EXHIBIT 10.28

EXECUTION COPY

 

$245,000,000

 

IHOP FRANCHISING, LLC

IHOP IP, LLC

 

7.0588% Series 2007-3 Fixed Rate Term Notes

 

PURCHASE AGREEMENT

 

November 29, 2007

 

Lehman Brothers Inc.

745 Seventh Avenue

New York, New York  10019

 

Ladies and Gentlemen:

 

IHOP FRANCHISING, LLC, a Delaware limited liability company (the “Master
Issuer”), and IHOP IP, LLC, a Delaware limited liability company (the “IP
Holder”, and together with the Master Issuer, the “Co-Issuers” and each a
“Co-Issuer”), propose, upon the terms and conditions set forth in this agreement
(the “Agreement”), to issue and sell to Lehman Brothers Inc. U.S. $245,000,000
principal amount of their Series 2007-3 Fixed Rate Term Notes due 2037 (the
“Securities”), pursuant to the Series Supplement for the Securities, dated as of
the date hereof (the “Supplement”), by and among the Co-Issuers and Wells Fargo
Bank, National Association, as indenture trustee (the “Trustee”), to the Base
Indenture, dated as of March 16, 2007 and supplemented on November 28, 2007 (as
supplemented, the “Base Indenture” and, together with the Supplement, the
“Indenture”), by and among the Co-Issuers and the Trustee.

 

Each of the Co-Issuers is a wholly-owned subsidiary of IHOP Corp., a Delaware
corporation (“IHOP”), who is entering into this Agreement as the guarantor of
the obligations of International House of Pancakes, Inc. (“IHOP Inc.” and,
together with IHOP, the “Parent Companies”), as Servicer under the Servicing
Agreement, dated as of March 16, 2007 (as amended, the “Servicing Agreement”),
among the Co-Issuers, IHOP Property Leasing LLC, a Delaware limited liability
company, IHOP Properties, LLC, a Delaware limited liability company, IHOP Real
Estate, LLC, a Delaware limited liability company, the Parent Companies and the
Trustee.  The Co-Issuers and the Parent Companies hereby confirm their agreement
with Lehman Brothers Inc. (the “Initial Purchaser”) concerning the purchase of
the Securities from the Co-Issuers by the Initial Purchaser.

 

Pursuant to an Agreement and Plan of Merger, dated as of July 15, 2007 (the
“Merger Agreement”), by and among Applebee’s International, Inc., a Delaware

 

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corporation (“Applebee’s International”), IHOP and CHLH Corp., a Delaware
corporation (“Merger Sub”), which is a wholly-owned subsidiary of IHOP, Merger
Sub will merge with and into Applebee’s International (the “Merger”), and each
outstanding share of common stock of Applebee’s International (except for shares
held by IHOP and certain other shares), will be automatically converted into the
right to receive $25.50 in cash, without interest, subject to certain
adjustments (the “Acquisition”). Applebee’s International will be the surviving
corporation of the Merger and a wholly-owned subsidiary of IHOP.  IHOP expects
to finance the Acquisition with (i) the cash proceeds from the issuance of the
Securities and (ii) cash proceeds from the issuance of $1,814 million aggregate
principal amount of additional asset-backed securities (the “Applebee’s
Securitization”) to be issued by subsidiaries of Applebee’s International.

 

The Securities will be offered and sold to the Initial Purchaser without being
registered under the Securities Act of 1933 (the “Securities Act”), in reliance
upon an exemption therefrom.  IHOP and the Co-Issuers have prepared a draft base
offering circular, a draft supplemental offering circular and a term sheet,
together attached hereto as Exhibit 1 (collectively, the “Draft Offering
Memorandum”), materials circulated in connection with the syndication of bridge
loans to finance the Acquisition listed on Schedule A-1 (collectively, the
“Bridge Syndication Materials”) and the preliminary marketing materials listed
on Schedule A-2 (collectively, the “Preliminary Marketing Materials”).

 

Pursuant to Sections 4(a) and (c) of this Agreement, the Co-Issuers intend to
prepare a final base offering circular and a supplemental offering circular
setting forth information concerning the Parent Companies, the Co-Issuers,
certain affiliated entities, and the Securities.  Such base offering circular,
together with the supplemental offering circular, as amended to the Initial Date
(as defined herein), each Supplemental Date (as defined herein) and each
Bringdown Date (as defined herein) is referred to herein as the “Offering
Memorandum”.

 

Any reference to the Offering Memorandum or the Draft Offering Memorandum shall
be deemed to refer to and include (i) the most recent Annual Report on
Form 10-K, (ii) the Quarterly Reports on Form 10-Q filed since the most recent
Annual Report on Form 10-K and (iii) the Current Reports on Form 8-K filed since
the most recent Annual Report on Form 10-K, of IHOP, filed with the United
States Securities and Exchange Commission (the “Commission”) pursuant to
Section 13(a) or 15(d) of the United States Securities Exchange Act of 1934 (the
“Exchange Act”), on or prior to the date of the Offering Memorandum, as the case
may be.  All documents filed by IHOP under the Exchange Act and so deemed to be
included in the Draft Offering Memorandum or the Offering Memorandum, as the
case may be, or any amendment or supplement thereto are hereinafter called the
“Exchange Act Documents.”

 

“Free Writing Communication” means a written communication (as such term is
defined in Rule 405 under the Securities Act) that constitutes an offer to sell
or a solicitation of an offer to buy the Securities and is made by means other
than the Offering Memorandum.  “Issuer Free Writing Communication” means a Free
Writing

 

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Communication prepared by or on behalf of the Parent Companies or the
Co-Issuers, used or referred to by the Parent Companies or the Co-Issuers or
containing a description of the final terms of the Securities or of their
offering, in the form retained in the Parent Companies’ or the Co-Issuers’
records.

 

Copies of the Offering Memorandum will be delivered by the Co-Issuers and the
Parent Companies to the Initial Purchaser pursuant to the terms of this
Agreement.  Any references herein to the Offering Memorandum shall be deemed to
include all amendments and supplements thereto.  The Co-Issuers and the Parent
Companies hereby confirm that they have authorized the use of the Offering
Memorandum in connection with the offering and resale of the Securities by the
Initial Purchaser in accordance with Section 2.

 

For purposes of this Agreement, (a) capitalized terms used but not defined
herein shall have the meanings given to such terms in the Indenture, (b) the
term “business day” means any day on which the New York Stock Exchange, Inc. is
open for trading, (c) except where otherwise expressly provided, the term
“affiliate” has the meaning set forth in Rule 405 under the Securities Act ,
(d) the term “Transaction Documents” means the “Transaction Documents,” as
defined in the Indenture, plus the Type 1 Residual Certificate, and (e) the
“Relevant Date” means the date on which representations, warranties and
agreements are being made by the Co-Issuers or the Parent Companies (as the case
may be) in accordance with Section 1(c) or 1(d).  The Base Indenture is attached
hereto as Exhibit 2.  The Supplement is attached hereto as Exhibit 3. As used
herein

 

1.             Representations, Warranties and Agreements of the Co-Issuers and
the Parent Companies

 

(a)           Each of the Co-Issuers, jointly and severally, represents and
warrants to, and agrees with, the Initial Purchaser, as of the Closing Date,
that:

 

(I)            AS OF THE CLOSING DATE, THE DRAFT OFFERING MEMORANDUM PRESENTS
FAIRLY, IN ALL MATERIAL RESPECTS, THE BUSINESS, RESULTS OF OPERATIONS AND
FINANCIAL CONDITION OF THE CO-ISSUERS.  AS OF THE RELEVANT DATE, THE OFFERING
MEMORANDUM DOES NOT INCLUDE ANY UNTRUE STATEMENT OF A MATERIAL FACT OR OMIT TO
STATE ANY MATERIAL FACT REQUIRED TO BE STATED THEREIN OR NECESSARY TO MAKE THE
STATEMENTS THEREIN, IN THE LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY WERE
MADE, NOT MISLEADING;

 

(II)           AS OF THE RELEVANT DATE, THE OFFERING MEMORANDUM CONTAINS ALL OF
THE INFORMATION THAT, IF REQUESTED BY A PROSPECTIVE PURCHASER OF THE SECURITIES,
WOULD BE REQUIRED TO BE PROVIDED TO SUCH PROSPECTIVE PURCHASER PURSUANT TO
RULE 144A(D)(4) UNDER THE SECURITIES ACT;

 

(III)          THE PRELIMINARY MARKETING MATERIALS AND THE OFFERING MEMORANDUM
HAVE BEEN OR WILL HAVE BEEN PREPARED BY THE CO-ISSUERS AND THE PARENT COMPANIES
FOR USE BY THE INITIAL PURCHASER IN CONNECTION WITH THE EXEMPT RESALES (AS
DEFINED BELOW).  NO ORDER OR DECREE PREVENTING THE USE OF THE PRELIMINARY
MARKETING MATERIALS OR THE OFFERING MEMORANDUM, OR ANY ORDER ASSERTING THAT THE
TRANSACTIONS

 

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CONTEMPLATED BY THIS AGREEMENT ARE SUBJECT TO THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT HAS BEEN ISSUED, AND NO PROCEEDING FOR THAT PURPOSE HAS
COMMENCED OR IS PENDING OR, TO THE KNOWLEDGE OF THE CO-ISSUERS OR THE PARENT
COMPANIES, IS CONTEMPLATED;

 

(IV)          AS OF THE RELEVANT DATE, EACH OF THE BASE INDENTURE, THE
SUPPLEMENT AND THE SECURITIES WILL CONFORM IN ALL MATERIAL RESPECTS TO THE
DESCRIPTION THEREOF CONTAINED IN THE OFFERING MEMORANDUM;

 

(V)           ASSUMING THE ACCURACY OF THE REPRESENTATIONS AND WARRANTIES OF THE
INITIAL PURCHASER CONTAINED IN SECTION 2 AND THEIR COMPLIANCE WITH THE
AGREEMENTS SET FORTH THEREIN, IT IS NOT NECESSARY, IN CONNECTION WITH THE
ISSUANCE AND SALE OF THE SECURITIES TO THE INITIAL PURCHASER AND THE OFFER,
RESALE AND DELIVERY OF THE SECURITIES BY THE INITIAL PURCHASER IN THE MANNER
CONTEMPLATED BY THIS AGREEMENT AND THE INDENTURE, TO REGISTER THE SECURITIES
UNDER THE SECURITIES ACT OR TO QUALIFY THE INDENTURE UNDER THE TRUST INDENTURE
ACT OF 1939, AS AMENDED;

 

(VI)          EACH OF THE CO-ISSUERS HAS BEEN DULY INCORPORATED AS A LIMITED
LIABILITY COMPANY AND IS VALIDLY EXISTING AND IN GOOD STANDING UNDER THE LAWS OF
THE JURISDICTION OF ITS FORMATION, IS QUALIFIED TO DO BUSINESS AND IS IN GOOD
STANDING AS A FOREIGN LIMITED LIABILITY COMPANY IN EACH JURISDICTION IN WHICH
THE OWNERSHIP OR LEASE OF PROPERTY OR THE CONDUCT OF ITS BUSINESS REQUIRES SUCH
QUALIFICATION EXCEPT FOR SUCH FAILURES TO QUALIFY TO DO BUSINESS OR BE IN GOOD
STANDING AS A FOREIGN LIMITED LIABILITY COMPANY AS ARE NOT REASONABLY LIKELY TO
RESULT IN A MATERIAL ADVERSE EFFECT, AND HAS THE REQUISITE POWER AND AUTHORITY
UNDER ITS OPERATING AGREEMENT TO OWN OR HOLD ITS PROPERTIES AND TO CONDUCT THE
BUSINESS IN WHICH IT IS ENGAGED AS DESCRIBED IN THE DRAFT OFFERING MEMORANDUM
(AS OF THE CLOSING DATE) OR THE OFFERING MEMORANDUM (AS OF THE RELEVANT DATE);

 

(VII)         EACH OF THE CO-ISSUERS HAS THE REQUISITE LIMITED LIABILITY COMPANY
POWER AND AUTHORITY UNDER ITS OPERATING AGREEMENT TO EXECUTE AND DELIVER THIS
AGREEMENT, THE SECURITIES, THE INDENTURE AND ANY OTHER TRANSACTION DOCUMENT TO
WHICH IT IS A PARTY AND PERFORM ITS OBLIGATIONS HEREUNDER AND THEREUNDER;

 

(VIII)        NEITHER CO-ISSUER IS IN VIOLATION OF (I) ITS RESPECTIVE CHARTER
DOCUMENTS, (II) ANY REQUIREMENTS OF LAW (AS DEFINED BELOW) WITH RESPECT TO SUCH
PARTY OR (III) ANY INDENTURE, CONTRACT, AGREEMENT, MORTGAGE, DEED OF TRUST OR
OTHER INSTRUMENT TO WHICH ANY OF CO-ISSUER OR GUARANTOR IS A PARTY OR BY WHICH
EITHER IT OR ITS ASSETS IS BOUND (EACH, A “CONTRACTUAL OBLIGATION”), EXCEPT,
SOLELY WITH RESPECT TO CLAUSES (II) AND (III), TO THE EXTENT SUCH VIOLATION
COULD NOT REASONABLY BE EXPECTED TO RESULT IN A MATERIAL ADVERSE EFFECT.  THE
EXECUTION AND DELIVERY OF THIS AGREEMENT AND THE OTHER TRANSACTION DOCUMENTS,
THE APPLICATION OF THE PROCEEDS FROM THE SALE OF THE SECURITIES AS DESCRIBED
HEREIN, IN THE DRAFT OFFERING MEMORANDUM (AS OF THE CLOSING DATE) AND IN THE
OFFERING MEMORANDUM (AS OF THE RELEVANT DATE) AND THE INCURRENCE OF THE
OBLIGATIONS AND CONSUMMATION OF THE TRANSACTIONS HEREIN AND THEREIN CONTEMPLATED
(A) REQUIRES NO ACTION BY OR IN RESPECT OF, OR FILING WITH, ANY GOVERNMENTAL
AUTHORITY WHICH HAS NOT BEEN OBTAINED, (B) WILL NOT CONFLICT WITH, OR CONSTITUTE
A BREACH OF OR DEFAULT UNDER, ANY CHARTER DOCUMENTS OF EITHER CO-ISSUER, AND
(C) DO NOT CONTRAVENE, OR CONSTITUTE A DEFAULT UNDER,

 

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ANY REQUIREMENTS OF LAW WITH RESPECT TO SUCH CO-ISSUER OR ANY CONTRACTUAL
OBLIGATION WITH RESPECT TO SUCH CO-ISSUER OR RESULT IN THE CREATION OR
IMPOSITION OF ANY LIEN ON ANY PROPERTY OF EITHER CO-ISSUER, EXCEPT FOR LIENS
CREATED BY THE TRANSACTION DOCUMENTS AND EXCEPT, IN THE CASE OF CLAUSE (A) AND
(C), SOLELY WITH RESPECT TO THE ASSET CONTRIBUTION AGREEMENTS, THE VIOLATION OF
WHICH COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.  FOR
PURPOSES OF THIS AGREEMENT, “REQUIREMENTS OF LAW” MEANS WITH RESPECT TO ANY
PERSON OR ANY OF ITS PROPERTY, THE CERTIFICATE OF INCORPORATION OR ARTICLES OF
ASSOCIATION AND BY LAWS, LIMITED LIABILITY COMPANY AGREEMENT, PARTNERSHIP
AGREEMENT OR OTHER ORGANIZATIONAL OR GOVERNING DOCUMENTS OF SUCH PERSON OR ANY
OF ITS PROPERTY, AND ANY LAW, TREATY, RULE OR REGULATION, OR DETERMINATION OF
ANY ARBITRATOR OR GOVERNMENTAL AUTHORITY (AS DEFINED BELOW), 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, WHETHER FEDERAL, STATE, LOCAL OR
FOREIGN; INCLUDING USURY LAWS, THE FEDERAL TRUTH IN LENDING ACT, STATE FRANCHISE
LAWS AND RETAIL INSTALLMENT SALES ACTS, AND “GOVERNMENTAL AUTHORITY” MEANS THE
GOVERNMENT OF THE UNITED STATES OF AMERICA, ANY OTHER NATION OR ANY POLITICAL
SUBDIVISION THEREOF, WHETHER STATE OR LOCAL, AND ANY AGENCY, AUTHORITY,
INSTRUMENTALITY, REGULATORY BODY, COURT, CENTRAL BANK OR OTHER ENTITY EXERCISING
EXECUTIVE, LEGISLATIVE, JUDICIAL, TAXING, REGULATORY OR ADMINISTRATIVE POWERS OR
FUNCTIONS OF OR PERTAINING TO GOVERNMENT;

 

(IX)           EACH TRANSACTION DOCUMENT TO WHICH A CO-ISSUER IS A PARTY HAS
BEEN DULY AND VALIDLY AUTHORIZED, EXECUTED AND DELIVERED BY SUCH CO-ISSUER, AND,
ASSUMING DUE AUTHORIZATION, EXECUTION AND DELIVERY BY THE OTHER PARTIES THERETO,
CONSTITUTES THE LEGAL, VALID AND BINDING OBLIGATION OF THE APPLICABLE CO-ISSUER
AND IS ENFORCEABLE IN ACCORDANCE WITH ITS TERMS (EXCEPT AS SUCH ENFORCEABILITY
MAY BE LIMITED BY BANKRUPTCY, INSOLVENCY, FRAUDULENT CONVEYANCE, REORGANIZATION,
MORATORIUM AND OTHER SIMILAR LAWS AFFECTING CREDITORS’ RIGHTS GENERALLY OR BY
GENERAL EQUITABLE PRINCIPLES, WHETHER CONSIDERED IN A PROCEEDING AT LAW OR IN
EQUITY AND BY AN IMPLIED COVENANT OF GOOD FAITH AND FAIR DEALING).  AS OF THE
RELEVANT DATE, EACH OF THE TRANSACTION DOCUMENTS WILL CONFORM IN ALL MATERIAL
RESPECTS TO THE DESCRIPTION THEREOF IN THE OFFERING MEMORANDUM;

 

(X)            (1) THE TRANSACTION DOCUMENTS ARE IN FULL FORCE AND EFFECT;
(2) THERE ARE NO OUTSTANDING DEFAULTS THEREUNDER; AND (3) NO EVENTS HAVE
OCCURRED WHICH, WITH THE GIVING OF NOTICE, THE PASSAGE OF TIME OR BOTH, WOULD
CONSTITUTE A DEFAULT THEREUNDER;

 

(XI)           (A) NEITHER CO-ISSUER IS A PARTY TO ANY CONTRACT OR AGREEMENT OF
ANY KIND OR NATURE AND (B) NEITHER CO-ISSUER IS SUBJECT TO ANY MATERIAL
OBLIGATIONS OR LIABILITIES OF ANY KIND OR NATURE IN FAVOR OF ANY THIRD PARTY,
INCLUDING, WITHOUT LIMITATION, GUARANTEES, KEEP WELL AGREEMENTS, DIVIDENDS,
ENDORSEMENTS, LETTERS OF CREDIT OR OTHER CONTINGENT OBLIGATIONS.  NEITHER
CO-ISSUER HAS ENGAGED IN ANY ACTIVITIES SINCE ITS FORMATION (OTHER THAN THOSE
INCIDENTAL TO ITS FORMATION, THE AUTHORIZATION AND THE ISSUE OF THE SECURITIES,
THE EXECUTION OF THE TRANSACTION DOCUMENTS TO WHICH SUCH CO-ISSUER IS A PARTY
AND THE PERFORMANCE OF THE ACTIVITIES REFERRED TO IN OR CONTEMPLATED BY SUCH
AGREEMENTS);

 

(XII)          THIS AGREEMENT HAS BEEN DULY AUTHORIZED, EXECUTED AND DELIVERED
BY THE CO-ISSUERS AND CONSTITUTES THE LEGAL, VALID AND BINDING OBLIGATION OF THE
CO-ISSUERS

 

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ENFORCEABLE IN ACCORDANCE WITH ITS TERMS (EXCEPT AS SUCH ENFORCEABILITY MAY BE
LIMITED BY BANKRUPTCY, INSOLVENCY, FRAUDULENT CONVEYANCE, REORGANIZATION,
MORATORIUM AND OTHER SIMILAR LAWS AFFECTING CREDITORS’ RIGHTS GENERALLY OR BY
GENERAL EQUITABLE PRINCIPLES, WHETHER CONSIDERED IN A PROCEEDING AT LAW OR IN
EQUITY AND BY AN IMPLIED COVENANT OF GOOD FAITH AND FAIR DEALING AND EXCEPT THAT
ANY INDEMNIFICATION OR CONTRIBUTION PROVISIONS HEREIN MAY BE DEEMED
UNENFORCEABLE);

 

(XIII)         THE SECURITIES HAVE BEEN DULY AUTHORIZED FOR ISSUANCE, OFFER AND
SALE BY THE CO-ISSUERS AS CONTEMPLATED BY THIS AGREEMENT AND, WHEN AUTHENTICATED
BY THE TRUSTEE AND ISSUED AND DELIVERED AGAINST PAYMENT OF THE PURCHASE PRICE
THEREFOR, WILL CONSTITUTE LEGAL, VALID AND BINDING OBLIGATIONS OF THE CO-ISSUERS
ENFORCEABLE IN ACCORDANCE WITH THEIR TERMS (EXCEPT AS SUCH ENFORCEABILITY MAY BE
LIMITED BY BANKRUPTCY, INSOLVENCY, FRAUDULENT CONVEYANCE, REORGANIZATION,
MORATORIUM AND OTHER SIMILAR LAWS AFFECTING CREDITORS’ RIGHTS GENERALLY OR BY
GENERAL EQUITABLE PRINCIPLES, WHETHER CONSIDERED IN A PROCEEDING AT LAW OR IN
EQUITY AND BY AN IMPLIED COVENANT OF GOOD FAITH AND FAIR DEALING);

 

(XIV)        NO CONSENT, ACTION BY OR IN RESPECT OF, APPROVAL OR OTHER
AUTHORIZATION OF, OR REGISTRATION, DECLARATION OR FILING WITH, ANY GOVERNMENTAL
AUTHORITY OR OTHER PERSON IS REQUIRED FOR THE ISSUANCE, OFFER OR SALE OF THE
SECURITIES BY THE CO-ISSUERS IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT, THE
EXECUTION, DELIVERY AND PERFORMANCE BY THE CO-ISSUERS OF THE SECURITIES, THE
INDENTURE, THIS AGREEMENT AND THE TRANSACTION DOCUMENTS (TO THE EXTENT THEY ARE
PARTIES THERETO), THE APPLICATION OF THE PROCEEDS FROM THE SALE OF THE
SECURITIES AS DESCRIBED HEREIN, IN THE DRAFT OFFERING MEMORANDUM (AS OF THE
CLOSING DATE) AND IN THE OFFERING MEMORANDUM (AS OF THE RELEVANT DATE) OR FOR
THE CONSUMMATION BY THE CO-ISSUERS OF THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT AND THE OTHER TRANSACTION DOCUMENTS OR FOR THE PERFORMANCE OF ANY OF
THE CO-ISSUERS’ OBLIGATIONS HEREUNDER OR THEREUNDER OTHER THAN SUCH CONSENTS,
APPROVALS, AUTHORIZATIONS, REGISTRATIONS, DECLARATIONS OR FILINGS (A) AS HAVE
BEEN OBTAINED PRIOR TO THE CLOSING DATE OR AS PERMITTED TO BE OBTAINED
SUBSEQUENT TO THE CLOSING DATE OR (B) RELATING TO THE PERFORMANCE OF ANY
FRANCHISE DOCUMENT THE FAILURE OF WHICH TO OBTAIN CONSENT IS NOT REASONABLY
LIKELY TO HAVE A MATERIAL ADVERSE EFFECT;

 

(XV)         THERE IS NO ACTION, SUIT, PROCEEDING OR INVESTIGATION PENDING
AGAINST OR, TO THE KNOWLEDGE OF EITHER CO-ISSUER, THREATENED AGAINST OR
AFFECTING EITHER CO-ISSUER OR OF WHICH ANY PROPERTY OR ASSETS OF THE CO-ISSUERS
IS THE SUBJECT BEFORE ANY COURT OR ARBITRATOR OR ANY GOVERNMENTAL AUTHORITY THAT
WOULD, INDIVIDUALLY OR IN THE AGGREGATE, AFFECT THE VALIDITY OR ENFORCEABILITY
OF THIS AGREEMENT OR ANY OF THE TRANSACTION DOCUMENTS, MATERIALLY ADVERSELY
AFFECT THE PERFORMANCE BY THE CO-ISSUERS OF THEIR OBLIGATIONS HEREUNDER OR
THEREUNDER OR WHICH IS REASONABLY LIKELY TO HAVE A MATERIAL ADVERSE EFFECT;

 

(XVI)        THE CO-ISSUERS MAINTAIN INSURANCE COVERAGES IN SUCH AMOUNTS AND
COVERING SUCH RISKS AS IS ADEQUATE FOR THE CONDUCT OF THEIR RESPECTIVE
BUSINESSES AND THE VALUE OF THEIR RESPECTIVE PROPERTIES AND AS IS CUSTOMARY FOR
COMPANIES ENGAGED IN SIMILAR BUSINESSES IN SIMILAR INDUSTRIES.  ALL POLICIES OF
INSURANCE OF THE CO-ISSUERS ARE IN FULL FORCE AND EFFECT AND THE CO-ISSUERS ARE
IN COMPLIANCE WITH THE TERMS OF SUCH POLICIES IN

 

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ALL MATERIAL RESPECTS.  NEITHER OF THE CO-ISSUERS HAS ANY REASON TO BELIEVE THAT
IT WILL NOT BE ABLE TO RENEW ITS EXISTING INSURANCE COVERAGE AS AND WHEN SUCH
COVERAGE EXPIRES OR TO OBTAIN SIMILAR COVERAGE FROM SIMILAR INSURERS AS MAY BE
NECESSARY TO CONTINUE ITS BUSINESS AT A COST THAT WOULD NOT REASONABLY BE
EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.  ALL SUCH INSURANCE IS PRIMARY
COVERAGE, ALL PREMIUMS THEREFOR DUE ON OR BEFORE THE DATE HEREOF HAVE BEEN PAID
IN FULL, AND THE TERMS AND CONDITIONS THEREOF ARE NO LESS FAVORABLE TO THE
CO-ISSUERS THAN THE TERMS AND CONDITIONS OF INSURANCE MAINTAINED BY THEIR
AFFILIATES THAT ARE NOT CO-ISSUERS;

 

(XVII)       (1)  EACH OF THE CO-ISSUERS OWNS AND HAS GOOD TITLE TO ITS
COLLATERAL, FREE AND CLEAR OF ALL LIENS OTHER THAN PERMITTED LIENS.  THE
CO-ISSUERS’ RIGHTS UNDER THE COLLATERAL DOCUMENTS RELATING TO THE SECURITY
INTERESTS HELD BY THE SECURED PARTIES CONSTITUTE GENERAL INTANGIBLES UNDER THE
APPLICABLE UCC.  THE BASE INDENTURE CONSTITUTES A VALID AND CONTINUING LIEN ON
THE COLLATERAL IN FAVOR OF THE TRUSTEE ON BEHALF OF AND FOR THE BENEFIT OF THE
SECURED PARTIES, WHICH LIEN ON THE COLLATERAL HAS BEEN PERFECTED (EXCEPT AS
DESCRIBED ON SCHEDULE 7.16 TO THE BASE INDENTURE) AND IS PRIOR TO ALL OTHER
LIENS (OTHER THAN PERMITTED LIENS), AND IS ENFORCEABLE AS SUCH AS AGAINST
CREDITORS OF AND PURCHASERS FROM EACH CO-ISSUER IN ACCORDANCE WITH ITS TERMS,
EXCEPT AS SUCH ENFORCEABILITY MAY BE LIMITED BY BANKRUPTCY, INSOLVENCY,
FRAUDULENT CONVEYANCE, REORGANIZATION, MORATORIUM AND OTHER SIMILAR LAWS
AFFECTING CREDITORS’ RIGHTS GENERALLY OR BY GENERAL EQUITABLE PRINCIPLES,
WHETHER CONSIDERED IN A PROCEEDING AT LAW OR IN EQUITY AND BY AN IMPLIED
COVENANT OF GOOD FAITH AND FAIR DEALING.  THE CO-ISSUERS HAVE RECEIVED ALL
CONSENTS AND APPROVALS REQUIRED BY THE TERMS OF THE COLLATERAL TO THE PLEDGE OF
THE COLLATERAL TO THE TRUSTEE UNDER THE BASE INDENTURE.  ALL ACTIONS NECESSARY
TO PERFECT SUCH FIRST-PRIORITY SECURITY INTEREST HAVE BEEN DULY TAKEN;

 

(2)  Other than the security interest granted to the Trustee under the Base
Indenture, pursuant to the other Transaction Documents or any other Permitted
Lien, neither of the Co-Issuers has pledged, assigned, sold or granted a
security interest in the Collateral.  All action necessary (including the filing
of UCC-1 financing statements and filings with the United States Patent and
Trademark Office, the United States Copyright Office or any applicable foreign
intellectual property office or agency) to protect and evidence the Trustee’s
security interest in the Collateral in the United States will have been duly and
effectively taken consistent with the obligations of Section 7.16(d) of the Base
Indenture, except as described on Schedule 7.16 to the Base Indenture).  No
security agreement, financing statement, equivalent security or lien instrument
or continuation statement authorized by either Co-Issuer and listing such
Co-Issuer as debtor covering all or any part of the Collateral is on file or of
record in any jurisdiction in the United States, except in respect of Permitted
Liens or such as may have been filed, recorded or made by such Co-Issuer in
favor of the Trustee on behalf of the Secured Parties in connection with the
Base Indenture, and neither Co-Issuer has authorized any such filing;

 

(XVIII)      EACH OF THE CO-ISSUERS POSSESSES ALL LICENSES, PERMITS, ORDERS,
PATENTS, FRANCHISES, CERTIFICATES OF NEED AND OTHER GOVERNMENTAL AND REGULATORY
APPROVALS TO OWN OR LEASE ITS PROPERTIES AND CONDUCT ITS BUSINESS IN THE
JURISDICTIONS IN WHICH SUCH BUSINESS IS TRANSACTED AS DESCRIBED IN THE DRAFT
OFFERING MEMORANDUM (AS OF THE CLOSING

 

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DATE) AND THE OFFERING MEMORANDUM (AS OF THE RELEVANT DATE) WITH ONLY SUCH
EXCEPTIONS AS WOULD NOT, INDIVIDUALLY OR IN THE AGGREGATE, HAVE A MATERIAL
ADVERSE EFFECT, AND HAS NOT RECEIVED ANY NOTICE OF PROCEEDINGS RELATING TO THE
REVOCATION OR MODIFICATION OF ANY SUCH LICENSE, PERMIT, ORDER OR APPROVAL,
EXCEPT FOR THOSE WHOSE REVOCATION OR MODIFICATION WOULD NOT INDIVIDUALLY OR IN
THE AGGREGATE, HAVE A MATERIAL ADVERSE EFFECT;

 

(XIX)         EXCEPT AS DESCRIBED IN THE DRAFT OFFERING MEMORANDUM (AS OF THE
CLOSING DATE) AND THE OFFERING MEMORANDUM (AS OF THE RELEVANT DATE), NO LABOR
DISTURBANCE BY THE EMPLOYEES OF THE CO-ISSUERS EXISTS OR, TO THE KNOWLEDGE OF
THE CO-ISSUERS, IS IMMINENT THAT WOULD REASONABLY BE EXPECTED TO HAVE A MATERIAL
ADVERSE EFFECT;

 

(XX)          AFTER GIVING EFFECT TO THE RESTRUCTURING, AS OF THE CLOSING DATE,
NEITHER OF THE CO-ISSUERS WILL HAVE ANY (I) EMPLOYEES, (II) OUTSTANDING
INDEBTEDNESS FOR BORROWED MONEY OTHER THAN UNDER THE INDENTURE OR (III) MATERIAL
LIABILITIES EXCEPT WHERE SUCH LIABILITIES ARE EXPRESSLY PERMITTED BY THE
TRANSACTION DOCUMENTS;

 

(XXI)         NEITHER A REPORTABLE EVENT NOR AN “ACCUMULATED FUNDING DEFICIENCY”
(WITHIN THE MEANING OF SECTION 412 OF THE CODE OR SECTION 302 OF ERISA) HAS
OCCURRED DURING THE SIX YEAR PERIOD PRIOR TO THE DATE ON WHICH THIS
REPRESENTATION IS MADE OR DEEMED MADE OR IS REASONABLY EXPECTED TO OCCUR WITH
RESPECT TO ANY SINGLE EMPLOYER PLAN, AND EACH PLAN (INCLUDING, TO THE ACTUAL
KNOWLEDGE OF THE CO-ISSUERS, A MULTIEMPLOYER PLAN OR A MULTIEMPLOYER WELFARE
PLAN MAINTAINED PURSUANT TO A COLLECTIVE BARGAINING AGREEMENT) HAS COMPLIED IN
ALL RESPECTS WITH THE APPLICABLE PROVISIONS OF ERISA, THE CODE AND THE
CONSTITUENT DOCUMENTS OF SUCH PLAN, EXCEPT FOR INSTANCES OF NON-COMPLIANCE THAT,
IN THE AGGREGATE, COULD NOT REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE
EFFECT.  NO TERMINATION OF A SINGLE EMPLOYER PLAN HAS OCCURRED DURING SUCH
SIX-YEAR PERIOD OR IS REASONABLY EXPECTED TO OCCUR (OTHER THAN A TERMINATION
DESCRIBED IN SECTION 4041(B) OF ERISA), AND NO LIEN IN FAVOR OF THE PBGC OR A
PLAN HAS ARISEN DURING SUCH SIX-YEAR PERIOD OR IS REASONABLY EXPECTED TO ARISE. 
EXCEPT TO THE EXTENT THAT ANY SUCH EXCESS COULD NOT REASONABLY BE EXPECTED TO
HAVE A MATERIAL ADVERSE EFFECT, THE PRESENT VALUE OF ALL ACCRUED BENEFITS UNDER
EACH SINGLE EMPLOYER PLAN (BASED ON THOSE ASSUMPTIONS USED TO FUND SUCH PLANS)
DID NOT, AS OF THE LAST ANNUAL VALUATION DATE PRIOR TO THE DATE ON WHICH THIS
REPRESENTATION IS MADE OR DEEMED MADE, EXCEED THE VALUE OF THE ASSETS OF SUCH
PLAN ALLOCABLE TO SUCH ACCRUED BENEFITS.  EXCEPT TO THE EXTENT THAT SUCH
LIABILITY COULD NOT REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT,
NEITHER OF THE CO-ISSUERS NOR ANY AFFILIATE THEREOF HAVE HAD A COMPLETE OR
PARTIAL WITHDRAWAL FROM ANY MULTIEMPLOYER PLAN, AND THE CO-ISSUERS WOULD NOT
BECOME SUBJECT TO ANY LIABILITY UNDER ERISA IF A CO-ISSUER OR ANY AFFILIATE
THEREOF WERE TO WITHDRAW COMPLETELY FROM ALL MULTIEMPLOYER PLANS AS OF THE
VALUATION DATE MOST CLOSELY PRECEDING THE DATE ON WHICH THIS REPRESENTATION IS
MADE OR DEEMED MADE.  TO THE ACTUAL KNOWLEDGE OF THE CO-ISSUERS, NO SUCH
MULTIEMPLOYER PLAN IS IN REORGANIZATION, INSOLVENT OR TERMINATING OR IS
REASONABLY EXPECTED TO BE IN REORGANIZATION, BECOME INSOLVENT OR BE TERMINATED. 
EXCEPT TO THE EXTENT THAT ANY SUCH EXCESS COULD NOT REASONABLY BE EXPECTED TO
HAVE A MATERIAL ADVERSE EFFECT, THE PRESENT VALUE (DETERMINED USING ACTUARIAL
AND OTHER ASSUMPTIONS WHICH ARE REASONABLE IN RESPECT OF THE BENEFITS PROVIDED
AND THE EMPLOYEES PARTICIPATING) OF THE LIABILITY OF THE CO-ISSUERS AND EACH
AFFILIATE THEREOF FOR POST RETIREMENT BENEFITS TO

 

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BE PROVIDED TO THEIR CURRENT AND FORMER EMPLOYEES UNDER PLANS WHICH ARE WELFARE
BENEFIT PLANS (AS DEFINED IN SECTION 3(1) OF ERISA) OTHER THAN SUCH LIABILITY
DISCLOSED IN THE FINANCIAL STATEMENTS OF THE CO-ISSUERS DOES NOT, IN THE
AGGREGATE, EXCEED THE ASSETS UNDER ALL SUCH PLANS ALLOCABLE TO SUCH BENEFITS. 
NONE OF THE CO-ISSUERS NOR ANY AFFILIATE THEREOF HAS ENGAGED IN A PROHIBITED
TRANSACTION UNDER SECTION 406 OF ERISA AND/OR SECTION 4975 OF THE CODE IN
CONNECTION WITH ANY PLAN THAT WOULD SUBJECT EITHER CO-ISSUER TO LIABILITY UNDER
ERISA AND/OR SECTION 4975 OF THE CODE THAT COULD REASONABLY BE EXPECTED TO HAVE
A MATERIAL ADVERSE EFFECT.  THERE IS NO OTHER CIRCUMSTANCE WHICH MAY GIVE RISE
TO A LIABILITY IN RELATION TO ANY PLAN THAT COULD REASONABLY BE EXPECTED TO HAVE
A MATERIAL ADVERSE EFFECT;

 

(XXII)        EACH OF THE CO-ISSUERS HAS FILED, OR CAUSED TO BE FILED, ALL
FEDERAL, STATE, LOCAL AND FOREIGN TAX RETURNS AND ALL OTHER TAX RETURNS WHICH,
TO THE KNOWLEDGE OF EITHER CO-ISSUER, ARE REQUIRED TO BE FILED BY, OR WITH
RESPECT TO THE INCOME, PROPERTIES OR OPERATIONS OF, SUCH CO-ISSUER (WHETHER
INFORMATION RETURNS OR NOT), AND HAS PAID, OR CAUSED TO BE PAID, ALL TAXES DUE,
IF ANY, PURSUANT TO SAID RETURNS OR PURSUANT TO ANY ASSESSMENT RECEIVED BY
EITHER CO-ISSUER OR OTHERWISE, EXCEPT SUCH TAXES, IF ANY, AS ARE BEING CONTESTED
IN GOOD FAITH AND BY APPROPRIATE PROCEEDINGS AND FOR WHICH ADEQUATE RESERVES
HAVE BEEN SET ASIDE IN ACCORDANCE WITH GAAP.  EXCEPT AS WOULD NOT REASONABLY BE
EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT, NO TAX DEFICIENCY HAS BEEN
DETERMINED ADVERSELY TO EITHER CO-ISSUER, NOR DOES EITHER CO-ISSUER HAVE ANY
KNOWLEDGE OF ANY TAX DEFICIENCIES.  EACH OF THE CO-ISSUERS HAS PAID ALL FEES AND
EXPENSES REQUIRED TO BE PAID BY IT IN CONNECTION WITH THE CONDUCT OF ITS
BUSINESS, THE MAINTENANCE OF ITS EXISTENCE AND ITS QUALIFICATION AS A FOREIGN
ENTITY AUTHORIZED TO DO BUSINESS IN EACH STATE AND EACH FOREIGN COUNTRY IN WHICH
IT IS REQUIRED TO SO QUALIFY, EXCEPT TO THE EXTENT THAT THE FAILURE TO PAY SUCH
FEES AND EXPENSES IS NOT REASONABLY LIKELY TO RESULT IN A MATERIAL ADVERSE
EFFECT;

 

(XXIII)       THERE ARE NO TRANSFER TAXES OR OTHER SIMILAR FEES OR CHARGES UNDER
FEDERAL LAW OR THE LAWS OF ANY STATE, OR ANY POLITICAL SUBDIVISION THEREOF,
REQUIRED TO BE PAID IN CONNECTION WITH THE EXECUTION AND DELIVERY OF THIS
AGREEMENT OR THE ISSUANCE BY THE CO-ISSUERS OR SALE BY THE CO-ISSUERS OF THE
SECURITIES;

 

(XXIV)       ALL CERTIFICATES, REPORTS, STATEMENTS, NOTICES, DOCUMENTS AND OTHER
INFORMATION FURNISHED TO THE TRUSTEE, OR THE INITIAL PURCHASER BY OR ON BEHALF
OF THE CO-ISSUERS OR THE PARENT COMPANIES PURSUANT TO ANY PROVISION OF THE
INDENTURE OR ANY OTHER TRANSACTION DOCUMENT, OR IN CONNECTION WITH OR PURSUANT
TO ANY AMENDMENT OR MODIFICATION OF, OR WAIVER UNDER, THE INDENTURE OR ANY OTHER
TRANSACTION DOCUMENT, ARE, AT THE TIME THE SAME ARE SO FURNISHED, COMPLETE AND
CORRECT IN ALL MATERIAL RESPECTS (WHEN TAKEN TOGETHER WITH ALL OTHER INFORMATION
FURNISHED BY OR ON BEHALF OF THE CO-ISSUERS) TO THE TRUSTEE OR THE INITIAL
PURCHASER, AS THE CASE MAY BE, AND GIVE THE TRUSTEE OR THE INITIAL PURCHASER, AS
THE CASE MAY BE, TRUE AND ACCURATE KNOWLEDGE OF THE SUBJECT MATTER THEREOF IN
ALL MATERIAL RESPECTS, AND THE FURNISHING OF THE SAME TO THE TRUSTEE OR THE
INITIAL PURCHASER, AS THE CASE MAY BE, SHALL CONSTITUTE A REPRESENTATION AND
WARRANTY BY EACH OF THE CO-ISSUERS MADE ON THE DATE THE SAME ARE FURNISHED TO
THE TRUSTEE OR THE INITIAL PURCHASER, AS THE CASE MAY BE, TO THE EFFECT
SPECIFIED HEREIN;

 

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(XXV)        NEITHER CO-ISSUER IS, AFTER GIVING EFFECT TO THE ISSUANCE OF THE
SECURITIES, THE TRANSACTIONS CONTEMPLATED BY THE TRANSACTION DOCUMENTS AND THE
APPLICATION OF THE PROCEEDS FROM THE SALE OF THE SECURITIES AS DESCRIBED HEREIN,
IN THE DRAFT OFFERING MEMORANDUM (AS OF THE CLOSING DATE) AND IN THE OFFERING
MEMORANDUM (AS OF THE RELEVANT DATE), AN “INVESTMENT COMPANY”, OR A COMPANY
“CONTROLLED” BY AN “INVESTMENT COMPANY”, WITHIN THE MEANING OF THE INVESTMENT
COMPANY ACT OF 1940, AS AMENDED (THE “1940 ACT”);

 

(XXVI)       THE PROCEEDS OF THE SECURITIES WILL NOT BE USED TO PURCHASE OR
CARRY ANY “MARGIN STOCK” (AS DEFINED OR USED IN THE REGULATIONS OF THE BOARD OF
GOVERNORS OF THE FEDERAL RESERVE SYSTEM, INCLUDING REGULATIONS T, U AND X
THEREOF) IN SUCH A WAY THAT COULD CAUSE THE TRANSACTIONS CONTEMPLATED BY THE
TRANSACTION DOCUMENTS TO FAIL TO COMPLY WITH THE REGULATIONS OF THE BOARD OF
GOVERNORS OF THE FEDERAL RESERVE SYSTEM, INCLUDING REGULATIONS T, U, AND X
THEREOF.  NEITHER CO-ISSUER OWNS OR IS ENGAGED IN THE BUSINESS OF EXTENDING
CREDIT FOR THE PURPOSE OF PURCHASING OR CARRYING ANY MARGIN STOCK;

 

(XXVII)      NO SUBSIDIARY OF THE CO-ISSUERS IS CURRENTLY PROHIBITED, DIRECTLY
OR INDIRECTLY, FROM PAYING ANY DIVIDENDS TO ITS PARENT CO-ISSUER, FROM MAKING
ANY OTHER DISTRIBUTION ON SUCH SUBSIDIARY’S CAPITAL STOCK OR LIMITED LIABILITY
COMPANY INTERESTS, FROM REPAYING ITS PARENT CO-ISSUER ANY LOANS OR ADVANCES TO
SUCH SUBSIDIARY FROM ITS PARENT CO-ISSUER OR FROM TRANSFERRING ANY SUCH
SUBSIDIARY’S PROPERTY OR ASSETS TO ITS PARENT CO-ISSUER OR ANY OTHER SUBSIDIARY
OF THE PARENT CO-ISSUER, EXCEPT AS DESCRIBED IN THE DRAFT OFFERING MEMORANDUM
(AS OF THE CLOSING DATE) OR IN THE OFFERING MEMORANDUM (AS OF THE RELEVANT
DATE);

 

(XXVIII)     THE REPRESENTATIONS AND WARRANTIES OF EACH OF THE CO-ISSUERS
CONTAINED IN THE TRANSACTION DOCUMENTS TO WHICH SUCH CO-ISSUER IS A PARTY ARE
TRUE AND CORRECT AND ARE REPEATED HEREIN AS THOUGH FULLY SET FORTH HEREIN;

 

(XXIX)       NEITHER OF THE CO-ISSUERS (AFTER GIVING EFFECT TO THE ISSUANCE OF
THE SECURITIES AND TO THE OTHER TRANSACTIONS RELATED THERETO AS DESCRIBED IN THE
DRAFT OFFERING MEMORANDUM) IS INSOLVENT WITHIN THE MEANING OF THE BANKRUPTCY
CODE OR ANY APPLICABLE STATE LAW AND NEITHER OF THE CO-ISSUERS IS THE SUBJECT OF
ANY VOLUNTARY OR INVOLUNTARY CASE OR PROCEEDING SEEKING LIQUIDATION,
REORGANIZATION OR OTHER RELIEF WITH RESPECT TO ITSELF OR ITS DEBTS UNDER ANY
BANKRUPTCY OR INSOLVENCY LAW AND NO EVENT OF BANKRUPTCY HAS OCCURRED WITH
RESPECT TO EITHER CO-ISSUER;

 

(XXX)        (A)          ALL OF THE ISSUED AND OUTSTANDING LIMITED LIABILITY
COMPANY INTERESTS OF THE MASTER ISSUER ARE OWNED BY IHOP, ALL OF WHICH LIMITED
LIABILITY COMPANY INTERESTS HAVE BEEN VALIDLY ISSUED AND ARE OWNED OF RECORD BY
IHOP FREE AND CLEAR OF ALL LIENS OTHER THAN PERMITTED LIENS;

 

(B)           ALL OF THE ISSUED AND OUTSTANDING LIMITED LIABILITY COMPANY
INTERESTS OF THE IP HOLDER ARE OWNED BY THE MASTER ISSUER, ALL OF WHICH LIMITED
LIABILITY COMPANY INTERESTS HAVE BEEN VALIDLY ISSUED AND ARE OWNED OF RECORD BY
THE MASTER ISSUER, FREE AND CLEAR OF ALL LIENS OTHER THAN PERMITTED LIENS; AND

 

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(C)           THE MASTER ISSUER HAS NO SUBSIDIARIES AND OWNS NO EQUITY INTERESTS
IN ANY OTHER PERSON, OTHER THAN THE IP HOLDER, IHOP REAL ESTATE, LLC, IHOP
PROPERTIES, LLC AND IHOP PROPERTY LEASING, LLC.  THE IP HOLDER HAS NO
SUBSIDIARIES AND OWN NO EQUITY INTERESTS IN ANY OTHER PERSON (FOR PURPOSES OF
THIS AGREEMENT, THE “EQUITY INTERESTS” MEANS (A) OWNERSHIP, MANAGEMENT OR
MEMBERSHIP INTERESTS IN ANY LIMITED LIABILITY COMPANY OR UNLIMITED COMPANY, (B) 
GENERAL OR LIMITED PARTNERSHIP INTEREST IN ANY PARTNERSHIP, (C)  COMMON,
PREFERRED OR OTHER STOCK INTEREST IN ANY CORPORATION, (D)  SHARE, PARTICIPATION,
UNIT OR OTHER INTEREST IN THE PROPERTY OR ENTERPRISE OF AN ISSUER THAT EVIDENCES
OWNERSHIP RIGHTS THEREIN, (E)  OWNERSHIP OR BENEFICIAL INTEREST IN ANY TRUST OR
(F)  OPTION, WARRANT OR OTHER RIGHT TO CONVERT INTO OR OTHERWISE RECEIVE ANY OF
THE FOREGOING);

 

(XXXI)       THE SECURITIES SATISFY THE ELIGIBILITY REQUIREMENTS OF
RULE 144A(D)(3) UNDER THE SECURITIES ACT;

 

(XXXII)      NO FORWARD-LOOKING STATEMENT (WITHIN THE MEANING OF SECTION 27A OF
THE SECURITIES ACT AND SECTION 21E OF THE EXCHANGE ACT) OF EITHER CO-ISSUER OR
OF THE PARENT COMPANIES CONTAINED IN THE PRELIMINARY MARKETING MATERIALS, THE
DRAFT OFFERING MEMORANDUM (AS OF THE CLOSING DATE) OR THE OFFERING MEMORANDUM
(AS OF THE RELEVANT DATE) HAS BEEN MADE OR REAFFIRMED WITHOUT A REASONABLE BASIS
OR HAS BEEN DISCLOSED OTHER THAN IN GOOD FAITH;

 

(XXXIII)     WITH RESPECT TO THOSE SECURITIES SOLD IN RELIANCE UPON REGULATION S
OF THE SECURITIES ACT (“REGULATION S”) (I) NONE OF THE CO-ISSUERS OR ANY OF
THEIR AFFILIATES OR ANY OTHER PERSON ACTING ON THEIR BEHALF HAS ENGAGED IN ANY
DIRECTED SELLING EFFORTS WITHIN THE MEANING OF RULE 902 OF REGULATION S AND
(II) THE CO-ISSUERS AND THEIR AFFILIATES AND EACH PERSON ACTING ON THEIR BEHALF
HAVE COMPLIED WITH THE OFFERING RESTRICTIONS SET FORTH IN RULE 902 OF REGULATION
S;

 

(XXXIV)     EXCEPT PURSUANT TO THIS AGREEMENT, NONE OF THE CO-ISSUERS OR ANY OF
THEIR AFFILIATES OR ANY OTHER PERSON ACTING ON THEIR BEHALF HAS, WITHIN THE
SIX-MONTH PERIOD PRIOR TO THE DATE HEREOF, OFFERED OR SOLD IN THE UNITED STATES
OR TO ANY U.S. PERSON (AS SUCH TERMS ARE DEFINED IN RULE 902 OF REGULATION S)
THE SECURITIES OR ANY SECURITY OF THE SAME CLASS OR SERIES AS THE SECURITIES;

 

(XXXV)      NONE OF THE CO-ISSUERS OR ANY OF THEIR AFFILIATES HAS PARTICIPATED
IN A PLAN OR SCHEME TO EVADE THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
THROUGH THE SALE OF THE SECURITIES PURSUANT TO REGULATION S;

 

(XXXVI)     ERNST & YOUNG LLP (“E&Y”), WHO HAVE AUDITED OR REVIEWED THE
CONSOLIDATED FINANCIAL STATEMENTS OF IHOP CONTAINED IN THE DRAFT OFFERING
MEMORANDUM (AS OF THE CLOSING DATE) AND THE OFFERING MEMORANDUM (AS OF THE
RELEVANT DATE), ARE INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS WITH RESPECT TO THE
IHOP AND MERGER SUB WITHIN THE MEANING OF RULE 101 OF THE CODE OF PROFESSIONAL
CONDUCT OF THE AICPA AND ITS INTERPRETATIONS AND RULINGS THEREUNDER.  THE
HISTORICAL CONSOLIDATED FINANCIAL STATEMENTS (INCLUDING THE RELATED NOTES AND
SUPPORTING SCHEDULES) OF IHOP CONTAINED IN THE DRAFT OFFERING MEMORANDUM (AS OF
THE CLOSING DATE) AND THE OFFERING MEMORANDUM (AS OF THE

 

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RELEVANT DATE) HAVE BEEN PREPARED IN ACCORDANCE WITH GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES IN THE UNITED STATES CONSISTENTLY APPLIED THROUGHOUT THE
PERIODS COVERED THEREBY AND FAIRLY PRESENT THE FINANCIAL POSITION OF THE
ENTITIES PURPORTED TO BE COVERED THEREBY AT THE RESPECTIVE DATES INDICATED AND
THE RESULTS OF THEIR OPERATIONS AND THEIR CASH FLOWS FOR THE RESPECTIVE PERIODS
INDICATED; AND THE FINANCIAL INFORMATION CONTAINED IN THE DRAFT OFFERING
MEMORANDUM (AS OF THE CLOSING DATE) AND THE OFFERING MEMORANDUM (AS OF THE
RELEVANT DATE) UNDER THE HEADINGS “CAPITALIZATION OF IHOP CORP. AND ITS
SUBSIDIARIES,” “SELECTED HISTORICAL AND PRO FORMA FINANCIAL DATA OF IHOP CORP.
AND ITS SUBSIDIARIES,” “UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL
INFORMATION OF IHOP CORP.,” “CAPITALIZATION OF IHOP FRANCHISING, LLC,”
“UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION OF IHOP
FRANCHISING, LLC,” “IHOP FRANCHISING, LLC UNAUDITED SUPPLEMENTAL FINANCIAL
INFORMATION” AND IN THE EXCHANGE ACT DOCUMENTS UNDER THE HEADING “MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF
IHOP” IS DERIVED FROM THE ACCOUNTING RECORDS OF IHOP OR THE RELEVANT SUBSIDIARY
OF IHOP (EACH, AN “IHOP ENTITY”) AND FAIRLY PRESENT THE INFORMATION PURPORTED TO
BE SHOWN THEREBY.  THE OTHER HISTORICAL FINANCIAL AND STATISTICAL INFORMATION
AND DATA OF IHOP AND THE OTHER IHOP ENTITIES CONTAINED IN THE DRAFT OFFERING
MEMORANDUM (AS OF THE CLOSING DATE) AND THE OFFERING MEMORANDUM (AS OF THE
RELEVANT DATE) ARE, IN ALL MATERIAL RESPECTS, FAIRLY PRESENTED;

 

(XXXVII)            THE PRO FORMA FINANCIAL INFORMATION INCLUDED IN THE DRAFT
OFFERING MEMORANDUM (AS OF THE CLOSING DATE) AND THE OFFERING MEMORANDUM (AS OF
THE RELEVANT DATE) INCLUDE ASSUMPTIONS THAT PROVIDE A REASONABLE BASIS FOR
PRESENTING THE SIGNIFICANT EFFECTS DIRECTLY ATTRIBUTABLE TO THE TRANSACTIONS AND
EVENTS DESCRIBED THEREIN (IT BEING UNDERSTOOD THAT THE SECURITIES THAT ARE
ASSUMED TO BE ISSUED IN THE PRO FORMA FINANCIAL INFORMATION THAT IS CONTAINED IN
THE DRAFT OFFERING MEMORANDUM AS OF THE CLOSING DATE ARE DIFFERENT FROM THE
SECURITIES BEING ISSUED HEREUNDER AND IN THE APPLEBEE’S SECURITIZATION), THE
RELATED PRO FORMA ADJUSTMENTS GIVE APPROPRIATE EFFECT TO THOSE ASSUMPTIONS, AND
THE PRO FORMA ADJUSTMENTS REFLECT THE PROPER APPLICATION OF THOSE ADJUSTMENTS TO
THE HISTORICAL FINANCIAL STATEMENT AMOUNTS IN THE PRO FORMA FINANCIAL
INFORMATION INCLUDED IN THE DRAFT OFFERING MEMORANDUM (AS OF THE CLOSING DATE)
AND THE OFFERING MEMORANDUM (AS OF THE RELEVANT DATE).  THE PRO FORMA FINANCIAL
INFORMATION INCLUDED IN THE DRAFT OFFERING MEMORANDUM (AS OF THE CLOSING DATE)
AND THE OFFERING MEMORANDUM (AS OF THE RELEVANT DATE) COMPLY AS TO FORM IN ALL
MATERIAL RESPECTS WITH THE APPLICABLE REQUIREMENTS OF REGULATION S-X UNDER THE
SECURITIES ACT;

 

(XXXVIII)           THE EXCHANGE ACT DOCUMENTS DID NOT, WHEN FILED WITH THE
COMMISSION, CONTAIN AN UNTRUE STATEMENT OF MATERIAL FACT OR OMIT TO STATE A
MATERIAL FACT NECESSARY IN ORDER TO MAKE THE STATEMENTS MADE THEREIN, IN THE
LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY WERE MADE, NOT MISLEADING. THE
EXCHANGE ACT DOCUMENTS, WHEN FILED WITH THE COMMISSION, CONFORMED OR WILL
CONFORM IN ALL MATERIAL RESPECTS TO THE APPLICABLE REQUIREMENTS OF THE EXCHANGE
ACT AND THE APPLICABLE RULES AND REGULATIONS OF THE COMMISSION THEREUNDER;

 

(XXXIX)      THE MARKET-RELATED AND CUSTOMER-RELATED DATA AND ESTIMATES INCLUDED
IN THE PRELIMINARY MARKETING MATERIALS, THE DRAFT OFFERING MEMORANDUM (AS OF THE
CLOSING DATE) AND THE OFFERING MEMORANDUM (AS OF THE RELEVANT DATE) ARE BASED ON

 

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OR DERIVED FROM SOURCES THAT THE CO-ISSUERS BELIEVE TO BE RELIABLE AND ACCURATE
IN ALL MATERIAL RESPECTS OR REPRESENT THE CO-ISSUERS’ GOOD FAITH ESTIMATES MADE
ON THE BASIS OF DATA DERIVED FROM SUCH SOURCES;

 

(XL)           THE CO-ISSUERS MAINTAIN AND HAVE MAINTAINED EFFECTIVE INTERNAL
CONTROL OVER FINANCIAL REPORTING, AS DEFINED IN RULE 13A-15 UNDER THE EXCHANGE
ACT, AND A SYSTEM OF ACCOUNTING CONTROLS THAT IS SUFFICIENT TO PROVIDE
REASONABLE ASSURANCE THAT (I) TRANSACTIONS ARE EXECUTED IN ACCORDANCE WITH
MANAGEMENT’S GENERAL OR SPECIFIC AUTHORIZATION; (II) TRANSACTIONS ARE RECORDED
AS NECESSARY TO PERMIT PREPARATION OF FINANCIAL STATEMENTS IN CONFORMITY WITH
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN THE UNITED STATES AND TO MAINTAIN
ACCOUNTABILITY FOR ASSETS; (III) ACCESS TO ASSETS IS PERMITTED ONLY IN
ACCORDANCE WITH MANAGEMENT’S GENERAL OR SPECIFIC AUTHORIZATION; AND (IV) THE
RECORDED ACCOUNTABILITY FOR ASSETS IS COMPARED WITH EXISTING ASSETS AT
REASONABLE INTERVALS AND APPROPRIATE ACTION IS TAKEN WITH RESPECT TO ANY
DIFFERENCES;

 

(XLI)          (I) EACH OF THE CO-ISSUERS HAS ESTABLISHED AND MAINTAINS
DISCLOSURE CONTROLS AND PROCEDURES (AS SUCH TERM IS DEFINED IN RULE 13A-15 UNDER
THE EXCHANGE ACT), (II) SUCH DISCLOSURE CONTROLS AND PROCEDURES ARE DESIGNED TO
ENSURE THAT THE INFORMATION REQUIRED TO BE DISCLOSED BY EACH CO-ISSUER IN THE
REPORTS IT FILES OR SUBMITS UNDER THE EXCHANGE ACT (ASSUMING EACH CO-ISSUER WAS
REQUIRED TO FILE OR SUBMIT SUCH REPORTS UNDER THE EXCHANGE ACT) IS ACCUMULATED
AND COMMUNICATED TO MANAGEMENT OF SUCH CO-ISSUER, INCLUDING THEIR RESPECTIVE
PRINCIPAL EXECUTIVE OFFICERS AND PRINCIPAL FINANCIAL OFFICERS, AS APPROPRIATE,
TO ALLOW TIMELY DECISIONS REGARDING REQUIRED DISCLOSURE TO BE MADE; AND
(III) SUCH DISCLOSURE CONTROLS AND PROCEDURES ARE EFFECTIVE IN ALL MATERIAL
RESPECTS TO PERFORM THE FUNCTIONS FOR WHICH THEY WERE ESTABLISHED.

 

(XLII)         NONE OF THE CO-ISSUERS OR ANY OF THEIR AFFILIATES HAS, DIRECTLY
OR THROUGH ANY AGENT, SOLD, OFFERED FOR SALE, SOLICITED OFFERS TO BUY OR
OTHERWISE NEGOTIATED IN RESPECT OF ANY SECURITY (AS SUCH TERM IS DEFINED IN THE
SECURITIES ACT), WHICH IS OR WILL BE INTEGRATED WITH THE SALE OR RESALE OF THE
SECURITIES IN A MANNER THAT WOULD REQUIRE REGISTRATION OF THE RESALE OF THE
SECURITIES UNDER THE SECURITIES ACT;

 

(XLIII)        NONE OF THE CO-ISSUERS OR ANY OF THEIR AFFILIATES OR ANY OTHER
PERSON ACTING ON THEIR BEHALF HAS ENGAGED, IN CONNECTION WITH THE OFFERING OF
THE SECURITIES, IN ANY FORM OF GENERAL SOLICITATION OR GENERAL ADVERTISING
WITHIN THE MEANING OF RULE 502(C) UNDER THE SECURITIES ACT (INCLUDING, BUT NOT
LIMITED TO, ADVERTISEMENTS, ARTICLES, NOTICES OR OTHER COMMUNICATIONS PUBLISHED
IN ANY NEWSPAPER, MAGAZINE OR SIMILAR MEDIUM OR BROADCAST OVER TELEVISION OR
RADIO, OR ANY SEMINAR OR MEETING WHOSE ATTENDEES HAVE BEEN INVITED BY ANY
GENERAL SOLICITATION OR GENERAL ADVERTISING);

 

(XLIV)       NONE OF THE CO-ISSUERS OR ANY OF THEIR AFFILIATES OR ANY OTHER
PERSON ACTING ON THEIR BEHALF HAS OFFERED, SOLD, CONTRACTED TO SELL OR OTHERWISE
DISPOSED OF, DIRECTLY OR INDIRECTLY, ANY SECURITIES UNDER CIRCUMSTANCES WHERE
SUCH OFFER, SALE, CONTRACT OR DISPOSITION WOULD CAUSE THE EXEMPTION AFFORDED BY
SECTION 4(2) OF THE SECURITIES ACT OR SECTION 3(C)(7) OF THE 1940 ACT TO CEASE
TO BE APPLICABLE TO THE OFFERING, SALE AND RESALE OF THE SECURITIES AS
CONTEMPLATED BY THIS AGREEMENT, THE DRAFT OFFERING MEMORANDUM (AS OF THE CLOSING
DATE) AND THE OFFERING MEMORANDUM (AS OF THE RELEVANT DATE);

 

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(XLV)        NONE OF THE CO-ISSUERS OR ANY OF THEIR AFFILIATES HAS TAKEN AND
NONE OF THE CO-ISSUERS OR ANY OF THEIR AFFILIATES WILL TAKE ANY ACTION
PROHIBITED BY REGULATION M UNDER THE EXCHANGE ACT, IN CONNECTION WITH THE
OFFERING OR RESALE OF THE SECURITIES;

 

(XLVI)       (A)          NEITHER OF THE CO-ISSUERS IS SUBJECT TO ANY MATERIAL
LIABILITIES OR OBLIGATIONS PURSUANT TO ANY ENVIRONMENTAL LAW, WHICH COULD,
INDIVIDUALLY OR IN THE AGGREGATE, REASONABLY BE EXPECTED TO RESULT IN THE
PAYMENT OF A MATERIAL ENVIRONMENTAL AMOUNT; AND

 

(B)           THE CO-ISSUERS HAVE GOOD AND MARKETABLE TITLE IN FEE SIMPLE TO ALL
REAL PROPERTY AND GOOD AND MARKETABLE TITLE TO ALL PERSONAL PROPERTY OWNED BY
THEM, IN EACH CASE FREE AND CLEAR OF ALL LIENS, ENCUMBRANCES AND DEFECTS, EXCEPT
SUCH AS ARE DESCRIBED IN THE DRAFT OFFERING MEMORANDUM (AS OF THE CLOSING DATE)
AND THE OFFERING MEMORANDUM (AS OF THE RELEVANT DATE) AND SUCH AS DO NOT
MATERIALLY AFFECT THE VALUE OF SUCH PROPERTY AND DO NOT MATERIALLY INTERFERE
WITH THE USE MADE AND PROPOSED TO BE MADE OF SUCH PROPERTY BY THE CO-ISSUERS;
AND ALL ASSETS HELD UNDER LEASE BY THE CO-ISSUERS ARE HELD BY THEM UNDER VALID,
SUBSISTING AND ENFORCEABLE LEASES, WITH SUCH EXCEPTIONS AS DO NOT MATERIALLY
INTERFERE WITH THE USE MADE AND PROPOSED TO BE MADE OF SUCH ASSETS BY THE
CO-ISSUERS;

 

(XLVII)      THERE IS AND HAS BEEN NO FAILURE ON THE PART OF THE CO-ISSUERS OR
ANY OF THE CO-ISSUERS’ MANAGERS, DIRECTORS OR OFFICERS, IN THEIR CAPACITIES AS
SUCH, TO COMPLY WITH THE PROVISIONS OF THE SARBANES-OXLEY ACT OF 2002 AND THE
RULES AND REGULATIONS PROMULGATED IN CONNECTION THEREWITH;

 

(XLVIII)     THE SECTION ENTITLED “MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS – CRITICAL ACCOUNTING POLICIES”
CONTAINED  IN THE EXCHANGE ACT DOCUMENTS AND IN THE DRAFT OFFERING MEMORANDUM
(AS OF THE CLOSING DATE) AND THE OFFERING MEMORANDUM (AS OF THE RELEVANT DATE)
ACCURATELY AND FULLY DESCRIBES (A) THE ACCOUNTING POLICIES THAT THE CO-ISSUERS
AND IHOP BELIEVE ARE THE MOST IMPORTANT IN THE PORTRAYAL OF IHOP’S FINANCIAL
CONDITION AND RESULTS OF OPERATIONS AND THAT REQUIRE MANAGEMENT’S MOST
DIFFICULT, SUBJECTIVE OR COMPLEX JUDGMENTS; (B) THE JUDGMENTS AND UNCERTAINTIES
AFFECTING THE APPLICATION OF CRITICAL ACCOUNTING POLICIES; AND (C) THE
LIKELIHOOD THAT MATERIALLY DIFFERENT AMOUNTS WOULD BE REPORTED UNDER DIFFERENT
CONDITIONS OR USING DIFFERENT ASSUMPTIONS AND AN EXPLANATION THEREOF;

 

(XLIX)        NEITHER OF THE CO-ISSUERS IS IN VIOLATION OF OR HAS RECEIVED
NOTICE OF ANY VIOLATION WITH RESPECT TO ANY FEDERAL OR STATE LAW RELATING TO
DISCRIMINATION IN THE HIRING, PROMOTION OR PAY OF EMPLOYEES, OR ANY APPLICABLE
FEDERAL OR STATE WAGE AND HOUR LAWS, OR ANY STATE LAW PRECLUDING THE DENIAL OF
CREDIT DUE TO THE NEIGHBORHOOD IN WHICH A PROPERTY IS SITUATED, THE VIOLATION OF
ANY OF WHICH WOULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE AFFECT;

 

(L)            THE OPERATIONS OF THE CO-ISSUERS ARE AND HAVE BEEN CONDUCTED AT
ALL TIMES IN COMPLIANCE WITH APPLICABLE FINANCIAL RECORD KEEPING AND REPORTING
REQUIREMENTS OF THE CURRENCY AND FOREIGN TRANSACTIONS REPORTING ACT OF 1970, AS

 

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AMENDED, THE MONEY LAUNDERING STATUTES OF ALL JURISDICTIONS, THE RULES AND
REGULATIONS THEREUNDER AND ANY RELATED OR SIMILAR RULES, REGULATIONS OR
GUIDELINES, ISSUED, ADMINISTERED OR ENFORCED BY ANY GOVERNMENTAL AGENCY
(COLLECTIVELY, THE “MONEY LAUNDERING LAWS”) AND NO ACTION, SUIT OR PROCEEDING BY
OR BEFORE ANY COURT OR GOVERNMENTAL AGENCY, AUTHORITY OR BODY OR ANY ARBITRATOR
INVOLVING THE CO-ISSUERS WITH RESPECT TO THE MONEY LAUNDERING LAWS IS PENDING
OR, TO THE KNOWLEDGE OF THE CO-ISSUERS, THREATENED, EXCEPT, IN EACH CASE, AS
WOULD NOT REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT;

 

(LI)           NEITHER OF THE CO-ISSUERS OR, TO THE KNOWLEDGE OF THE CO-ISSUERS,
ANY DIRECTOR, OFFICER, AGENT, EMPLOYEE OR AFFILIATE OF THE CO-ISSUERS, IS
CURRENTLY SUBJECT TO ANY U.S. SANCTIONS ADMINISTERED BY THE OFFICE OF FOREIGN
ASSETS CONTROL OF THE U.S. TREASURY DEPARTMENT (“OFAC”); AND THE CO-ISSUERS WILL
NOT DIRECTLY OR INDIRECTLY USE THE PROCEEDS OF THE OFFERING, OR LEND, CONTRIBUTE
OR OTHERWISE MAKE AVAILABLE SUCH PROCEEDS TO ANY SUBSIDIARY, JOINT VENTURE
PARTNER OR OTHER PERSON OR ENTITY, FOR THE PURPOSE OF FINANCING THE ACTIVITIES
OF ANY PERSON CURRENTLY SUBJECT TO ANY U.S. SANCTIONS ADMINISTERED BY OFAC;

 

(LII)          (A)          ALL OF THE MATERIAL REGISTRATIONS AND APPLICATIONS
INCLUDED IN THE IP ASSETS ARE SUBSISTING, UNEXPIRED AND HAVE NOT BEEN ABANDONED
IN ANY APPLICABLE JURISDICTION EXCEPT WHERE SUCH ABANDONMENT COULD NOT
REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT;

 

(B)           (I) THE USE OF THE IP ASSETS DOES NOT INFRINGE OR VIOLATE THE
RIGHTS OF ANY THIRD PARTY, (II) THE IP ASSETS ARE NOT BEING INFRINGED OR
VIOLATED BY ANY THIRD PARTY IN A MANNER THAT COULD REASONABLY BE EXPECTED TO
HAVE A MATERIAL ADVERSE EFFECT AND (III) THERE IS NO ACTION OR PROCEEDING
PENDING OR, TO THE CO-ISSUERS’ KNOWLEDGE, THREATENED ALLEGING SAME THAT COULD
REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT;

 

(C)           NO ACTION OR PROCEEDING IS PENDING OR, TO THE CO-ISSUERS’
KNOWLEDGE, THREATENED THAT SEEKS TO LIMIT, CANCEL OR QUESTION THE VALIDITY OF
ANY MATERIAL IP ASSETS, OR THE USE THEREOF, THAT COULD REASONABLY BE EXPECTED TO
HAVE A MATERIAL ADVERSE EFFECT;

 

(D)          THE IP HOLDER IS THE EXCLUSIVE OWNER OF THE IP ASSETS, FREE AND
CLEAR OF ALL LIENS, SET-OFFS, DEFENSES AND COUNTERCLAIMS OF WHATSOEVER KIND OR
NATURE (OTHER THAN LICENSES GRANTED IN THE ORDINARY COURSE OF BUSINESS AND THE
RIGHTS GRANTED UNDER THE IP LICENSE AGREEMENTS, THE FRANCHISE AGREEMENTS AND THE
PERMITTED LIENS);

 

(E)           THE CO-ISSUERS HAVE NOT MADE AND WILL NOT HEREAFTER MAKE ANY
MATERIAL ASSIGNMENT, PLEDGE, MORTGAGE, HYPOTHECATION OR TRANSFER OF ANY OF THE
IP ASSETS (OTHER THAN LICENSES GRANTED IN THE ORDINARY COURSE OF BUSINESS AND
THE RIGHTS GRANTED UNDER THE IP LICENSE AGREEMENTS, THE FRANCHISE AGREEMENTS AND
THE PERMITTED LIENS);

 

(LIII)         THE CO-ISSUERS HAVE NOT TAKEN ANY ACTION OR OMITTED TO TAKE ANY
ACTION (SUCH AS ISSUING ANY PRESS RELEASE RELATING TO ANY SECURITIES WITHOUT AN
APPROPRIATE

 

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LEGEND) WHICH MAY RESULT IN THE LOSS BY THE INITIAL PURCHASER OF THE ABILITY TO
RELY ON ANY STABILIZATION SAFE HARBOR PROVIDED BY THE FINANCIAL SERVICES
AUTHORITY UNDER THE FINANCIAL SERVICES AND MARKETS ACT 2000 (THE “FSMA”).  THE
CO-ISSUERS HAVE BEEN INFORMED OF THE GUIDANCE RELATING TO STABILIZATION PROVIDED
BY THE FINANCIAL SERVICES AUTHORITY; AND

 

(LIV)         SINCE THE DATE AS OF WHICH INFORMATION IS GIVEN IN THE DRAFT
OFFERING MEMORANDUM (AS OF THE CLOSING DATE) OR THE OFFERING MEMORANDUM (AS OF
THE RELEVANT DATE), THERE HAS NOT BEEN ANY DEVELOPMENT IN THE CONDITION,
FINANCIAL OR OTHERWISE, OF THE SECURITIZATION ENTITIES, TAKEN AS A WHOLE, OR IN
THE EARNINGS, BUSINESS AFFAIRS OR MANAGEMENT, WHETHER OR NOT ARISING IN THE
COURSE OF BUSINESS OF THE SECURITIZATION ENTITIES, TAKEN AS A WHOLE, THAT COULD
REASONABLY BE EXPECTED TO RESULT IN A MATERIAL ADVERSE EFFECT.

 

(B)           EACH OF THE PARENT COMPANIES, JOINTLY AND SEVERALLY, REPRESENTS
AND WARRANTS TO, AND AGREES WITH, THE INITIAL PURCHASER, AS OF THE CLOSING DATE,
THAT:

 

(I)            AS OF THE CLOSING DATE, THE DRAFT OFFERING MEMORANDUM PRESENTS
FAIRLY, IN ALL MATERIAL RESPECTS, THE BUSINESS, RESULTS OF OPERATIONS AND
FINANCIAL CONDITION OF THE CO-ISSUERS.  AS OF THE RELEVANT DATE, THE OFFERING
MEMORANDUM DOES NOT INCLUDE ANY UNTRUE STATEMENT OF A MATERIAL FACT OR OMIT TO
STATE ANY MATERIAL FACT REQUIRED TO BE STATED THEREIN OR NECESSARY TO MAKE THE
STATEMENTS THEREIN, IN THE LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY WERE
MADE, NOT MISLEADING;

 

(II)           THE PRELIMINARY MARKETING MATERIALS AND THE OFFERING MEMORANDUM
HAVE BEEN OR WILL HAVE BEEN PREPARED BY THE CO-ISSUERS AND THE PARENT COMPANIES
FOR USE BY THE INITIAL PURCHASER IN CONNECTION WITH THE EXEMPT RESALES (AS
DEFINED BELOW).  NO ORDER OR DECREE PREVENTING THE USE OF THE PRELIMINARY
MARKETING MATERIALS OR THE OFFERING MEMORANDUM, OR ANY ORDER ASSERTING THAT THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT ARE SUBJECT TO THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT HAS BEEN ISSUED, AND NO PROCEEDING FOR THAT
PURPOSE HAS COMMENCED OR IS PENDING OR, TO THE KNOWLEDGE OF THE PARENT
COMPANIES, IS CONTEMPLATED;

 

(III)          EACH OF THE PARENT COMPANIES AND THE IHOP SECURITIZATION ENTITIES
HAS BEEN DULY FORMED AS A CORPORATION OR LIMITED LIABILITY COMPANY AND IS
VALIDLY EXISTING AND IN GOOD STANDING UNDER THE LAWS OF THE STATE OF DELAWARE,
IS QUALIFIED TO DO BUSINESS AND IS IN GOOD STANDING AS A FOREIGN CORPORATION OR
LIMITED LIABILITY COMPANY IN EACH JURISDICTION IN WHICH THE OWNERSHIP OR LEASE
OF PROPERTY OR THE CONDUCT OF ITS BUSINESS REQUIRES SUCH QUALIFICATION EXCEPT
FOR SUCH FAILURES TO QUALIFY TO DO BUSINESS OR BE IN GOOD STANDING AS ARE NOT
REASONABLY LIKELY TO RESULT IN A MATERIAL ADVERSE EFFECT, AND HAS THE REQUISITE
CORPORATE OR LIMITED LIABILITY COMPANY POWER AND AUTHORITY TO OWN OR HOLD ITS
PROPERTIES AND TO CONDUCT THE BUSINESS IN WHICH IT IS ENGAGED AS DESCRIBED IN
THE DRAFT OFFERING MEMORANDUM (AS OF THE CLOSING DATE) OR THE OFFERING
MEMORANDUM (AS OF THE RELEVANT DATE);

 

(IV)          EACH OF THE PARENT COMPANIES HAS THE REQUISITE CORPORATE OR
LIMITED LIABILITY COMPANY POWER AND AUTHORITY TO EXECUTE AND DELIVER THIS
AGREEMENT AND

 

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ALL OTHER TRANSACTION DOCUMENTS TO WHICH IT IS A PARTY AND PERFORM ITS
OBLIGATIONS HEREUNDER AND THEREUNDER;

 

(V)           NONE OF THE PARENT COMPANIES OR THE IHOP SECURITIZATION ENTITIES
(COLLECTIVELY THE “OTHER ENTITIES”) IS IN VIOLATION OF (I) ITS RESPECTIVE
SECURITIZATION ENTITY CHARTER DOCUMENTS, (II) ANY REQUIREMENTS OF LAW WITH
RESPECT TO SUCH OTHER ENTITY OR (III) ANY CONTRACTUAL OBLIGATION WITH RESPECT TO
SUCH OTHER ENTITY EXCEPT, SOLELY WITH RESPECT TO CLAUSES (II) AND (III), TO THE
EXTENT SUCH VIOLATION COULD NOT REASONABLY BE EXPECTED TO RESULT IN A MATERIAL
ADVERSE EFFECT.  THE EXECUTION AND DELIVERY OF THIS AGREEMENT AND THE OTHER
TRANSACTION DOCUMENTS, THE APPLICATION OF THE PROCEEDS FROM THE SALE OF THE
SECURITIES AS DESCRIBED AS DESCRIBED HEREIN AND IN THE OFFERING MEMORANDUM (AS
OF THE RELEVANT DATE) AND THE INCURRENCE OF THE OBLIGATIONS AND CONSUMMATION OF
THE TRANSACTIONS HEREIN AND THEREIN CONTEMPLATED (A) WILL NOT CONFLICT WITH, OR
CONSTITUTE A BREACH OF OR DEFAULT UNDER, ANY SECURITIZATION ENTITY CHARTER
DOCUMENTS OF ANY OTHER ENTITY, AND (B) DOES NOT CONTRAVENE, OR CONSTITUTE A
DEFAULT UNDER, ANY REQUIREMENTS OF LAW WITH RESPECT TO SUCH OTHER ENTITY OR ANY
CONTRACTUAL OBLIGATION WITH RESPECT TO SUCH OTHER ENTITY OR RESULT IN THE
CREATION OR IMPOSITION OF ANY LIEN ON ANY PROPERTY OF ANY OTHER ENTITY, EXCEPT
FOR LIENS CREATED BY THE TRANSACTION DOCUMENTS;

 

(VI)          EACH OF THE TRANSACTION DOCUMENTS TO WHICH ANY OTHER ENTITY IS A
PARTY HAS BEEN DULY AND VALIDLY AUTHORIZED, EXECUTED AND DELIVERED BY IT AND,
ASSUMING DUE AUTHORIZATION, EXECUTION AND DELIVERY BY THE OTHER PARTIES THERETO,
CONSTITUTES ITS LEGAL, VALID AND BINDING OBLIGATION ENFORCEABLE IN ACCORDANCE
WITH ITS TERMS (EXCEPT AS SUCH ENFORCEABILITY MAY BE LIMITED BY BANKRUPTCY,
INSOLVENCY, FRAUDULENT CONVEYANCE, REORGANIZATION, MORATORIUM AND OTHER SIMILAR
LAWS AFFECTING CREDITORS’ RIGHTS GENERALLY OR BY GENERAL EQUITABLE PRINCIPLES,
WHETHER CONSIDERED IN A PROCEEDING AT LAW OR IN EQUITY AND BY AN IMPLIED
COVENANT OF GOOD FAITH AND FAIR DEALING).  EACH OF THE TRANSACTION DOCUMENTS TO
WHICH AN OTHER ENTITY IS A PARTY WILL CONFORM IN ALL MATERIAL RESPECTS TO THE
DESCRIPTION THEREOF IN THE DRAFT OFFERING MEMORANDUM (AS OF THE CLOSING DATE) OR
THE OFFERING MEMORANDUM (AS OF THE RELEVANT DATE);

 

(VII)         (1) THE TRANSACTION DOCUMENTS TO WHICH AN OTHER ENTITY IS A PARTY
ARE IN FULL FORCE AND EFFECT; (2) THERE ARE NO OUTSTANDING DEFAULTS THEREUNDER;
AND (3) NO EVENTS SHALL HAVE OCCURRED WHICH, WITH THE GIVING OF NOTICE, THE
PASSAGE OF TIME OR BOTH, WOULD CONSTITUTE A DEFAULT THEREUNDER;

 

(VIII)        THIS AGREEMENT HAS BEEN DULY AUTHORIZED, EXECUTED AND DELIVERED BY
EACH PARENT COMPANY PARTY HERETO AND CONSTITUTES THE LEGAL, VALID AND BINDING
OBLIGATION OF EACH PARENT COMPANY ENFORCEABLE IN ACCORDANCE WITH ITS TERMS
(EXCEPT AS SUCH ENFORCEABILITY MAY BE LIMITED BY BANKRUPTCY, INSOLVENCY,
FRAUDULENT CONVEYANCE, REORGANIZATION, MORATORIUM AND OTHER SIMILAR LAWS
AFFECTING CREDITORS’ RIGHTS GENERALLY OR BY GENERAL EQUITABLE PRINCIPLES,
WHETHER CONSIDERED IN A PROCEEDING AT LAW OR IN EQUITY AND BY AN IMPLIED
COVENANT OF GOOD FAITH AND FAIR DEALING AND EXCEPT THAT ANY INDEMNIFICATION OR
CONTRIBUTION PROVISIONS HEREIN MAY BE DEEMED UNENFORCEABLE);

 

17

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(IX)           THERE IS NO CONSENT, APPROVAL, AUTHORIZATION, ORDER, REGISTRATION
OR QUALIFICATION OF OR WITH ANY COURT OR ANY REGULATORY AUTHORITY OR OTHER
GOVERNMENTAL AGENCY OR BODY WHICH IS REQUIRED FOR, AND THE ABSENCE OF WHICH
WOULD MATERIALLY AFFECT, THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED BY
THIS AGREEMENT AND THE OTHER TRANSACTION DOCUMENTS, THE ISSUANCE OF THE
SECURITIES, THE EXECUTION, DELIVERY AND PERFORMANCE BY THE PARENT COMPANIES OF
THIS AGREEMENT AND BY THE OTHER ENTITIES OF THE TRANSACTION DOCUMENTS (TO THE
EXTENT THEY ARE PARTIES THERETO) OR THE APPLICATION OF THE PROCEEDS FROM THE
SALE OF THE SECURITIES AS DESCRIBED HEREIN AND IN THE OFFERING MEMORANDUM (AS OF
THE RELEVANT DATE);

 

(X)            EACH OF THE OTHER ENTITIES POSSESSES ALL LICENSES, PERMITS,
ORDERS, PATENTS, FRANCHISES, CERTIFICATES OF NEED AND OTHER GOVERNMENTAL AND
REGULATORY APPROVALS TO OWN OR LEASE ITS PROPERTIES AND CONDUCT ITS BUSINESS IN
THE JURISDICTIONS IN WHICH SUCH BUSINESS IS TRANSACTED AS DESCRIBED IN THE DRAFT
OFFERING MEMORANDUM (AS OF THE CLOSING DATE) OR THE OFFERING MEMORANDUM (AS OF
THE RELEVANT DATE), WITH ONLY SUCH EXCEPTIONS AS WOULD NOT INDIVIDUALLY OR IN
THE AGGREGATE HAVE A MATERIAL ADVERSE EFFECT, AND HAS NOT RECEIVED ANY NOTICE OF
PROCEEDINGS RELATING TO THE REVOCATION OR MODIFICATION OF ANY SUCH LICENSE,
PERMIT, ORDER OR APPROVAL, EXCEPT FOR THOSE WHOSE REVOCATION OR MODIFICATION
WOULD NOT, INDIVIDUALLY OR IN THE AGGREGATE, HAVE A MATERIAL ADVERSE EFFECT;

 

(XI)           EXCEPT AS DESCRIBED IN THE DRAFT OFFERING MEMORANDUM (AS OF THE
CLOSING DATE) OR THE OFFERING MEMORANDUM (AS OF THE RELEVANT DATE), NO LABOR
DISTURBANCE BY THE EMPLOYEES OF THE OTHER ENTITIES EXISTS OR, TO THE KNOWLEDGE
OF THE OTHER ENTITIES, IS IMMINENT THAT WOULD REASONABLY BE EXPECTED TO HAVE A
MATERIAL ADVERSE EFFECT;

 

(XII)          AFTER GIVING EFFECT TO THE RESTRUCTURING, AS OF THE CLOSING DATE,
NEITHER OF THE CO-ISSUERS WILL HAVE ANY (I) EMPLOYEES, (II) OUTSTANDING
INDEBTEDNESS FOR BORROWED MONEY OTHER THAN UNDER THE INDENTURE OR (III) MATERIAL
LIABILITIES EXCEPT WHERE SUCH LIABILITIES ARE EXPRESSLY PERMITTED BY THE
TRANSACTION DOCUMENTS;

 

(XIII)         NEITHER A REPORTABLE EVENT NOR AN “ACCUMULATED FUNDING
DEFICIENCY” (WITHIN THE MEANING OF SECTION 412 OF THE CODE OR SECTION 302 OF
ERISA) HAS OCCURRED DURING THE SIX YEAR PERIOD PRIOR TO THE DATE ON WHICH THIS
REPRESENTATION IS MADE OR DEEMED MADE OR IS REASONABLY EXPECTED TO OCCUR WITH
RESPECT TO ANY SINGLE EMPLOYER PLAN, AND EACH PLAN (INCLUDING, TO THE ACTUAL
KNOWLEDGE OF THE OTHER ENTITIES, A MULTIEMPLOYER PLAN OR A MULTIEMPLOYER WELFARE
PLAN MAINTAINED PURSUANT TO A COLLECTIVE BARGAINING AGREEMENT) HAS COMPLIED IN
ALL RESPECTS WITH THE APPLICABLE PROVISIONS OF ERISA, THE CODE AND THE
CONSTITUENT DOCUMENTS OF SUCH PLAN, EXCEPT FOR INSTANCES OF NON-COMPLIANCE THAT,
IN THE AGGREGATE, COULD NOT REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE
EFFECT.  NO TERMINATION OF A SINGLE EMPLOYER PLAN HAS OCCURRED DURING SUCH
SIX-YEAR PERIOD OR IS REASONABLY EXPECTED TO OCCUR (OTHER THAN A TERMINATION
DESCRIBED IN SECTION 4041(B) OF ERISA), AND NO LIEN IN FAVOR OF THE PBGC OR A
PLAN HAS ARISEN DURING SUCH SIX-YEAR PERIOD OR IS REASONABLY EXPECTED TO ARISE. 
EXCEPT TO THE EXTENT THAT ANY SUCH EXCESS COULD NOT REASONABLY BE EXPECTED TO
HAVE A MATERIAL ADVERSE EFFECT, THE PRESENT VALUE OF ALL ACCRUED BENEFITS UNDER
EACH SINGLE EMPLOYER PLAN (BASED ON THOSE ASSUMPTIONS USED TO FUND SUCH PLANS)
DID NOT, AS OF THE LAST ANNUAL VALUATION DATE PRIOR TO

 

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THE DATE ON WHICH THIS REPRESENTATION IS MADE OR DEEMED MADE, EXCEED THE VALUE
OF THE ASSETS OF SUCH PLAN ALLOCABLE TO SUCH ACCRUED BENEFITS.  EXCEPT TO THE
EXTENT THAT SUCH LIABILITY COULD NOT REASONABLY BE EXPECTED TO HAVE A MATERIAL
ADVERSE EFFECT, NEITHER THE OTHER ENTITIES NOR ANY AFFILIATE THEREOF HAVE HAD A
COMPLETE OR PARTIAL WITHDRAWAL FROM ANY MULTIEMPLOYER PLAN, AND THE OTHER
ENTITIES WOULD NOT BECOME SUBJECT TO ANY LIABILITY UNDER ERISA IF AN OTHER
ENTITY OR ANY AFFILIATE THEREOF WERE TO WITHDRAW COMPLETELY FROM ALL
MULTIEMPLOYER PLANS AS OF THE VALUATION DATE MOST CLOSELY PRECEDING THE DATE ON
WHICH THIS REPRESENTATION IS MADE OR DEEMED MADE.  TO THE ACTUAL KNOWLEDGE OF
THE OTHER ENTITIES, NO SUCH MULTIEMPLOYER PLAN IS IN REORGANIZATION, INSOLVENT
OR TERMINATING OR IS REASONABLY EXPECTED TO BE IN REORGANIZATION, BECOME
INSOLVENT OR BE TERMINATED.  EXCEPT TO THE EXTENT THAT ANY SUCH EXCESS COULD NOT
REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT, THE PRESENT VALUE
(DETERMINED USING ACTUARIAL AND OTHER ASSUMPTIONS WHICH ARE REASONABLE IN
RESPECT OF THE BENEFITS PROVIDED AND THE EMPLOYEES PARTICIPATING) OF THE
LIABILITY OF THE OTHER ENTITIES AND EACH AFFILIATE THEREOF FOR POST RETIREMENT
BENEFITS TO BE PROVIDED TO THEIR CURRENT AND FORMER EMPLOYEES UNDER PLANS WHICH
ARE WELFARE BENEFIT PLANS (AS DEFINED IN SECTION 3(1) OF ERISA) OTHER THAN SUCH
LIABILITY DISCLOSED IN THE FINANCIAL STATEMENTS OF THE OTHER ENTITIES DOES NOT,
IN THE AGGREGATE, EXCEED THE ASSETS UNDER ALL SUCH PLANS ALLOCABLE TO SUCH
BENEFITS.  NEITHER THE OTHER ENTITIES NOR ANY AFFILIATE THEREOF HAS ENGAGED IN A
PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA AND/OR SECTION 4975 OF THE
CODE IN CONNECTION WITH ANY PLAN THAT WOULD SUBJECT EITHER OTHER ENTITIES TO
LIABILITY UNDER ERISA AND/OR SECTION 4975 OF THE CODE THAT COULD REASONABLY BE
EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.  THERE IS NO OTHER CIRCUMSTANCE
WHICH MAY GIVE RISE TO A LIABILITY IN RELATION TO ANY PLAN THAT COULD REASONABLY
BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT;

 

(XIV)        THERE IS NO ACTION, SUIT, PROCEEDING OR INVESTIGATION PENDING
AGAINST OR, TO THE KNOWLEDGE OF EACH PARENT COMPANY, THREATENED AGAINST OR
AFFECTING ANY OTHER ENTITY OR OF WHICH ANY PROPERTY OR ASSETS OF THE OTHER
ENTITIES IS THE SUBJECT BEFORE ANY COURT OR ARBITRATOR OR ANY GOVERNMENTAL
AUTHORITY THAT WOULD, INDIVIDUALLY OR IN THE AGGREGATE, AFFECT THE VALIDITY OR
ENFORCEABILITY OF THIS AGREEMENT OR ANY OF THE TRANSACTION DOCUMENTS, MATERIALLY
ADVERSELY AFFECT THE PERFORMANCE BY THE PARENT COMPANIES OF THEIR OBLIGATIONS
HEREUNDER OR BY THE OTHER ENTITIES THEREUNDER OR WHICH IS REASONABLY LIKELY TO
HAVE A MATERIAL ADVERSE EFFECT;

 

(XV)         NONE OF THE OTHER ENTITIES IS, AFTER GIVING EFFECT TO THE ISSUANCE
OF THE SECURITIES, THE TRANSACTIONS CONTEMPLATED BY THE TRANSACTION DOCUMENTS
AND THE APPLICATION OF THE PROCEEDS FROM THE SALE OF THE SECURITIES AS DESCRIBED
HEREIN, IN THE DRAFT OFFERING MEMORANDUM (AS OF THE CLOSING DATE) AND IN THE
OFFERING MEMORANDUM (AS OF THE RELEVANT DATE), AN “INVESTMENT COMPANY”, OR A
COMPANY “CONTROLLED” BY AN “INVESTMENT COMPANY”, WITHIN THE MEANING OF THE 1940
ACT;

 

(XVI)        EACH OF THE OTHER ENTITIES (AFTER GIVING EFFECT TO THE TRANSACTIONS
CONTEMPLATED BY THE TRANSACTION DOCUMENTS) IS NOT INSOLVENT WITHIN THE MEANING
OF THE BANKRUPTCY CODE AND NONE OF THE OTHER ENTITIES IS THE SUBJECT OF ANY
VOLUNTARY OR INVOLUNTARY CASE OR PROCEEDING SEEKING LIQUIDATION, REORGANIZATION
OR OTHER RELIEF WITH RESPECT TO ITSELF OR ITS DEBTS UNDER ANY BANKRUPTCY OR
INSOLVENCY LAW AND NO EVENT OF BANKRUPTCY HAS OCCURRED WITH RESPECT TO ANY OF
THE OTHER ENTITIES;

 

19

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(XVII)       NO FORWARD-LOOKING STATEMENT (WITHIN THE MEANING OF SECTION 27A OF
THE SECURITIES ACT AND SECTION 21E OF THE EXCHANGE ACT) CONTAINED IN THE DRAFT
OFFERING MEMORANDUM (AS OF THE CLOSING DATE) OR THE OFFERING MEMORANDUM (AS OF
THE RELEVANT DATE) HAS BEEN MADE OR REAFFIRMED WITHOUT A REASONABLE BASIS OR HAS
BEEN DISCLOSED OTHER THAN IN GOOD FAITH;

 

(XVIII)      SINCE THE DATE AS OF WHICH INFORMATION IS GIVEN IN THE DRAFT
OFFERING MEMORANDUM (AS OF THE CLOSING DATE) OR THE OFFERING MEMORANDUM (AS OF
THE RELEVANT DATE), THERE HAS NOT BEEN ANY DEVELOPMENT IN THE CONDITION,
FINANCIAL OR OTHERWISE, OF THE SECURITIZATION ENTITIES, TAKEN AS A WHOLE, OR IN
THE EARNINGS, BUSINESS AFFAIRS OR MANAGEMENT, WHETHER OR NOT ARISING IN THE
COURSE OF BUSINESS OF THE SECURITIZATION ENTITIES, TAKEN AS A WHOLE, THAT COULD
REASONABLY BE EXPECTED TO RESULT IN A MATERIAL ADVERSE EFFECT;

 

(XIX)         E&Y, WHO HAVE AUDITED OR REVIEWED THE CONSOLIDATED FINANCIAL
STATEMENTS OF IHOP CONTAINED IN THE DRAFT OFFERING MEMORANDUM (AS OF THE CLOSING
DATE) AND THE OFFERING MEMORANDUM (AS OF THE RELEVANT DATE), ARE INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS WITH RESPECT TO IHOP AND MERGER SUB WITHIN THE
MEANING OF RULE 101 OF THE CODE OF PROFESSIONAL CONDUCT OF THE AICPA AND ITS
INTERPRETATIONS AND RULINGS THEREUNDER.  THE HISTORICAL CONSOLIDATED FINANCIAL
STATEMENTS (INCLUDING THE RELATED NOTES AND SUPPORTING SCHEDULES) OF IHOP
CONTAINED IN THE DRAFT OFFERING MEMORANDUM (AS OF THE CLOSING DATE) AND THE
OFFERING MEMORANDUM (AS OF THE RELEVANT DATE) HAVE BEEN PREPARED IN ACCORDANCE
WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN THE UNITED STATES CONSISTENTLY
APPLIED THROUGHOUT THE PERIODS COVERED THEREBY AND FAIRLY PRESENT THE FINANCIAL
POSITION OF THE ENTITIES PURPORTED TO BE COVERED THEREBY AT THE RESPECTIVE DATES
INDICATED AND THE RESULTS OF THEIR OPERATIONS AND THEIR CASH FLOWS FOR THE
RESPECTIVE PERIODS INDICATED; AND THE FINANCIAL INFORMATION CONTAINED IN THE
DRAFT OFFERING MEMORANDUM (AS OF THE CLOSING DATE) AND THE OFFERING MEMORANDUM
(AS OF THE RELEVANT DATE) UNDER THE HEADINGS “CAPITALIZATION OF IHOP CORP. AND
ITS SUBSIDIARIES,” “SELECTED HISTORICAL AND PRO FORMA FINANCIAL DATA OF IHOP
CORP. AND ITS SUBSIDIARIES,” “UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL
INFORMATION OF IHOP CORP.,” “CAPITALIZATION OF IHOP FRANCHISING, LLC,”
“UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION OF IHOP
FRANCHISING, LLC,” “IHOP FRANCHISING, LLC UNAUDITED SUPPLEMENTAL FINANCIAL
INFORMATION” AND IN THE EXCHANGE ACT DOCUMENTS UNDER THE HEADING “MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF
IHOP” IS DERIVED FROM THE ACCOUNTING RECORDS OF THE APPLICABLE IHOP ENTITIES AND
FAIRLY PRESENT THE INFORMATION PURPORTED TO BE SHOWN THEREBY.  THE OTHER
HISTORICAL FINANCIAL AND STATISTICAL INFORMATION AND DATA OF IHOP AND THE OTHER
IHOP ENTITIES CONTAINED IN THE DRAFT OFFERING MEMORANDUM (AS OF THE CLOSING
DATE) AND THE OFFERING MEMORANDUM (AS OF THE RELEVANT DATE) ARE, IN ALL MATERIAL
RESPECTS, FAIRLY PRESENTED;

 

(XX)          THE PRO FORMA FINANCIAL INFORMATION INCLUDED IN THE DRAFT OFFERING
MEMORANDUM (AS OF THE CLOSING DATE) AND THE OFFERING MEMORANDUM (AS OF THE
RELEVANT DATE) INCLUDE ASSUMPTIONS THAT PROVIDE A REASONABLE BASIS FOR
PRESENTING THE SIGNIFICANT EFFECTS DIRECTLY ATTRIBUTABLE TO THE TRANSACTIONS AND
EVENTS DESCRIBED THEREIN (IT BEING UNDERSTOOD THAT THE SECURITIES THAT ARE
ASSUMED TO BE ISSUED IN THE PRO FORMA

 

20

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FINANCIAL INFORMATION THAT IS CONTAINED IN THE DRAFT OFFERING MEMORANDUM AS OF
THE CLOSING DATE ARE DIFFERENT FROM THE SECURITIES BEING ISSUED HEREUNDER AND IN
THE APPLEBEE’S SECURITIZATION), THE RELATED PRO FORMA ADJUSTMENTS GIVE
APPROPRIATE EFFECT TO THOSE ASSUMPTIONS, AND THE PRO FORMA ADJUSTMENTS REFLECT
THE PROPER APPLICATION OF THOSE ADJUSTMENTS TO THE HISTORICAL FINANCIAL
STATEMENT AMOUNTS IN THE PRO FORMA FINANCIAL INFORMATION INCLUDED IN THE DRAFT
OFFERING MEMORANDUM (AS OF THE CLOSING DATE) AND THE OFFERING MEMORANDUM (AS OF
THE RELEVANT DATE).  THE PRO FORMA FINANCIAL INFORMATION INCLUDED IN THE DRAFT
OFFERING MEMORANDUM (AS OF THE CLOSING DATE) AND THE OFFERING MEMORANDUM (AS OF
THE RELEVANT DATE) COMPLY AS TO FORM IN ALL MATERIAL RESPECTS WITH THE
APPLICABLE REQUIREMENTS OF REGULATION S-X UNDER THE SECURITIES ACT;

 

(XXI)         THE EXCHANGE ACT DOCUMENTS DID NOT, WHEN FILED WITH THE
COMMISSION, CONTAIN AN UNTRUE STATEMENT OF MATERIAL FACT OR OMIT TO STATE A
MATERIAL FACT NECESSARY IN ORDER TO MAKE THE STATEMENTS MADE THEREIN, IN THE
LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY WERE MADE, NOT MISLEADING. THE
EXCHANGE ACT DOCUMENTS, WHEN FILED WITH THE COMMISSION, CONFORMED OR WILL
CONFORM IN ALL MATERIAL RESPECTS TO THE APPLICABLE REQUIREMENTS OF THE EXCHANGE
ACT AND THE APPLICABLE RULES AND REGULATIONS OF THE COMMISSION THEREUNDER;

 

(XXII)        THE MARKET-RELATED AND CUSTOMER-RELATED DATA AND ESTIMATES
INCLUDED IN THE PRELIMINARY MARKETING MATERIALS, IN THE DRAFT OFFERING
MEMORANDUM (AS OF THE CLOSING DATE) AND THE OFFERING MEMORANDUM (AS OF THE
RELEVANT DATE) ARE BASED ON OR DERIVED FROM SOURCES THAT THE PARENT COMPANIES
BELIEVE TO BE RELIABLE AND ACCURATE IN ALL MATERIAL RESPECTS OR REPRESENT THE
PARENT COMPANIES’ GOOD FAITH ESTIMATES MADE ON THE BASIS OF DATA DERIVED FROM
SUCH SOURCES;

 

(XXIII)       THE OTHER ENTITIES MAINTAIN AND HAVE MAINTAINED EFFECTIVE INTERNAL
CONTROL OVER FINANCIAL REPORTING, AS DEFINED IN RULE 13A-15 UNDER THE EXCHANGE
ACT, AND A SYSTEM OF ACCOUNTING CONTROLS THAT IS SUFFICIENT TO PROVIDE
REASONABLE ASSURANCES THAT (I) TRANSACTIONS ARE EXECUTED IN ACCORDANCE WITH
MANAGEMENT’S GENERAL OR SPECIFIC AUTHORIZATION; (II) TRANSACTIONS ARE RECORDED
AS NECESSARY TO PERMIT PREPARATION OF FINANCIAL STATEMENTS IN CONFORMITY WITH
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN THE UNITED STATES AND TO MAINTAIN
ACCOUNTABILITY FOR ASSETS; (III) ACCESS TO ASSETS IS PERMITTED ONLY IN
ACCORDANCE WITH MANAGEMENT’S GENERAL OR SPECIFIC AUTHORIZATION; AND (IV) THE
RECORDED ACCOUNTABILITY FOR ASSETS IS COMPARED WITH EXISTING ASSETS AT
REASONABLE INTERVALS AND APPROPRIATE ACTION IS TAKEN WITH RESPECT TO ANY
DIFFERENCES;

 

(XXIV)       (I) EACH OF THE PARENT COMPANIES AND EACH OF THEIR RESPECTIVE 
SUBSIDIARIES HAVE ESTABLISHED AND MAINTAIN DISCLOSURE CONTROLS AND PROCEDURES
(AS SUCH TERM IS DEFINED IN RULE 13A-15 UNDER THE EXCHANGE ACT), (II) SUCH
DISCLOSURE CONTROLS AND PROCEDURES ARE DESIGNED TO ENSURE THAT THE INFORMATION
REQUIRED TO BE DISCLOSED BY THE PARENT COMPANIES IN THE REPORTS THEY FILE OR
SUBMIT UNDER THE EXCHANGE ACT (ASSUMING THE PARENT COMPANIES WERE REQUIRED TO
FILE OR SUBMIT SUCH REPORTS UNDER THE EXCHANGE ACT) IS ACCUMULATED AND
COMMUNICATED TO MANAGEMENT OF THE PARENT COMPANIES, INCLUDING THEIR RESPECTIVE
PRINCIPAL EXECUTIVE OFFICERS AND PRINCIPAL FINANCIAL OFFICERS, AS APPROPRIATE,
TO ALLOW TIMELY DECISIONS REGARDING REQUIRED DISCLOSURE TO BE MADE; AND

 

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(III) SUCH DISCLOSURE CONTROLS AND PROCEDURES ARE EFFECTIVE IN ALL MATERIAL
RESPECTS TO PERFORM THE FUNCTIONS FOR WHICH THEY WERE ESTABLISHED;

 

(XXV)        SINCE THE DATE OF THE MOST RECENT BALANCE SHEET OF IHOP AND ITS
CONSOLIDATED SUBSIDIARIES REVIEWED OR AUDITED BY E&Y AND THE AUDIT COMMITTEE OF
THE BOARD OF DIRECTORS OF IHOP, (I) IHOP HAS NOT BEEN ADVISED OF (A) ANY
SIGNIFICANT DEFICIENCIES IN THE DESIGN OR OPERATION OF INTERNAL CONTROL OVER
FINANCIAL REPORTING THAT WOULD ADVERSELY AFFECT THE ABILITY OF IHOP OR ANY OF
ITS SUBSIDIARIES TO RECORD, PROCESS, SUMMARIZE AND REPORT FINANCIAL DATA, OR ANY
MATERIAL WEAKNESSES IN INTERNAL CONTROL OVER FINANCIAL REPORTING AND (B) ANY
FRAUD, WHETHER OR NOT MATERIAL, THAT INVOLVES MANAGEMENT OR OTHER EMPLOYEES WHO
HAVE A SIGNIFICANT ROLE IN THE INTERNAL CONTROLS OF IHOP AND EACH OF ITS
SUBSIDIARIES, AND (II) SINCE THAT DATE, THERE HAVE BEEN NO SIGNIFICANT CHANGES
IN INTERNAL CONTROL OVER FINANCIAL REPORTING OR IN OTHER FACTORS THAT WOULD
SIGNIFICANTLY AFFECT INTERNAL CONTROL OVER FINANCIAL REPORTING, INCLUDING ANY
CORRECTIVE ACTIONS WITH REGARD TO SIGNIFICANT DEFICIENCIES AND MATERIAL
WEAKNESSES;

 

(XXVI)       THE REPRESENTATIONS AND WARRANTIES OF EACH OF THE OTHER ENTITIES,
CONTAINED IN THE TRANSACTION DOCUMENTS TO WHICH IT IS A PARTY ARE TRUE AND
CORRECT AND ARE REPEATED AS THOUGH FULLY SET FORTH HEREIN;

 

(XXVII)      WITH RESPECT TO THOSE SECURITIES SOLD IN RELIANCE UPON
REGULATION S, (I) NONE OF THE OTHER ENTITIES OR ANY OF THEIR AFFILIATES OR ANY
OTHER PERSON ACTING ON THEIR BEHALF HAS ENGAGED IN ANY DIRECTED SELLING EFFORTS
WITHIN THE MEANING OF RULE 902 OF REGULATION S AND (II) THE OTHER ENTITIES AND
THEIR AFFILIATES AND EACH PERSON ACTING ON THEIR BEHALF HAVE COMPLIED WITH THE
OFFERING RESTRICTIONS SET FORTH IN REGULATION S;

 

(XXVIII)     NONE OF THE OTHER ENTITIES OR ANY OF THEIR AFFILIATES OR ANY OTHER
PERSON ACTING ON THEIR BEHALF HAVE ENGAGED, IN CONNECTION WITH THE OFFERING OF
THE SECURITIES, IN ANY FORM OF GENERAL SOLICITATION OR GENERAL ADVERTISING
WITHIN THE MEANING OF RULE 502(C) UNDER THE SECURITIES ACT (INCLUDING, BUT NOT
LIMITED TO, ADVERTISEMENTS, ARTICLES, NOTICES OR OTHER COMMUNICATIONS PUBLISHED
IN ANY NEWSPAPER, MAGAZINE OR SIMILAR MEDIUM OR BROADCAST OVER TELEVISION OR
RADIO, OR ANY SEMINAR OR MEETING WHOSE ATTENDEES HAVE BEEN INVITED BY ANY
GENERAL SOLICITATION OR GENERAL ADVERTISING);

 

(XXIX)       NONE OF THE OTHER ENTITIES OR ANY OF THEIR AFFILIATES OR ANY OTHER
PERSON ACTING ON THEIR BEHALF HAVE OFFERED, SOLD, CONTRACTED TO SELL OR
OTHERWISE DISPOSED OF, DIRECTLY OR INDIRECTLY, ANY SECURITIES UNDER
CIRCUMSTANCES WHERE SUCH OFFER, SALE, CONTRACT OR DISPOSITION WOULD CAUSE THE
EXEMPTION AFFORDED BY SECTION 4(2) OF THE SECURITIES ACT OR SECTION 3(C)(7) OF
THE 1940 ACT TO CEASE TO BE APPLICABLE TO THE OFFERING, SALE AND RESALE OF THE
SECURITIES AS CONTEMPLATED BY THIS AGREEMENT, THE DRAFT OFFERING MEMORANDUM (AS
OF THE CLOSING DATE) AND THE OFFERING MEMORANDUM (AS OF THE RELEVANT DATE);

 

(XXX)        THERE IS AND HAS BEEN NO FAILURE ON THE PART OF THE OTHER ENTITIES
OR ANY OF THE OTHER ENTITIES’ MANAGERS, DIRECTORS OR OFFICERS, IN THEIR
CAPACITIES AS SUCH, TO COMPLY WITH THE PROVISIONS OF THE SARBANES-OXLEY ACT OF
2002 AND THE RULES AND REGULATIONS PROMULGATED IN CONNECTION THEREWITH;

 

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(XXXI)       THE SECTION ENTITLED “MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS –CRITICAL ACCOUNTING POLICIES” IN
THE EXCHANGE ACT DOCUMENTS, THE DRAFT OFFERING MEMORANDUM (AS OF THE CLOSING
DATE) AND THE OFFERING MEMORANDUM (AS OF THE RELEVANT DATE) ACCURATELY AND FULLY
DESCRIBES (A) THE ACCOUNTING POLICIES THAT IHOP BELIEVES ARE THE MOST IMPORTANT
IN THE PORTRAYAL OF IHOP’S FINANCIAL CONDITION AND RESULTS OF OPERATIONS AND
THAT REQUIRE MANAGEMENT’S MOST DIFFICULT, SUBJECTIVE OR COMPLEX JUDGMENTS;
(B) THE JUDGMENTS AND UNCERTAINTIES AFFECTING THE APPLICATION OF CRITICAL
ACCOUNTING POLICIES; AND (C) THE LIKELIHOOD THAT MATERIALLY DIFFERENT AMOUNTS
WOULD BE REPORTED UNDER DIFFERENT CONDITIONS OR USING DIFFERENT ASSUMPTIONS AND
AN EXPLANATION THEREOF;

 

(XXXII)      NONE OF THE OTHER ENTITIES IS IN VIOLATION OF OR HAS RECEIVED
NOTICE OF ANY VIOLATION WITH RESPECT TO ANY FEDERAL OR STATE LAW RELATING TO
DISCRIMINATION IN THE HIRING, PROMOTION OR PAY OF EMPLOYEES, OR ANY APPLICABLE
FEDERAL OR STATE WAGE AND HOUR LAWS, OR ANY STATE LAW PRECLUDING THE DENIAL OF
CREDIT DUE TO THE NEIGHBORHOOD IN WHICH A PROPERTY IS SITUATED, THE VIOLATION OF
ANY OF WHICH WOULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE AFFECT;

 

(XXXIII)     THE OPERATIONS OF THE OTHER ENTITIES ARE AND HAVE BEEN CONDUCTED AT
ALL TIMES IN COMPLIANCE WITH THE MONEY LAUNDERING LAWS AND NO ACTION, SUIT OR
PROCEEDING BY OR BEFORE ANY COURT OR GOVERNMENTAL AGENCY, AUTHORITY OR BODY OR
ANY ARBITRATOR INVOLVING THE OTHER ENTITIES WITH RESPECT TO THE MONEY LAUNDERING
LAWS IS PENDING OR, TO THE KNOWLEDGE OF THE OTHER ENTITIES, THREATENED, EXCEPT,
IN EACH CASE, AS WOULD NOT REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE
EFFECT;

 

(XXXIV)     NONE OF THE OTHER ENTITIES OR, TO THE KNOWLEDGE OF THE OTHER
ENTITIES, ANY DIRECTOR, OFFICER, AGENT, EMPLOYEE OR AFFILIATE OF THE OTHER
ENTITIES IS CURRENTLY SUBJECT TO ANY U.S. SANCTIONS ADMINISTERED BY OFAC; AND
THE OTHER ENTITIES WILL NOT DIRECTLY OR INDIRECTLY USE THE PROCEEDS OF THE
OFFERING, OR LEND, CONTRIBUTE OR OTHERWISE MAKE AVAILABLE SUCH PROCEEDS TO ANY
SUBSIDIARY, JOINT VENTURE PARTNER OR OTHER PERSON OR ENTITY, FOR THE PURPOSE OF
FINANCING THE ACTIVITIES OF ANY PERSON CURRENTLY SUBJECT TO ANY U.S. SANCTIONS
ADMINISTERED BY OFAC;

 

(XXXV)      THE OTHER ENTITIES HAVE NOT TAKEN ANY ACTION OR OMITTED TO TAKE ANY
ACTION (SUCH AS ISSUING ANY PRESS RELEASE RELATING TO ANY SECURITIES WITHOUT AN
APPROPRIATE LEGEND) WHICH MAY RESULT IN THE LOSS BY THE INITIAL PURCHASER OF THE
ABILITY TO RELY ON ANY STABILIZATION SAFE HARBOR PROVIDED BY THE FSMA.  THE
OTHER ENTITIES HAVE BEEN INFORMED OF THE GUIDANCE RELATING TO STABILIZATION
PROVIDED BY THE FINANCIAL SERVICES AUTHORITY;

 

(XXXVI)     AS OF THE CLOSING DATE, NO PARENT COMPANY IS AWARE OF ANY PROPOSED
TAX ASSESSMENTS AGAINST ANY APPLEBEE’S ENTITY OR ANY IHOP ENTITY, EXCEPT FOR
THOSE TAX ASSESSMENTS THAT WOULD NOT HAVE A MATERIAL ADVERSE EFFECT;

 

(C)           EACH OF THE CO-ISSUERS, JOINTLY AND SEVERALLY, SHALL MAKE THE
REPRESENTATIONS AND WARRANTIES TO THE INITIAL PURCHASER AND AGREEMENTS WITH THE
INITIAL PURCHASER CONTAINED IN SECTION 1(A) AS OF THE INITIAL DATE AND EACH
BRINGDOWN DATE; AND

 

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(D)           EACH OF THE PARENT COMPANIES, JOINTLY AND SEVERALLY, SHALL MAKE
THE REPRESENTATIONS AND WARRANTIES TO THE INITIAL PURCHASER AND AGREEMENTS WITH
THE INITIAL PURCHASER CONTAINED IN SECTION 1(B) AS OF THE INITIAL DATE AND EACH
BRINGDOWN DATE.

 

2.             Purchase and Resale of the Securities

 

(A)           ON THE BASIS OF THE REPRESENTATIONS, WARRANTIES AND AGREEMENTS
CONTAINED HEREIN, AND SUBJECT TO THE TERMS AND CONDITIONS SET FORTH HEREIN, EACH
OF THE CO-ISSUERS, JOINTLY AND SEVERALLY, AGREES TO ISSUE AND SELL TO THE
INITIAL PURCHASER, AND THE INITIAL PURCHASER AGREES TO PURCHASE FROM THE
CO-ISSUERS, U.S. $245,000,000 PRINCIPAL AMOUNT OF SERIES 2007-3 FIXED RATE TERM
NOTES AT A PURCHASE PRICE OF 99.999707% OF THE AGGREGATE PRINCIPAL AMOUNT
THEREOF.  THE CO-ISSUERS SHALL NOT BE OBLIGATED TO DELIVER ANY OF THE SECURITIES
EXCEPT UPON PAYMENT FOR ALL OF THE SECURITIES TO BE PURCHASED AS PROVIDED
HEREIN.  THE SECURITIES WILL ACCRUE INTEREST AT AN ANNUAL RATE OF 7.0588%.  IN
CONNECTION WITH THE ABOVE PURCHASE AND SALE, THE CO-ISSUERS SHALL PAY, ON THE
CLOSING DATE, TO THE INITIAL PURCHASER $5,019,121, IN IMMEDIATELY AVAILABLE
FUNDS.

 

(B)           THE INITIAL PURCHASER HAS ADVISED THE CO-ISSUERS THAT IT PROPOSES
TO OFFER THE SECURITIES FOR RESALE UPON THE TERMS AND SUBJECT TO THE CONDITIONS
SET FORTH HEREIN.  THE INITIAL PURCHASER REPRESENTS AND WARRANTS TO, AND AGREES
WITH, THE CO-ISSUERS, ON THE BASIS OF THE REPRESENTATIONS, WARRANTIES AND
AGREEMENT OF THE CO-ISSUERS, IHOP, THE PARENT COMPANIES AND THE IHOP
SECURITIZATION ENTITIES THAT (I) IT IS PURCHASING THE SECURITIES PURSUANT TO A
PRIVATE SALE EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT, (II) NEITHER IT
NOR ANY OF ITS AFFILIATES, NOR ANY PERSON ACTING ON THE INITIAL PURCHASER’S
BEHALF, HAS SOLICITED OFFERS FOR, OR OFFERED OR SOLD, AND NEITHER IT, NOR ANY OF
ITS AFFILIATES, NOR ANY PERSON ACTING ON THE INITIAL PURCHASER’S BEHALF, WILL
SOLICIT OFFERS FOR, OR OFFER OR SELL, THE SECURITIES BY MEANS OF ANY FORM OF
GENERAL SOLICITATION OR GENERAL ADVERTISING WITHIN THE MEANING OF RULE 502(C) OF
REGULATION D UNDER THE SECURITIES ACT (“REGULATION D”) OR IN ANY MANNER
INVOLVING A PUBLIC OFFERING WITHIN THE MEANING OF SECTION 4(2) OF THE SECURITIES
ACT, AND (III) IT HAS SOLICITED AND WILL SOLICIT OFFERS (THE “EXEMPT RESALES”)
FOR THE SECURITIES ONLY FROM, AND HAVE OFFERED OR SOLD AND WILL OFFER, SELL OR
DELIVER THE SECURITIES, AS PART OF ITS INITIAL OFFERING, ONLY TO PERSONS WHOM IT
REASONABLY BELIEVES TO BE: (A) (I) QUALIFIED INSTITUTIONAL BUYERS (“QUALIFIED
INSTITUTIONAL BUYERS”) AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT
(“RULE 144A”), OR IF ANY SUCH PERSON IS BUYING FOR ONE OR MORE INSTITUTIONAL
ACCOUNTS FOR WHICH SUCH PERSON IS ACTING AS FIDUCIARY OR AGENT, ONLY WHEN SUCH
PERSON HAS REPRESENTED TO IT THAT EACH SUCH ACCOUNT IS A QUALIFIED INSTITUTIONAL
BUYER TO WHOM NOTICE HAS BEEN GIVEN THAT SUCH SALE OR DELIVERY IS BEING MADE IN
RELIANCE ON RULE 144A AND, IN EACH CASE IN TRANSACTIONS IN ACCORDANCE WITH
RULE 144A AND (II) QUALIFIED PURCHASERS (“QUALIFIED PURCHASERS”) WITHIN THE
MEANING OF SECTION 2(A)(51) OF THE 1940 ACT OR (B) (I) NEITHER “U.S. PERSONS”
(AS SUCH TERM IS DEFINED IN REGULATION S) NOR U.S. RESIDENTS (WITHIN THE MEANING
OF THE 1940 ACT) WHO ACQUIRE THE SECURITIES OUTSIDE THE U.S. IN A TRANSACTION
MEETING THE REQUIREMENTS OF REGULATION S OR (II) QUALIFIED PURCHASERS.  THOSE
PERSONS SPECIFIED IN CLAUSES (A) AND (B) ABOVE ARE REFERRED TO HEREIN AS THE
“ELIGIBLE PURCHASERS”.  IN ADDITION TO THE FOREGOING, THE INITIAL PURCHASER
ACKNOWLEDGES AND AGREES THAT THE CO-ISSUERS AND, FOR PURPOSES OF THE OPINIONS TO
BE DELIVERED TO THE INITIAL PURCHASER PURSUANT TO SECTION 5, COUNSEL FOR THE
CO-ISSUERS AND FOR THE INITIAL PURCHASER, RESPECTIVELY, MAY RELY UPON THE
ACCURACY OF THE

 

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REPRESENTATIONS AND WARRANTIES OF THE INITIAL PURCHASER AND ITS COMPLIANCE WITH
ITS AGREEMENTS CONTAINED IN THIS SECTION 2 (EXCEPT CLAUSE (I) OF THIS SUBSECTION
(B)), AND THE INITIAL PURCHASER HEREBY CONSENTS TO SUCH RELIANCE.

 

(C)           THE CO-ISSUERS ACKNOWLEDGE AND AGREE THAT THE INITIAL PURCHASER
MAY SELL SECURITIES TO ANY AFFILIATE OF THE INITIAL PURCHASER AND THAT ANY SUCH
AFFILIATE MAY SELL SECURITIES PURCHASED BY IT TO THE INITIAL PURCHASER.  THE
CO-ISSUERS ACKNOWLEDGE AND AGREE THAT THE INITIAL PURCHASER MAY, FROM TIME TO
TIME, MAKE ONE OR MORE EXEMPT RESALES FOLLOWING THE CLOSING DATE, WITH RESPECT
TO WHICH THE INITIAL PURCHASER MAY DELIVER A COPY OF THE OFFERING MEMORANDUM.

 

(D)           THE INITIAL PURCHASER ALSO REPRESENTS AND AGREES THAT (I) IT HAS
COMPLIED AND WILL COMPLY WITH ALL APPLICABLE PROVISIONS OF THE FSMA WITH RESPECT
TO ANYTHING DONE BY IT IN RELATION TO THE SECURITIES IN, FROM OR OTHERWISE
INVOLVING THE UNITED KINGDOM, AND (II) IT HAS ONLY COMMUNICATED OR CAUSED TO BE
COMMUNICATED AND IT WILL ONLY COMMUNICATE OR CAUSE TO BE COMMUNICATED ANY
INVITATION OR INDUCEMENT TO ENGAGE IN INVESTMENT ACTIVITY (WITHIN THE MEANING OF
SECTION 21 OF THE FSMA) RECEIVED BY IT IN CONNECTION WITH THE ISSUE OR SALE OF
ANY SECURITIES, IN CIRCUMSTANCES IN WHICH SECTION 21(1) OF THE FSMA DOES NOT
APPLY TO THE CO-ISSUERS.

 

(E)           THE INITIAL PURCHASER ALSO REPRESENTS AND AGREES THAT, IN RELATION
TO EACH MEMBER STATE OF THE EUROPEAN ECONOMIC AREA WHICH HAS IMPLEMENTED THE
PROSPECTUS DIRECTIVE (EACH, A “RELEVANT MEMBER STATE”), WITH EFFECT FROM AND
INCLUDING THE DATE ON WHICH THE PROSPECTUS DIRECTIVE IS IMPLEMENTED IN THAT
RELEVANT MEMBER STATE (THE “RELEVANT IMPLEMENTATION DATE”), IT HAS NOT MADE AND
WILL NOT MAKE AN OFFER OF THE SECURITIES TO THE PUBLIC IN THAT RELEVANT MEMBER
STATE PRIOR TO THE PUBLICATION OF A PROSPECTUS IN RELATION TO THE SECURITIES
WHICH HAS BEEN APPROVED BY THE COMPETENT AUTHORITY IN THAT RELEVANT MEMBER STATE
OR, WHERE APPROPRIATE, APPROVED IN ANOTHER RELEVANT MEMBER STATE AND NOTIFIED TO
THE COMPETENT AUTHORITY IN THAT RELEVANT MEMBER STATE, ALL IN ACCORDANCE WITH
THE PROSPECTUS DIRECTIVE, EXCEPT THAT IT MAY, WITH EFFECT FROM AND INCLUDING THE
RELEVANT IMPLEMENTATION DATE, MAKE AN OFFER OF THE SECURITIES TO THE PUBLIC IN
THAT RELEVANT MEMBER STATE AT ANY TIME:

 

(I)            TO LEGAL ENTITIES WHICH ARE AUTHORIZED OR REGULATED TO OPERATE IN
THE FINANCIAL MARKETS OR, IF NOT SO AUTHORIZED OR REGULATED, WHOSE CORPORATE
PURPOSE IS SOLELY TO INVEST IN SECURITIES;

 

(II)           TO ANY LEGAL ENTITY WHICH HAS TWO OR MORE OF (A) AN AVERAGE OF AT
LEAST 250 EMPLOYEES DURING THE LAST FINANCIAL YEAR; (B) A TOTAL BALANCE SHEET OF
MORE THAN €43,000,000 AND (C) AN ANNUAL NET TURNOVER OF MORE THAN €50,000,000,
AS SHOWN IN ITS LAST ANNUAL OR CONSOLIDATED ACCOUNTS; OR

 

(III)          IN ANY OTHER CIRCUMSTANCES WHICH DO NOT REQUIRE THE PUBLICATION
BY THE ISSUER OF A PROSPECTUS PURSUANT TO ARTICLE 3 OF THE PROSPECTUS DIRECTIVE.

 

For the purposes of this representation, the expression an “offer of the
Securities to the public” in any Relevant Member State means the communication
in any form and

 

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by any means of sufficient information on the terms of the offer and the
Securities to be offered so as to enable an investor to decide to purchase or
subscribe to the Securities, as the same may be varied in that Relevant Member
State by any measure implementing the Prospectus Directive in that Relevant
Member State and the expression “Prospectus Directive” means Directive
2003/71/EC and includes any relevant implementing measure in each Relevant
Member State.

 

(F)            THE INITIAL PURCHASER ALSO REPRESENTS AND AGREES THAT THAT IT
WILL NOT OFFER OR SELL ANY SECURITIES, DIRECTLY OR INDIRECTLY, IN JAPAN OR TO,
OR FOR THE BENEFIT OF, ANY RESIDENT OF JAPAN (WHICH TERM AS USED HEREIN MEANS
ANY PERSON RESIDENT IN JAPAN, INCLUDING ANY CORPORATION OR OTHER ENTITY
ORGANIZED UNDER THE LAWS OF JAPAN), OR TO OTHERS FOR RE-OFFERING OR RESALE,
DIRECTLY OR INDIRECTLY, IN JAPAN OR TO A RESIDENT OF JAPAN, EXCEPT PURSUANT TO
AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF, AND OTHERWISE IN COMPLIANCE
WITH, THE SECURITIES AND EXCHANGE LAW AND ANY OTHER APPLICABLE LAWS, REGULATIONS
AND MINISTERIAL GUIDELINES OF JAPAN.

 

(G)           THE INITIAL PURCHASER ALSO REPRESENTS AND AGREES THAT IT HAS NOT
MADE AND, UNLESS IT OBTAINS THE PRIOR CONSENT OF THE PARENT COMPANIES AND THE
CO-ISSUERS, WILL NOT MAKE ANY OFFER RELATING TO THE SECURITIES THAT WOULD
CONSTITUTE A FREE WRITING COMMUNICATION, IT BEING UNDERSTOOD THAT A FREE WRITING
COMMUNICATION THAT (I) CONTAINS ONLY INFORMATION THAT DESCRIBES THE FINAL TERMS
OF THE SECURITIES OR THEIR OFFERING AND THAT IS INCLUDED IN THE OFFERING
MEMORANDUM OR (II) DOES NOT CONTAIN ANY MATERIAL INFORMATION ABOUT THE
CO-ISSUERS OR THEIR SECURITIES THAT WAS PROVIDED BY OR ON BEHALF OF THE
CO-ISSUERS, SHALL NOT BE AN ISSUER FREE WRITING COMMUNICATION FOR PURPOSES OF
THIS AGREEMENT.

 

3.             Delivery of and Payment for the Securities

 

(A)           DELIVERY OF AND PAYMENT FOR THE SECURITIES SHALL BE MADE AT THE
OFFICES OF SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP, FOUR TIMES SQUARE, NEW
YORK, NEW YORK, 10036 OR AT SUCH OTHER PLACE AS SHALL BE AGREED UPON BY THE
INITIAL PURCHASER AND THE CO-ISSUERS, AT 10:00 A.M., NEW YORK CITY TIME, ON
NOVEMBER 29, 2007 OR AT SUCH OTHER TIME OR DATE AS SHALL BE AGREED UPON BY THE
INITIAL PURCHASER AND THE CO-ISSUERS (SUCH DATE AND TIME OF PAYMENT AND DELIVERY
BEING REFERRED TO HEREIN AS THE “CLOSING DATE”).

 

(B)           ON THE CLOSING DATE, PAYMENT OF THE PURCHASE PRICE FOR THE
SECURITIES SHALL BE MADE TO THE CO-ISSUERS BY WIRE OR BOOK-ENTRY TRANSFER OF
SAME-DAY FUNDS TO SUCH ACCOUNT OR ACCOUNTS AS THE CO-ISSUERS SHALL SPECIFY PRIOR
TO THE CLOSING DATE OR BY SUCH OTHER MEANS AS THE PARTIES HERETO SHALL AGREE
PRIOR TO THE CLOSING DATE AGAINST DELIVERY TO THE INITIAL PURCHASER OF THE
SECURITIES THROUGH THE FACILITIES OF THE DEPOSITORY TRUST COMPANY (“DTC”).  TIME
SHALL BE OF THE ESSENCE AND DELIVERY AT THE TIME AND PLACE SPECIFIED PURSUANT TO
THIS AGREEMENT IS A FURTHER CONDITION OF THE OBLIGATION OF THE INITIAL PURCHASER
HEREUNDER.  UPON DELIVERY, THE SECURITIES SHALL BE IN GLOBAL FORM, REGISTERED IN
SUCH NAMES AND IN SUCH DENOMINATIONS AS THE INITIAL PURCHASER SHALL HAVE
REQUESTED.

 

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4.             Further Agreements of the Co-Issuers, the Parent Companies and
the IHOP Securitization Entities

 

Each of the Parent Companies and each of the Co-Issuers, jointly and severally,
agrees with the Initial Purchaser:

 

(A)           TO PROVIDE, AS SOON AS PRACTICABLE AFTER THE CLOSING DATE, A FINAL
OFFERING MEMORANDUM FOR THE SECURITIES, TO BE DATED AS OF A DATE TO BE SPECIFIED
BY THE INITIAL PURCHASER (THE “INITIAL DATE”), (I) WHICH SHALL NOT INCLUDE ANY
UNTRUE STATEMENT OF A MATERIAL FACT OR OMIT TO STATE ANY MATERIAL FACT REQUIRED
TO BE STATED THEREIN OR NECESSARY TO MAKE THE STATEMENTS THEREIN, IN THE LIGHT
OF THE CIRCUMSTANCES UNDER WHICH THEY WERE MADE, NOT MISLEADING, AND (II) WHICH
SHALL CONTAIN ALL FINANCIAL STATEMENTS AND OTHER DATA, INCLUDING AUDITED
FINANCIAL STATEMENTS, ALL UNAUDITED FINANCIAL STATEMENTS (WHICH SHALL HAVE BEEN
REVIEWED BY INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS AS PROVIDED IN STATEMENT
ON AUDITING STANDARDS NO. 100) AND ALL APPROPRIATE PRO FORMA FINANCIAL
STATEMENTS PREPARED IN ACCORDANCE WITH REGULATION S-X UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (TO THE EXTENT DEEMED REASONABLY NECESSARY BY THE INITIAL
PURCHASER), AND ALL OTHER DATA (INCLUDING SELECTED FINANCIAL DATA), IN EACH
CASE, THAT THE COMMISSION WOULD REQUIRE IN A REGISTERED OFFERING OF ANY OR ALL
OF THE SECURITIES (IN EACH CASE, EXCEPT AS OTHERWISE AGREED) OR THAT WOULD BE
NECESSARY FOR THE INITIAL PURCHASER TO RECEIVE CUSTOMARY “COMFORT” (INCLUDING,
WITHOUT LIMITATION, “NEGATIVE ASSURANCE” COMFORT) FROM INDEPENDENT REGISTERED
PUBLIC ACCOUNTANTS (COLLECTIVELY, THE “REQUIRED FINANCIAL INFORMATION”);

 

(B)           ON THE INITIAL DATE, TO USE ITS BEST EFFORTS:

 

(I)            TO CAUSE TO BE FURNISHED TO THE INITIAL PURCHASER A LETTER (THE
“E&Y INITIAL COMFORT LETTER”) OF E&Y, IN FORM AND SUBSTANCE SATISFACTORY TO THE
INITIAL PURCHASER, ADDRESSED TO THE INITIAL PURCHASER AND DATED THE INITIAL
DATE, (I) CONCERNING THE ACCOUNTING, FINANCIAL AND CERTAIN OF THE STATISTICAL
INFORMATION WITH RESPECT TO THE PARENT COMPANIES AND THE CO-ISSUERS SET FORTH IN
THE OFFERING MEMORANDUM AND (II) COVERING SUCH OTHER MATTERS AS ARE ORDINARILY
COVERED BY ACCOUNTANTS’ “COMFORT LETTERS” TO INITIAL PURCHASERS IN CONNECTION
WITH SUCH OFFERINGS OF SECURITIES;

 

(II)           TO CAUSE TO BE FURNISHED TO THE INITIAL PURCHASER A LETTER (THE
“INITIAL AUP LETTER”) OF FTI CONSULTING, INC., ADDRESSED TO THE INITIAL
PURCHASER AND DATED THE INITIAL DATE, IN FORM AND SUBSTANCE SATISFACTORY TO THE
INITIAL PURCHASER, CONCERNING CERTAIN AGREED-UPON PROCEDURES PERFORMED IN
RESPECT OF THE INFORMATION PRESENTED IN THE PRELIMINARY MARKETING MATERIALS, THE
SUPPLEMENTAL MATERIALS (IF ANY), THE OFFERING MEMORANDUM AND THE INVESTOR MODEL
RUNS;

 

(III)          TO CAUSE SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP, SPECIAL
COUNSEL TO THE CO-ISSUERS, TO FURNISH TO THE INITIAL PURCHASER (1) A “10B-5”
DISCLOSURE LETTER, SUBSTANTIALLY IN THE FORM ATTACHED HERETO AS EXHIBIT 4 AND
(2) CUSTOMARY OPINIONS WITH RESPECT TO (A) THE EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT OF THE OFFER AND SALE OF THE SECURITIES BY THE CO-ISSUERS AND
THE INITIAL RESALE OF THE SECURITIES BY THE INITIAL PURCHASER AND (B) THE
CONFORMITY OF THE TRANSACTION DOCUMENTS (AS DEFINED

 

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HEREIN) TO THE DESCRIPTIONS THEREOF AND CERTAIN TAX DISCLOSURES IN THE OFFERING
MEMORANDUM, IN A FORM TO BE AGREED REASONABLY BETWEEN IHOP AND THE INITIAL
PURCHASER, IN EACH CASE, DATED AS OF THE INITIAL DATE; AND

 

(IV)          TO CAUSE TO BE FURNISHED TO THE INITIAL PURCHASER CERTIFICATES
WITH RESPECT TO THE INITIAL DATE THAT ARE SUBSTANTIALLY SIMILAR TO THOSE TO BE
FURNISHED ON THE CLOSING DATE PURSUANT TO SECTIONS 5(S), (T), AND (U), EXCEPT
THAT SUCH CERTIFICATES SHALL PERTAIN TO THE OFFERING MEMORANDUM RATHER THAN THE
DRAFT OFFERING MEMORANDUM, AND SHALL STATE THAT THE RELEVANT OFFICER HAS NO
REASON TO BELIEVE THAT (A) THE OFFERING MEMORANDUM, AS OF THE INITIAL DATE,
INCLUDED ANY UNTRUE STATEMENT OF A MATERIAL FACT OR OMITTED TO STATE ANY
MATERIAL FACT NECESSARY IN ORDER TO MAKE THE STATEMENTS THEREIN, IN LIGHT OF THE
CIRCUMSTANCES UNDER WHICH THEY WERE MADE, NOT MISLEADING OR (B) SINCE THE DATE
OF THE OFFERING MEMORANDUM, ANY EVENT HAS OCCURRED WHICH SHOULD HAVE BEEN SET
FORTH IN A SUPPLEMENT OR AMENDMENT TO THE OFFERING MEMORANDUM;

 

(C)           IF THE EXEMPT RESALES OF THE SECURITIES BY THE INITIAL PURCHASER
AS CONTEMPLATED BY THIS AGREEMENT HAS NOT BEEN COMPLETED BY THE DATE ON WHICH
THE INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS FOR IHOP ARE NO LONGER ABLE TO
DELIVER A COMFORT LETTER WITH RESPECT TO THE FINANCIAL INFORMATION FOR THE
QUARTER ENDED SEPTEMBER 30, 2007 CONTAINED IN THE OFFERING MEMORANDUM, TO
PROVIDE, AS SOON AS PRACTICABLE AFTER THE FILING OF IHOP’S ANNUAL REPORT ON
FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2007, AN UPDATED VERSION OF THE
OFFERING MEMORANDUM, (I) WHICH SHALL NOT INCLUDE ANY UNTRUE STATEMENT OF A
MATERIAL FACT OR OMIT TO STATE ANY MATERIAL FACT REQUIRED TO BE STATED THEREIN
OR NECESSARY TO MAKE THE STATEMENTS THEREIN, IN THE LIGHT OF THE CIRCUMSTANCES
UNDER WHICH THEY WERE MADE, NOT MISLEADING, AND (II) WHICH SHALL CONTAIN ALL
REQUIRED FINANCIAL INFORMATION;

 

(D)           (I)            TO ADVISE THE INITIAL PURCHASER PROMPTLY AND, IF
REQUESTED, CONFIRM SUCH ADVICE IN WRITING, OF THE HAPPENING OF ANY EVENT WHICH
MAKES ANY STATEMENT OF A MATERIAL FACT MADE IN THE OFFERING MEMORANDUM UNTRUE OR
WHICH REQUIRES THE MAKING OF ANY ADDITIONS TO OR CHANGES IN THE OFFERING
MEMORANDUM IN ORDER TO MAKE THE STATEMENTS THEREIN, IN LIGHT OF THE
CIRCUMSTANCES UNDER WHICH THEY WERE MADE, NOT MISLEADING, (II) TO ADVISE THE
INITIAL PURCHASER PROMPTLY OF ANY ORDER PREVENTING OR SUSPENDING THE USE OF THE
PRELIMINARY MATERIALS, THE SUPPLEMENTAL MATERIALS (AS DEFINED HEREIN) OR THE
OFFERING MEMORANDUM, OF ANY SUSPENSION OF THE QUALIFICATION OF THE SECURITIES
FOR OFFERING OR SALE IN ANY JURISDICTION AND OF THE INITIATION OR THREATENING OF
ANY PROCEEDING FOR ANY SUCH PURPOSE AND (III) TO USE COMMERCIALLY REASONABLE
EFFORTS TO PREVENT THE ISSUANCE OF ANY SUCH ORDER PREVENTING OR SUSPENDING THE
USE OF THE PRELIMINARY MATERIALS, THE SUPPLEMENTAL MATERIALS OR THE OFFERING
MEMORANDUM OR SUSPENDING ANY SUCH QUALIFICATION AND, IF ANY SUCH SUSPENSION IS
ISSUED, TO OBTAIN THE LIFTING THEREOF AT THE EARLIEST POSSIBLE TIME;

 

(E)           TO PREPARE THE OFFERING MEMORANDUM IN A FORM REASONABLY ACCEPTABLE
TO THE INITIAL PURCHASER AND TO FURNISH PROMPTLY TO THE INITIAL PURCHASER AND
COUNSEL FOR THE INITIAL PURCHASER, WITHOUT CHARGE, AS MANY COPIES OF THE
OFFERING MEMORANDUM (AND ANY AMENDMENTS OR SUPPLEMENTS THERETO) AS MAY BE
REASONABLY REQUESTED;

 

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(F)            PRIOR TO MAKING ANY AMENDMENT OR SUPPLEMENT TO THE OFFERING
MEMORANDUM, TO FURNISH A COPY THEREOF TO THE INITIAL PURCHASER AND COUNSEL FOR
THE INITIAL PURCHASER AND NOT TO EFFECT ANY SUCH AMENDMENT OR SUPPLEMENT WITHOUT
THE CONSENT OF THE INITIAL PURCHASER, WHICH CONSENT SHALL NOT BE UNREASONABLY
WITHHELD OR DELAYED;

 

(G)           IF, AT ANY TIME PRIOR TO COMPLETION OF THE RESALE OF THE
SECURITIES BY THE INITIAL PURCHASER (IT BEING AGREED THAT UPON REQUEST BY THE
CO-ISSUERS, THE INITIAL PURCHASER WILL PROMPTLY ADVISE THE CO-ISSUERS AS TO WHEN
SUCH RESALE HAS BEEN COMPLETED), ANY EVENT SHALL OCCUR OR CONDITION EXIST AS A
RESULT OF WHICH IT IS NECESSARY, IN THE OPINION OF COUNSEL FOR THE INITIAL
PURCHASER OR COUNSEL FOR THE CO-ISSUERS, TO AMEND OR SUPPLEMENT THE OFFERING
MEMORANDUM IN ORDER THAT THE OFFERING MEMORANDUM WILL NOT INCLUDE AN UNTRUE
STATEMENT OF A MATERIAL FACT OR OMIT TO STATE A MATERIAL FACT NECESSARY IN ORDER
TO MAKE THE STATEMENTS THEREIN, IN LIGHT OF THE CIRCUMSTANCES EXISTING AT THE
TIME IT IS DELIVERED TO A PURCHASER, NOT MISLEADING, OR IF IT IS NECESSARY, IN
THE OPINION OF SUCH COUNSEL, AT ANY SUCH TIME TO AMEND OR SUPPLEMENT THE
OFFERING MEMORANDUM TO COMPLY WITH APPLICABLE LAW, TO PROMPTLY PREPARE SUCH
AMENDMENT OR SUPPLEMENT AS MAY BE NECESSARY TO CORRECT SUCH UNTRUE STATEMENT OR
OMISSION OR SO THAT THE OFFERING MEMORANDUM, AS SO AMENDED OR SUPPLEMENTED, WILL
COMPLY WITH APPLICABLE LAW;

 

(H)           ON THE DATE OF EACH SUPPLEMENT FURNISHED IN ACCORDANCE WITH
SECTION 4(G) HEREOF AND ON EACH DATE REQUESTED BY THE INITIAL PURCHASER IN
CONNECTION WITH THE RESALE OF THE SECURITIES (EACH OF THE FOREGOING, A
“BRINGDOWN DATE”), TO USE ITS BEST EFFORTS:

 

(I)            TO CAUSE TO BE FURNISHED TO THE INITIAL PURCHASER A LETTER OF
E&Y, IN FORM AND SUBSTANCE SATISFACTORY TO THE INITIAL PURCHASER, ADDRESSED TO
THE INITIAL PURCHASER AND DATED SUCH BRINGDOWN DATE (I) CONFIRMING THAT IT IS A
FIRM OF INDEPENDENT PUBLIC ACCOUNTANTS WITH RESPECT TO IHOP, IHOP FRANCHISING
AND THE MERGER SUB WITHIN THE MEANING OF RULE 101 OF THE CODE OF PROFESSIONAL
CONDUCT OF THE AICPA AND ITS INTERPRETATIONS AND RULINGS THEREUNDER AND ARE IN
COMPLIANCE WITH THE APPLICABLE REQUIREMENTS RELATING TO THE QUALIFICATION OF
ACCOUNTANTS UNDER RULE 2-01 OF REGULATION S-X OF THE SEC, (II) STATING, AS OF
SUCH BRINGDOWN DATE (OR, WITH RESPECT TO MATTERS INVOLVING CHANGES OR
DEVELOPMENTS SINCE THE RESPECTIVE DATES AS OF WHICH SPECIFIED FINANCIAL
INFORMATION IS GIVEN IN THE OFFERING MEMORANDUM, AS OF A DATE NOT MORE THAN
THREE BUSINESS DAYS PRIOR TO SUCH BRINGDOWN DATE), THAT THE CONCLUSIONS AND
FINDINGS OF SUCH ACCOUNTANTS WITH RESPECT TO THE FINANCIAL INFORMATION AND OTHER
MATTERS COVERED BY THE E&Y INITIAL COMFORT LETTER ARE ACCURATE AND
(III) CONFIRMING IN ALL MATERIAL RESPECTS THE CONCLUSIONS AND FINDINGS SET FORTH
IN THE E&Y INITIAL COMFORT LETTER;

 

(II)           TO CAUSE TO BE FURNISHED TO THE INITIAL PURCHASER A LETTER  OF
FTI CONSULTING, INC., IN FORM AND SUBSTANCE SATISFACTORY TO THE INITIAL
PURCHASER, ADDRESSED TO THE INITIAL PURCHASER AND DATED SUCH BRINGDOWN DATE
(I) STATING, AS OF SUCH BRINGDOWN DATE (OR, WITH RESPECT TO MATTERS INVOLVING
CHANGES OR DEVELOPMENTS SINCE THE RESPECTIVE DATES AS OF WHICH SPECIFIED
INFORMATION IS GIVEN IN THE OFFERING MEMORANDUM, AS OF A DATE NOT MORE THAN
THREE BUSINESS DAYS PRIOR TO SUCH BRINGDOWN DATE), THAT THE CONCLUSIONS,
PROCEDURES AND FINDINGS OF SUCH COMPANY WITH RESPECT TO THE INFORMATION AND
OTHER MATTERS COVERED BY THE INITIAL AUP LETTER ARE ACCURATE AND (II) CONFIRMING
IN ALL

 

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MATERIAL RESPECTS THE CONCLUSIONS, PROCEDURES AND FINDINGS SET FORTH IN THE
INITIAL AUP LETTER;

 

(III)          TO CAUSE SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP, SPECIAL
COUNSEL TO THE CO-ISSUERS, TO FURNISH TO THE INITIAL PURCHASER A  (1) A “10B-5”
DISCLOSURE LETTER, SUBSTANTIALLY IN THE FORM ATTACHED HERETO AS EXHIBIT 4 AND
(2) CUSTOMARY OPINIONS WITH RESPECT TO (A) THE EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT OF THE OFFER AND SALE OF THE SECURITIES BY THE CO-ISSUERS AND
THE INITIAL RESALE OF THE SECURITIES BY THE INITIAL PURCHASER AND (B) THE
CONFORMITY OF THE TRANSACTION DOCUMENTS (AS DEFINED HEREIN) TO THE DESCRIPTIONS
THEREOF AND CERTAIN TAX DISCLOSURES IN THE OFFERING MEMORANDUM, IN A FORM TO BE
AGREED REASONABLY BETWEEN IHOP AND THE INITIAL PURCHASER, IN EACH CASE DATED AS
OF SUCH BRINGDOWN DATE, AND

 

(IV)          TO CAUSE TO BE FURNISHED TO THE INITIAL PURCHASER CERTIFICATES
WITH RESPECT TO SUCH BRINGDOWN DATE THAT ARE SUBSTANTIALLY SIMILAR TO THOSE TO
BE FURNISHED ON THE CLOSING DATE PURSUANT TO SECTIONS 5(S), (T), AND (U) EXCEPT
THAT SUCH CERTIFICATES SHALL PERTAIN TO THE OFFERING MEMORANDUM RATHER THAN THE
DRAFT OFFERING MEMORANDUM, AND SHALL STATE THAT NOTHING HAS COME TO EACH
RELEVANT OFFICER’S ATTENTION THAT WOULD LEAD SUCH OFFICER TO BELIEVE THAT
(A) THE OFFERING MEMORANDUM, AS OF SUCH BRINGDOWN DATE, INCLUDED ANY UNTRUE
STATEMENT OF A MATERIAL FACT OR OMITTED TO STATE ANY MATERIAL FACT NECESSARY IN
ORDER TO MAKE THE STATEMENTS THEREIN, IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH
THEY WERE MADE, NOT MISLEADING OR (B) SINCE THE DATE OF THE OFFERING MEMORANDUM,
ANY EVENT HAS OCCURRED WHICH SHOULD HAVE BEEN SET FORTH IN A SUPPLEMENT OR
AMENDMENT TO THE OFFERING MEMORANDUM;

 

(I)            TO CAUSE THE SENIOR EXECUTIVE OFFICERS OF IHOP, APPLEBEE’S
INTERNATIONAL AND THE CO-ISSUERS (INCLUDING, WITHOUT LIMITATION, JULIA STEWART
AND THOMAS CONFORTI) TO BE AVAILABLE TO PARTICIPATE IN SUCH INVESTOR
PRESENTATIONS AND ROADSHOWS AS THE INITIAL PURCHASER MAY REASONABLY REQUEST IN
CONNECTION WITH THE RESALE OF THE SECURITIES;

 

(J)            TO PROVIDE SUCH OTHER SUPPLEMENTAL MARKETING MATERIAL (THE
“SUPPLEMENTAL MATERIALS”) AS MAY BE REASONABLY REQUESTED BY THE INITIAL
PURCHASER IN CONNECTION WITH THE RESALES OF THE SECURITIES AND AGREED REASONABLY
IN WRITING BY IHOP;

 

(K)           FOR A PERIOD COMMENCING ON THE DATE HEREOF AND ENDING ON THE 180TH
DAY AFTER THE COMPLETION OF THE RESALE OF THE SECURITIES BY THE INITIAL
PURCHASER, NOT TO, DIRECTLY OR INDIRECTLY, (A) OFFER FOR SALE, SELL, OR
OTHERWISE DISPOSE OF (OR ENTER INTO ANY TRANSACTION OR DEVICE THAT IS DESIGNED
TO, OR WOULD BE EXPECTED TO, RESULT IN THE DISPOSITION BY ANY PERSON AT ANY TIME
IN THE FUTURE OF) ANY DEBT SECURITIES OF THE CO-ISSUERS OR THE PARENT COMPANIES
SUBSTANTIALLY SIMILAR TO THE SECURITIES OR SECURITIES CONVERTIBLE INTO OR
EXCHANGEABLE FOR SUCH DEBT SECURITIES OF THE CO-ISSUERS OR THE PARENT COMPANIES,
OR SELL OR GRANT OPTIONS, RIGHTS OR WARRANTS WITH RESPECT TO SUCH DEBT
SECURITIES OF THE CO-ISSUERS OR THE PARENT COMPANIES OR SECURITIES CONVERTIBLE
INTO OR EXCHANGEABLE FOR SUCH DEBT SECURITIES OF THE CO-ISSUERS OR THE PARENT
COMPANIES, (B) ENTER INTO ANY SWAP OR OTHER DERIVATIVES TRANSACTION THAT
TRANSFERS TO ANOTHER, IN WHOLE OR IN PART, ANY OF THE ECONOMIC BENEFITS OR RISKS
OF OWNERSHIP OF SUCH DEBT SECURITIES OF THE CO-ISSUERS OR THE PARENT COMPANIES,
WHETHER ANY SUCH TRANSACTION DESCRIBED IN CLAUSE (1) OR (2) ABOVE IS TO BE

 

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SETTLED BY DELIVERY OF DEBT SECURITIES OF THE CO-ISSUERS OR THE PARENT COMPANIES
OR OTHER SECURITIES, IN CASH OR OTHERWISE, (C) FILE OR CAUSE TO BE FILED A
REGISTRATION STATEMENT, INCLUDING ANY AMENDMENTS, WITH RESPECT TO THE
REGISTRATION OF DEBT SECURITIES OF THE CO-ISSUERS OR THE PARENT COMPANIES
SUBSTANTIALLY SIMILAR TO THE SECURITIES OR SECURITIES CONVERTIBLE, EXERCISABLE
OR EXCHANGEABLE INTO DEBT SECURITIES OF THE CO-ISSUERS OR THE PARENT COMPANIES
OR (D) PUBLICLY ANNOUNCE AN OFFERING OF ANY DEBT SECURITIES OF THE CO-ISSUERS OR
THE PARENT COMPANIES SUBSTANTIALLY SIMILAR TO THE SECURITIES OR SECURITIES
CONVERTIBLE OR EXCHANGEABLE INTO SUCH DEBT SECURITIES, IN EACH CASE WITHOUT THE
PRIOR WRITTEN CONSENT OF THE INITIAL PURCHASER;

 

(L)            FOR SO LONG AS THE SECURITIES ARE OUTSTANDING, TO TIMELY FILE (OR
OBTAIN EXTENSIONS IN RESPECT THEREOF AND FILE WITHIN THE APPLICABLE GRACE
PERIOD) ALL REPORTS REQUIRED TO BE FILED BY THE PARENT COMPANIES AFTER THE DATE
HEREOF PURSUANT TO THE EXCHANGE ACT;

 

(M)          FOR SO LONG AS THE SECURITIES ARE OUTSTANDING AND ARE “RESTRICTED
SECURITIES” WITHIN THE MEANING OF RULE 144(A)(3) UNDER THE SECURITIES ACT, TO
FURNISH TO HOLDERS OF THE SECURITIES AND PROSPECTIVE PURCHASERS OF THE
SECURITIES DESIGNATED BY SUCH HOLDERS, UPON REQUEST OF SUCH HOLDERS OR SUCH
PROSPECTIVE PURCHASERS, THE INFORMATION REQUIRED TO BE DELIVERED PURSUANT TO
RULE 144A(D)(4) UNDER THE SECURITIES ACT, UNLESS THE CO-ISSUERS ARE THEN SUBJECT
TO AND IN COMPLIANCE WITH SECTION 13 OR 15(D) OF THE EXCHANGE ACT (THE FOREGOING
AGREEMENT BEING FOR THE BENEFIT OF THE HOLDERS FROM TIME TO TIME OF THE
SECURITIES AND PROSPECTIVE PURCHASERS OF THE SECURITIES DESIGNATED BY SUCH
HOLDERS);

 

(N)           TO PROMPTLY TAKE FROM TIME TO TIME SUCH ACTIONS AS THE INITIAL
PURCHASER MAY REASONABLY REQUEST TO QUALIFY THE SECURITIES FOR OFFERING AND SALE
UNDER THE SECURITIES OR BLUE SKY LAWS OF SUCH JURISDICTIONS AS THE INITIAL
PURCHASER MAY DESIGNATE AND TO CONTINUE SUCH QUALIFICATIONS IN EFFECT FOR SO
LONG AS REQUIRED FOR THE RESALE OF THE SECURITIES; AND TO ARRANGE FOR THE
DETERMINATION OF THE ELIGIBILITY FOR INVESTMENT OF THE SECURITIES UNDER THE LAWS
OF SUCH JURISDICTIONS AS THE INITIAL PURCHASER MAY REASONABLY REQUEST; PROVIDED
THAT NONE OF THE CO-ISSUERS SHALL BE OBLIGATED TO QUALIFY AS FOREIGN
CORPORATIONS IN ANY JURISDICTION IN WHICH THEY ARE NOT SO QUALIFIED OR TO FILE A
GENERAL CONSENT TO SERVICE OF PROCESS IN ANY JURISDICTION;

 

(O)           TO ASSIST THE INITIAL PURCHASER IN ARRANGING FOR THE SECURITIES TO
BE ELIGIBLE FOR CLEARANCE AND SETTLEMENT IN THE UNITED STATES THROUGH DTC AND IN
EUROPE THROUGH EUROCLEAR BANK, S.A./N.V., OR CLEARSTREAM BANKING, SOCIÉTÉ
ANONYME;

 

(P)           TO COMPLY WITH ALL THE TERMS AND CONDITIONS OF ALL AGREEMENTS SET
FORTH IN THE REPRESENTATION LETTERS OF THE CO-ISSUERS TO DTC RELATING TO THE
APPROVAL OF THE SECURITIES BY DTC FOR “BOOK ENTRY” TRANSFER;

 

(Q)           NOT TO TAKE ANY ACTION OR OMIT TO TAKE ANY ACTION (SUCH AS ISSUING
ANY PRESS RELEASE RELATING TO THE SECURITIES WITHOUT AN APPROPRIATE LEGEND)
WHICH MAY RESULT IN THE LOSS BY THE INITIAL PURCHASER OF THE ABILITY TO RELY ON
ANY STABILIZATION SAFE HARBOR PROVIDED BY THE FINANCIAL SERVICES AUTHORITY UNDER
THE FSMA;

 

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(R)            NOT TO, AND TO CAUSE THEIR AFFILIATES NOT TO, SELL, OFFER FOR
SALE OR SOLICIT OFFERS TO BUY OR OTHERWISE NEGOTIATE IN RESPECT OF ANY SECURITY
(AS SUCH TERM IS DEFINED IN THE SECURITIES ACT) WHICH COULD REASONABLY BE
EXPECTED TO BE INTEGRATED WITH THE SALE OF THE SECURITIES IN A MANNER WHICH
WOULD REQUIRE REGISTRATION OF THE SECURITIES UNDER THE SECURITIES ACT;

 

(S)           NOT TO, AND TO CAUSE ITS AFFILIATES NOT TO, ENGAGE IN ANY DIRECTED
SELLING EFFORTS WITHIN THE MEANING OF REGULATION S;

 

(T)            TO COMPLY, AND TO CAUSE ITS AFFILIATES TO COMPLY, WITH THE
OFFERING RESTRICTIONS SET FORTH IN REGULATION S;

 

(U)           NOT TO, AND TO CAUSE THEIR AFFILIATES NOT TO, AUTHORIZE OR
KNOWINGLY PERMIT ANY PERSON ACTING ON THEIR BEHALF TO SOLICIT ANY OFFER TO BUY
OR OFFER TO SELL THE SECURITIES BY MEANS OF ANY FORM OF GENERAL SOLICITATION OR
GENERAL ADVERTISING WITHIN THE MEANING OF REGULATION D OR IN ANY MANNER
INVOLVING A PUBLIC OFFERING WITHIN THE MEANING OF SECTION 4(2) OF THE SECURITIES
ACT; AND NOT TO OFFER, SELL, CONTRACT TO SELL OR OTHERWISE DISPOSE OF, DIRECTLY
OR INDIRECTLY, ANY SECURITIES UNDER CIRCUMSTANCES WHERE SUCH OFFER, SALE,
CONTRACT OR DISPOSITION WOULD CAUSE THE EXEMPTION AFFORDED BY SECTION 4(2) OR OF
RULE 144A OF THE SECURITIES ACT OR SECTION 3(C)(7) OF THE 1940 ACT TO CEASE TO
BE APPLICABLE TO THE OFFERING AND SALE OF THE SECURITIES AS CONTEMPLATED BY THIS
AGREEMENT , THE DRAFT OFFERING MEMORANDUM AND THE OFFERING MEMORANDUM;

 

(V)           IN CONNECTION WITH THE OFFERING OF THE SECURITIES, UNTIL THE
INITIAL PURCHASER SHALL HAVE NOTIFIED THE CO-ISSUERS OF THE COMPLETION OF THE
RESALE OF THE SECURITIES, NOT TO, AND TO CAUSE THEIR AFFILIATED PURCHASERS (AS
DEFINED IN REGULATION M UNDER THE EXCHANGE ACT) NOT TO, EITHER ALONE OR WITH ONE
OR MORE OTHER PERSONS, BID FOR OR PURCHASE, FOR ANY ACCOUNT IN WHICH THEY OR ANY
OF THEIR AFFILIATED PURCHASERS HAVE A BENEFICIAL INTEREST, ANY SECURITIES, OR
ATTEMPT TO INDUCE ANY PERSON TO PURCHASE ANY SECURITIES; AND NOT TO, AND TO
CAUSE THEIR AFFILIATED PURCHASERS NOT TO, MAKE BIDS OR PURCHASE FOR THE PURPOSE
OF CREATING ACTUAL, OR APPARENT, ACTIVE TRADING IN OR OF RAISING THE PRICE OF
THE SECURITIES;

 

(W)          IN CONNECTION WITH THE OFFERING OF THE SECURITIES, TO MAKE THEIR
OFFICERS, EMPLOYEES, INDEPENDENT ACCOUNTANTS AND LEGAL COUNSEL AVAILABLE UPON
REASONABLE REQUEST BY THE INITIAL PURCHASER;

 

(X)            TO FURNISH TO THE INITIAL PURCHASER, PRIOR TO THE DATE OF EACH
OFFERING MEMORANDUM, A COPY OF EACH SIGNED INDEPENDENT ACCOUNTANTS’ REPORT TO BE
INCLUDED IN SUCH OFFERING MEMORANDUM;

 

(Y)           TO APPLY THE NET PROCEEDS FROM THE SALE OF THE SECURITIES AS SET
FORTH IN HEREIN (AS OF THE CLOSING DATE) AND THE OFFERING MEMORANDUM UNDER THE
HEADING “USE OF PROCEEDS” (AS OF THE INITIAL DATE AND EACH BRINGDOWN DATE);

 

(Z)            TO THE EXTENT THAT THE RATINGS TO BE PROVIDED WITH RESPECT TO THE
SECURITIES BY MOODY’S INVESTORS SERVICE, INC. (“MOODY’S”), STANDARD & POOR’S
RATINGS SERVICES, A DIVISION OF THE MCGRAW-HILL COMPANIES, INC. (“S&P”) AND
FITCH, INC. (“FITCH”, AND TOGETHER WITH MOODY’S AND S&P, THE “RATING AGENCIES”)
ARE CONDITIONAL UPON THE

 

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FURNISHING OF DOCUMENTS OR THE TAKING OF ANY OTHER ACTIONS BY THE CO-ISSUERS,
THE PARENT COMPANIES OR ANY OF THEIR AFFILIATES, TO FURNISH SUCH DOCUMENTS AND
TAKE ANY SUCH OTHER ACTION THAT IS REASONABLY REQUESTED BY THE RATING AGENCIES;

 

(AA)         FOR A PERIOD FROM THE DATE OF THIS AGREEMENT UNTIL THE RETIREMENT
OF THE SECURITIES, OR UNTIL SUCH TIME AS THE INITIAL PURCHASER SHALL CEASE TO
MAINTAIN A SECONDARY MARKET IN THE SECURITIES, WHICHEVER OCCURS FIRST, TO
FURNISH TO THE INITIAL PURCHASER, AS SOON AS AVAILABLE, (I) COPIES OF EACH
REPORT AND CERTIFICATE AND ANY FINANCIAL INFORMATION DELIVERED TO THE HOLDERS OF
THE SECURITIES OR FILED WITH ANY STOCK EXCHANGE OR REGULATORY BODY AND (II) FROM
TIME TO TIME SUCH OTHER INFORMATION CONCERNING THE CO-ISSUERS AND THE PARENT
COMPANIES AS THE INITIAL PURCHASER MAY REASONABLY REQUEST;

 

(BB)         UNLESS IT OBTAINS THE PRIOR CONSENT OF THE INITIAL PURCHASER, NOT
TO MAKE (AND EACH SUCH PARTY REPRESENTS THAT IT HAS NOT MADE), ANY OFFER
RELATING TO THE SECURITIES THAT WOULD CONSTITUTE A FREE WRITING COMMUNICATION;
IF AT ANY TIME FOLLOWING ISSUANCE OF A FREE WRITING COMMUNICATION ANY EVENT
OCCURRED OR OCCURS AS A RESULT OF WHICH SUCH FREE WRITING COMMUNICATION
CONFLICTS WITH THE INFORMATION IN THE OFFERING MEMORANDUM OR, WHEN TAKEN
TOGETHER WITH THE INFORMATION IN THE OFFERING MEMORANDUM, INCLUDES AN UNTRUE
STATEMENT OF A MATERIAL FACT OR OMITS TO STATE ANY MATERIAL FACT NECESSARY IN
ORDER TO MAKE THE STATEMENTS THEREIN, IN THE LIGHT OF THE CIRCUMSTANCES THEN
PREVAILING, NOT MISLEADING, AS PROMPTLY AS PRACTICABLE AFTER BECOMING AWARE
THEREOF, TO GIVE NOTICE THEREOF TO THE INITIAL PURCHASER AND, IF REQUESTED BY
THE INITIAL PURCHASER, TO PREPARE AND FURNISH WITHOUT CHARGE TO THE INITIAL
PURCHASER A FREE WRITING OFFERING COMMUNICATION OR OTHER DOCUMENT WHICH WILL
CORRECT SUCH CONFLICT, STATEMENT OR OMISSION;

 

(CC)         TO CONSENT TO THE USE BY THE INITIAL PURCHASER OF (1) THE OFFERING
MEMORANDUM, (2) THE PRELIMINARY MARKETING MATERIALS, (3) THE SUPPLEMENTAL
MATERIALS AND (4) ADDITIONAL MARKETING MATERIALS TO BE PROVIDED TO PROSPECTIVE
INVESTORS, CONSISTING OF MODEL RUNS (“INVESTOR MODEL RUNS”), WHICH WILL BE
SUBJECT TO THE PROCEDURES SET FORTH IN THE INITIAL AUP LETTER (AS DEFINED
BELOW);

 

(DD)         TO USE ITS BEST EFFORTS TO ASSIST THE INITIAL PURCHASER IN
MARKETING THE SECURITIES AFTER THE CLOSING DATE;

 

(EE)         TO COOPERATE REASONABLY IN ANY DUE DILIGENCE INVESTIGATIONS BY
REPRESENTATIVES OF THE INITIAL PURCHASER THAT MAY BE REQUIRED IN CONNECTION WITH
THE USE OF THE OFFERING MEMORANDUM; AND

 

(FF)           TO PROMPTLY UPDATE THE OFFERING MEMORANDUM, UPON THE REQUEST OF
THE INITIAL PURCHASER, UNTIL SUCH TIME AS THE INITIAL PURCHASER SHALL CEASE TO
OWN ANY OF THE SECURITIES.

 

5.             CONDITIONS OF INITIAL PURCHASER’S OBLIGATIONS

 

The obligations of the Initial Purchaser hereunder are subject (i) to the
accuracy, on and as of the date hereof, of the representations and warranties of
the Co-Issuers, the

 

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Guarantors, IHOP and the Merger Sub contained herein, and on and as of the
Closing Date of the representations and warranties of the Co-Issuers, the
Guarantors, the Parent Companies and the IHOP Securitization Entities contained
herein, (ii) to the accuracy of the statements of each of the Co-Issuers, the
Guarantors, the Parent Companies and their respective officers made in any
certificates delivered pursuant hereto, (iii) to the performance by the
Co-Issuers, the Guarantors, the Parent Companies and the IHOP Securitization
Entities of their obligations hereunder and (iv) to each of the following
additional terms and conditions:

 

(A)           NO STOP ORDER SUSPENDING THE SALE OF THE SECURITIES IN ANY
JURISDICTION SHALL HAVE BEEN ISSUED AND NO PROCEEDING FOR THAT PURPOSE SHALL
HAVE BEEN COMMENCED OR SHALL BE PENDING OR THREATENED.

 

(B)           THE INITIAL PURCHASER SHALL NOT HAVE DISCOVERED AND DISCLOSED TO
THE CO-ISSUERS OR THE PARENT COMPANIES ON OR PRIOR TO THE CLOSING DATE THAT THE
DRAFT OFFERING MEMORANDUM OR ANY AMENDMENT OR SUPPLEMENT THERETO CONTAINS AN
UNTRUE STATEMENT OF A FACT WHICH, IN THE OPINION OF COUNSEL FOR THE INITIAL
PURCHASER, IS MATERIAL OR OMITS TO STATE ANY FACT WHICH, IN THE OPINION OF SUCH
COUNSEL, IS MATERIAL AND IS REQUIRED TO BE STATED THEREIN OR IS NECESSARY TO
MAKE THE STATEMENTS THEREIN, IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY WERE
MADE, NOT MISLEADING.

 

(C)           ALL CORPORATE PROCEEDINGS AND OTHER LEGAL MATTERS INCIDENT TO THE
AUTHORIZATION, FORM AND VALIDITY OF THIS AGREEMENT, THE SECURITIES, EACH OF THE
TRANSACTION DOCUMENTS AND THE OFFERING MEMORANDUM, AND ALL OTHER LEGAL MATTERS
RELATING TO THIS AGREEMENT, THE TRANSACTION DOCUMENTS AND THE TRANSACTIONS
CONTEMPLATED THEREBY, SHALL BE SATISFACTORY IN ALL MATERIAL RESPECTS TO THE
INITIAL PURCHASER, AND THE CO-ISSUERS AND THE PARENT COMPANIES SHALL HAVE
FURNISHED TO THE INITIAL PURCHASER ALL DOCUMENTS AND INFORMATION THAT THE
INITIAL PURCHASER OR ITS COUNSEL MAY REASONABLY REQUEST TO ENABLE IT TO PASS
UPON SUCH MATTERS.

 

(D)           THE SUPPLEMENT SHALL HAVE BEEN DULY EXECUTED AND DELIVERED BY THE
CO-ISSUERS AND THE TRUSTEE, AND THE SECURITIES SHALL HAVE BEEN DULY EXECUTED AND
DELIVERED BY THE CO-ISSUERS AND DULY AUTHENTICATED BY THE TRUSTEE.

 

(E)           EACH OF THE TRANSACTION DOCUMENTS SHALL HAVE BEEN DULY EXECUTED
AND DELIVERED BY THE RESPECTIVE PARTIES THERETO AND THE INITIAL PURCHASER SHALL
HAVE RECEIVED AN ORIGINAL COPY OF EACH TRANSACTION DOCUMENT, DULY EXECUTED AND
DELIVERED BY THE RESPECTIVE PARTIES THERETO.

 

(F)            THE INITIAL PURCHASER SHALL HAVE RECEIVED A LETTER FROM EACH
RATING AGENCY STATING THAT THE SECURITIES HAVE RECEIVED THE RATINGS INDICATED IN
THE TABLE BELOW:

 

MOODY’S RATING

 

S&P RATING

BAA2

 

BBB-

 

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(G)           SUBSEQUENT TO THE EXECUTION AND DELIVERY OF THIS AGREEMENT THERE
SHALL NOT HAVE OCCURRED ANY OF THE FOLLOWING:  (I) TRADING IN SECURITIES
GENERALLY ON THE NEW YORK STOCK EXCHANGE, THE AMERICAN STOCK EXCHANGE, THE
NASDAQ GLOBAL MARKET OR IN THE OVER-THE-COUNTER MARKET, OR TRADING IN ANY
SECURITIES OF IHOP, THE MASTER ISSUER OR APPLEBEE’S INTERNATIONAL ON ANY
EXCHANGE OR IN THE OVER-THE-COUNTER MARKET, SHALL HAVE BEEN SUSPENDED OR
MATERIALLY LIMITED OR THE SETTLEMENT OF SUCH TRADING GENERALLY SHALL HAVE BEEN
MATERIALLY DISRUPTED OR MINIMUM PRICES SHALL HAVE BEEN ESTABLISHED ON ANY SUCH
EXCHANGE OR SUCH MARKET BY THE COMMISSION, BY SUCH EXCHANGE OR BY ANY OTHER
REGULATORY BODY OR GOVERNMENTAL AUTHORITY HAVING JURISDICTION (EXCEPT THAT A
SUSPENSION OF TRADING IN THE SECURITIES OF APPLEBEE’S INTERNATIONAL AS A RESULT
OF THE COMPLETION OF THE MERGER SHALL BE PERMITTED), (II) A BANKING MORATORIUM
SHALL HAVE BEEN DECLARED BY FEDERAL OR STATE AUTHORITIES, (III) THE UNITED
STATES SHALL HAVE BECOME ENGAGED IN HOSTILITIES, THERE SHALL HAVE BEEN AN
ESCALATION IN HOSTILITIES INVOLVING THE UNITED STATES OR THERE SHALL HAVE BEEN A
DECLARATION OF A NATIONAL EMERGENCY OR WAR BY THE UNITED STATES, (IV) A MATERIAL
DISRUPTION IN SECURITIES SETTLEMENT OR CLEARING OR PAYMENT SYSTEMS SHALL HAVE
OCCURRED OR (V) THERE SHALL HAVE OCCURRED SUCH A MATERIAL ADVERSE CHANGE IN
GENERAL ECONOMIC, POLITICAL OR FINANCIAL CONDITIONS, INCLUDING, WITHOUT
LIMITATION, AS A RESULT OF TERRORIST ACTIVITIES AFTER THE DATE HEREOF (OR THE
EFFECT OF INTERNATIONAL CONDITIONS ON THE FINANCIAL MARKETS IN THE UNITED STATES
SHALL BE SUCH), AS TO MAKE IT, IN THE JUDGMENT OF THE INITIAL PURCHASER,
IMPRACTICABLE OR INADVISABLE TO PROCEED WITH THE OFFERING OR DELIVERY OF THE
SECURITIES BEING DELIVERED ON THE CLOSING DATE ON THE TERMS AND IN THE MANNER
CONTEMPLATED HEREBY  OR THAT, IN THE JUDGMENT OF THE INITIAL PURCHASER, WOULD
MATERIALLY AND ADVERSELY AFFECT THE FINANCIAL MARKETS OR THE MARKETS FOR THE
SECURITIES AND OTHER DEBT SECURITIES.

 

(H)           NONE OF (I) THE ISSUANCE AND SALE OF THE SECURITIES PURSUANT TO
THIS AGREEMENT, (II) THE TRANSACTIONS CONTEMPLATED BY THE TRANSACTION DOCUMENTS
OR (III) THE USE OF THE PRELIMINARY MARKETING MATERIALS, THE SUPPLEMENTAL
MATERIALS OR THE OFFERING MEMORANDUM SHALL BE SUBJECT TO AN INJUNCTION
(TEMPORARY OR PERMANENT) AND NO RESTRAINING ORDER OR OTHER INJUNCTIVE ORDER
SHALL HAVE BEEN ISSUED; AND THERE SHALL NOT HAVE BEEN ANY LEGAL ACTION, ORDER,
DECREE OR OTHER ADMINISTRATIVE PROCEEDING INSTITUTED OR THREATENED AGAINST THE
CO-ISSUERS OR THE PARENT COMPANIES OR THE INITIAL PURCHASER THAT WOULD BE
REASONABLY LIKELY TO ADVERSELY IMPACT THE ISSUANCE OR RESALE OF THE SECURITIES
OR THE INITIAL PURCHASER’S ACTIVITIES IN CONNECTION THEREWITH OR ANY OTHER
TRANSACTIONS CONTEMPLATED HEREBY OR BY THE TRANSACTION DOCUMENTS.

 

(I)            THE INITIAL PURCHASER SHALL HAVE RECEIVED AN OPINION OF SKADDEN,
ARPS, SLATE, MEAGHER & FLOM LLP, SPECIAL COUNSEL TO THE CO-ISSUERS AND THE
PARENT COMPANIES, DATED THE CLOSING DATE AND ADDRESSED TO THE INITIAL PURCHASER,
SUBSTANTIALLY IN THE FORM ATTACHED HERETO AS EXHIBIT 5.

 

(J)            THE INITIAL PURCHASER SHALL HAVE RECEIVED AN OPINION OF SKADDEN,
ARPS, SLATE, MEAGHER & FLOM LLP, SPECIAL COUNSEL TO THE CO-ISSUERS, THE
GUARANTORS AND THE PARENT COMPANIES, DATED THE CLOSING DATE AND ADDRESSED TO THE
INITIAL PURCHASER, SUBSTANTIALLY IN THE FORM ATTACHED HERETO AS EXHIBIT 6
REGARDING THE SUBSTANTIVE NONCONSOLIDATION OF THE ASSETS AND LIABILITIES OF THE
CO-ISSUERS, THE OTHER SECURITIZATION ENTITIES AND THEIR AFFILIATES.

 

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(K)           THE INITIAL PURCHASER SHALL HAVE RECEIVED AN OPINION OF SKADDEN,
ARPS, SLATE, MEAGHER & FLOM LLP, SPECIAL COUNSEL TO THE CO-ISSUERS, THE OTHER
SECURITIZATION ENTITIES AND THE PARENT COMPANIES, DATED THE CLOSING DATE AND
ADDRESSED TO THE INITIAL PURCHASER, SUBSTANTIALLY IN THE FORM ATTACHED HERETO AS
EXHIBIT 7 REGARDING THE TREATMENT OF THE TRANSFERS OF ASSETS AS “TRUE
CONTRIBUTIONS” OR OTHER ABSOLUTE TRANSFERS.

 

(L)            THE INITIAL PURCHASER SHALL HAVE RECEIVED AN OPINION OF SKADDEN,
ARPS, SLATE, MEAGHER & FLOM LLP, SPECIAL COUNSEL TO THE CO-ISSUERS, DATED THE
CLOSING DATE AND ADDRESSED TO THE INITIAL PURCHASER, SUBSTANTIALLY IN THE FORM
ATTACHED HERETO AS EXHIBIT 8 REGARDING THE U.S. FEDERAL INCOME TAX TREATMENT OF
THE SECURITIES, AMONG OTHER THINGS.

 

(M)          THE INITIAL PURCHASER SHALL HAVE RECEIVED AN OPINION OF BLACKWELL
SANDERS LLP, AS FRANCHISE COUNSEL TO THE CO-ISSUERS AND THE PARENT COMPANIES,
DATED THE CLOSING DATE AND ADDRESSED TO THE INITIAL PURCHASER, REGARDING
COMPLIANCE WITH APPLICABLE FRANCHISING LAWS AND REGULATIONS AND SUCH OTHER
MATTERS AS THE INITIAL PURCHASER MAY REQUEST, IN FORM AND SUBSTANCE SATISFACTORY
TO THE INITIAL PURCHASER AND ITS COUNSEL.

 

(N)           THE INITIAL PURCHASER SHALL HAVE RECEIVED AN OPINION OF IN-HOUSE
COUNSEL TO THE CO-ISSUERS AND THE PARENT COMPANIES DATED THE CLOSING DATE AND
ADDRESSED TO THE INITIAL PURCHASER, REGARDING COMPLIANCE WITH APPLICABLE
FRANCHISING LAWS AND REGULATIONS AND SUCH OTHER MATTERS AS THE INITIAL PURCHASER
MAY REQUEST, IN FORM AND SUBSTANCE SATISFACTORY TO THE INITIAL PURCHASER AND ITS
COUNSEL.

 

(O)           THE INITIAL PURCHASER SHALL HAVE RECEIVED AN OPINION OF SKADDEN,
ARPS, SLATE, MEAGHER & FLOM LLP, SPECIAL DELAWARE COUNSEL TO THE CO-ISSUERS,
DATED THE CLOSING DATE AND ADDRESSED TO THE INITIAL PURCHASER, REGARDING THE
FILING OF UCC-1 FINANCING STATEMENTS, THE PERFECTION AND PRIORITY OF THE
SECURITY INTERESTS CREATED UNDER THE INDENTURE AND THE ABSENCE OF ANY PRIOR
FINANCING STATEMENTS OF RECORD AGAINST ANY OF THE CO-ISSUER ORGANIZED IN
DELAWARE IDENTIFYING ANY OF THE COLLATERAL (BASED ON A REVIEW OF UCC FILINGS),
IN FORM AND SUBSTANCE SATISFACTORY TO THE INITIAL PURCHASER AND ITS COUNSEL.

 

(P)           THE INITIAL PURCHASER SHALL HAVE RECEIVED AN OPINION OF CHAPMAN
AND CUTLER LLP, COUNSEL TO THE TRUSTEE, DATED THE CLOSING DATE AND ADDRESSED TO
THE INITIAL PURCHASER, IN FORM AND SUBSTANCE SATISFACTORY TO THE INITIAL
PURCHASER AND ITS COUNSEL.

 

(Q)           THE INITIAL PURCHASER SHALL HAVE RECEIVED AN OPINION OF INHOUSE
COUNSEL TO THE BACK-UP SERVICER, DATED THE CLOSING DATE AND ADDRESSED TO THE
INITIAL PURCHASER, IN FORM AND SUBSTANCE SATISFACTORY TO THE INITIAL PURCHASER
AND ITS COUNSEL.

 

(R)            THE INITIAL PURCHASER SHALL HAVE RECEIVED AN OPINION OF PAUL,
WEISS, RIFKIND, WHARTON & GARRISON LLP, DATED THE CLOSING DATE AND ADDRESSED TO
THE INITIAL PURCHASER, WITH RESPECT TO THE VALIDITY OF THE SECURITIES AND SUCH
OTHER MATTERS AS THE INITIAL PURCHASER MAY REASONABLY REQUEST.

 

(S)           THE INITIAL PURCHASER SHALL HAVE RECEIVED A CERTIFICATE FROM EACH
CO-ISSUER EXECUTED ON BEHALF OF SUCH CO-ISSUER BY ANY TWO OF THE PRESIDENT, ANY
MANAGER, THE CHIEF EXECUTIVE OFFICER, ANY VICE PRESIDENT, THE CHIEF FINANCIAL
OFFICER, THE SECRETARY,

 

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THE GENERAL COUNSEL OR THE TREASURER OF SUCH CO-ISSUER, DATED THE CLOSING DATE,
TO THE EFFECT THAT, TO THE BEST OF EACH SUCH OFFICER’S KNOWLEDGE (I) THE
REPRESENTATIONS AND WARRANTIES OF SUCH CO-ISSUER IN THIS AGREEMENT ARE TRUE AND
CORRECT ON AND AS OF THE DATE HEREOF AND THE CLOSING DATE AND THE
REPRESENTATIONS AND WARRANTIES OF SUCH CO-ISSUER IN ANY OTHER TRANSACTION
DOCUMENTS TO WHICH SUCH CO-ISSUER IS A PARTY ARE TRUE AND CORRECT ON AND AS OF
THE DATE HEREOF AND THE CLOSING DATE; (II) THAT SUCH CO-ISSUER HAS COMPLIED IN
ALL MATERIAL RESPECTS WITH ALL AGREEMENTS AND SATISFIED ALL CONDITIONS ON SUCH
CO-ISSUER’S PART TO BE PERFORMED OR SATISFIED HEREUNDER OR UNDER THE TRANSACTION
DOCUMENTS AT OR PRIOR TO THE CLOSING DATE; (III) SUBSEQUENT TO THE DATE AS OF
WHICH INFORMATION IS GIVEN IN THE DRAFT OFFERING MEMORANDUM, THERE HAS NOT BEEN
ANY DEVELOPMENT IN THE GENERAL AFFAIRS, BUSINESS, PROPERTIES, CAPITALIZATION,
CONDITION (FINANCIAL OR OTHERWISE) OR RESULTS OF OPERATION OF SUCH CO-ISSUER
EXCEPT AS SET FORTH OR CONTEMPLATED IN THE DRAFT OFFERING MEMORANDUM OR AS
DESCRIBED IN SUCH CERTIFICATE OR CERTIFICATES THAT COULD REASONABLY BE EXPECTED
TO RESULT IN A MATERIAL ADVERSE EFFECT; AND (IV) NOTHING HAS COME TO SUCH
OFFICER’S ATTENTION THAT WOULD LEAD SUCH OFFICER TO BELIEVE THAT (A) AS OF THE
CLOSING DATE, THE DRAFT OFFERING MEMORANDUM DID NOT PRESENT FAIRLY, IN ALL
MATERIAL RESPECTS, THE BUSINESS, RESULTS OF OPERATIONS AND FINANCIAL CONDITION
OF THE CO-ISSUERS OR (B) SINCE THE DATE OF THE DRAFT OFFERING MEMORANDUM, ANY
EVENT HAS OCCURRED WHICH SHOULD HAVE BEEN SET FORTH IN A SUPPLEMENT OR AMENDMENT
TO THE DRAFT OFFERING MEMORANDUM SO THAT IT WOULD PRESENT FAIRLY, IN ALL
MATERIAL RESPECTS, THE BUSINESS, RESULTS OF OPERATIONS AND FINANCIAL CONDITION
OF THE CO-ISSUERS.

 

(T)            THE INITIAL PURCHASER SHALL HAVE RECEIVED A CERTIFICATE FROM EACH
PARENT COMPANY EXECUTED ON BEHALF OF SUCH PARENT COMPANY BY ANY TWO OF THE
PRESIDENT, ANY MANAGER, THE CHIEF EXECUTIVE OFFICER, ANY VICE PRESIDENT, THE
CHIEF FINANCIAL OFFICER, THE SECRETARY, THE GENERAL COUNSEL OR THE TREASURER OF
SUCH PARENT COMPANY, DATED THE CLOSING DATE, TO THE EFFECT THAT, TO THE BEST OF
EACH SUCH OFFICER’S KNOWLEDGE (I) THE REPRESENTATIONS AND WARRANTIES OF SUCH
PARENT COMPANY IN THIS AGREEMENT ARE TRUE AND CORRECT ON AND AS OF THE DATE
HEREOF (TO THE EXTENT MADE ON AND AS OF THE DATE HEREOF) AND THE CLOSING DATE,
AND THE REPRESENTATIONS AND WARRANTIES OF SUCH PARENT COMPANY IN ANY OTHER
TRANSACTION DOCUMENTS TO WHICH SUCH PARENT COMPANY IS A PARTY ARE TRUE AND
CORRECT ON AND AS OF THE DATE HEREOF (TO THE EXTENT MADE ON AND AS OF THE DATE
HEREOF) AND THE CLOSING DATE; (II) THE REPRESENTATIONS AND WARRANTIES OF EACH
SECURITIZATION ENTITY IN ANY TRANSACTION DOCUMENTS TO WHICH SUCH SECURITIZATION
ENTITY IS A PARTY ARE TRUE AND CORRECT ON AND AS OF THE DATE HEREOF AND THE
CLOSING DATE; (III) THAT SUCH PARENT COMPANY HAS COMPLIED IN ALL MATERIAL
RESPECTS WITH ALL AGREEMENTS AND SATISFIED ALL CONDITIONS ON ITS PART TO BE
PERFORMED OR SATISFIED HEREUNDER OR UNDER THE TRANSACTION DOCUMENTS AT OR PRIOR
TO THE CLOSING DATE; (IV) SUBSEQUENT TO THE DATE AS OF WHICH INFORMATION IS
GIVEN IN THE DRAFT OFFERING MEMORANDUM, THERE HAS NOT BEEN ANY DEVELOPMENT IN OR
AFFECTING PARTICULARLY THE BUSINESS OR ASSETS OF SUCH PARENT COMPANY AND THEIR
SUBSIDIARIES CONSIDERED AS A WHOLE OR IN THE FINANCIAL POSITION OR RESULTS OF
OPERATIONS OF SUCH PARENT COMPANY AND ITS SUBSIDIARIES CONSIDERED AS A WHOLE,
OTHERWISE THAN AS SET FORTH OR CONTEMPLATED IN THE DRAFT OFFERING MEMORANDUM OR
AS DESCRIBED IN SUCH CERTIFICATE OR CERTIFICATES THAT COULD REASONABLY BE
EXPECTED TO RESULT IN A MATERIAL ADVERSE EFFECT AND (V) NOTHING HAS COME TO SUCH
OFFICER’S ATTENTION THAT WOULD LEAD SUCH OFFICER TO BELIEVE THAT (A) AS OF THE
CLOSING DATE, THE DRAFT OFFERING MEMORANDUM DID NOT PRESENT FAIRLY, IN ALL
MATERIAL RESPECTS, THE BUSINESS, RESULTS OF OPERATIONS AND FINANCIAL CONDITION
OF THE CO-

 

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ISSUERS OR (B) SINCE THE DATE OF THE DRAFT OFFERING MEMORANDUM, ANY EVENT HAS
OCCURRED WHICH SHOULD HAVE BEEN SET FORTH IN A SUPPLEMENT OR AMENDMENT TO THE
DRAFT OFFERING MEMORANDUM SO THAT IT WOULD PRESENT FAIRLY, IN ALL MATERIAL
RESPECTS, THE BUSINESS, RESULTS OF OPERATIONS AND FINANCIAL CONDITION OF THE
CO-ISSUERS.

 

(U)           THE INITIAL PURCHASER SHALL HAVE RECEIVED A CERTIFICATE FROM EACH
SECURITIZATION ENTITY THAT IS NOT A CO-ISSUER SIGNED BY ANY TWO OF THE
PRESIDENT, ANY MANAGER, THE CHIEF EXECUTIVE OFFICER, ANY VICE PRESIDENT, THE
CHIEF FINANCIAL OFFICER, THE SECRETARY, THE GENERAL COUNSEL OR THE TREASURER OF
SUCH SECURITIZATION ENTITY, DATED THE CLOSING DATE, IN WHICH EACH SUCH OFFICER
SHALL STATE THAT, TO THE BEST OF EACH SUCH OFFICER’S KNOWLEDGE (I) THE
REPRESENTATIONS AND WARRANTIES OF SUCH SECURITIZATION ENTITY IN THIS AGREEMENT
ARE TRUE AND CORRECT ON AND AS OF THE CLOSING DATE AND THE REPRESENTATIONS AND
WARRANTIES OF SUCH SECURITIZATION ENTITY IN ANY OTHER TRANSACTION DOCUMENTS TO
WHICH SUCH SECURITIZATION ENTITY IS A PARTY ARE TRUE AND CORRECT ON AND AS OF
THE CLOSING DATE; (II) THAT SUCH SECURITIZATION ENTITY HAS COMPLIED IN ALL
MATERIAL RESPECTS WITH ALL AGREEMENTS AND SATISFIED ALL CONDITIONS ON SUCH
SECURITIZATION ENTITY’S PART TO BE PERFORMED OR SATISFIED HEREUNDER OR UNDER THE
TRANSACTION DOCUMENTS AT OR PRIOR TO THE CLOSING DATE AND (III) SUBSEQUENT TO
THE DATE AS OF WHICH INFORMATION IS GIVEN IN THE DRAFT OFFERING MEMORANDUM,
THERE HAS NOT BEEN ANY DEVELOPMENT IN THE GENERAL AFFAIRS, BUSINESS, PROPERTIES,
CAPITALIZATION, CONDITION (FINANCIAL OR OTHERWISE) OR RESULTS OF OPERATION OF
SUCH SECURITIZATION ENTITY EXCEPT AS SET FORTH OR CONTEMPLATED IN THE DRAFT
OFFERING MEMORANDUM OR AS DESCRIBED IN SUCH CERTIFICATE OR CERTIFICATES THAT
COULD REASONABLY BE EXPECTED TO RESULT IN A MATERIAL ADVERSE EFFECT.

 

(V)           THE MERGER SHALL HAVE BEEN COMPLETED ON THE CLOSING DATE ON THE
TERMS SPECIFIED IN THE MERGER AGREEMENT AND AS CONTEMPLATED BY THE DRAFT
OFFERING MEMORANDUM.

 

(W)          THE APPLEBEE’S SECURITIZATION SHALL HAVE BEEN COMPLETED ON THE
CLOSING DATE AS CONTEMPLATED BY THE DRAFT OFFERING MEMORANDUM.

 

(X)            ALL NECESSARY WAIVERS, CONSENTS AND APPROVALS FOR THE ISSUANCE OF
THE SECURITIES AND THE COMPLETION OF THE TRANSACTIONS CONTEMPLATED BY THE
TRANSACTION DOCUMENTS SHALL HAVE BEEN OBTAINED, INCLUDING, WITHOUT LIMITATION,
(I) WAIVERS AND CONSENTS BY FINANCIAL GUARANTY INSURANCE COMPANY, A NEW YORK
STOCK INSURANCE CORPORATION AND (II) CONFIRMATIONS AND APPROVALS BY THE RATING
AGENCIES WITH RESPECT TO SUCH WAIVERS AND CONSENTS.

 

All opinions, letters, evidence and certificates mentioned above or elsewhere in
this Agreement shall be deemed to be in compliance with the provisions hereof
only if they are in form and substance reasonably satisfactory to counsel for
the Initial Purchaser.

 

6.             Termination.

 

The obligations of the Initial Purchaser hereunder may be terminated at the sole
discretion of the Initial Purchaser by notice given to and received by the
Co-Issuers prior to delivery of and payment for the Securities if, prior to that
time, any of the events

 

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described in Sections 5(g) and 5(h) shall have occurred and be continuing, any
of the certifications in Sections 5(s)(iii), (t)(iv), and (u)(iii) cease to be
true and correct, or if the Initial Purchaser shall decline to purchase the
Securities for any reason permitted under this Agreement, including, but not
limited to, the failure, refusal or inability by any of the Co-Issuers or the
Parent Companies to satisfy all conditions on its part to be performed or
satisfied hereunder on or prior to the Closing Date.

 

7.             Indemnification

 

(A)           EACH OF THE CO-ISSUERS AND THE PARENT COMPANIES SHALL, JOINTLY AND
SEVERALLY, INDEMNIFY AND HOLD HARMLESS THE INITIAL PURCHASER, ITS AFFILIATES,
ITS OFFICERS, DIRECTORS, SHAREHOLDERS, PARTNERS, TRUSTEES, EMPLOYEES,
REPRESENTATIVES AND AGENTS, AND EACH PERSON, IF ANY, WHO CONTROLS THE INITIAL
PURCHASER WITHIN THE MEANING OF THE SECURITIES ACT OR THE EXCHANGE ACT
(COLLECTIVELY REFERRED TO FOR PURPOSES OF SECTIONS 7(A) AND 8 AS THE INITIAL
PURCHASER), FROM AND AGAINST ANY LOSS, CLAIM, DAMAGE OR LIABILITY, OR ANY ACTION
IN RESPECT THEREOF (INCLUDING, WITHOUT LIMITATION, ANY LOSS, CLAIM, DAMAGE,
LIABILITY OR ACTION RELATING TO PURCHASES AND SALES OF THE SECURITIES), TO WHICH
THE INITIAL PURCHASER MAY BECOME SUBJECT, WHETHER COMMENCED OR THREATENED, UNDER
THE SECURITIES ACT, THE EXCHANGE ACT, ANY OTHER FEDERAL OR STATE STATUTORY LAW
OR REGULATION, AT COMMON LAW OR OTHERWISE, INSOFAR AS SUCH LOSS, CLAIM, DAMAGE,
LIABILITY OR ACTION ARISES OUT OF, OR IS BASED UPON, (I) ANY UNTRUE STATEMENT OR
ALLEGED UNTRUE STATEMENT OF A MATERIAL FACT CONTAINED IN (A) THE BRIDGE
SYNDICATION MATERIALS, THE PRELIMINARY MARKETING MATERIALS, THE SUPPLEMENTAL
MATERIALS OR THE OFFERING MEMORANDUM OR IN ANY AMENDMENT OR SUPPLEMENT THERETO,
OR IN ANY ISSUER FREE WRITING COMMUNICATION, (B) ANY OTHER INFORMATION PROVIDED
PURSUANT TO SECTION 4(J) OR 4(CC) HEREOF OR (C) OTHER MATERIALS PROVIDED TO
POTENTIAL INVESTORS WITH THE PRIOR WRITTEN CONSENT OF THE CO-ISSUERS OR PARENT
COMPANIES (COLLECTIVELY, THE ITEMS IN (A), (B) AND (C) ABOVE, THE “OFFERING
MATERIALS”), (II) THE OMISSION OR ALLEGED OMISSION TO STATE IN THE OFFERING
MATERIALS A MATERIAL FACT REQUIRED TO BE STATED THEREIN OR NECESSARY IN ORDER TO
MAKE THE STATEMENTS THEREIN, IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY WERE
MADE, NOT MISLEADING, OR (III) ANY ACT OR FAILURE TO ACT OR ANY ALLEGED ACT OR
FAILURE TO ACT BY THE INITIAL PURCHASER IN CONNECTION WITH, OR RELATING IN ANY
MANNER TO, THE SECURITIES OR THE OFFERING CONTEMPLATED HEREBY, AND WHICH IS
INCLUDED AS PART OF OR REFERRED TO IN ANY LOSS, CLAIM, DAMAGE, LIABILITY OR
ACTION ARISING OUT OF OR BASED UPON MATTERS COVERED BY CLAUSE (I) OR (II) ABOVE
(PROVIDED THAT THE CO-ISSUERS AND THE PARENT COMPANIES SHALL NOT BE LIABLE UNDER
THIS CLAUSE (III) TO THE EXTENT THAT IT IS DETERMINED IN A FINAL JUDGMENT BY A
COURT OF COMPETENT JURISDICTION THAT SUCH LOSS, CLAIM, DAMAGE, LIABILITY OR
ACTION RESULTED DIRECTLY FROM ANY SUCH ACTS OR FAILURES TO ACT UNDERTAKEN OR
OMITTED TO BE TAKEN BY THE INITIAL PURCHASER THROUGH ITS GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT), AND SHALL REIMBURSE THE INITIAL PURCHASER AND EACH SUCH
DIRECTOR, OFFICER, EMPLOYEE OR CONTROLLING PERSON PROMPTLY UPON DEMAND FOR ANY
LEGAL OR OTHER EXPENSES REASONABLY INCURRED BY THE INITIAL PURCHASER, DIRECTOR,
OFFICER, EMPLOYEE OR CONTROLLING PERSON IN CONNECTION WITH INVESTIGATING OR
DEFENDING OR PREPARING TO DEFEND AGAINST OR APPEARING AS A THIRD PARTY WITNESS
IN CONNECTION WITH ANY SUCH LOSS, CLAIM, DAMAGE, LIABILITY OR ACTION AS SUCH
EXPENSES ARE INCURRED; PROVIDED, HOWEVER, THAT THE CO-ISSUERS AND THE PARENT
COMPANIES SHALL NOT BE LIABLE IN ANY SUCH CASE TO THE EXTENT THAT ANY SUCH LOSS,
CLAIM, DAMAGE, LIABILITY OR ACTION ARISES OUT OF, OR IS BASED UPON, ANY UNTRUE
STATEMENT OR ALLEGED UNTRUE STATEMENT OR OMISSION OR ALLEGED

 

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OMISSION MADE IN THE OFFERING MATERIALS, IN RELIANCE UPON AND IN CONFORMITY WITH
WRITTEN INFORMATION CONCERNING THE INITIAL PURCHASER FURNISHED TO THE CO-ISSUERS
BY THE INITIAL PURCHASER SPECIFICALLY FOR INCLUSION THEREIN, WHICH INFORMATION
CONSISTS SOLELY OF THE INFORMATION SPECIFIED IN SECTION 13 (THE “INITIAL
PURCHASER’S INFORMATION”).

 

(B)           THE INITIAL PURCHASER SHALL INDEMNIFY AND HOLD HARMLESS EACH OF
THE PARENT COMPANIES AND EACH OF THE CO-ISSUERS, AND THEIR RESPECTIVE OFFICERS,
DIRECTORS, EMPLOYEES, REPRESENTATIVES AND AGENTS, AND EACH PERSON, IF ANY, WHO
CONTROLS ANY OF THE PARENT COMPANIES OR ANY OF THE CO-ISSUERS WITHIN THE MEANING
OF THE SECURITIES ACT OR THE EXCHANGE ACT (COLLECTIVELY REFERRED TO FOR PURPOSES
OF SECTIONS 7(B) AND 8 AS THE “IHOP PARTIES”), FROM AND AGAINST ANY LOSS, CLAIM,
DAMAGE OR LIABILITY, JOINT OR SEVERAL, OR ANY ACTION IN RESPECT THEREOF, TO
WHICH THE IHOP PARTIES MAY BECOME SUBJECT, WHETHER COMMENCED OR THREATENED,
UNDER THE SECURITIES ACT, THE EXCHANGE ACT, ANY OTHER FEDERAL OR STATE STATUTORY
LAW OR REGULATION, AT COMMON LAW OR OTHERWISE, INSOFAR AS SUCH LOSS, CLAIM,
DAMAGE, LIABILITY OR ACTION ARISES OUT OF, OR IS BASED UPON, (I) ANY UNTRUE
STATEMENT OR ALLEGED UNTRUE STATEMENT OF A MATERIAL FACT CONTAINED IN THE
OFFERING MATERIALS OR (II) THE OMISSION OR ALLEGED OMISSION TO STATE IN THE
OFFERING MATERIALS A MATERIAL FACT REQUIRED TO BE STATED THEREIN OR NECESSARY IN
ORDER TO MAKE THE STATEMENTS THEREIN, IN THE LIGHT OF THE CIRCUMSTANCES UNDER
WHICH THEY WERE MADE, NOT MISLEADING, BUT IN EACH CASE ONLY TO THE EXTENT THAT
THE UNTRUE STATEMENT OR ALLEGED UNTRUE STATEMENT OR OMISSION OR ALLEGED OMISSION
WAS MADE IN RELIANCE UPON AND IN CONFORMITY WITH THE INFORMATION RELATING TO THE
INITIAL PURCHASER FURNISHED TO THE CO-ISSUERS BY THE INITIAL PURCHASER
SPECIFICALLY FOR USE THEREIN (AS SET FORTH IN SECTION 13 BELOW), AND SHALL
REIMBURSE THE IHOP PARTIES, FOR ANY LEGAL OR OTHER EXPENSES REASONABLY INCURRED
BY THE IHOP PARTIES IN CONNECTION WITH INVESTIGATING OR DEFENDING OR PREPARING
TO DEFEND AGAINST OR APPEARING AS A THIRD PARTY WITNESS IN CONNECTION WITH ANY
SUCH LOSS, CLAIM, DAMAGE, LIABILITY OR ACTION AS SUCH EXPENSES ARE INCURRED.

 

(C)           PROMPTLY AFTER RECEIPT BY AN INDEMNIFIED PARTY UNDER THIS
SECTION 7 OF NOTICE OF ANY CLAIM OR THE COMMENCEMENT OF ANY ACTION, THE
INDEMNIFIED PARTY SHALL, IF A CLAIM IN RESPECT THEREOF IS TO BE MADE AGAINST THE
INDEMNIFYING PARTY PURSUANT TO SECTION 7(A) OR 7(B), NOTIFY THE INDEMNIFYING
PARTY IN WRITING OF THE CLAIM OR THE COMMENCEMENT OF THAT ACTION; PROVIDED,
HOWEVER, THAT THE FAILURE TO NOTIFY THE INDEMNIFYING PARTY SHALL NOT RELIEVE IT
FROM ANY LIABILITY WHICH IT MAY HAVE UNDER THIS SECTION 7 EXCEPT TO THE EXTENT
THAT IT HAS BEEN MATERIALLY PREJUDICED (THROUGH THE FORFEITURE OF SUBSTANTIVE OR
PROCEDURAL RIGHTS OR DEFENSES) BY SUCH FAILURE; AND, PROVIDED, FURTHER, THAT THE
FAILURE TO NOTIFY THE INDEMNIFYING PARTY SHALL NOT RELIEVE IT FROM ANY LIABILITY
WHICH IT MAY HAVE TO AN INDEMNIFIED PARTY OTHERWISE THAN UNDER THIS SECTION 7. 
IF ANY SUCH CLAIM OR ACTION SHALL BE BROUGHT AGAINST AN INDEMNIFIED PARTY, AND
IT SHALL NOTIFY THE INDEMNIFYING PARTY THEREOF, THE INDEMNIFYING PARTY SHALL BE
ENTITLED TO PARTICIPATE THEREIN AND, TO THE EXTENT THAT IT WISHES, JOINTLY WITH
ANY OTHER SIMILARLY NOTIFIED INDEMNIFYING PARTY, TO ASSUME THE DEFENSE THEREOF
WITH COUNSEL REASONABLY SATISFACTORY TO THE INDEMNIFIED PARTY.  EXCEPT AS
OTHERWISE SET FORTH IN THIS SECTION 7(C), AFTER NOTICE FROM THE INDEMNIFYING
PARTY TO THE INDEMNIFIED PARTY OF ITS ELECTION TO ASSUME THE DEFENSE OF SUCH
CLAIM OR ACTION, THE INDEMNIFYING PARTY SHALL NOT BE LIABLE TO THE INDEMNIFIED
PARTY UNDER THIS SECTION 7 FOR ANY LEGAL OR OTHER EXPENSES SUBSEQUENTLY INCURRED
BY THE INDEMNIFIED PARTY IN CONNECTION WITH THE DEFENSE THEREOF OTHER THAN

 

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REASONABLE COSTS OF INVESTIGATION.  ANY INDEMNIFIED PARTY SHALL HAVE THE RIGHT
TO RETAIN ITS OWN COUNSEL, BUT THE FEES AND EXPENSES OF SUCH COUNSEL SHALL BE AT
THE EXPENSE OF SUCH INDEMNIFIED PARTY UNLESS (I) THE INDEMNIFYING PARTY AND THE
INDEMNIFIED PARTY SHALL HAVE MUTUALLY AGREED TO THE RETENTION OF SUCH COUNSEL OR
(II) THE NAMED PARTIES TO ANY SUCH PROCEEDING (INCLUDING ANY IMPLEADED PARTIES)
INCLUDE BOTH THE INDEMNIFYING PARTIES AND AN INDEMNIFIED PARTY AND THE
INDEMNIFIED PARTY HAS REASONABLY CONCLUDED THAT REPRESENTATION OF BOTH PARTIES
BY THE SAME COUNSEL WOULD BE INAPPROPRIATE DUE TO MATERIAL ACTUAL OR POTENTIAL
DIFFERING INTERESTS BETWEEN THEM.  IT IS UNDERSTOOD THAT THE INDEMNIFYING
PARTIES SHALL NOT, IN CONNECTION WITH ANY PROCEEDING OR RELATED PROCEEDINGS IN
THE SAME JURISDICTION, BE LIABLE FOR THE FEES AND EXPENSES OF MORE THAN ONE
SEPARATE FIRM (IN ADDITION TO ANY LOCAL COUNSEL) FOR ALL INDEMNIFIED PARTIES,
AND THAT ALL SUCH REASONABLE FEES AND EXPENSES SHALL BE REIMBURSED AS THEY ARE
INCURRED AND PAID.  IN THE CASE OF ANY SUCH SEPARATE FIRM FOR THE INDEMNIFIED
PARTIES, SUCH FIRM SHALL BE DESIGNATED IN WRITING BY THE INDEMNIFIED PARTIES. NO
INDEMNIFYING PARTY SHALL BE LIABLE FOR ANY SETTLEMENT OF ANY SUCH ACTION OR
CLAIM EFFECTED WITHOUT ITS WRITTEN CONSENT (WHICH CONSENT SHALL NOT BE
UNREASONABLY WITHHELD), BUT IF SETTLED WITH ITS WRITTEN CONSENT OR IF THERE BE A
FINAL JUDGMENT FOR THE PLAINTIFF IN ANY SUCH ACTION OR CLAIM, THE INDEMNIFYING
PARTY AGREES TO INDEMNIFY AND HOLD HARMLESS ANY INDEMNIFIED PARTY FROM AND
AGAINST ANY LOSS OR LIABILITY BY REASON OF SUCH SETTLEMENT OR JUDGMENT IN
ACCORDANCE WITH THE TERMS HEREOF.  NO INDEMNIFYING PARTY SHALL, WITHOUT THE
PRIOR WRITTEN CONSENT OF THE INDEMNIFIED PARTY, EFFECT ANY SETTLEMENT OF ANY
PENDING OR THREATENED PROCEEDING IN RESPECT OF WHICH ANY INDEMNIFIED PARTY IS OR
COULD HAVE BEEN A PARTY AND INDEMNITY COULD HAVE BEEN SOUGHT HEREUNDER BY SUCH
INDEMNIFIED PARTY UNLESS SUCH SETTLEMENT (I) INCLUDES AN EXPLICIT AND
UNCONDITIONAL RELEASE OF SUCH INDEMNIFIED PARTY FROM ALL LIABILITY ON CLAIMS
THAT ARE THE SUBJECT MATTER OF SUCH PROCEEDING AND (II) DOES NOT INCLUDE A
STATEMENT AS TO OR AN ADMISSION OF FAULT, CULPABILITY OR A FAILURE TO ACT BY OR
ON BEHALF OF ANY INDEMNIFIED PARTY.

 

(D)           THE OBLIGATIONS OF THE PARENT COMPANIES, THE CO-ISSUERS AND THE
INITIAL PURCHASER IN THIS SECTION 7 AND IN SECTION 8 ARE IN ADDITION TO ANY
OTHER LIABILITY THAT THE PARENT COMPANIES, THE CO-ISSUERS OR THE INITIAL
PURCHASER, AS THE CASE MAY BE, MAY OTHERWISE HAVE, INCLUDING IN RESPECT OF ANY
BREACHES OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS MADE HEREIN BY ANY SUCH
PARTY.

 

8.             CONTRIBUTION

 

If the indemnification provided for in Section 7 is unavailable or insufficient
to hold harmless an indemnified party under Section 7(a) or 7(b), then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the IHOP Parties on the one hand and the Initial Purchaser on the
other from the offering of the Securities or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the IHOP Parties on the one hand and
the Initial Purchaser on the other with respect to the statements or omissions
that resulted in such loss, claim, damage or liability, or action in respect
thereof, as well as any other relevant equitable considerations.  The relative

 

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benefits received by the IHOP Parties on the one hand and the Initial Purchaser
on the other with respect to such offering shall be deemed to be in the same
proportion as the total net proceeds from the offering of the Securities
purchased under this Agreement (before deducting expenses) received by or on
behalf of the Co-Issuers on the one hand, and the total discounts and
commissions received by the Initial Purchaser with respect to the Securities
purchased under this Agreement, on the other, bear to the total gross proceeds
from the sale of the Securities under this Agreement as set forth on the cover
page of the Offering Memorandum.  The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to IHOP Parties or information supplied by the IHOP Parties on the one
hand or to the Initial Purchaser’s Information on the other, the intent of the
parties and their relative knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission.  For purpose of the
preceding two sentences, the net proceeds deemed to be received by the
Co-Issuers shall be deemed to be also for the benefit of the Parent Companies,
and information supplied by the Co-Issuers shall also be deemed to have been
supplied by the Parent Companies.  The Parent Companies, the Co-Issuers and the
Initial Purchaser agree that it would not be just and equitable if contributions
pursuant to this Section 8 were to be determined by pro rata allocation or by
any other method of allocation that does not take into account the equitable
considerations referred to herein.  The amount paid or payable by an indemnified
party as a result of the loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section 8 shall be deemed to include, for
purposes of this Section 8, any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending or
preparing to defend any such action or claim.  Notwithstanding the provisions of
this Section 8, the Initial Purchaser shall not be required to contribute any
amount in excess of the amount by which the total discounts and commissions
received by the Initial Purchaser with respect to the Securities purchased by it
under this Agreement exceeds the amount of any damages which the Initial
Purchaser has otherwise paid or become liable to pay by reason of any untrue or
alleged untrue statement or omission or alleged omission.  No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.

 

9.             PERSONS ENTITLED TO BENEFIT OF AGREEMENT

 

This Agreement shall inure to the benefit of and be binding upon the Initial
Purchaser, the Co-Issuers, the Parent Companies and their respective
successors.  This Agreement and the terms and provisions hereof are for the sole
benefit of only those persons, except as provided in Sections 7 and 8 with
respect to controlling persons of the Co-Issuers and the Initial Purchaser and
in Section 4(k) with respect to holders and prospective purchasers of the
Securities.  Nothing in this Agreement is intended or shall be construed to give
any person, other than the persons referred to in this Section 9, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein.

 

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10.           EXPENSES

 

(A)           THE CO-ISSUERS, JOINTLY AND SEVERALLY, IN ACCORDANCE WITH THIS
AGREEMENT, AGREE TO PAY (I) THE COSTS INCIDENT TO THE AUTHORIZATION, ISSUANCE,
SALE, RESALE, PREPARATION AND DELIVERY OF THE SECURITIES AND ANY TAXES PAYABLE
IN THAT CONNECTION; (II) THE COSTS INCIDENT TO THE PREPARATION, PRINTING AND
DISTRIBUTION OF THE PRELIMINARY MARKETING MATERIALS, THE SUPPLEMENTAL MATERIALS
AND THE OFFERING MEMORANDUM AND ANY AMENDMENTS OR SUPPLEMENTS THERETO; (III) THE
COSTS OF REPRODUCING AND DISTRIBUTING EACH OF THE TRANSACTION DOCUMENTS;
(IV) THE COSTS INCIDENT TO THE PREPARATION, PRINTING AND DELIVERY OF THE GLOBAL
CERTIFICATES EVIDENCING THE SECURITIES, INCLUDING STAMP DUTIES AND TRANSFER
TAXES, IF ANY, PAYABLE UPON ISSUANCE OF THE SECURITIES; (V) THE FEES AND
EXPENSES OF COUNSEL TO THE CO-ISSUERS; (VI) THE FEES AND EXPENSES OF QUALIFYING
THE SECURITIES UNDER THE SECURITIES LAWS OF THE SEVERAL JURISDICTIONS AND OF
PREPARING, PRINTING AND DISTRIBUTING BLUE SKY MEMORANDA (INCLUDING RELATED FEES
AND EXPENSES OF COUNSEL FOR THE INITIAL PURCHASER); (VII) ANY FEES CHARGED BY
THE RATING AGENCIES IN CONNECTION WITH THEIR RATING OF THE SECURITIES;
(VIII) THE FEES AND EXPENSES OF THE TRUSTEE AND ANY PAYING AGENT (INCLUDING
RELATED FEES AND EXPENSES OF ANY COUNSEL TO SUCH PARTIES); (IX) ALL EXPENSES AND
APPLICATION FEES INCURRED IN CONNECTION WITH THE APPROVAL OF THE SECURITIES FOR
BOOK-ENTRY TRANSFER BY DTC; (X) FEES AND EXPENSES INCURRED BY THE CO-ISSUERS IN
CONNECTION WITH ANY “ROADSHOW” PRESENTATIONS TO INVESTORS, INCLUDING, WITHOUT
LIMITATION, EXPENSES RELATED TO THE USE OF ANY AIRCRAFT IN CONNECTION THEREWITH;
AND (XI) ALL OTHER COSTS AND EXPENSES INCIDENT TO THE PERFORMANCE OF THE
OBLIGATIONS OF THE CO-ISSUERS UNDER THIS AGREEMENT WHICH ARE NOT OTHERWISE
SPECIFICALLY PROVIDED FOR IN THIS SECTION 10.

 

(B)           THE PARENT COMPANIES, IN ACCORDANCE WITH THIS AGREEMENT, AGREE TO
PAY (I) THE FEES AND EXPENSES OF COUNSEL TO THE PARENT COMPANIES, (II) THE FEES
AND EXPENSES OF THE INDEPENDENT ACCOUNTANTS OF THE IHOP ENTITIES; (III) THE FEES
AND EXPENSES OF THE ACCOUNTANTS INCURRED IN CONNECTION WITH THE DELIVERY OF THE
COMFORT LETTERS AND “AGREED UPON PROCEDURES” LETTERS TO THE INITIAL PURCHASER
PURSUANT TO THE TERMS OF THIS AGREEMENT, (IV) THE FEES AND EXPENSES INCURRED BY
THE PARENT COMPANIES IN CONNECTION WITH ANY “ROADSHOW” PRESENTATIONS TO
INVESTORS, INCLUDING, WITHOUT LIMITATION, EXPENSES RELATED TO THE USE OF ANY
AIRCRAFT IN CONNECTION THEREWITH, (V) THE FEES AND EXPENSES OF THE INITIAL
PURCHASER, INCURRED IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT, INCLUDING BUT NOT LIMITED TO FEES AND EXPENSES INCURRED BY THE
INITIAL PURCHASER IN CONNECTION WITH ANY “ROADSHOW” PRESENTATIONS TO INVESTORS,
INCLUDING, WITHOUT LIMITATION, EXPENSES RELATED TO THE USE OF ANY AIRCRAFT IN
CONNECTION THEREWITH, THE FEES AND EXPENSES OF PAUL, WEISS, RIFKIND, WHARTON &
GARRISON LLP, COUNSEL TO THE INITIAL PURCHASER (INCLUDING EXPENSES INCURRED IN
CONNECTION WITH DUE DILIGENCE AND TRAVEL, COURIER, REPRODUCTION, PRINTING AND
DELIVERY EXPENSES, BUT EXCLUDING THE IHOP EXCLUDED FEES) THE FEES OF OUTSIDE
ACCOUNTANTS, THE COSTS OF ANY DILIGENCE SERVICE AND THE FEES OF ANY OTHER
ADVISOR RETAINED BY THE INITIAL PURCHASER WITH THE PRIOR APPROVAL OF THE PARENT
COMPANIES (NOT TO BE UNREASONABLY WITHHELD) (WHETHER INCURRED PRIOR TO OR
SUBSEQUENT TO THE CLOSING DATE) AND (VI) ALL OTHER COSTS AND EXPENSES INCIDENT
TO THE PERFORMANCE OF THE OBLIGATIONS OF THE PARENT COMPANIES UNDER THIS
AGREEMENT AND UNDER THE TRANSACTION DOCUMENTS WHICH ARE NOT OTHERWISE
SPECIFICALLY PROVIDED FOR IN THIS SECTION 10.  NOTWITHSTANDING THE FOREGOING, IF
(A) THIS AGREEMENT SHALL HAVE BEEN TERMINATED PURSUANT TO SECTION 6, (B) THE
CO-ISSUERS SHALL FAIL TO TENDER THE SECURITIES FOR DELIVERY TO THE INITIAL
PURCHASER FOR ANY

 

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REASON PERMITTED UNDER THIS AGREEMENT OR (C) THE INITIAL PURCHASER SHALL DECLINE
TO PURCHASE THE SECURITIES FOR ANY REASON PERMITTED UNDER THIS AGREEMENT, THE
PARENT COMPANIES SHALL REIMBURSE THE INITIAL PURCHASER FOR SUCH OUT-OF-POCKET
EXPENSES (INCLUDING REASONABLE FEES AND DISBURSEMENTS OF COUNSEL) AS SHALL HAVE
BEEN REASONABLY INCURRED BY THE INITIAL PURCHASER IN CONNECTION WITH THIS
AGREEMENT AND THE PROPOSED PURCHASE AND RESALE OF THE SECURITIES. FOR PURPOSES
OF THIS AGREEMENT, THE “IHOP EXCLUDED FEES” MEANS LEGAL FEES AND EXPENSES OF
PAUL, WEISS, RIFKIND, WHARTON & GARRISON LLP INCURRED PRIOR TO THE CLOSING DATE
IN CONNECTION WITH (X) SUCH COUNSEL’S DUE DILIGENCE INVESTIGATION OF THE ASSETS
AND BUSINESS OF IHOP AND ITS EXISTING SUBSIDIARIES (WHICH, FOR THE AVOIDANCE OF
DOUBT, EXCLUDES APPLEBEE’S INTERNATIONAL AND ITS EXISTING SUBSIDIARIES) AND
(Y) THE PREPARATION, REVIEW, NEGOTIATION, EXECUTION AND DELIVERY OF ALL
DOCUMENTATION IN CONNECTION WITH THE SECURITIES.

 

11.           SURVIVAL

 

The respective indemnities, rights of contribution, representations, warranties
and agreements of the Co-Issuers, the Parent Companies and the Initial Purchaser
contained in this Agreement or made by or on behalf of the Co-Issuers, the
Parent Companies or the Initial Purchaser pursuant to this Agreement or any
certificate delivered pursuant hereto shall survive the delivery of and payment
for the Securities and shall remain in full force and effect, regardless of any
termination or cancellation of this Agreement or any investigation made by or on
behalf of any of them or any of their respective affiliates, officers,
directors, employees, representatives, agents or controlling persons.

 

12.           NOTICES, ETC.

 

All statements, requests, notices and agreements hereunder shall be in writing,
and:

 

(A)           IF TO THE INITIAL PURCHASER, SHALL BE DELIVERED OR SENT BY MAIL OR
FACSIMILE TRANSMISSION TO:

 

                             Lehman Brothers Inc.
745 Seventh Avenue
New York, NY  10019
Attention: Scott C. Lechner
Facsimile No.:  (646) 758-4203

 

(B)           IF TO THE CO-ISSUERS OR THE PARENT COMPANIES, SHALL BE DELIVERED
OR SENT BY MAIL OR FACSIMILE TRANSMISSION TO:

 

44

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If to the Master Issuer:

c/o IHOP, Corp.
450 North Brand Boulevard
Glendale, California  91203-2306
ATT:  General Counsel
Facsimile No.:  818-637-5361

 

If to the IP Holder:

c/o IHOP, Corp.
450 North Brand Boulevard
Glendale, California  91203-2306
ATT:  General Counsel
Facsimile No.:  818-637-5361

 

If to the IHOP, Inc.:

International House of Pancakes, Inc.
450 North Brand Boulevard
Glendale, California  91203-2306
ATT:  General Counsel
Facsimile No.:  818-637-5361

 

If to IHOP Corp.:

c/o IHOP, Corp.
450 North Brand Boulevard
Glendale, California  91203-2306
ATT:  General Counsel
Facsimile No.:  818-637-5361

 

with copies to (which copies shall not constitute notice to the Co-Issuers or
each Parent Company):

 

                             Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, NY  10036
Attention:  David H. Midvidy
Facsimile No.:  (917) 777-2089
Email:  dmidvidy@skadden.com

 

Any such statements, requests, notices or agreements shall take effect at the
time of receipt thereof.

 

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13.           INITIAL PURCHASER’S INFORMATION

 

The parties hereto acknowledge and agree that, for all purposes of this
Agreement, the “Initial Purchaser’s Information” consists solely of the
information to be specified in a letter signed by a representative of the
Initial Purchaser, dated the date of the relevant Offering Memorandum, and
(ii) the names and phone numbers of certain personnel of the Initial Purchaser
on page 60 of the preliminary materials dated November 7, 2007 (posted on the
IntraLinks electronic data site on November 8, 2007).

 

14.          GOVERNING LAW

 

This Agreement shall be governed by and construed in accordance with the laws of
the State of New York without regard to conflicts of law principles (other than
Sections 5-1401 and 5-1402 of the General Obligations Law of the State
New York).

 

15.           WAIVER OF JURY TRIAL.

 

EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVE, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE
TRANSACTIONS CONTEMPLATED HEREBY.

 

16.           SUBMISSION TO JURISDICTION.

 

Each of the parties hereto hereby irrevocably and unconditionally:

 

(A)           SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED
HEREBY, OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF,
TO THE NON-EXCLUSIVE GENERAL JURISDICTION OF THE COURTS OF THE STATE OF
NEW YORK, THE COURTS OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK,
AND APPELLATE COURTS FROM ANY THEREOF;

 

(B)           CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE BROUGHT IN SUCH
COURTS AND WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE
OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR
PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND AGREES NOT TO PLEAD OR CLAIM
THE SAME;

 

(C)           AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR PROCEEDING
MAY BE EFFECTED BY MAILING A COPY THEREOF BY REGISTERED OR CERTIFIED MAIL (OR
ANY SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO ANY PARTY HERETO AT
ITS ADDRESS SET FORTH IN SECTION 12 OR AT SUCH OTHER ADDRESS OF WHICH SUCH PARTY
SHALL HAVE BEEN NOTIFIED PURSUANT THERETO; AND

 

(D)           AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT
SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT
TO SUE IN ANY OTHER JURISDICTION; AND WAIVES, TO THE MAXIMUM EXTENT NOT
PROHIBITED BY LAW, ANY RIGHT IT MAY

 

46

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HAVE TO CLAIM OR RECOVER IN ANY LEGAL ACTION OR PROCEEDING REFERRED TO IN THIS
SECTION 16 ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES.

 

17.           COUNTERPARTS

 

This Agreement may be executed in one or more counterparts (which may include
counterparts delivered by facsimile) and, if executed in more than one
counterpart, the executed counterparts shall each be deemed to be an original,
but all such counterparts shall together constitute one and the same instrument.

 

18.           AMENDMENTS

 

No amendment or waiver of any provision of this Agreement, nor any consent or
approval to any departure therefrom, shall in any event be effective unless the
same shall be in writing and signed by the parties hereto.

 

19.           HEADINGS

 

The headings herein are inserted for convenience of reference only and are not
intended to be part of, or to affect the meaning or interpretation of, this
Agreement.

 

20.           ABSENCE OF FIDUCIARY RELATIONSHIP

 

The Co-Issuers and the Parent Companies acknowledge and agree that in connection
with this offering, sale and resale of the Securities or any other services the
Initial Purchaser may be deemed to be providing hereunder, notwithstanding any
preexisting relationship, advisory or otherwise, between the parties or any oral
representations or assurances previously or subsequently made by the Initial
Purchaser: (i) no fiduciary or agency relationship between the Co-Issuers, the
Parent Companies and any other person, on the one hand, and the Initial
Purchaser, on the other, exists; (ii) the Initial Purchaser is not acting as an
advisor, expert or otherwise, to the Co-Issuers and the Parent Companies,
including, without limitation, with respect to the determination of the offering
price of the Securities, and such relationship between the Co-Issuers and the
Parent Companies, on the one hand, and the Initial Purchaser, on the other, is
entirely and solely commercial, based on arms-length negotiations; (iii) any
duties and obligations that the Initial Purchaser may have to the Co-Issuers and
the Parent Companies shall be limited to those duties and obligations
specifically stated herein; and (iv) the Initial Purchaser and its respective
affiliates may have interests that differ from those of the Co-Issuers and the
Parent Companies.  The Co-Issuers and the Parent Companies hereby waive any
claims that the Co-Issuers and the Parent Companies may have against the Initial
Purchaser with respect to any breach of fiduciary duty in connection with the
offering of the Securities.

 

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21.           EFFECT ON PREVIOUS LETTER AGREEMENT.  THIS AGREEMENT SUPERSEDES IN
ITS ENTIRETY THE LETTER AGREEMENT, DATED NOVEMBER 28, 2007, AMONG IHOP, CHLH
CORP., THE INITIAL PURCHASER AND LEHMAN COMMERCIAL PAPER INC.

 

[Remainder of page intentionally left blank]

 

48

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If the foregoing is in accordance with your understanding of our agreement,
kindly sign and return to us a counterpart hereof, whereupon this instrument
will become a binding agreement, effective as of the date first written above,
among the Co-Issuers, IHOP, IHOP Inc. and the Initial Purchaser in accordance
with its terms.

 

 

Very truly yours,

 

 

 

IHOP CORP., as Parent Company

 

 

 

 

 

By:

/s/ Julia Stewart

 

Name:

Julia Stewart

 

Title:

Chairman and Chief Executive Officer

 

 

 

 

 

INTERNATIONAL HOUSE OF PANCAKES,
INC., as Parent Company

 

 

 

 

 

By:

/s/ Tom Conforti

 

Name:

Tom Conforti

 

Title:

Chief Financial Officer

 

 

 

 

 

IHOP FRANCHISING, LLC, as Co-Issuer

 

 

 

 

 

By:

/s/ Mark Weisberger

 

Name:

Mark Weisberger

 

Title:

Vice President

 

 

 

 

 

IHOP IP, LLC, as Co-Issuer

 

 

 

 

 

By:

/s/ Mark Weisberger

 

Name:

Mark Weisberger

 

Title:

Vice President

 

--------------------------------------------------------------------------------

 

Acknowledged and agreed:

 

 

 

LEHMAN BROTHERS INC.,

 

as Initial Purchaser

 

 

 

 

 

By:

/s/ Cory Wishengrad

 

 

Authorized Signatory

 

 

--------------------------------------------------------------------------------

 

SCHEDULE A-1

 

BRIDGE SYNDICATION MATERIALS

 

1.               Rating assessment letter of Standard & Poor’s Rating Evaluation
Services dated July 13, 2007.

 

2.               Financial guaranty insurance policy agreement between Financial
Guaranty Insurance Company and IHOP Corporation dated July 15, 2007.

 

3.               Financial guaranty insurance policy agreement between Financial
Guaranty Insurance Company and IHOP Corporation dated as of July 15, 2007.

 

4.               Financial guaranty insurance policies agreement among Financial
Guaranty Insurance Company, Assured Guaranty Corp., XL Capital Assurance Inc.,
Applebee’s International Inc. and IHOP Corporation dated as of July 15, 2007.

 

5.               Letter of expression of interest of Spirit Finance Corporation
and GE Capital Franchise Finance Corporation to provide sale/lease back
financing for approximately 200 fee simple Applebee’s restaurants.

 

6.               Letter of expression of interest of Corporate Property
Associates 16 – Global Incorporated to provide sale/lease back financing for
approximately 200 fee simple Applebee’s restaurants.

 

7.               The Pro Forma Financial Assumptions

 

8.               The Pro Forma Financial Statements

 

9.               The 2006 Applebee’s International Corporation Form of Franchise
Agreement

 

10.         Summary of Terms of First Lien Securitization Bridge Facilities

 

11.         The Securities Demand

 

12.         Pro Forma Financial Statements Summary

 

13.         WBS Model

 

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SCHEDULE A-2

 

PRELIMINARY MARKETING MATERIALS

 

1.     Preliminary Materials dated October 24, 2007.

 

2.     Preliminary Materials dated November 7, 2007.

 

3.               Applebee’s and IHOP model runs made available on IntraLinks
data site October 31, 2007.

 

4.               Applebee’s and IHOP model runs made available on IntraLinks
data site November 8, 2007.

 

1

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EXHIBIT 1

 

DRAFT OFFERING MEMORANDUM

 

1

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EXHIBIT 2

 

BASE INDENTURE

 

1

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EXHIBIT 3

 

SUPPLEMENT

 

1

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EXHIBIT 4

 

FORM OF 10b-5 LETTER OF
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP

 

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EXHIBIT 5

 

FORM OF OPINION OF SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP

PURSUANT TO SECTION 5(i) HEREIN

 

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EXHIBIT 6

 

FORM OF OPINION OF SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP

PURSUANT TO SECTION 5(j) HEREIN

 

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EXHIBIT 7

 

FORM OF OPINION OF SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP

PURSUANT TO SECTION 5(k) HEREIN

 

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EXHIBIT 8

 

FORM OF OPINION OF SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP

PURSUANT TO SECTION 5(l) HEREIN

 

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