Intercompany Credit Agreement - Carlson Companies Inc. and Carlson Restaurants Worldwide Inc.
INTERCOMPANY CREDIT AGREEMENT
This INTERCOMPANY CREDIT AGREEMENT (this "Agreement") by and between
Carlson Companies, Inc., a Minnesota corporation ("CCI"), and Carlson
Restaurants Worldwide Inc., a Delaware corporation ("CRW"), is effective as
of August 19, 1999.
ARTICLE I
DEFINITIONS
SECTION 1.01 DEFINITIONS. The following terms, as used herein, have the
following meanings:
(a) "ADVANCE" means, an advance by CCI or CRW, as applicable, pursuant to
Section 2.01 or 2.02, which shall include, without limitation, advances by
CCI to CRW or on behalf of CRW and amounts owed by CRW and its Subsidiaries
for fees, costs and expenses under the Services Agreement between the
parties.
(b) "CCI BALANCE" means, with respect to an Interest Period, the net daily
balance of funds owed by CCI to CRW as set forth in the intercompany account
maintained by CCI pursuant to Section 2.05 hereof.
(c) "CODE" means, the Internal Revenue Code of 1986 as amended.
(d) "CRW BALANCE" means, with respect to an Interest Period, the net daily
balance of funds owed by CRW to CCI as set forth in the intercompany account
maintained by CCI pursuant to Section 2.05 hereof.
(e) "CRW PROMISSORY NOTE" means, that certain Promissory Note dated December
31, 1998 issued by CRW in the amount of approximately $70.4 million to
Carlson Companies, Inc.
(f) "DIVIDEND PROMISSORY NOTE" means, that certain Promissory Note dated
June 28, 1999 issued by CRW in the amount of $120 million to Carlson
Hospitality Group, Inc.
(g) "ERISA" means, the Employee Retirement Income Security Act of 1974,
together with all amendments from time to time thereto.
(h) "ERISA AFFILIATE" means, any trade or business (whether or not
incorporated) which is under common control with CRW within the meaning of
the regulations promulgated under the Internal Revenue Code of 1986 as
amended.
(i) "EVENT OF DEFAULT" means, any material default of the terms of this
Agreement or the Services Agreement.
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(j) "INDEBTEDNESS" means, with respect to any Person at any time, without
duplication, all obligations of such Person which, in accordance with
generally accepted accounting principles, consistently applied, should be
classified as liabilities on a consolidated balance sheet of such Person
prepared in accordance with generally accepted accounting principles,
consistently applied, but in any event shall include: (a) all obligations of
such Person for borrowed money, (b) all obligations of such Person evidenced
by bonds, debentures, notes or other similar instruments, (c) all obligations
of such Person upon which interest charges are customarily paid or accrued,
(d) all obligations of such Person under conditional sale or other title
retention agreements relating to property purchased by such Person, (e) all
obligations of such Person issued or assumed as the deferred purchase price
of property or services (other than accounts payable on normal payment terms
to suppliers incurred in the ordinary course of business), (f) all
obligations of others secured by any Lien on property owned or acquired by
such Person, whether or not the obligations secured thereby have been
assumed, (g) all capitalized lease obligations of such Person, (h) all
obligations of any partnership or joint venture as to which such Person is or
may become personally liable, (i) all guarantees by such Person of
Indebtedness of others, and (j) all contingent obligations of such Person.
(k) "INTEREST PERIOD" means, the period commencing on the date of an Advance
and ending on the date the Advance is paid.
(l) "INTEREST RATE" has the meaning ascribed to it in Section 2.03.
(m) "INVESTMENT" means, any investment in any Person, whether by means of
share purchase, capital contribution, loan or otherwise; in determining from
time to time the amount of Investments, share purchases and capital
contributions shall be taken at the original cost thereof regardless of any
subsequent appreciation or depreciation therein and loans shall be taken at
the principal amount thereof remaining unpaid.
(n) "LIBOR RATE" means, a rate equal to the LIBOR Rate, as the rate for the
Interest Period shall be published from time to time in the Money Rates
column of the "Money & Investing Section" of the WALL STREET JOURNAL as the
"LIBOR Rate" for three month borrowings.
(o) "MULTIEMPLOYER PLAN" means, the term as defined in Section 4001 (a)(3)
of ERISA to which CRW or and Subsidiary is making or accruing an obligation
to make contributions or has within any of the preceding three plan years
made or accrued an obligation to make contributions.
(p) "PLAN" means, each employee benefit plan (whether now in existence or
hereafter instituted), as such term is defined in Section 3 of ERISA,
maintained for the benefit of employees, officers or directors of CRW or any
Subsidiary.
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(q) "LIEN" means, any security interest, mortgage, pledge, lien, charge,
encumbrance, title retention agreement or analogous instrument, in, of, or on
any of the assets or properties, now owned or hereafter acquired, of CRW or
any Subsidiary, whether arising by agreement or operation of law.
(r) "PERSON" means, any natural person, corporation, partnership, joint
venture, firm, association, trust, unincorporated organization, government or
governmental agency or political subdivision or any other entity, whether
acting in an individual, fiduciary or other capacity.
(s) "SERVICES AGREEMENT" means, the Services Agreement effective as of
August 19, 1999, between CCI and CRW, as it may be amended from time to time.
If the Services Agreement is terminated prior to the termination of this
Agreement, any references to the Services Agreement after its termination
shall mean the version of the Services Agreement in effect immediately prior
to the termination of the Services Agreement.
(t) "SUBSIDIARY" means, any corporation a majority of the shares of the
outstanding stock of which have ordinary voting power for the election of
directors is owned by CRW, either directly or through one or more of its
Subsidiaries.
ARTICLE II
ADVANCES AND CASH MANAGEMENT
SECTION 2.01 ADVANCES FROM CRW TO CCI. Any funds of CRW and its
Subsidiaries that are not required to meet the daily cash requirements of CRW
and its Subsidiaries will be transferred to CCI through a concentration
account on a daily basis as an Advance hereunder and/or applied, at the
discretion of CRW, to decrease the outstanding balance of Advances from CCI
pursuant to Section 2.02, as applicable. Any funds transferred from CRW to
CCI will be deemed as either an Advance to CCI, if there are no outstanding
Advances from CCI to CRW, or a decrease of Advances from CCI to CRW, if such
Advances exist. Any interest payable by CCI on an Advance from CRW (other
than interest payable upon or after termination of this Agreement) shall be
treated (effective as of the first day of the following Interest Period) as
an Advance from CRW for the purposes of this Agreement. Each Advance by CRW
under this Section 2.01 shall be deemed to be made by CRW notwithstanding the
fact that such Advance may involve cash of one or more Subsidiaries of CRW.
All funds which constitute Advances to CCI pursuant to this Section 2.01(and
not decreases in Advances from CCI to CRW) shall bear interest at the LIBOR
Rate.
SECTION 2.02 ADVANCES FROM CCI TO CRW. Subject to the following limit,
any funds needed by CRW and its Subsidiaries in order to meet daily cash
requirements of CRW and its Subsidiaries will be advanced by CCI. In
addition, subject to repayment as provided in Section 2.04 and simultaneously
with the execution of this Agreement,
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CCI will issue an Advance and satisfy the outstanding balance of the Dividend
Promissory Note and CRW Promissory Note. The outstanding balance of all
Advances from CCI to CRW and all of its Subsidiaries shall never exceed (i)
$225,000,000 in the aggregate at any time prior to an initial public offering
of stock of CRW, or (ii) $105,000,000 in the aggregate at any time after the
application of the proceeds of such initial public offering of stock of CRW.
Any funds transferred from CCI to CRW will be deemed as either an Advance to
CRW, if there are no outstanding Advances from CRW to CCI, or a decrease of
the Advances from CRW, if such Advances to CCI exist. Any interest payable by
CRW on an Advance from CCI (other than interest payable upon or after
termination of this Agreement) shall be treated (effective as of the first
day of the following Interest Period) as an Advance from CCI for the purposes
of this Agreement. Interest that accrues after the maximum borrowing amount
has been reached shall be considered an Advance notwithstanding the limits
set forth in this Section. Each Advance by CCI under this Section 2.02 shall
be deemed made by CCI notwithstanding the fact that such Advance may involve
cash of one or more Subsidiaries of CCI.
SECTION 2.03 INTEREST.
(a) Subject to the other provisions of this Section 2.03, interest shall
accrue on Advances at the rate (the "Interest Rate") of 125 basis points over
the LIBOR Rate in effect on the date of the Advance. Interest shall be
calculated on the basis of a 360 day year for the actual number of days
elapsed. Interest payments for Interest Periods ending (i) prior to the
termination of this Agreement shall be treated as Advances pursuant to
Sections 2.01 and 2.02 herein, as applicable, on the first day of the
following Interest Period and (ii) on the termination of this Agreement shall
be payable immediately (each an "Interest Payment"). Outstanding Advances and
Interest Payments for the final Interest Period not repaid when they become
due and payable upon the termination of this Agreement as provided in Section
4.03 shall bear interest from and after the required date of payment to the
date of payment at an annual rate equal to two and one-half percent (2-1/2 %)
per annum in excess of the rate applicable to the unpaid principal amount
immediately before it became due.
(b) The interest payable by CCI under this Agreement shall be calculated by
multiplying the Interest Rate by the CCI Balance for the applicable days in
the Interest Period. The interest payable by CRW under this Agreement shall
be calculated by multiplying the Interest Rate by CRW Balance for the
applicable days in the Interest Period. The Interest Payment required to be
made by each party is independent of the Interest Payment required to be paid
by the other party, and interest may be paid by both CCI and CRW for any
given Interest Period. CCI shall calculate the amount of interest payable by
both CCI and CRW for each Interest Period and, upon request, shall provide
notice thereof to CRW, together with supporting calculations.
(c) All calculations shall be performed by CCI and shall be subject to the
dispute resolution mechanisms provided for in Section 4.01.
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SECTION 2.04 REPAYMENT. During the term of this Agreement, all
Advances received by either party under this Agreement shall be offset
against and shall be treated as repaid to the extent of any Advances made by
such party to the other party. Repayments can be made at any time by either
party with interest payable up to the date of repayment. No prepayment
penalty may be levied. Upon termination of this Agreement, any Advances that
have not theretofore been repaid, together with accrued interest, will be
payable in full immediately following termination of this Agreement.
SECTION 2.05 INTERCOMPANY ACCOUNT. CCI shall maintain a ledger in
which all CCI Advances and CRW Advances and all repayments of such Advances
shall be recorded. CCI shall give CRW access, during normal business hours,
to such ledger and the other records relating to Advances and payments made
with respect thereto. CCI shall have until the 30th day following the end of
each Interest Period to make any calculations required to be made by it under
the provisions of this Agreement.
SECTION 2.06 REQUESTS FOR ADVANCES. Notice of a request for an Advance
hereunder (other than Advances made by CCI to CRW through intercompany
accounts) to meet the daily cash requirements of CRW and its Subsidiaries
will be made pursuant to a form and instructions provided separately by CCI.
Advances will be made according to a schedule to be agreed between the
parties.
SECTION 2.07 TRANSFERS OF FUNDS. All transfers of funds between CCI and
CRW will be initiated by CCI Treasury. All funds will be transferred through
intercompany accounts, or as otherwise agreed by the parties.
SECTION 2.08 TAXES. If CRW or CCI shall be required by law to deduct
any tax from or in respect of any sum payable hereunder to the other party:
(a) as soon as such party is aware that any such deduction, withholding or
payment of a tax is required, or of any change in any such requirement, it
shall notify the other party; (b) such party shall make such deductions, or
pay such tax, before any interest or penalty becomes payable; (c) such party
shall pay the full amount deducted to the relevant taxing authority or other
authority in accordance with applicable law; and (d) within thirty (30) days
after paying such tax, such party shall deliver to the other party
satisfactory evidence of that deduction, withholding or payment and (where
remittance is required) of the remittance thereof to the relevant taxing or
other authority.
SECTION 2.09 REQUIREMENT TO BORROW. CRW shall not borrow any funds from
any person other than CCI in order to satisfy its financial requirements
unless such borrowing is consented to by CCI in writing.
SECTION 2.10 USURY. All agreements between the parties, whether now
existing or hereafter arising and whether written or oral, are hereby limited
so that in no contingency, whether by reason of demand for payment or
acceleration of the maturity hereof or otherwise, shall the interest
contracted for, charged or received by either party exceed the maximum amount
permissible under applicable law. If, from any
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circumstance whatsoever, interest would otherwise be payable to either party
in excess of the maximum lawful amount, the interest payable to such party
shall be reduced to the maximum amount permitted under applicable law; and if
from any circumstance either party shall ever receive anything of value
deemed interest by applicable law in excess of the maximum lawful amount, an
amount equal to any excessive interest shall be applied to the reduction of
the principal hereof and not to the payment of interest, or if such excessive
interest exceeds the unpaid balance of principal hereof such excess shall be
refunded to the party deemed to have made such payment. All interest paid or
agreed to be paid to either party shall, to the extent permitted by
applicable law, be amortized, prorated, allocated, and spread throughout the
full period until payment in full of the principal (including the period of
any renewal or extension hereof) so that the interest hereon for such full
period shall not exceed the maximum amount permitted by applicable law. This
paragraph shall control all agreements between the parties.
ARTICLE III
COVENANTS OF CRW
Until the repayment of all Advances under this Agreement, CRW will:
SECTION 3.01 CORPORATE EXISTENCE. Maintain, and, except as provided in
Section 3.7 hereof, cause each Subsidiary to maintain, (a) its corporate
existence in good standing under the laws of the jurisdiction of its
incorporation, (b) its right to transact business in each jurisdiction in
which the character of the properties owned or leased by it or the business
conducted by it makes such qualification necessary and the failure to so
qualify would permanently preclude CRW or such Subsidiary from enforcing its
rights with respect to any material assets or expose CRW or such Subsidiary
to any material liability and (c) conduct and operate its business in a
lawful manner as presently conducted.
SECTION 3.02 COMPLIANCE WITH LAWS, ETC. Comply, and cause each
Subsidiary to comply, in all material respects with all applicable laws,
rules, regulations and orders (including without limitation Regulation X of
the Board of Governors of the Federal Reserve System), such compliance to
include, without limitation, paying before the same become delinquent all
taxes, assessments and governmental charges imposed upon it or upon its
property except to the extent contested in good faith by appropriate
proceedings and for which adequate reserves have been established.
SECTION 3.03 ERISA. At all times maintain, and cause each Subsidiary
to maintain, each of its Plans in compliance with all material applicable
requirements of ERISA and of the Code and with all material applicable
rulings and regulations issued under the provisions of ERISA and the Code;
and not permit any of its ERISA Affiliates to, (a) engage in any transaction
in connection with which CRW or any of its ERISA Affiliates would be
subject to either a civil penalty assessed pursuant to Section 502(i) of
ERISA or a tax imposed by Section 4975 of the Code, in either case in an
amount exceeding $1,000,000, (b) fail to make full payment when due of all
amounts which,
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under the provisions of any Plan, CRW or any of its ERISA Affiliates is
required to pay as contributions thereto, or permit to exist any accumulated
funding deficiency (as such term is defined in Section 302 of ERISA and
Section 412 of the Code), whether or not waived, with respect to any Plan in
an aggregate amount exceeding $1,000,000 or (c) fail to make any payments in
an aggregate amount exceeding $1,000,000 to any Multiemployer Plan that the
CRW or any of its ERISA Affiliates may be required to make under any
agreement relating to such Multiemployer Plan or any law pertaining thereto.
SECTION 3.04 INSURANCE. Maintain, and cause each Subsidiary to
maintain, in full force and effect insurance comparable to present policies
in amounts and risks covered plus such additional insurance, if any, as may
from time to time be required to provide coverage customarily maintained by
similarly situated companies.
SECTION 3.05 LITIGATION. Notify the CCI in writing of all litigation
involving a claim against CRW or any Subsidiary of more than $5,000,000 and
of all other litigation and proceedings before any governmental or regulatory
agencies affecting CRW or any Subsidiary which, if adversely determined,
would materially affect the consolidated financial condition of CRW and the
Subsidiaries.
SECTION 3.06 LIENS. Not, and not permit any Subsidiary to, create,
incur, assume or suffer to exist, any Lien with respect to its right, title
and interest in or to any property or assets now owned or hereafter acquired
by CRW or any Subsidiary except (a) materialmen's, mechanics', suppliers',
tax, carriers or warehousemen's Liens, statutory Liens of landlords and other
like Liens arising in the ordinary course of business and liens for taxes,
assessments or other governmental charges, securing obligations which are not
yet due or which are being contested in good faith by appropriate
proceedings, and other like Liens in existence less than 120 days from the
date of creation thereof, (b) existing Liens on property acquired in
acquisitions, (c) any Lien on property owned by any Person (other than CRW or
a Subsidiary) in which CRW or a Subsidiary has made an Investment and which
Lien secures all obligation of such Person for which neither CRW nor any
Subsidiary has any liability, and (d) purchase money mortgages, liens,
security interests or encumbrances upon or in property acquired after the
date hereof, or mortgages, liens, lease purchase liens, security interests or
encumbrances existing in the property at the time of acquisition thereof,
provided that such mortgages, liens, security interests or encumbrances
extend only to the property then being acquired and secure only indebtedness
being created or assumed in connection with that acquisition.
SECTION 3.07 MERGER AND CONSOLIDATION. Not, and not permit any
Subsidiary to, merge or consolidate or enter into any analogous
reorganization or transaction with any other Person except that: (a) any
Subsidiary may merge or consolidate with, or be liquidated into, CRW or
another Subsidiary; (b) CRW may merge or consolidate with another Person if
(i) CRW is the surviving or resulting entity and (ii) no Event of Default
would result from, or would exist immediately after, such consolidation or
merger; (c) a Subsidiary may merge or consolidate with another Person if (i)
the Subsidiary is the surviving or resulting entity or such other Person
becomes a Subsidiary upon such
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consolidation or merger and (ii) no Event of Default or would result from, or
would exist immediately after, such consolidation or merger; and (d) any
Person may become a Subsidiary if no Event of Default would result from, or
would exist immediately after, such consolidation or merger.
SECTION 3.08 LOANS AND ADVANCES. Not, and not permit any Subsidiary
to, make or make any commitment to make, or permit to exist or remain
outstanding, any loan, advance or extension of credit to, or any Investment
in, any Person, except:
(a) loans, advances or extensions of credit to, or Investments in, a
Subsidiary which is engaged in a line of business similar to any line of
business in which CRW or any Subsidiary was engaged as of August 19, 1999;
(b) Investments in stock, obligations, securities or assets of a Person
provided such Person is engaged in a line of business similar to any line of
business engaged in by CRW or any Subsidiary as of August 19, 1999;
(c) obligations, securities or assets received in settlement of
Indebtedness of a Person to CRW or a Subsidiary and which was incurred in
the ordinary course of business of CRW or such Subsidiary, as the case
may be;
(d) trade receivables arising in the ordinary course of business; and
(e) loans, advances, extensions of credit, or Investments, approved by
CCI in writing.
SECTION 3.09 SALES OF ASSETS. Not, and not permit any Subsidiary to
sell (including sales with a view to the concurrent or subsequent acquisition
by lease ["sale-leaseback transactions"]), transfer, convey, lease or
otherwise dispose of (or enter into any commitment to do so) all or any part
of its assets except for:
(a) sales in the ordinary course of business;
(b) sale-leaseback transactions provided that the aggregate fair market
value of the assets sold under all such sale-leaseback transactions during
the Term shall not at any time exceed ten percent (10%) of CRWs equity
determined as of the last day of the fiscal quarter next preceding the most
recent such transaction, without the written consent of CCI;
(c) any other sale of assets (whether in one transaction or a series of
transactions), provided that the aggregate fair market value of the assets
sold pursuant to this paragraph (c) for any fiscal year of CRW shall not
exceed ten percent (10%) of CRWs equity as of the last day of the fiscal
quarter next preceding the most recent such transaction; and
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(d) transfers of assets between Subsidiaries or between CRW and any
Subsidiary.
SECTION 3.10 GUARANTIES AND CONTINGENT LIABILITIES. Not, and not
permit any Subsidiary to, guarantee, endorse, contingently agree to purchase
or to provide funds for the payment of, agree to maintain the net worth or
working capital or any other financial test of or otherwise become
contingently liable upon, any obligation of any other Person, or create,
incur, assume, suffer or permit to exist any other contingent liability
except:
(a) by the endorsement of negotiable instruments for deposit or
collection (or similar transactions) in the ordinary course of business;
(b) guaranties of the obligations of Persons given by CRW or a
Subsidiary in the ordinary course of business in connection with a franchise
agreement, management agreement or similar service agreement or customer
relationship between CRW or a Subsidiary and such Person, approved in writing
by CCI;
(c) reimbursement obligations with respect to standby letters of credit
furnished in the ordinary course of business to secure payment of insurance
premiums, deductible losses and similar miscellaneous charges in connection
with obtaining insurance coverage, approved in writing by CCI;
(d) reimbursement obligations with respect to standby letters of credit
furnished in the ordinary course of business in international trade
transactions;
(e) claims against CRW or any Subsidiary which are being contested by
CRW or such Subsidiary in good faith and by appropriate proceedings;
(f) guaranties by CRW of Indebtedness of any Subsidiary incurred in the
ordinary course of business in connection with a line of business engaged in
by CRW or any Subsidiary as of August 19, 1999; and
(g) guaranties by any Subsidiary of Indebtedness of CRW or any other
Subsidiary incurred in the ordinary course of business in connection with a
line of business engaged in by CRW or any Subsidiary as of August 19, 1999.
SECTION 3.11 REGULATIONS U, G AND X. Not, and not permit any Subsidiary
to, use any part of the proceeds of the Loans to extend credit to others for
the purpose of purchasing or carrying any margin stock (within the meaning of
Regulation G of the Board of Governors of the Federal Reserve System) in
violation of any provision of Regulation U, G or X of said Board of
Governors. If requested by any Bank, it will furnish the Banks with a
statement in conformity with the requirements of Federal Reserve Form U-1
referred to in Regulation U.
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ARTICLE IV
ADMINISTRATION
SECTION 4.01 DISPUTES. All disputes under this Agreement shall be
handled in the manner provided for in Article 7.10 of the Services Agreement.
SECTION 4.02 LIMITATIONS ON LIABILITY. Neither party shall have any
liability under this Agreement (including any liability for its own
negligence) for damages, losses or expenses (including expenses or higher
interest rates incurred in order to obtain alternative financing sources)
suffered by the other party or its Subsidiaries as a result of the
performance or non-performance of such party's obligations hereunder, unless
such damages, losses or expenses are caused by or arise out of the willful
misconduct or gross negligence of such party or a breach by such party. In
no event shall either party have any liability to the other party for
indirect, incidental or consequential damages that such other party or its
Subsidiaries or any third party may incur or experience on account of the
performance or non-performance of such party's obligations hereunder. The
provisions of this Section 4.02 shall survive any termination of this
Agreement.
SECTION 4.03 TERM OF THE AGREEMENT. This Agreement commences on the
effective date of this Agreement as set forth above and will continue in
effect until 11:59 p.m., Central Time, on December 31, 2001. Notwithstanding
the foregoing, this Agreement may be sooner terminated, without liability to
the terminating party:
(a) by either party, upon 90 days' notice to the other party, if CCI ceases
to own, directly or indirectly, 50% or more of the outstanding common
stock of CRW;
(b) by either party, immediately upon notice to the other party, if (i) that
other party makes a general assignment of all or substantially all of
its assets for the benefit of its creditors; (ii) that other party
applies for, consents to or acquiesces in the appointment of a receiver,
trustee, custodian or liquidator for its business or all or
substantially all of its assets; (iii) that other party files, or
consents to or acquiesces in a petition seeking relief or reorganization
under any bankruptcy or insolvency laws; or (iv) a petition seeking
relief or reorganization under any bankruptcy or insolvency laws is
filed against that other party and is not dismissed within 90 days after
it was filed;
(c) by either party, immediately upon notice to the other party, if that
other party's material breach of this Agreement continues uncured or
uncorrected for 30 days after both the nature of that breach and the
necessary cure or correction has been agreed upon by the parties or
otherwise determined by the dispute resolution procedure described in
Section 3.01; provided that if the parties agree or it is determined by
the dispute resolution procedure that the material breach is not capable
of being cured or corrected, the termination shall be effective
immediately upon notice;
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(d) by either party, immediately upon notice to the other party, if it
determines that performance of its rights or obligations under this
Agreement is or becomes illegal;
(e) by either party, immediately upon notice to the other party, if payments
made by the other party are subject to any deduction or withholding for
or on account of any tax, unless the other party agrees to increase its
payments such that, after all required deductions have been made, the
party receives a net amount equal to the sum it would have received had
no such deductions been made;
(f) by either party, immediately upon notice to the other party, if it
determines that its compliance with any law or regulation or any
guideline or request from any central bank or governmental or regulatory
authority would create a cost or increase the cost of providing credit
under this Agreement, unless the other party agrees to pay amounts
sufficient to indemnify for such cost or increase in cost; or
(g) by either party, immediately upon notice to the other party, if the
Services Agreement has been terminated.
SECTION 4.04 RENEWAL. The parties may consent to successive one-year
renewal terms. If CRW wishes to renew the term of this Agreement, it shall
provide notice to CCI of that desire by June 30, 2001 and the same date of
each subsequent year. If CCI consents to such renewal, it shall provide
notice to CRW of that concurrence by July 30 of that year. If no notice of
desire to renew or subsequent consent is given, this Agreement will terminate
when the then current term expires.
SECTION 4.05 CONFIDENTIALITY. Confidentiality of matters will be
maintained in the manner set forth in Article 7.08 of the Services Agreement.
SECTION 4.06 SUCCESSORS AND ASSIGNS. Matters regarding succession and
assignment shall be determined in the manner set forth in the Services
Agreement.
SECTION 4.07 NO THIRD-PARTY BENEFICIARIES. Nothing expressed or implied
in this Agreement shall be construed to give any person or entity other than
the parties hereto any legal or equitable rights hereunder.
SECTION 4.08 ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement of the parties on this subject, except that any administrative
matters not addressed herein shall be addressed in the manner set forth in
the Services Agreement. This Agreement replaces and supersedes any prior
agreement or understanding of the parties, whether written or oral, on this
subject not expressed or referred to in this Agreement.
SECTION 4.09 AMENDMENT. This Agreement may not be amended except by a
written instrument signed by the parties hereto.
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SECTION 4.10 WAIVERS. Either party hereto may (a) extend the time for
performance of any of the obligations or other act of the other party or (b)
waive compliance with any of the agreements contained herein. No waiver of
any term shall be construed as a waiver of the same term in any other
situation or a waiver of any other term of this Agreement. The failure of any
party to assert any of its rights hereunder will not constitute a waiver of
any such rights.
SECTION 4.11 SEVERABILITY. If any provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of law or public
policy, such provision shall be deemed severable and all other provisions of
this Agreement shall nevertheless remain in full force and effect.
SECTION 4.12 HEADINGS. Section headings in this Agreement are included
herein for convenience of reference only and shall not constitute a part of
this Agreement for any other purpose.
SECTION 4.13 NOTICES. All notices required hereunder shall be given in
the manner set forth in Article 7.09 of the Services Agreement.
SECTION 4.14 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the substantive laws of the State of Minnesota,
without giving effect to any choice-of-law rules that may require the
application of the laws of another jurisdiction.
SECTION 4.15 CHANGES IN LAW. If at any time due to the adoption of any
law, rule, regulation, treaty or directive, or any change therein or in the
interpretation or administration thereof by any court, central bank,
governmental authority, agency or instrumentality, or comparable agency
charged with the interpretation or administration thereof, or for any other
reason arising subsequent to the date of this Agreement, it shall become
unlawful or impossible for CCI to make any Advance, the obligation of CCI to
provide such Advances shall, upon the happening of such event, forthwith be
suspended for the duration of such illegality or impossibility. If any such
event shall make it unlawful or impossible for CCI to continue any Advances
previously made by it hereunder, CCI shall, upon the happening of such event,
notify CRW thereof in writing, and CRW shall, at the time notified by CCI,
repay such Advances in full, together with accrued interest thereon.
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<PAGE>
SECTION 4.16 COUNTERPARTS. This Agreement may be signed in any number of
counterparts, with the same effect as if all signatories had signed the same
document. All counterparts shall be construed together to constitute one,
and the same, document.
IN WITNESS WHEREOF, CCI and CRW have caused this Agreement to be executed as
of the date first above written.
CARLSON COMPANIES, INC. CARLSON RESTAURANTS WORLDWIDE INC.
By: /s/ Martyn R. Redgrave By: /s/ Wallace B. Doolin
------------------------- ----------------------------
Martyn R. Redgrave Wallace B. Doolin
Title: Executive V.P. and CFO Title: President and CEO
---------------------- -------------------------
Date: August 19, 1999 Date: August 19, 1999
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