following termination of
this Agreement, then RTM will be entitled to a Sales Commission with respect to
such Sale Transaction, calculated in accordance with Paragraph 3(a), payable at
the time the Company receives the Sale Proceeds from such Sale Transaction,
provided that the Company held material discussions with such Transaction
Purchaser during the Term regarding Sale Transactions. If RTM has introduced
the Company to a Funding Source during the Term and the Company consummates a
Funding Arrangement with such Funding Source during the Term or within twelve
(12) months following termination of this Agreement, then RTM will be entitled
to a Funding Commission with respect to such Funding Arrangement, calculated in
accordance with Paragraph 3(c), payable at the closing for such Funding
Arrangement.
(e) The basis for computing Commissions shall be reviewed by the
Company and RTM on or about April 1, 1998, and, if the Company and RTM mutually
determine that adjustments are appropriate, the basis for computing Commissions
shall be amended in writing at such time as mutually determined.
4. (a) The Company shall issue to RTM, within 15 days after the
execution of this Agreement by RTM, 81.63 Common Shares (the "RTM Shares")
upon receipt from RTM of such certificates or other instruments as the Company
may reasonably request to comply with federal and state securities laws. RTM
shall be solely responsible for any taxes payable as a result of the issuance
of the RTM Shares. As consideration for the RTM Shares, RTM hereby agrees to
pay the Company in accordance with this Paragraph 4 an amount equal to
$173,333.33 (the "RTM Share Amount"), together with interest on the aggregate
unpaid balance of the RTM Share Amount from time to time outstanding at a
compounding annual rate equal to 6.50%.
(b) During the Term, the RTM Share Amount, together with accrued
and unpaid interest thereon, shall be payable solely by application, in
accordance with Paragraph 7 hereof, of Commissions otherwise payable to RTM
hereunder. Upon expiration of the Term, the entire unpaid balance of the RTM
Share Amount, together with all accrued and unpaid interest thereon, shall be
immediately due and payable; provided, however, that if the Term expires as a
result of a termination of this Agreement by the Company for Cause (as defined
in Paragraph 8 hereof) or due to the voluntary termination of this Agreement by
RTM, then the Company shall have the option of applying the unpaid balance of
the RTM Share Amount, together with all accrued and unpaid interest thereon, to
the purchase by the Company of RTM Shares as provided in Paragraph 4(d) hereof.
(c) RTM shall have the right to prepay the RTM Share Amount at any
time, without penalty of any kind. Prepayments shall be applied first to
accrued or unpaid interest on the RTM Share Amount and then to the unpaid
principal balance of the RTM Share Amount.
(d) In the event that (i) this Agreement is terminated by the
Company for Cause or as a result of the voluntary termination of this Agreement
by RTM or (ii) RTM shall default in the payment of any portion of the RTM Share
Amount (or accrued or unpaid interest thereon) when due and payable hereunder,
and such default shall continue unremedied for a period of 30 days (a "Payment
Default"), then the Company shall have the right, exercisable by written notice
delivered to RTM not later than 30 days following the date of such termination
or the expiration of the grace period with respect to such default, to purchase
from RTM (and, if the Company exercises such right, RTM agrees to sell to the
Company, free and clear of all liens and claims of any kind) a number of RTM
Shares (including, for purposes of this Paragraph 4, any shares issued in
respect of RTM Shares as a result of an Adjustment Event (as defined in
Paragraph 5 hereof)) equal to the lesser of (x) the number of RTM Shares and
(y) the number of RTM Shares multiplied by a fraction (A) the numerator of
which shall equal the sum of (1) the outstanding RTM Share Amount and all
accrued and unpaid interest thereon as of the date of such termination or the
expiration of the grace period with respect to such default and (2) the
aggregate amount of Commission Advances that have not been repaid pursuant to
Paragraph 7 as of the date of such termination or the expiration of the grace
period with respect to such default (or, if less, such portion of such
Commission Advances that would not cause the numerator to exceed $173,333.33)
("Applied Commissions") and (B) the denominator of which shall equal
$173,333.33. In full payment for the purchase by the Company of the RTM Shares
pursuant to this Paragraph 4(d), the entire unpaid balance of the RTM Share
Amount, together with all accrued and unpaid interest thereon, shall be
canceled and the aggregate amount of outstanding Commission Advances shall be
reduced by the amount of Applied Commissions.
(e) Prior to the occurrence of the later of a Liquidity Event or
payment in full of the RTM Share Amount together with all accrued and unpaid
interest thereon, the RTM Shares may be transferred, pledged or encumbered
only with the prior written consent of the Board of Directors, which consent
may be granted or withheld in the sole discretion of the Board of Directors
and, if granted, may be subject to whatever conditions the Board of Directors
may reasonably impose.
(f) In connection with the purchase of the RTM Shares, RTM hereby
represents and warrants to, and agrees with, the Company as follows:
(i) RTM is acquiring the RTM Shares for its own account as
principal for investment and not with a view to or for resale or
distribution thereof, and RTM has no present intention of distributing or
selling to any other person any of the RTM Shares.
(ii) RTM will not sell, transfer or otherwise dispose of all or any
part of the RTM Shares without either (i) delivering to the Company an
unqualified opinion of counsel addressed to the Company that the transfer
or any offering in connection therewith is not required to be registered
under either the Securities Act of 1933, as amended, or any applicable
state securities laws, or (ii) making such sale, transfer or other
disposition pursuant to an effective registration statement under such act
and laws.
(iii) RTM acknowledges that the Designated Consultant is a director
of the Company and is familiar with the business and affairs of the
Company. RTM has had an opportunity to make inquiries concerning the
Company and all matters relevant to an investment in the RTM Shares.
(iv) RTM is aware that the RTM Shares are being purchased in a
private offering and that there is no market for resale thereof. Thus,
RTM may not be able to sell or dispose of the RTM Shares. RTM understands
that its right to transfer, pledge or encumber the RTM Shares will be
restricted under federal and applicable state securities laws (and any
certificates representing the RTM Shares will bear a legend restricting
such transfer) and that such laws impose strict restrictions on such
transfer. RTM further understands that transfer, pledge or encumbrance of
the RTM Shares will also be restricted under the terms of this Agreement.
(v) RTM's place of business is located in the State of Connecticut.
5. If a Liquidity Event occurs prior to March 31, 2007 and the
valuation of the Company Equity in such Liquidity Event shall exceed the
Valuation Target, then, immediately prior to such Liquidity Event, the Company
shall issue to RTM a number of Common Shares, appropriately adjusted in the
event of an Adjustment Event (the "Liquidity Event Shares"), equal to 41.23
multiplied by the Liquidity Shares Vested Percentage. "Company Equity" in such
Liquidity Event means the Company's equity, including, without limitation,
common stock and preferred stock, additional-paid-in-capital and retained
earnings, but excluding debt (whether senior or subordinated) and other
obligations of the Company, whether or not such debt or other obligations are
convertible into equity. RTM shall be solely responsible for any taxes payable
as a result of the issuance of the Liquidity Event Shares. The Company shall
have no obligation to issue the Liquidity Event Shares if a Liquidity Event
does not occur prior to March 31, 2007. As used in this Agreement: (a)
"Adjustment Event" means (i) any subdivision (by any stock split, stock
dividend or otherwise) of outstanding Common Shares into a greater number of
shares, (ii) any combination (by any reverse stock split or otherwise) of
outstanding Common Shares into a smaller number of shares or (iii) any
recapitalization or similar transaction in which Common Shares are changed
into, converted into or exchanged for other securities; (b) "Valuation Target",
with respect to any Liquidity Event, means: (i) if the Liquidity Event shall
occur prior to March 31, 2002: 4.5 times the Valuation Base; (ii) if the
Liquidity Event shall occur on or after March 31, 2002 and prior to March 31,
2003: 6.3 times the Valuation Base; (iii) if the Liquidity Event shall occur on
or after March 31, 2003 and prior to March 31, 2004: 8.82 times the Valuation
Base; (iv) if the Liquidity Event shall occur on or after March 31, 2004 and
prior to March 31, 2005: 12.348 times the Valuation Base; (v) if the Liquidity
Event shall occur on or after March 31, 2005 and prior to March 31, 2006:
17.2872 times the Valuation Base; and (vi) if the Liquidity Event shall occur
on or after March 31, 2006 and prior to March 31, 2007: 24.20208 times the
Valuation Base; and (c) "Valuation Base", with respect to any Liquidity Event,
means the sum of (i) the aggregate amount of capital invested by the Purchasers
in the Company through the date of such Liquidity Event plus (ii) the aggregate
amount of capital invested in the Company by parties other than the Purchasers
after the date of this Agreement, in each case whether such capital is
evidenced by equity securities or subordinated debt of the Company. Subject to
Paragraph 8 hereof, the obligations of the Company under this Paragraph 5 shall
survive the expiration of the Term. "Liquidity Shares Vested Percentage," with
respect to a Liquidity Event, means (i) 100%, if this Agreement has not been
terminated pursuant to Paragraph 8 hereof prior to the occurrence of such
Liquidity Event, or (ii) if this Agreement has been terminated pursuant to
Paragraph 8 hereof prior to the occurrence of such Liquidity Event, a fraction,
expressed as a percentage, (x) the numerator of which is the number of annual
periods commencing on April 1 and ending on March 31 that have occurred from
April 1, 1997 to the date of such termination and (y) the denominator of which
is the number of annual periods commencing on April 1 and ending on March 31
that have occurred from April 1, 1997 to the date of such Liquidity Event.
6. Pursuant to that certain Executive Share Agreement dated as of March
28, 1997 among ▇▇▇▇▇, INROADS Capital Partners, L.P. ("INROADS"), Mesirow
Capital Partners VII, an Illinois Limited Partnership ("Mesirow") and Edgewater
Private Equity Fund II, L.P. ("Edgewater"; together with INROADS and Mesirow,
the "Purchasers") and the Company (the "Executive Share Agreement"), ▇▇▇▇▇
hereby designates RTM as a Recipient (as defined in the Executive Share
Agreement) to receive, upon, and subject to, the occurrence of a Liquidity
Event prior to March 31, 2001, a number of Executive Shares equal to (a) 8 1/3%
of the maximum number of Executive Shares that would be required to be
delivered by the Purchasers pursuant to the Executive Share Agreement at such
time if ▇▇▇▇▇ were employed by the Company as of such time and the conditions
set forth in Section 3 of the Executive Share Agreement were satisfied
multiplied by (b) the Executive Share Vested Percentage (the "RTM Executive
Share Number"), such Executive Shares to be delivered to RTM prior to, and in
preference to, the delivery of any Executive Shares to ▇▇▇▇▇ or any other
Recipient. If the number of Executive Shares that the Purchasers are required
to deliver under the Executive Share Agreement upon the occurrence of a
Liquidity Event prior to March 31, 2001 is reduced below the RTM Executive
Share Number, then, upon the occurrence of a Liquidity Event prior to March 31,
2001, if the conditions set forth in Section 3 of the Executive Share Agreement
are met, each Purchaser severally (in proportion to its obligation to deliver
Executive Shares under the Executive Share Agreement) agrees to transfer and
deliver promptly to RTM, in addition to the Executive Shares to be delivered to
RTM pursuant to the preceding sentence (the "Required Executive Shares"),
Executive Shares in an aggregate amount equal to such Purchaser's proportionate
share of the RTM Executive Share Number less the number of Required Executive
Shares. "Executive Share Vested Percentage" means (i) 100%, if this Agreement
has not been terminated pursuant to Paragraph 8 hereof prior to the occurrence
of such Liquidity Event, or (ii) if this Agreement has been terminated pursuant
to Paragraph 8 hereof prior to the occurrence of such Liquidity Event, a
fraction, expressed as a percentage, (x) the numerator of which is the number
of full annual periods commencing on April 1 and ending on March 31 that have
occurred from April 1, 1997 to the date of such termination and (y) the
denominator of which is four. If Executive Shares designated by ▇▇▇▇▇ to be
delivered to RTM pursuant to this Paragraph 6 shall, in accordance with the
terms of this Agreement, cease to be deliverable to RTM, then for purposes of
the Executive Share Agreement ▇▇▇▇▇ shall be entitled to re-designate the
Recipient of such Executive Shares in accordance with and subject to the terms
and conditions of the Executive Share Agreement.
7. (a) Commissions, whether payable during or, pursuant to Paragraph
3(d), after the Term, shall be paid as follows: (i) first, by repayment to the
Company of the amount of Commission Advances paid to RTM that have not
theretofore been repaid pursuant to this clause (i), (ii) second, by payment to
the Company of accrued and unpaid interest on, and thereafter of the principal
balance of, the RTM Share Amount, until the RTM Share Amount together with all
accrued interest thereon has been paid in full, provided that the aggregate
amount of Commissions applied pursuant to this clause (ii) shall not exceed
$50,000 during any consecutive 12-month period without the consent of RTM, and
(iii) third to RTM, to the extent of any remaining Commissions. Sales
Commissions payable to RTM pursuant to this Paragraph 7 with respect to any
Sale Transaction shall be paid as soon as practicable following the
consummation of such Sale Transaction. Funding Commissions payable to RTM
pursuant to this Paragraph 7 with respect to any Funding Arrangement shall be
paid as soon as practicable following the consummation of such Funding
Arrangement.
(b) Neither RTM nor the Designated Consultant shall have any
personal liability to the Company for repayment of Commission Advances;
provided, however, that (i) Commissions shall be applied to the repayment of
Commission Advances as provided in Paragraph 7(a) hereof and (ii) the aggregate
amount of Commission Advances that have not been repaid pursuant to Paragraph
7(a) hereof may be applied toward payment for the purchase by the Company of
the RTM Shares as provided in Paragraph 4(d) hereof.
8. (a) This Agreement shall terminate upon the earlier of (i) the
expiration of the Term, (ii) the voluntary termination of this Agreement by
RTM, effective upon 30 days' prior written notice to the Company, (iii) the
death or Permanent Disability of the Designated Consultant, effective as of the
date of such death or the determination of such Permanent Disability, (iv) the
termination of this Agreement by the Company for Cause, effective upon written
notice to RTM, or (v) the termination of this Agreement by the Company other
than for Cause, effective upon 30 days' prior written notice to RTM.
(b) If this Agreement is terminated as a result of the voluntary
termination of this Agreement by RTM: (i) the Company's sole obligation shall
be payment of (x) Consulting Fees through the effective date of such
termination and (y) unpaid Commissions that are earned in accordance with
Paragraph 3 hereof; (ii) the Company shall have the right to purchase the RTM
Shares as provided in Paragraph 4(d) hereof; and (iii) notwithstanding the
provisions of Paragraphs 5 and 6 hereof, the Company shall have no obligation
to deliver Liquidity Event Shares pursuant to Paragraph 5 hereof and Purchasers
shall have no obligation to deliver Executive Shares pursuant to Paragraph 6
hereof.
(c) If this Agreement is terminated as a result of the death or
Permanent Disability of the Designated Consultant or as a result of the
termination of this Agreement by the Company on or after March 28, 1999, other
than for Cause: (i) the Company's sole obligation shall be payment of (x)
Consulting Fees through the effective date of such termination and (y) unpaid
Commissions that are earned in accordance with Paragraph 3 hereof; (ii) the
Company shall have no right to purchase the RTM Shares, except in the event of
a Payment Default; and (iii) the Company shall have the obligation to deliver
Liquidity Event Shares pursuant to (and subject to) Paragraph 5 hereof and
Purchasers shall have the obligation to deliver Executive Shares pursuant to
(and subject to) Paragraph 6 hereof.
(d) If this Agreement is terminated as a result of the termination
of this Agreement by the Company, prior to March 28, 1999, other than for
Cause: (i) the Company's sole obligation shall be payment of (x) Consulting
Fees and Commission Advances through March 28, 1999, when and as otherwise
payable under this Agreement, notwithstanding that neither RTM nor the
Designated Consultant shall have any further obligation to perform Transaction
Services or Consulting Services following such termination and (y) unpaid
Commissions that are earned in accordance with Paragraph 3 hereof; (ii) the
Company shall have no right to purchase the RTM Shares, except in the event of
a Payment Default; and (iii) the Company shall have the obligation to deliver
Liquidity Event Shares pursuant to (and subject to) Paragraph 5 hereof and
Purchasers shall have the obligation to deliver Executive Shares pursuant to
(and subject to) Paragraph 6 hereof.
(e) If this Agreement is terminated by the Company for Cause: (i)
the Company's sole obligation shall be payment of (x) Consulting Fees through
the effective date of such termination and (y) unpaid Commissions that are
earned in accordance with Paragraph 3 hereof; (ii) the Company shall have the
right to purchase the RTM Shares as provided in Paragraph 4(d) hereof; and
(iii) notwithstanding the provisions of Paragraphs 5 and 6 hereof, the Company
shall have no obligation to deliver Liquidity Event Shares pursuant to
Paragraph 5 hereof and Purchasers shall have no obligation to deliver Executive
Shares pursuant to Paragraph 6 hereof.
(f) For purposes of this Agreement, (i) "Cause means" (A) the
conviction, admission or plea of no contest by RTM or the Designated Consultant
with respect to any crime, whether or not involving the Company, which
constitutes a felony in the jurisdiction involved; (B) the embezzlement or
misappropriation of property of the Company by RTM or the Designated
Consultant, or any other act by RTM or the Designated Consultant involving
fraud with respect to the Company; (C) any substance abuse by the Designated
Consultant that interferes with the RTM's ability to discharge its duties under
this Agreement; (D) a material breach by RTM of its obligations under this
Agreement; or (E) the failure of RTM, during any consecutive 24-month period
during the Term to generate Sales Commissions of at least $90,000 or, if the
Transaction Services are changed following the date of this Agreement, the
failure of RTM to meet such performance standards as may be agreed to by RTM
and the Company in connection with such change; and (ii) "Permanent Disability"
means physical or mental incapacity of a nature that prevents or could prevent
the Designated Consultant, in the judgment of a licensed physician practicing
in the Indianapolis, Indiana area designated by the Board of Directors (the
"Designated Physician"), from performing services on behalf of RTM as
contemplated by this Agreement for a period of 120 consecutive days or 180
days, whether or not consecutive, during any 12-month period during the Term.
RTM agrees to cause the Designated Consultant to cooperate fully with any
Designated Physician in determining whether the Permanent Disability of the
Designated Consultant has occurred.
9. All covenants and agreements contained in this Agreement by or on
behalf of any of the parties hereto shall bind and inure to the benefit of the
respective successors and permitted assigns of the parties hereto whether so
expressed or not.
10. If any party to this Agreement obtains a judgment against any party
hereto by reason of any breach of this Agreement or the failure of such other
party to comply with the provisions hereof, a reasonable attorneys' fee as
fixed by the court shall be included in such judgment. No remedy conferred
upon any party to this Agreement is intended to be exclusive of any other
remedy herein or by law provided or permitted, but each such remedy shall be
cumulative or shall be in addition to every other remedy given hereunder or now
or hereafter existing at law or in equity or by statute. Each party hereto
agrees that, in the event of any violation of this Agreement by such party, the
remedies available at law would be inadequate and that such party's obligations
under this Agreement may be specifically enforced. Notwithstanding the
foregoing sentence, nothing herein shall be construed as prohibiting any party
hereto from also pursuing any other rights, remedies or defenses, in connection
with any breach of this Agreement.
11. None of the terms of this Agreement shall be deemed to have been
waived by any party hereto, unless such waiver is in writing and signed by that
party. The waiver by any party hereto of a breach of any provision of this
Agreement shall not operate or be construed as a waiver of any other provision
of this Agreement or of any further breach of the provision so waived or of any
other provision of this Agreement. No extension of time for the performance of
any obligation or act hereunder shall be deemed an extension of time for the
performance of any other obligation or act.
12. This Agreement shall be governed by and construed in accordance with
the laws of the State of Indiana, without giving effect to its conflicts of law
rules.
13. This Agreement constitutes the sole and entire agreement of the
parties with respect to the subject matter hereof, and supersedes all prior
agreements between the Company and RTM, whether oral or written (including the
existing oral agreement between RTM and the Company described in the Disclosure
Schedule (as defined in the Securities Purchase Agreement (the "Securities
Purchase Agreement") dated as of March 28, 1997 among the Company, the
Purchasers, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇)), with respect to services
performed by RTM on behalf of the Company, other than the letter agreement
between the Company and RTM relating to senior debt financing.
14. This Agreement may be executed in any number of counterparts, each
of which shall be effective only upon delivery and thereafter shall be deemed
to be an original, and all of which shall be taken to be one and the same
instrument with the same effect as if each of the parties hereto had signed the
same signature page. Any signature page of this Agreement may be detached from
any counterpart of this Agreement without impairing the legal effect of any
signature thereon and may be attached to another counterpart of this Agreement
identical in form hereto and having attached to it one or more additional
signature pages.
15. This Agreement may not be amended, modified or changed in any
respect without the written consent of the party against whom enforcement of
each amendment, modification or change is sought.
16. Whenever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement shall be unenforceable or invalid under
applicable law, such provision shall be ineffective only to the extent of such
unenforceability or invalidity, and the remaining provisions of this Agreement
shall continue to be binding and in full force and effect.
17. RTM and the Designated Consultant shall perform the Transaction
Services and Consulting Services as an independent contractor, and nothing
herein shall be construed as creating any other relationship among the parties
hereto, including but not limited to any joint venture, partnership, agency
relationship or employment relationship.
Please indicate your acceptance of the terms hereof by signing where
indicated below.
MERIDIAN FINANCIAL CORPORATION
By:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
President
Agreed to and accepted as of
this 28th day of March, 1997
RTM FINANCIAL SERVICES, INC.
By: ______________________________
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇ and the Purchasers join in this Agreement in recognition of their
undertakings set forth in Paragraph 6, which undertakings are made for the
purpose of inducing RTM to assist the Company in satisfying the conditions set
forth in Section 3 of the Executive Share Agreement. In addition, each of the
Purchasers, by signing below, hereby signifies, for purposes of the Securities
Purchase Agreement and Section 6.5 of the terms of the Company's Series C
Preferred Stock, its approval of, and consent to, the issuance of the RTM
Shares and the Liquidity Event Shares in accordance with and subject to the
terms and conditions of this Agreement.
INROADS CAPITAL PARTNERS, L.P.
By: INROADS GENERAL PARTNERS, L.P., its general partner
By:
Title:
MESIROW CAPITAL PARTNERS VII, an
Illinois Limited Partnership
By: MESIROW FINANCIAL SERVICES, INC., its general partner
By:
Title:
EDGEWATER PRIVATE EQUITY FUND II, L.P.
By: ▇▇▇▇▇▇ MANAGEMENT, INC.,
its general partner
By:
Title:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇