Exhibit 10.1

 

 

 

GUARANTEE AND COLLATERAL AGREEMENT

made by

PLANET FITNESS FRANCHISING LLC,

PLANET FITNESS DISTRIBUTION LLC,

PLANET FITNESS ASSETCO LLC, and

PLANET FITNESS SPV GUARANTOR LLC,

each as a Guarantor,

in favor of

CITIBANK, N.A.,

as Trustee

Dated as of August 1, 2018

 

 

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TABLE OF CONTENTS

 

         Page  

SECTION 1 DEFINED TERMS

     1  

1.1

 

Definitions

     1  

SECTION 2 GUARANTEE

     2  

2.1

 

Guarantee

     2  

2.2

 

No Subrogation

     3  

2.3

 

Amendments, etc. with respect to the Master Issuer Obligations

     3  

2.4

 

Guarantee Absolute and Unconditional

     3  

2.5

 

Reinstatement

     4  

2.6

 

Payments

     4  

2.7

 

Information

     4  

SECTION 3 SECURITY

     5  

3.1

 

Grant of Security Interest

     5  

3.2

 

Certain Rights and Obligations of the Guarantors Unaffected

     7  

3.3

 

Performance of Collateral Transaction Documents

     8  

3.4

 

Stamp, Other Similar Taxes and Filing Fees

     9  

3.5

 

Authorization to File Financing Statements

     9  

SECTION 4 REPRESENTATIONS AND WARRANTIES

     9  

4.1

 

Existence and Power

     9  

4.2

 

Company and Governmental Authorization

     10  

4.3

 

No Consent

     10  

4.4

 

Binding Effect

     10  

4.5

 

Ownership of Equity Interests; Subsidiaries

     10  

4.6

 

Security Interests

     11  

4.7

 

Other Representations

     12  

SECTION 5 COVENANTS

     12  

5.1

 

Maintenance of Office or Agency

     12  

5.2

 

Covenants in Base Indenture and Other Related Documents

     12  

5.3

 

Further Assurances

     12  

5.4

 

Legal Name, Location Under Section 9-301 or 9-307

     13  

5.5

 

Equity Interests

     14  

5.6

 

Management Accounts

     14  

5.7

 

Senior Notes Interest Reserve Account

     14  

5.8

 

Senior Subordinated Notes Interest Reserve Account

     14  

SECTION 6 REMEDIAL PROVISIONS

     14  

6.1

 

Rights of the Control Party and Trustee upon Event of Default

     14  

6.2

 

Waiver of Appraisal, Valuation, Stay and Right to Marshaling

     17  

6.3

 

Limited Recourse

     17  

6.4

 

Optional Preservation of the Securitized Assets

     17  

6.5

 

Control by the Control Party

     17  

6.6

 

The Trustee May File Proofs of Claim

     18  

6.7

 

Undertaking for Costs

     18  

6.8

 

Restoration of Rights and Remedies

     19  

6.9

 

Rights and Remedies Cumulative

     19  

6.10

 

Delay or Omission Not Waiver

     19  

6.11

 

Waiver of Stay or Extension Laws

     19  

 

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SECTION 7 THE TRUSTEE’S AUTHORITY

     20  

SECTION 8 MISCELLANEOUS

     20  

8.1

 

Amendments

     20  

8.2

 

Notices

     20  

8.3

 

Governing Law

     22  

8.4

 

Successors

     22  

8.5

 

Severability

     22  

8.6

 

Counterpart Originals

     22  

8.7

 

Table of Contents, Headings, etc.

     22  

8.8

 

Waiver of Jury Trial

     22  

8.9

 

Submission to Jurisdiction; Waivers

     22  

8.10

 

Additional Guarantors

     23  

8.11

 

Currency Indemnity

     23  

8.12

 

Acknowledgment of Receipt; Waiver

     23  

8.13

 

Termination; Partial Release

     24  

8.14

 

Third Party Beneficiary

     24  

8.15

 

Entire Agreement

     24  

8.16

 

Electronic Communication

     24  

SCHEDULES

Schedule 4.5    —    Pledged Equity Interests

EXHIBITS

Exhibit A    —    Form of Assumption Agreement

 

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GUARANTEE AND COLLATERAL AGREEMENT

GUARANTEE AND COLLATERAL AGREEMENT (as amended, supplemented or otherwise
modified from time to time, this “Agreement”), dated as of August 1, 2018, made
by PLANET FITNESS FRANCHISING LLC, a Delaware limited liability company (the
“Franchisor”), PLANET FITNESS DISTRIBUTION LLC, a Delaware limited liability
company (the “Equipment Distributor”), PLANET FITNESS ASSETCO LLC, a Delaware
limited liability company (the “Planet Fitness Assetco,” and, together with the
Franchisor and the Equipment Distributor, the “Subsidiary Guarantors”) and
PLANET FITNESS SPV GUARANTOR LLC, a Delaware limited liability company (the
“Holding Company Guarantor,” and, together with the Subsidiary Guarantors, the
“Guarantors” and each, a “Guarantor”), in favor of CITIBANK, N.A., a national
banking association, as trustee and securities intermediary under the Indenture
referred to below (in such capacity, together with its successors, the
“Trustee”) for the benefit of the Secured Parties.

W I T N E S S E T H:

WHEREAS, Planet Fitness Master Issuer LLC, a Delaware limited liability company
(the “Master Issuer”), the Trustee and Citibank, N.A., as securities
intermediary, have entered into the Base Indenture, dated as of the date of this
Agreement (as amended, modified or supplemented from time to time, exclusive of
any Series Supplements, the “Base Indenture” and, together with all Series
Supplements, the “Indenture”), providing for the issuance from time to time of
one or more Series of Notes thereunder; and

WHEREAS, the Indenture and the other Related Documents require that the parties
hereto execute and deliver this Agreement;

NOW, THEREFORE, in consideration of the premises and for other good and valuable
consideration the receipt and sufficiency of which are hereby acknowledged, each
Guarantor hereby agrees with the Trustee, for the benefit of the Secured
Parties, as follows:

SECTION 1

DEFINED TERMS

1.1    Definitions.

(a)    Unless otherwise defined herein, terms defined in the Base Indenture
Definitions List attached to the Base Indenture as Annex A thereto or otherwise
defined in the Base Indenture and used herein shall have the meanings given to
them in such Base Indenture Definitions List or elsewhere in the Base Indenture.
All rules of construction set forth in Section 1.4 of the Base Indenture apply
to this Agreement.

(b)    The following terms shall have the following meanings:

“Collateral” has the meaning assigned to such term in Section 3.1(a).

“Master Issuer Obligations” means all Obligations owed by the Master Issuer to
the Secured Parties under the Indenture and the other Related Documents.

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“Other Currency” has the meaning assigned to such term in Section 8.11.

“Termination Date” has the meaning assigned to such term in Section 2.1(d).

SECTION 2

GUARANTEE

2.1    Guarantee.

(a)    Each of the Guarantors hereby, jointly and severally, unconditionally and
irrevocably, guarantees to the Trustee, for the benefit of the Secured Parties,
the prompt and complete payment and performance by the Master Issuer when due
(whether at the stated maturity, by acceleration or otherwise, but after giving
effect to all applicable grace periods) of the Master Issuer Obligations. In
furtherance of the foregoing and not in limitation of any other right that the
Trustee or any other Secured Party has at law or in equity against any Guarantor
by virtue hereof, upon the failure of the Master Issuer to pay any Master Issuer
Obligation when and as the same shall become due, whether at maturity, by
acceleration, after notice of prepayment or otherwise, each Guarantor hereby
jointly and severally promises to and shall forthwith pay, or cause to be paid,
to the Trustee for distribution to the applicable Secured Parties in accordance
with the Indenture, in cash, the amount of such unpaid Master Issuer Obligation.
This is a guarantee of payment and not merely of collection.

(b)    Anything herein or in any other Related Document to the contrary
notwithstanding, the maximum liability of each Guarantor hereunder and under the
other Related Documents shall in no event exceed the amount which can be
guaranteed by such Guarantor under applicable federal and state laws relating to
the insolvency of debtors.

(c)    Each Guarantor agrees that the Master Issuer Obligations may at any time
and from time to time exceed the amount of the liability of such Guarantor
hereunder without impairing the guarantee contained in this Section 2 or
affecting the rights and remedies of the Trustee or any other Secured Party
hereunder.

(d)    The guarantee contained in this Section 2 shall remain in full force and
effect until the date (the “Termination Date”) on which this Agreement ceases to
be of further effect in accordance with Article XII of the Base Indenture,
notwithstanding that from time to time prior thereto the Master Issuer may be
free from any Master Issuer Obligations.

(e)    No payment made by the Master Issuer, any of the Guarantors, any other
guarantor or any other Person or received or collected by the Trustee or any
other Secured Party from the Master Issuer, any of the Guarantors, any other
guarantor or any other Person by virtue of any action or proceeding or any
set-off or appropriation or application at any time or from time to time in
reduction of or in payment of the Master Issuer Obligations shall be deemed to
modify, reduce, release or otherwise affect the liability of any Guarantor which
shall, notwithstanding any such payment (other than any payment made by such
Guarantor in respect of the Master Issuer Obligations or any payment received or
collected from such Guarantor in respect of the Master Issuer Obligations),
remain liable hereunder for the Master Issuer Obligations up to the maximum
liability of such Guarantor hereunder until the Termination Date.

 

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2.2    No Subrogation. Notwithstanding any payment made by any Guarantor
hereunder or any set-off or application of funds of any Guarantor by the Trustee
or any other Secured Party, no Guarantor shall be entitled to be subrogated to
any of the rights of the Trustee or any other Secured Party against the Master
Issuer or any other Guarantor or any collateral security or guarantee or right
of offset held by the Trustee or any other Secured Party for the payment of the
Master Issuer Obligations, nor shall any Guarantor seek or be entitled to seek
any contribution or reimbursement from the Master Issuer or any other Guarantor
in respect of payments made by such Guarantor hereunder, until the Termination
Date. If any amount shall be paid to any Guarantor on account of such
subrogation, contribution or reimbursement rights at any time when all of the
Master Issuer Obligations shall not have been paid in full, such amount shall be
held by such Guarantor in trust for the Trustee and the other Secured Parties,
segregated from other funds of such Guarantor, and shall, forthwith upon receipt
by such Guarantor, be turned over to the Trustee in the exact form received by
such Guarantor (duly endorsed by such Guarantor to the Trustee, if required), to
be applied against the Master Issuer Obligations, whether matured or unmatured,
in such order as the Trustee may determine in accordance with the Indenture.

2.3    Amendments, etc. with respect to the Master Issuer Obligations. Each
Guarantor shall remain obligated hereunder notwithstanding that, without any
reservation of rights against any Guarantor and without notice to or further
assent by any Guarantor, any demand for payment of any of the Master Issuer
Obligations made by the Trustee or any other Secured Party may be rescinded by
the Trustee or such other Secured Party and any of the Master Issuer Obligations
continued, and the Master Issuer Obligations, or the liability of any other
Person upon or for any part thereof, or any collateral security or guarantee
therefor or right of offset with respect thereto, may, from time to time, in
whole or in part, be renewed, extended, amended, modified, accelerated,
compromised, waived, surrendered or released by the Trustee or any other Secured
Party, and the Base Indenture and any other documents executed and delivered in
connection therewith may be amended, modified, supplemented or terminated, in
whole or in part, from time to time, and any collateral security, guarantee or
right of offset at any time held by the Trustee or any other Secured Party for
the payment of the Master Issuer Obligations may be sold, exchanged, waived,
surrendered or released (it being understood that this Section 2.3 is not
intended to affect any rights or obligations set forth in any other Related
Document). Neither the Trustee nor any other Secured Party shall have any
obligation to protect, secure, perfect or insure any Lien at any time held by it
as security for the Master Issuer Obligations or for the guarantee contained in
this Section 2 or any property subject thereto.

2.4    Guarantee Absolute and Unconditional. Each Guarantor waives any and all
notice of the creation, renewal, extension or accrual of any of the Master
Issuer Obligations and notice of or proof of reliance by the Trustee or any
other Secured Party upon the guarantee contained in this Section 2 or acceptance
of the guarantee contained in this Section 2; all Master Issuer Obligations
shall conclusively be deemed to have been created, contracted or incurred, or
renewed, extended, amended or waived, in reliance upon the guarantee contained
in this Section 2 and the grant of the security interests pursuant to Section 3;
and all dealings between the Master Issuer and any of the Guarantors, on the one
hand, and the Trustee and the other Secured Parties, on the other hand, likewise
shall be conclusively presumed to have occurred or been consummated in reliance
upon the guarantee contained in this Section 2 and the grant of the security
interests pursuant to Section 3. Each Guarantor waives diligence, presentment,
protest, demand for payment and notice of default or nonpayment to or upon the
Master Issuer or any of the Guarantors with

 

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respect to the Master Issuer Obligations. Each Guarantor understands and agrees
that the guarantee contained in this Section 2 and the grant of the security
interests pursuant to Section 3 shall be construed as a continuing, absolute and
unconditional guarantee of payment without regard to (a) the validity or
enforceability of the Indenture or any other Related Document, any of the Master
Issuer Obligations or any other collateral security therefor or guarantee or
right of offset with respect thereto at any time or from time to time held by
the Trustee or any other Secured Party, (b) any defense, set-off or counterclaim
(other than a defense of full payment or performance) which may at any time be
available to or be asserted by the Master Issuer or any other Person against the
Trustee or any other Secured Party, or (c) any other circumstance whatsoever
(with or without notice to or knowledge of the Master Issuer or such Guarantor)
which constitutes, or might be construed to constitute, an equitable or legal
discharge of the Master Issuer for the Master Issuer Obligations, or of such
Guarantor under the guarantee contained in this Section 2 and the grant of the
security interests pursuant to Section 3, in bankruptcy or in any other
instance. When making any demand hereunder or otherwise pursuing its rights and
remedies hereunder against any Guarantor, the Trustee or any other Secured Party
may, but shall be under no obligation to, make a similar demand on or otherwise
pursue such rights and remedies as it may have against the Master Issuer, any
other Guarantor or any other Person or against any collateral security or
guarantee for the Master Issuer Obligations or any right of offset with respect
thereto, and any failure by the Trustee or any other Secured Party to make any
such demand, to pursue such other rights or remedies or to collect any payments
from the Master Issuer, any other Guarantor or any other Person or to realize
upon any such collateral security or guarantee or to exercise any such right of
offset, or any release of the Master Issuer, any other Guarantor or any other
Person or any such collateral security, guarantee or right of offset, shall not
relieve any Guarantor of any obligation or liability hereunder, and shall not
impair or affect the rights and remedies, whether express, implied or available
as a matter of law, of the Trustee or any other Secured Party against any
Guarantor. For the purposes hereof “demand” shall include the commencement and
continuance of any legal proceedings.

2.5    Reinstatement. The guarantee contained in this Section 2 shall continue
to be effective, or be reinstated, as the case may be, if at any time payment,
or any part thereof, of any of the Master Issuer Obligations is rescinded or
must otherwise be restored or returned by the Trustee or any other Secured Party
upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of
the Master Issuer or any Guarantor, or upon or as a result of the appointment of
a receiver, intervenor or conservator of, or trustee or similar officer for, the
Master Issuer or any Guarantor or any substantial part of its property, or
otherwise, all as though such payments had not been made.

2.6    Payments. Each Guarantor hereby guarantees that payments hereunder shall
be paid to the Trustee without set-off or deduction or counterclaim in
immediately available funds in U.S. Dollars at the office of the Trustee.

2.7    Information. Each Guarantor assumes all responsibility for being and
keeping itself informed of the Master Issuer’s and each other Guarantor’s
financial condition and assets, and of all other circumstances bearing upon the
risk of nonpayment of the Master Issuer Obligations and the nature, scope and
extent of the risks that such Guarantor assumes and incurs hereunder, and agrees
that neither the Trustee nor any other Secured Party shall have any duty to
advise such Guarantor of information known to it or any of them regarding such
circumstances or risks.

 

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SECTION 3

SECURITY

3.1    Grant of Security Interest.

(a)    To secure the Obligations, each Guarantor hereby grants to the Trustee,
for the benefit of the Secured Parties, a security interest in such Guarantor’s
right, title and interest in, to and under all accounts, chattel paper,
commercial tort claims, deposit accounts, documents, equipment, fixtures,
general intangibles, health-care-insurance receivables, instruments, inventory,
securities, securities accounts and other investment property and
letter-of-credit rights (in each case, as defined in the New York UCC),
including all of the following property to the extent now owned or at any time
hereafter acquired by such Guarantor (collectively, the “Collateral”):

(i)    with respect to the Holding Company Guarantor, the limited liability
company membership interests and stock owned by the Holding Company Guarantor
that represent the 100% ownership interest in the Master Issuer;

(ii)    with respect to the Master Issuer, the limited liability company
membership interests and stock owned by the Master Issuer that represent the
100% ownership interest in the Securitization Entities owned by the Master
Issuer;

(iii)    with respect to the Franchisor, the Securitization IP and the right to
bring an action at law or in equity for any infringement, misappropriation,
dilution or other violation thereof occurring prior to, on or after the Closing
Date, and to collect all damages, settlements and proceeds relating thereto;

(iv)    with respect to the Franchisor, the IP License Agreements, all related
payments thereon and all rights thereunder;

(v)    with respect to the Franchisor, (A) the Contributed Franchise Agreements,
the Contributed Securitized Authorized Vendor Contracts, the Contributed Area
Development Agreements, and all Royalty Payments, Vendor Commissions and Other
Franchisee Payments payable thereunder or in respect thereof; (B) the New
Franchise Agreements, New Securitized Authorized Vendor Contracts, the New Area
Development Agreements and all Royalty Payments, Vendor Commissions and Other
Franchisee Payments payable thereunder or in respect thereof; (C) all rights to
enter into New Franchise Agreements, New Securitized Authorized Vendor Contracts
and New Area Development Agreements; (D) all Webjoin Fees and Payment Processor
Rebates and (E) any and all other property of every nature, now or hereafter
transferred, mortgaged, pledged, or assigned as security for payment or
performance of any obligation of Franchisees or other Persons, as applicable, to
the Franchisor under the Franchise Agreements, Securitized Authorized Vendor
Contracts or the Area Development Agreements, as applicable, and all guarantees
of such obligations and the rights evidenced by or reflected in the Franchise
Agreements, Securitized Authorized Vendor Contracts or the Area Development
Agreements, as applicable;

 

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(vi)    with respect to Planet Fitness Assetco, (i) all rights to own and
operate the Contributed Securitized Corporate-Owned Stores and the New
Securitized Corporate-Owned Stores, including the right to all Securitized
Corporate-Owned Collections, (ii) all Securitized Corporate-Owned Store Assets
and (iii) with respect to the Securitized Franchisee Leases, the Franchisee
Lease Payments received by Planet Fitness Assetco thereunder;

(vii)    with respect to the Franchisor, Securitized Corporate-Owned Store IP
License Fees, Canadian IP License Fees, International IP License Fees, Retained
Corporate-Owned Store IP License Fees and the Additional IP License Fees and all
rights thereunder;

(viii)    with respect to the Equipment Distributor, the Securitized Equipment
Supply Agreements, and all related payments thereon and all rights thereunder;

(ix)    the Accounts and all amounts on deposit in or otherwise credited to the
Accounts;

(x)    any Interest Reserve Letter of Credit;

(xi)    the books and records (whether in physical, electronic or other form) of
each of the Securitization Entities, including those books and records
maintained by the Manager on behalf of the Securitization Entities relating to
the Franchise Assets, the Securitization IP, the Securitized Corporate-Owned
Store Assets and the Securitized Equipment Supply Agreements;

(xii)    the rights, powers, remedies and authorities of the Securitization
Entities under (i) each of the Related Documents (other than the Indenture and
the Notes) to which they are a party and (ii) each of the documents relating to
the Franchise Assets to which it is a party;

(xiii)    any and all other property of the Securitization Entities now or
hereafter acquired, including, without limitation, all accounts, chattel paper,
commercial tort claims, deposit accounts, documents, equipment, fixtures,
general intangibles, health-care-insurance receivables, instruments, inventory,
securities, securities accounts and other investment property and
letter-of-credit rights (in each case, as defined in the New York UCC); and

(xiv)    all payments, proceeds, supporting obligations and accrued and future
rights to payment with respect to the foregoing;

provided that (A) the Collateral shall exclude the Collateral Exclusions;
(B) the Master Issuer and the Guarantors shall not be required to pledge, and
the Collateral shall not include, more than 65% of the Equity Interests (and any
rights associated with such Equity Interests) of (1) any foreign

 

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Subsidiary of any of the Master Issuer or the Guarantors that is a Controlled
Foreign Corporation or (2) any domestic Subsidiary, substantially all of the
assets of which are the equity interests of Controlled Foreign Corporations
(each, a “Foreign Subsidiary Holding Company”), and in no circumstance will any
such foreign Subsidiary that is a Controlled Foreign Corporation, any U.S.
Subsidiary of a foreign Subsidiary that is a Controlled Foreign Corporation or
any Foreign Subsidiary Holding Company be required to pledge any assets, serve
as Guarantor, or otherwise guarantee the Notes; and (C) the security interest in
(1) the Senior Notes Interest Reserve Account and the related property shall
only be for the benefit of the Senior Noteholders and the Trustee, in its
capacity as trustee for the Senior Noteholders, (2) the Senior Subordinated
Notes Interest Reserve Account and the related property shall only be for the
benefit of the Senior Subordinated Noteholders and the Trustee, in its capacity
as trustee for the Senior Subordinated Noteholders and (3) each Series
Distribution Account and the related property thereto shall only be for the
benefit of the applicable Series Noteholders as set forth in the applicable
Series Supplement.

(b)    The foregoing grant is made in trust to secure the Obligations and to
secure compliance with the provisions of this Agreement. The Trustee, on behalf
of the Secured Parties, acknowledges such grant, accepts the trusts under this
Agreement in accordance with the provisions of this Agreement, and agrees to
perform its duties required in this Agreement. The Collateral shall secure the
Obligations equally and ratably without prejudice, priority or distinction
(except, with respect to any Series of Notes, as otherwise stated in the
applicable Series Supplement or in the applicable provisions of the Base
Indenture).

(c)    The parties hereto agree and acknowledge that each certificated Equity
Interest may be held by a custodian on behalf of the Trustee.

3.2    Certain Rights and Obligations of the Guarantors Unaffected.

(a)    Notwithstanding the grant of the security interest in the Collateral
hereunder to the Trustee, on behalf of the Secured Parties, the Guarantors
acknowledge that the Manager, on behalf of the Guarantors shall, subject to the
terms and conditions of the Management Agreement, have the right, subject to the
Trustee’s right to revoke such right, in whole or in part, in the event of the
occurrence of an Event of Default, (i) to give, in accordance with the Managing
Standard, all consents, requests, notices, directions, approvals, extensions or
waivers, if any, which are required or permitted to be given by any Guarantor
under the Collateral Transaction Documents, and to enforce all rights, remedies,
powers, privileges and claims of each Guarantor under the Collateral Transaction
Documents, (ii) to give, in accordance with the Managing Standard, all consents,
requests, notices, directions and approvals, if any, which are required or
permitted to be given by any Guarantor under any IP License Agreement to which
such Guarantor is a party and (iii) to take any other actions required or
permitted to be taken by a Guarantor under the terms of the Management
Agreement.

(b)    The grant of the security interest by the Guarantors in the Collateral to
the Trustee on behalf of and for the benefit of the Secured Parties hereunder
shall not (i) relieve any Guarantor from the performance of any term, covenant,
condition or agreement on such Guarantor’s part to be performed or observed
under or in connection with any of the Collateral Transaction Documents or
(ii) impose any obligation on the Trustee or any of the Secured Parties to
perform or observe any such term, covenant, condition or agreement on such
Guarantor’s part to be so performed or observed or impose any liability on the
Trustee or any of the Secured Parties for any act or omission on the part of
such Guarantor or from any breach of any representation or warranty on the part
of such Guarantor.

 

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(c)    Each Guarantor hereby jointly and severally agrees to indemnify and hold
harmless the Trustee and each Secured Party (including its directors, officers,
employees and agents) from and against any and all losses, liabilities
(including liabilities for penalties), claims, demands, actions, suits,
judgments, reasonable and documented out-of-pocket costs and expenses arising
out of or resulting from the security interest granted hereby, whether arising
by virtue of any act or omission on the part of such Guarantor or otherwise,
including, without limitation, the reasonable out-of-pocket costs, expenses and
disbursements (including reasonable attorneys’ fees and expenses) incurred by
the Trustee or any Secured Party in enforcing this Agreement or any other
Related Document or preserving any of its rights to, or realizing upon, any of
the Collateral or, to the extent permitted by applicable law, the Securitized
Assets; provided, however, that the foregoing indemnification shall not extend
to any action by the Trustee or any Secured Party which constitutes gross
negligence, bad faith or willful misconduct by the Trustee or any Secured Party
or any other indemnified Person hereunder. The indemnification provided for in
this Section 3.2 shall survive the removal of, or a resignation by, any Person
as Trustee as well as the termination of this Agreement.

3.3    Performance of Collateral Transaction Documents. Upon the occurrence of a
default or breach (after giving effect to any applicable grace or cure periods)
by any Person party to (a) a Collateral Transaction Document or (b) a Collateral
Business Document (only if a Manager Termination Event or an Event of Default
has occurred and is continuing), promptly following a request from the Trustee
to do so and at the Guarantors’ expense, the Guarantors agree jointly and
severally to take all such lawful action as permitted under this Agreement as
the Trustee (acting at the direction of the Control Party (acting at the
direction of the Controlling Class Representative)) may reasonably request to
compel or secure the performance and observance by such Person of its
obligations to any Guarantor, and to exercise any and all rights, remedies,
powers and privileges lawfully available to any Guarantor to the extent and in
the manner directed by the Trustee (acting at the direction of the Control Party
(acting at the direction of the Controlling Class Representative)), including,
without limitation, the transmission of notices of default and the institution
of legal or administrative actions or proceedings to compel or secure
performance by such Person of its obligations thereunder.

If (i) any Guarantor shall have failed, within ten (10) Business Days of
receiving the direction of the Trustee (given at the direction of the Control
Party (at the direction of the Controlling Class Representative)), to take
commercially reasonable action to accomplish such directions of the Trustee,
(ii) any Guarantor refuses to take any such action, as reasonably determined by
the Trustee in good faith, or (iii) the Control Party (acting at the direction
of the Controlling Class Representative) reasonably determines that such action
must be taken immediately, in any such case the Servicer may, but shall not be
obligated to, take, and the Trustee shall take (if so directed by the Control
Party (acting at the direction of the Controlling Class Representative)), at the
expense of the Guarantors, such previously directed action and any related
action permitted under this Agreement which the Control Party (acting at the
direction of the Controlling Class Representative) thereafter determines is
appropriate (without the need under this provision or any other provision under
this Agreement to direct the Guarantor to take such action), on behalf of the
Guarantor and the Secured Parties.

 

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3.4    Stamp, Other Similar Taxes and Filing Fees. The Guarantors shall jointly
and severally indemnify and hold harmless the Trustee and each Secured Party
from any present or future claim for liability for any stamp, documentary or
other similar tax and any penalties or interest and expenses with respect
thereto, that may be assessed, levied or collected by any jurisdiction in
connection with this Agreement, any other Related Document or the Securitized
Assets. The Guarantors shall pay, and jointly and severally indemnify and hold
harmless each Secured Party against, any and all amounts in respect of all
search, filing, recording and registration fees, excise taxes and other similar
imposts that may be payable or determined to be payable in respect of the
execution, delivery, performance and/or enforcement of this Agreement or any
other Related Document.

3.5    Authorization to File Financing Statements.

(a)    Each Guarantor hereby irrevocably authorizes the Control Party on behalf
of the Secured Parties at any time and from time to time to file or record in
any filing office in any applicable jurisdiction financing statements and other
filing or recording documents or instruments with respect to the Collateral
(other than Excepted Securitization IP Assets) to perfect the security interests
of the Trustee for the benefit of the Secured Parties under this Agreement. Each
Guarantor authorizes the filing of any such financing statement, document or
instrument naming the Trustee as secured party and indicating that the
Collateral includes “all assets” or words of similar effect or import regardless
of whether any particular assets comprised in the Collateral fall within the
scope of Article 9 of the UCC, including, without limitation, any and all
Securitization IP. Each Guarantor agrees to furnish any information necessary to
accomplish the foregoing promptly upon the Control Party’s request. Each
Guarantor also hereby ratifies and authorizes the filing on behalf of the
Secured Parties of any financing statement with respect to the Collateral made
prior to the date hereof.

(b)    Each Guarantor acknowledges that to the extent the Collateral includes
certain rights of the Guarantors as secured parties under the Related Documents,
each Guarantor hereby irrevocably appoints the Trustee as its representative
with respect to all financing statements filed to perfect or record evidence of
such security interests and authorizes the Control Party on behalf of and for
the benefit of the Secured Parties to make such filings as it deems necessary to
reflect the Trustee as secured party of record with respect to such financing
statements.

SECTION 4

REPRESENTATIONS AND WARRANTIES

Each Guarantor hereby represents and warrants, for the benefit of the Trustee
and the Secured Parties, as follows as of the date hereof and as of each Series
Closing Date:

4.1    Existence and Power. Each Guarantor (a) is duly organized, validly
existing and in good standing under the laws of its jurisdiction of
organization, (b) is duly qualified to do business as a foreign entity and in
good standing under the laws of each jurisdiction where the

 

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character of its property, the nature of its business or the performance of its
obligations under the Related Documents make such qualification necessary, and
(c) has all limited liability company, corporate or other powers and all
governmental licenses, authorizations, consents and approvals required (i) to
carry on its business as now conducted and (ii) for consummation of the
transactions contemplated by this Agreement and the other Related Documents
except, in the case of clauses (b) and (c)(i), to the extent the failure to do
so would not, individually or in the aggregate, be reasonably likely to result
in a Material Adverse Effect.

4.2    Company and Governmental Authorization. The execution, delivery and
performance by each Guarantor of this Agreement and the other Related Documents
to which it is a party (a) is within such Guarantor’s limited liability company,
corporate or other powers and has been duly authorized by all necessary limited
liability company, corporate or other action, (b) requires no action by or in
respect of, or filing with, any Governmental Authority which has not been
obtained (other than any actions or filings that may be undertaken after the
Closing Date pursuant to the terms of the Base Indenture or any other Related
Document) and (c) does not contravene, or constitute a default under, any
Requirements of Law with respect to such Guarantor or any Contractual Obligation
with respect to such Guarantor or result in the creation or imposition of any
Lien on any property of any Guarantor (other than Permitted Liens), except for
Liens created by this Agreement or the other Related Documents, except in the
case of clauses (b) and (c) above, as applied to the Contribution Agreements,
the violation of which would not reasonably be expected to result in a Material
Adverse Effect. This Agreement and each of the other Related Documents to which
each Guarantor is a party has been executed and delivered by a duly Authorized
Officer of such Guarantor.

4.3    No Consent. 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 valid execution and delivery by
each Guarantor of this Agreement or any Related Document to which it is a party
or for the performance of any of the Guarantors’ obligations hereunder or
thereunder other than such consents, approvals, authorizations, registrations,
declarations or filings (a) as shall have been obtained or made by such
Guarantor prior to the Closing Date or as are permitted to be obtained
subsequent to the Closing Date in accordance with Section 4.6 hereof or Sections
7.13 or 8.25 of the Base Indenture or (b) relating to the performance of any
Collateral Business Document, the failure of which to obtain would not
reasonably be expected to result in a Material Adverse Effect.

4.4    Binding Effect. This Agreement, and each other Related Document to which
a Guarantor is a party, is a legal, valid and binding obligation of each such
Guarantor enforceable against such Guarantor in accordance with its terms
(except as 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).

4.5    Ownership of Equity Interests; Subsidiaries. All of the issued and
outstanding Equity Interests owned by such Guarantor are set forth in Schedule
4.5 to this Agreement, all of which interests have been duly authorized and
validly issued, are fully paid and non-assessable and are owned of record by
such Guarantor free and clear of all Liens other than Permitted Liens. No
Guarantor has any subsidiaries or owns any Equity Interests in any other Person,
other than as set forth in such Schedule 4.5 and other than any Additional
Securitization Entity.

 

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4.6    Security Interests.

(a)    Each Guarantor owns and has good title to its Securitized Assets, free
and clear of all Liens other than Permitted Liens. Other than the Accounts, the
Securitized Franchisee Leases and Intellectual Property, the Collateral consists
of securities, loans, investments, accounts, commercial tort claims, inventory,
equipment, fixtures, health care insurance receivables, chattel paper, money,
deposit accounts, instruments, financial assets, documents, investment property,
general intangibles, letter of credit rights, or other supporting obligations
(in each case, as defined in the UCC). Except in the case of the Intellectual
Property, which is subject to Section 8.25(c) and Section 8.25(d) of the Base
Indenture or as described on Schedule 7.13(a) of the Base Indenture, this
Agreement 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 with regard to Excepted
Securitization IP Assets), and is prior to all other Liens (other than Permitted
Liens), and is enforceable as such against creditors of and purchasers from each
Guarantor 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. Except as set
forth in Schedule 7.13(a) of the Base Indenture, the Guarantors have received
all consents and approvals required by the terms of the Collateral to the pledge
of the Collateral to the Trustee hereunder. Each Guarantor has caused, or shall
have caused, the filing of all appropriate financing statements in the proper
filing office in the appropriate jurisdictions under applicable law in order to
perfect the first-priority security interest (subject to Permitted Liens) in the
Collateral (other than the Accounts and Intellectual Property) granted to the
Trustee hereunder within ten (10) days of the date of this Agreement.
Notwithstanding the foregoing, any representation contained in this
Section 4.6(a) regarding perfection shall not be violated to the extent that a
Guarantor is in compliance with the requirements of Section 5.1 of the Base
Indenture.

(b)    Other than the security interest granted to the Trustee in the Collateral
hereunder or pursuant to the other Related Documents or any other Permitted
Lien, none of the Guarantors has pledged, assigned, sold or granted a security
interest in the Securitized Assets. All action necessary (including the filing
of UCC-1 financing statements) to protect and evidence the Trustee’s security
interest in the Collateral (other than the Intellectual Property) in the United
States has been duly and effectively taken. No security agreement, financing
statement, equivalent security or lien instrument or continuation statement
authorized by any Guarantor and listing such Guarantor as debtor covering all or
any part of the Securitized Assets is on file or of record in any jurisdiction,
except in respect of Permitted Liens or such as may have been filed, recorded or
made by such Guarantor in favor of the Trustee on behalf of the Secured Parties
in connection with this Agreement, and no Guarantor has authorized any such
filing.

(c)    All authorizations in this Agreement for the Trustee to endorse checks,
instruments and securities and to execute financing statements, continuation
statements, security agreements and other instruments with respect to the
Collateral and to take such other actions with respect to the Collateral
authorized by this Agreement are powers coupled with an interest and are
irrevocable.

 

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4.7    Other Representations. All representations and warranties of or about
each Guarantor made in the Base Indenture and in each other Related Document to
which it is a party are true and correct (i) as of the date hereof or (ii) if
made on a future date (A) if qualified as to materiality, in all respects, and
(B) if not qualified as to materiality, in all material respects (unless stated
to relate solely to an earlier date, in which case such representations and
warranties were true and correct in all respects or in all material respects, as
applicable, as of such earlier date), and in each case are repeated herein as
though fully set forth herein.

SECTION 5

COVENANTS

5.1    Maintenance of Office or Agency. Each Guarantor shall maintain an office
or agency (which, with respect to the surrender for registration of, or transfer
or exchange or the payment of principal and premium, may be the Corporate Trust
Office of the Trustee or the Registrar or co-registrar or Paying Agent) where
notices and demands to or upon the Guarantors in respect of this Agreement may
be served. The Guarantors shall give prompt written notice to the Trustee and
the Servicer of the location, and any change in the location, of such office or
agency. If at any time the Guarantors shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee and the Servicer with the
address thereof, such notices and demands may be made at the address of such
Guarantor set forth in Section 8.2 hereof.

5.2    Covenants in Base Indenture and Other Related Documents. Each Guarantor
shall take, or shall refrain from taking, as the case may be, each action that
is necessary to be taken or not taken, as the case may be, by such Guarantor so
that no Default or Event of Default is caused by the failure to take such action
or to refrain from taking such action by such Guarantor or any of its
Subsidiaries; provided that, for the avoidance of doubt, such taking or
refraining from taking action shall result in an Event of Default under the
Indenture subject to the applicable cure periods set forth thereunder. All
covenants of each Guarantor made in the Base Indenture and in each other Related
Document are repeated herein as though fully set forth herein and each Guarantor
agrees to comply with such covenants, as applicable.

5.3    Further Assurances.

(a)    Each Guarantor shall do such further acts and things, and execute and
deliver to the Trustee and the Control Party such additional assignments,
agreements, powers of attorney and instruments, as are necessary or desirable to
obtain or maintain the security interest of the Trustee in the Collateral or the
Securitized Assets required to be part of the Collateral on behalf of the
Secured Parties as a perfected security interest subject to no prior Liens
(other than Permitted Liens), to carry into effect the purposes of this
Agreement or the other Related Documents or to better assure and confirm unto
the Trustee, the Control Party, the Noteholders or the other Secured Parties
their rights, powers and remedies hereunder including, without limitation, the
filing of any financing or continuation statements or amendments under the UCC
in effect in any jurisdiction with respect to the liens and security interests
granted hereby, in each case except

 

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as set forth on Schedule 7.13(a) of the Base Indenture and in accordance with
Section 8.25(c) or Section 8.25(d) of the Base Indenture. If any Guarantor fails
to perform any of its agreements or obligations under this Section 5.3(a), then
the Control Party may perform such agreement or obligation, and the expenses of
the Control Party incurred in connection therewith shall be payable by the
Guarantors upon the Control Party‘s demand therefor. The Control Party is hereby
authorized to execute and file any financing statements, continuation
statements, amendments or other instruments necessary or appropriate to perfect
or maintain the perfection of the Trustee’s security interest in the Collateral
or the Securitized Assets required to be part of the Collateral.

(b)    If any amount payable under or in connection with any of the Collateral
shall be or become evidenced by any promissory note, chattel paper or other
instrument, such note, chattel paper or instrument shall be deemed to be held in
trust and immediately pledged and within two (2) Business Days physically
delivered to the Trustee hereunder, and shall, subject to the rights of any
Person in whose favor a prior Lien has been perfected, be duly endorsed in a
manner satisfactory to the Trustee and delivered to the Trustee promptly;
provided that no Guarantor shall be required to deliver any Franchisee Note.

(c)    Notwithstanding the provisions set forth in clauses (a) and (b) above,
each Guarantor shall not be required to perfect any security interest in any
fixtures (other than through a central filing of a UCC financing statement), any
Franchisee Note or any Excepted Securitization IP Assets.

(d)    Each Guarantor, upon obtaining an interest in any commercial tort claim
or claims (as such term is defined in the New York UCC), shall comply with
Section 8.11(d) of the Base Indenture.

(e)    Each Guarantor shall warrant and defend the Trustee’s right, title and
interest in and to the Securitization Assets, including the right to cause the
Securitized Assets to become Collateral, and the income, distributions and
Proceeds thereof, for the benefit of the Trustee on behalf of the Secured
Parties, against the claims and demands of all Persons whomsoever.

5.4    Legal Name, Location Under Section 9-301 or 9-307. No Guarantor shall
change its location (within the meaning of Section 9-301 or 9-307 of the
applicable UCC) or its legal name without at least thirty (30) days’ prior
written notice to the Trustee, the Servicer, the Manager, the Back-Up Manager
and each Rating Agency with respect to each Series of Notes Outstanding. In the
event that any Guarantor desires to so change its location or change its legal
name, such Guarantor shall make any required filings and prior to actually
changing its location or its legal name such Guarantor shall deliver to the
Trustee and the Servicer (i) an Officer’s Certificate and an Opinion of Counsel
confirming that all required filings have been made, subject to Section 5.3(c),
to continue the perfected interest of the Trustee on behalf of the Secured
Parties in the Collateral under Article 9 of the applicable UCC in respect of
the new location or new legal name of such Guarantor and (ii) copies of all such
required filings with the filing information duly noted thereon by the office in
which such filings were made.

 

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5.5    Equity Interests. No Guarantor shall sell, transfer, assign, pledge,
hypothecate or otherwise dispose of any Equity Interest in any other
Securitization Entity, except as provided in the Related Documents.

5.6    Management Accounts. To the extent that it owns any Management Account
(including any lock-box related thereto), each Guarantor shall comply with
Section 5.2 of the Base Indenture with respect to each such Management Account
(including any lock-box related thereto).

5.7    Senior Notes Interest Reserve Account. To the extent a Guarantor shall
own a Senior Notes Interest Reserve Account, such Guarantor shall comply (and
shall cause the Manager to comply) with Section 5.3 of the Base Indenture, to
the extent applicable, with respect to each the Senior Notes Interest Reserve
Account (including any lock-box related thereto), and shall not make any
deposits or withdrawals except as provided therein.

5.8    Senior Subordinated Notes Interest Reserve Account. To the extent a
Guarantor shall own a Senior Subordinated Notes Interest Reserve Account, such
Guarantor shall comply (and shall cause the Manager to comply) with Section 5.4
of the Base Indenture, to the extent applicable, with respect to each the Senior
Subordinated Notes Interest Reserve Account (including any lock-box related
thereto), and shall not make any deposits or withdrawals except as provided
therein.

SECTION 6

REMEDIAL PROVISIONS

6.1    Rights of the Control Party and Trustee upon Event of Default.

(a)    Proceedings To Collect Money. In case any Guarantor shall fail forthwith
to pay any amounts due on this Agreement upon demand, the Trustee at the
direction of the Control Party (subject to Section 11.4(e) of the Base
Indenture, at the direction of the Controlling Class Representative), in its own
name and as trustee of an express trust, may institute a Proceeding for the
collection of the sums so due and unpaid, and may prosecute such Proceeding to
judgment or final decree, and may enforce the same against any Guarantor and
collect in the manner provided by law out of the property of any Guarantor,
wherever situated, the moneys adjudged or decreed to be payable.

(b)    Other Proceedings. If and when an Event of Default shall have occurred
and is continuing, the Trustee, at the direction of the Control Party (subject
to Section 11.4(e) of the Base Indenture at the direction of the Controlling
Class Representative) pursuant to a Control Party request shall take one or more
of the following actions:

(i)    proceed to protect and enforce its rights and the rights of the other
Secured Parties, by such appropriate Proceedings as the Control Party (at the
direction of the Controlling Class Representative) shall deem most effective to
protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Agreement or any other Related Document or in aid
of the exercise of any power granted therein, or to enforce any other proper
remedy or legal or equitable right vested in the Trustee by this Agreement or
any other Related Document or by law, including any remedies of a secured party
under applicable law;

(ii)    (A) direct any Guarantor to exercise (and each Guarantor agrees to
exercise) all rights, remedies, powers, privileges and claims of any Guarantor
against any party to any Collateral Transaction Document arising as a result of
the occurrence of such Event of Default or otherwise, including the right or
power to take any action to compel performance or observance by any such party
of its obligations to any

 

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Guarantor, and any right of any Guarantor to take such action independent of
such direction shall be suspended, and (B) if (x) any Guarantor shall have
failed, within ten (10) Business Days of receiving the direction of the Trustee
(given at the direction of the Control Party (at the direction of the
Controlling Class Representative)), to take commercially reasonable action to
accomplish such directions of the Trustee, (y) any Guarantor refuses to take
such action or (z) the Control Party (at the direction of the Controlling
Class Representative) reasonably determines that such action must be taken
immediately, take (or the Control Party on behalf of the Trustee shall take)
such previously directed action (and any related action as permitted under this
Agreement thereafter determined by the Trustee or the Control Party to be
appropriate without the need under this provision or any other provision under
this Agreement to direct the Guarantors to take such action);

(iii)    institute Proceedings from time to time for the complete or partial
foreclosure of this Agreement or, to the extent applicable, any other Related
Document, with respect to the Collateral and, to the extent permitted by
applicable law, any other Securitized Assets; provided that the Trustee shall
not be required to take title to any real property in connection with any
foreclosure or other exercise of remedies hereunder or under such Related
Documents and title to such property shall instead be acquired in an entity
designated and (unless owned by a third party) controlled by the Control Party;
and/or

(iv)    sell all or a portion of the Collateral and, to the extent permitted by
applicable law, any other Securitized Assets at one or more public or private
sales called and conducted in any manner permitted by law; provided, however,
that the Trustee shall not proceed with any such sale without the prior written
consent of the Control Party (at the direction of the Controlling
Class Representative) and the Trustee shall provide notice to the Guarantors and
each Holder of Senior Subordinated Notes and Subordinated Notes of a proposed
sale of Collateral or Securitized Assets, to the extent permitted by applicable
law.

(c)    Sale of Securitized Assets. In connection with any sale of the Collateral
hereunder (which may proceed separately and independently from the exercise of
remedies under the Indenture) or under any judgment, order or decree in any
judicial proceeding for the foreclosure or involving the enforcement of this
Agreement or any other Related Document, or any sale of Securitized Assets, to
the extent permitted by applicable law:

(i)    any of the Trustee, any Noteholder, any Enhancement Provider, any Hedge
Counterparty and/or any other Secured Party may bid for and purchase the
property being sold, and upon compliance with the terms of the sale may hold,
retain, possess and dispose of such property in its own absolute right without
further accountability;

(ii)    the Trustee (at the direction of the Control Party (at the direction of
the Controlling Class Representative)) may make and deliver to the purchaser or
purchasers a good and sufficient deed, bill of sale and instrument of assignment
and transfer of the property sold;

 

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(iii)    all right, title, interest, claim and demand whatsoever, either at law
or in equity or otherwise, of any Guarantor of, in and to the property so sold
shall be divested; and such sale shall be a perpetual bar both at law and in
equity against any Guarantor, its successors and assigns, and against any and
all Persons claiming or who may claim the property sold or any part thereof
from, through or under such Guarantor or its successors or assigns; and

(iv)    the receipt of the Trustee or of the officer thereof making such sale
shall be a sufficient discharge to the purchaser or purchasers at such sale for
his or their purchase money, and such purchaser or purchasers, and his or their
assigns or personal representatives, shall not, after paying such purchase money
and receiving such receipt of the Trustee or of such officer therefor, be
obliged to see to the application of such purchase money or be in any way
answerable for any loss, misapplication or non-application thereof.

(d)    Application of Proceeds. Any amounts obtained by the Trustee or the
Control Party on account of or as a result of the exercise by the Trustee or the
Control Party of any right hereunder or under the Base Indenture shall be held
by the Trustee as additional collateral for the repayment of the Obligations,
(a) shall be deposited into the Collection Account and, other than with respect
to amounts owed to a depository bank under the related Account Control
Agreement, shall be held by the Trustee or the Collateral Party as additional
collateral for the repayment of the Obligations and (b) shall be applied first
to pay a depositary bank in respect of amounts owed to it under the related
Account Control Agreement and then as provided in the priority set forth in
Article V of the Base Indenture; provided, however, that unless otherwise
provided in this Section 6 or Article IX to the Base Indenture, with respect to
any distribution to any Class of Notes, notwithstanding the provisions of
Article V of the Base Indenture, such amounts shall be distributed sequentially
in order of alphabetical (as opposed to alphanumerical) designation and pro rata
among each Class of Notes of the same alphabetical designation based upon the
Outstanding Principal Amount of the Notes of each such Class.

(e)    Additional Remedies. In addition to any rights and remedies now or
hereafter granted hereunder or under applicable law (x) with respect to the
Collateral, the Trustee shall have all of the rights and remedies of a secured
party under the UCC as enacted in any applicable jurisdiction and (y) with
respect to the other Securitized Assets, the Trustee shall have all of the
rights and remedies of an unsecured creditor in any applicable jurisdiction.

(f)    Proceedings. The Trustee may maintain a Proceeding even if it does not
possess any of the Notes or does not produce any of them in the Proceeding, and
any such Proceeding instituted by the Trustee shall be in its own name as
trustee. All remedies are cumulative to the extent permitted by law.

(g)    Power of Attorney. Each Guarantor hereby grants to the Trustee an
absolute and irrevocable power of attorney to sign, upon the occurrence and
during the continuance of an Event of Default, any document which may be
required by the PTO, United States Copyright Office, any similar office or
agency in Canada and in each foreign country in which any Securitization IP is
located, or any other Governmental Authority in order to effect an absolute
assignment of all right, title and interest in or to any Securitization IP, and
record the same.

 

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6.2    Waiver of Appraisal, Valuation, Stay and Right to Marshaling. To the
extent it may lawfully do so, each Guarantor for itself and for any Person who
may claim through or under it hereby:

(a)    agrees that neither it nor any such Person shall step up, plead, claim or
in any manner whatsoever take advantage of any appraisal, valuation, stay,
extension or redemption laws, now or hereafter in force in any jurisdiction,
which may delay, prevent or otherwise hinder (i) the performance, enforcement or
foreclosure of this Agreement, (ii) the sale of any of the Collateral or
Securitized Assets, to the extent permitted by applicable law or (iii) the
putting of the purchaser or purchasers thereof into possession of such property
immediately after the sale thereof;

(b)    waives all benefit or advantage of any such laws;

(c)    waives and releases all rights to have the Collateral and/or the
Securitized Assets marshaled upon any foreclosure, sale or other enforcement of
this Agreement; and

(d)    consents and agrees that, subject to the terms of this Agreement, all the
Collateral and all of the Securitized Assets (to the extent permitted by
applicable law) may at any such sale be sold by the Trustee as an entirety or in
such portions as the Trustee may (upon direction by the Control Party (at the
direction of the Controlling Class Representative)) determine.

6.3    Limited Recourse. Notwithstanding any other provision of this Agreement
or any other Related Document or otherwise, the liability of the Guarantors to
the Secured Parties under or in relation to this Agreement or any other Related
Document or otherwise, is limited in recourse to the assets of the
Securitization Entities. Following the proceeds of such assets having been
applied in accordance with the terms hereof, none of the Secured Parties shall
be entitled to take any further steps against any Guarantor to recover any sums
due but still unpaid hereunder or under any of the other agreements or documents
described in this Section 6.3, all claims in respect of which shall be
extinguished.

6.4    Optional Preservation of the Securitized Assets. If the maturity of the
Outstanding Notes of each Series has been accelerated pursuant to Section 9.2 of
the Base Indenture following an Event of Default and such declaration and its
consequences have not been rescinded and annulled, the Trustee, at the direction
of the Control Party (acting at the direction of the Controlling
Class Representative), shall elect to maintain possession of such portion, if
any, of the Collateral and/or Securitized Assets (to the extent permitted by
applicable law) as the Control Party (acting at the direction of the Controlling
Class Representative) shall in its discretion determine.

6.5    Control by the Control Party. Notwithstanding any other provision hereof,
the Control Party (subject to Section 11.4(e) of the Base Indenture, at the
direction of the Controlling Class Representative) may cause the institution of
and direct the time, method and place of conducting any proceeding in respect of
any enforcement of the Collateral (or, to the extent permitted by applicable
law, other Securitized Assets) or conducting any proceeding in respect of any
enforcement of Liens on the Collateral and other rights and remedies against
other Securitized Assets (to the extent permitted by applicable law) or
conducting any proceeding for any contractual or legal remedy available to the
Trustee or exercise any trust or power conferred on the Trustee; provided that:

 

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(a)    such direction of time, method and place shall not be in conflict with
any rule of law, the Servicing Standard, the Indenture or this Agreement;

(b)    the Control Party (at the direction of the Controlling
Class Representative) may take any other action deemed proper by the Control
Party (at the direction of the Controlling Class Representative) that is not
inconsistent with such direction (as the same may be modified by the Control
Party (with the consent of the Controlling Class Representative)); and

(c)    such direction shall be in writing;

provided further that, subject to Section 10.1 of the Base Indenture, the
Trustee need not take any action that it determines might involve it in
liability unless it has received an indemnity for such liability as provided in
the Base Indenture. The Trustee shall take no action referred to in this
Section 6.5 unless instructed to do so by the Control Party (at the direction of
the Controlling Class Representative).

6.6    The Trustee May File Proofs of Claim. The Trustee is authorized to file
such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee (including any claim for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel) and any other Secured Party (as applicable)
allowed in any judicial proceedings relative to any Guarantor, its creditors or
its property, and shall be entitled and empowered to collect, receive and
distribute any money or other property payable or deliverable on any such claim
and any custodian in any such judicial proceeding is hereby authorized by each
Secured Party to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to any other
Secured Party, to pay the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 10.5 of the
Base Indenture. To the extent that the payment of any such compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee under Section 10.5 of the Base Indenture out
of the estate in any such proceeding, shall be denied for any reason, payment of
the same shall be secured by a Lien on, and shall be paid out of, any and all
distributions, dividends, money and other properties which any other Secured
Party may be entitled to receive in such proceeding whether in liquidation or
under any plan of reorganization or arrangement or otherwise. Nothing herein
contained shall be deemed to authorize the Trustee to authorize or consent to or
accept or adopt on behalf of any other Secured Party any plan of reorganization,
arrangement, adjustment or composition affecting the Obligations or the rights
of any other Secured Party, or to authorize the Trustee to vote in respect of
the claim of any Secured Parties in any such proceeding.

6.7    Undertaking for Costs. In any suit for the enforcement of any right or
remedy under this Agreement or in any suit against the Trustee for any action
taken or omitted by it as a Trustee, a court in its discretion may require the
filing by any party litigant in the suit of any undertaking to pay the costs of
the suit, and the court in its discretion may assess reasonable costs,

 

18

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including reasonable attorneys’ fees, against any party litigant in the suit,
having due regard to the merits and good faith of the claims or defenses made by
the party litigant. This Section 6.7 does not apply to a suit by the Trustee (or
by the Control Party for any contractual or legal remedy available to the
Trustee), a suit by a Noteholder pursuant to Section 9.9 of the Base Indenture
or a suit by Noteholders of more than 10% of the Aggregate Outstanding Principal
Amount of all Series of Notes.

6.8    Restoration of Rights and Remedies. If the Trustee or any other Secured
Party has instituted any Proceeding to enforce any right or remedy under this
Agreement or any other Related Document and such Proceeding has been
discontinued or abandoned for any reason or has been determined adversely to the
Trustee or to such other Secured Party, then and in every such case the Trustee
and any such other Secured Party shall, subject to any determination in such
proceeding, be restored severally and respectively to their former positions
hereunder, and thereafter all rights and remedies of the Trustee and the other
Secured Parties shall continue as though no such Proceeding had been instituted.

6.9    Rights and Remedies Cumulative. No right or remedy herein conferred upon
or reserved to the Trustee or to any other Secured Party is intended to be
exclusive of any other right or remedy, and every right or remedy shall, to the
extent permitted by law, be cumulative and in addition to every other right and
remedy given under this Agreement or any other Related Document or now or
hereafter existing at law or in equity or otherwise. The assertion or employment
of any right or remedy under this Agreement or any other Related Document, or
otherwise, shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.

6.10    Delay or Omission Not Waiver. No delay or omission of the Trustee, the
Control Party, the Controlling Class Representative or any other Secured Party
to exercise any right or remedy accruing upon any Potential Rapid Amortization
Event, Rapid Amortization Event, Default or Event of Default shall impair any
such right or remedy or constitute a waiver of any such Potential Rapid
Amortization Event, Rapid Amortization Event, Default or Event of Default or an
acquiescence therein. Every right and remedy given by this Section 6 or by law
to the Trustee, the Control Party, the Controlling Class Representative or any
other Secured Party may be exercised from time to time to the extent not
inconsistent with the Indenture or this Agreement, and as often as may be deemed
expedient, by the Trustee, the Control Party, the Controlling
Class Representative or any other Secured Party, as the case may be.

6.11    Waiver of Stay or Extension Laws. Each Guarantor covenants (to the
extent that it may lawfully do so) that it shall not at any time insist upon, or
plead, or in any manner whatsoever claim or take the benefit or advantage of,
any stay or extension law wherever enacted, now or at any time hereafter in
force, that may affect the covenants or the performance of this Agreement or any
other Related Document; and each Guarantor (to the extent that it may lawfully
do so) hereby expressly waives all benefit or advantages of any such law, and
covenants that it shall not hinder, delay or impede the execution of any power
herein granted to the Trustee, the Control Party or the Controlling
Class Representative, but shall suffer and permit the execution of every such
power as though no such law had been enacted.

 

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SECTION 7

THE TRUSTEE’S AUTHORITY

Each Guarantor acknowledges that the rights and responsibilities of the Trustee
under this Agreement with respect to any action taken by the Trustee or the
exercise or non-exercise by the Trustee of any option, voting right, request,
judgment or other right or remedy provided for herein or resulting or arising
out of this Agreement shall, as between the Trustee and the other Secured
Parties, be governed by the Indenture and by such other agreements with respect
thereto as may exist from time to time among them, but, as between the Trustee
and the Guarantors, the Trustee shall be conclusively presumed to be acting as
agent for the Secured Parties with full and valid authority so to act or refrain
from acting, it being understood that the Trustee (at the direction of the
Control Party (at the direction of the Controlling Class Representative)) and
the Control Party (at the direction of the Controlling Class Representative)
directly shall be the only parties entitled to exercise remedies under this
Agreement; and no Guarantor shall be under any obligation, or entitlement, to
make any inquiry respecting such authority.

SECTION 8

MISCELLANEOUS

8.1    Amendments. None of the terms or provisions of this Agreement may be
amended, supplemented, waived or otherwise modified except in accordance with
Article XIII of the Base Indenture.

8.2    Notices.

(a)    Any notice or communication by the Guarantors or the Trustee to any other
party hereto shall be in writing and delivered in person, delivered by email
(provided that such email may contain a link to a password-protected website
containing such notice for which the recipient has granted access; provided,
further, that any email notice to the Trustee other than an email containing a
link to a password-protected website shall be in the form of an attachment of a
.pdf or similar file) or mailed by first-class mail (registered or certified,
return receipt requested), facsimile or overnight air courier guaranteeing next
day delivery, to such other party’s address:

If to the Holding Company Guarantor:

Planet Fitness SPV Guarantor LLC

4 Liberty Lane West, Floor 2

Hampton, NH 03842

Attention: General Counsel

Facsimile: 603-590-2594

 

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If to the Franchisor:

Planet Fitness Franchising LLC

4 Liberty Lane West, Floor 2

Hampton, NH 03842

Attention: General Counsel

Facsimile: 603-590-2594

If to the Equipment Distributor:

Planet Fitness Distribution LLC

4 Liberty Lane West, Floor 2

Hampton, NH 03842

Attention: General Counsel

Facsimile: 603-590-2594

If to Planet Fitness Assetco:

Planet Fitness Assetco LLC

4 Liberty Lane West, Floor 2

Hampton, NH 03842

Attention: General Counsel

Facsimile: 603-590-2594

If to any Guarantor with a copy to (which shall not constitute notice):

Ropes & Gray LLP

Prudential Tower, 800 Boylston Street

Boston, MA 02199

Attention: Patricia C. Lynch

Facsimile: 617-235-9384

If to the Trustee:

Citibank, N.A.

388 Greenwich Street

New York, NY 10013

Attention: Citibank Agency & Trust – Planet Fitness Master Issuer LLC

Email: jacqueline.suarez@citi.com or contact Citibank, N.A.’s customer service
desk at 888-855-9695 to obtain the account administrator’s email address

(b)    The Guarantors or the Trustee by notice to each other party may designate
additional or different addresses for subsequent notices or communications;
provided, however, the Guarantors may not at any time designate more than a
total of three (3) addresses to which notices must be sent in order to be
effective.

(c)    Any notice (i) given in person shall be deemed delivered on the date of
delivery of such notice, (ii) given by first class mail shall be deemed given
five (5) days after the date that such notice is mailed, (iii) delivered by
facsimile shall be deemed given on the date of delivery of such notice,
(iv) delivered by overnight air courier shall be deemed delivered one
(1) Business Day after the date that such notice is delivered to such overnight
courier, (v) when posted on a password-protected website shall be deemed
delivered after notice of such posting has been provided to the recipient and
(vi) delivered by email shall be deemed delivered on the date of delivery of
such notice.

 

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(d)    Notwithstanding any provisions of this Agreement to the contrary, the
Trustee shall have no liability based upon or arising from the failure to
receive any notice required by or relating to this Agreement or any other
Related Document.

8.3    Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

8.4    Successors. All agreements of each of the Guarantors in this Agreement
and each other Related Document to which it is a party shall bind its successors
and assigns; provided, however, no Guarantor may assign its obligations or
rights under this Agreement or any other Related Document, except with the
written consent of the Servicer. All agreements of the Trustee in this Agreement
shall bind its successors.

8.5    Severability. In case any provision in this Agreement or any other
Related Document shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.

8.6    Counterpart Originals. This Agreement may be executed in counterparts
(and by different parties hereto on different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a
single agreement.

8.7    Table of Contents, Headings, etc. The Table of Contents and headings of
the Sections of this Agreement have been inserted for convenience of reference
only, are not to be considered a part hereof, and shall in no way modify or
restrict any of the terms or provisions hereof.

8.8    Waiver of Jury Trial. EACH OF THE GUARANTORS AND THE TRUSTEE HEREBY
IRREVOCABLY WAIVES, 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, THE OTHER RELATED DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED
HEREBY AND THEREBY.

8.9    Submission to Jurisdiction; Waivers. Each of the Guarantors and the
Trustee hereby irrevocably and unconditionally:

(a)    submits for itself and its property in any legal action or proceeding
relating to this Agreement and the other Related Documents to which it is a
party, 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
sitting in New York County, the courts of the United States for the Southern
District of New York, and appellate courts from any thereof;

 

22

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(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 the Guarantors or the
Trustee, as the case may be, at its address set forth in Section 8.2 or at such
other address of which the Trustee shall have been notified pursuant thereto;

(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

(e)    waives, to the maximum extent not prohibited by law, any right it may
have to claim or recover in any legal action or proceeding referred to in this
Section 8.9 any special, exemplary, punitive or consequential damages.

8.10    Additional Guarantors. Each Additional Securitization Entity that is to
become a “Guarantor” for all purposes of this Agreement shall execute and
deliver an Assumption Agreement in substantially the form of Exhibit A hereto.
Upon the execution and delivery by any Additional Securitization Entity of such
an Assumption Agreement, the supplemental schedules attached to such Assumption
Agreement shall be incorporated into and become a part of and supplement the
Schedules to this Agreement and each reference to such Schedules shall mean and
be a reference to such Schedules as supplemented pursuant to each Assumption
Agreement.

8.11    Currency Indemnity. Each Guarantor shall make all payments of amounts
owing by it hereunder in U.S. Dollars. If a Guarantor makes any such payment to
the Trustee or any other Secured Party in a currency (the “Other Currency”)
other than U.S. Dollars (whether voluntarily or pursuant to an order or judgment
of a court or tribunal of any jurisdiction), such payment shall constitute a
discharge of the liability of such party hereunder in respect of such amount
owing only to the extent of the amount of U.S. Dollars which the Trustee or such
Secured Party is able to purchase with the amount it receives on the date of
receipt (if it can timely exchange such Other Currency on such date) or
otherwise on the next following Business Day on which foreign currency exchange
transactions may be effected for such Other Currency. If the amount of U.S.
Dollars which the Trustee or such Secured Party is able to purchase is less than
the amount of such currency originally so due in respect of such amount, such
Guarantor shall indemnify and save the Trustee or such Secured Party, as
applicable, harmless from and against any loss or damage arising as a result of
such deficiency. This indemnity shall constitute an obligation separate and
independent from the other obligations contained in this Agreement, shall give
rise to a separate and independent cause of action, shall survive termination
hereof, shall apply irrespective of any indulgence granted by the Trustee or
such Secured Party and shall continue in full force and effect notwithstanding
any judgment or order in respect of any amount due hereunder or under any
judgment or order.

8.12    Acknowledgment of Receipt; Waiver. Each Guarantor acknowledges receipt
of an executed copy of this Agreement and, to the extent permitted by applicable
law, waives the right to receive a copy of any financing statement, financing
change statement or verification statement in respect of any registered
financing statement or financing change statement prepared, registered or issued
in connection with this Agreement.

 

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8.13    Termination; Partial Release.

(a)    This Agreement and any grants, pledges and assignments hereunder shall
become effective on the date hereof and shall terminate on the Termination Date.

(b)    On the Termination Date, the Collateral shall be automatically released
from the Liens created hereby, and this Agreement and all obligations (other
than those expressly stated to survive such termination) of the Trustee and each
Guarantor shall automatically terminate, all without delivery of any instrument
or performance of any act by any party, and all rights to the Securitized Assets
shall revert to the Guarantors. At the request and sole expense of any Guarantor
following any such termination, the Trustee shall deliver to such Guarantor any
Securitized Assets held by the Trustee hereunder, and execute and deliver to
such Guarantor such documents as such Guarantor shall reasonably request to
evidence such termination.

(c)    Any partial release of Collateral hereunder requested by the Master
Issuer or any Guarantor in connection with any Permitted Asset Disposition shall
be governed by Section 8.16 and Section 14.17 of the Base Indenture.

8.14    Third Party Beneficiary. Each of the Secured Parties and the Controlling
Class Representative is an express third party beneficiary of this Agreement.

8.15    Entire Agreement.

This Agreement, together with the schedule hereto, the Indenture and the other
Related Documents, contain a final and complete integration of all prior
expressions by the parties hereto with respect to the subject matter hereof and
shall constitute the entire agreement among the parties hereto with respect to
the subject matter hereof, superseding all previous oral statements and writings
with respect thereto.

8.16    Electronic Communication.

The Trustee (in each of its capacities) agrees to accept and act upon
instructions or directions pursuant to this Agreement or any documents executed
in connection herewith sent by unsecured email or other similar unsecured
electronic methods, provided, however, that any person providing such
instructions or directions shall provide to the Trustee an incumbency
certificate listing persons designated to provide such instructions or
directions (including the email addresses of such persons), which incumbency
certificate shall be amended whenever a person is added or deleted from the
listing. If such person elects to give the Trustee email (of .pdf or similar
files) (or instructions by a similar electronic method) and the Trustee in its
discretion elects to act upon such instructions, the Trustee’s reasonable
understanding of such instructions shall be deemed controlling. The Trustee
shall not be liable for any losses, costs or expenses arising directly or
indirectly from the Trustee’s reliance upon and compliance with such
instructions notwithstanding such instructions conflicting with or being
inconsistent with a subsequent written instruction. Any person providing such
instructions or directions agrees to assume all risks arising out of the use of
such electronic methods to submit instructions and directions to the Trustee,
including without limitation the risk of the Trustee acting on unauthorized
instructions, and the risk of interception and misuse by third parties.

[Signature pages to follow]

 

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IN WITNESS WHEREOF, each of the Guarantors and the Trustee has caused this
Guarantee and Collateral Agreement to be duly executed and delivered by its duly
authorized officer as of the date first above written.

 

PLANET FITNESS SPV GUARANTOR LLC By:    /s/ Justin Vartanian   Name:   Justin
Vartanian   Title:   General Counsel and Secretary PLANET FITNESS FRANCHISING
LLC By:   /s/ Justin Vartanian   Name:   Justin Vartanian   Title:   General
Counsel and Secretary PLANET FITNESS ASSETCO LLC By:   /s/ Justin Vartanian  
Name:   Justin Vartanian   Title:   General Counsel and Secretary PLANET FITNESS
DISTRIBUTION LLC By:   /s/ Justin Vartanian   Name:   Justin Vartanian   Title:
  General Counsel and Secretary

Signature Page to Guarantee and Collateral Agreement

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AGREED AND ACCEPTED:

CITIBANK, N.A., in its capacity as Trustee

By:    /s/ Anthony Bausa   Name:   Anthony Bausa   Title:   Senior Trust Officer

Signature Page to Guarantee and Collateral Agreement

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Schedule 4.5

PLEDGED EQUITY INTERESTS

 

PLEDGED ENTITY

 

 

OWNED BY

 

 

PERCENTAGE OWNERSHIP

 

Planet Fitness Master Issuer LLC   Planet Fitness SPV Guarantor LLC   100%
Planet Fitness Franchising LLC   Planet Fitness Master Issuer LLC   100% Planet
Fitness Distribution LLC   Planet Fitness Master Issuer LLC   100% Planet
Fitness Assetco LLC   Planet Fitness Master Issuer LLC   100%

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Exhibit A to

Guarantee and Collateral Agreement

ASSUMPTION AGREEMENT, dated as of                     , 20     (this “Assumption
Agreement”), made by                      a                      (the
“Additional Guarantor”), in favor of CITIBANK, N.A., as Trustee and Securities
Intermediary under the Indenture referred to below (in such capacity, together
with its successors, the “Trustee”). All capitalized terms not defined herein
shall have the meaning ascribed to them in the Base Indenture Definitions List
attached to the Base Indenture (as defined below) as Annex A thereto.

W I T N E S S E T H:

WHEREAS, Planet Fitness Master Issuer LLC (the “Master Issuer”), the Trustee and
Citibank, N.A., as securities intermediary, have entered into a Base Indenture
dated as of August 1, 2018 (as amended, restated, supplemented or otherwise
modified from time to time, exclusive of any Series Supplements, the “Base
Indenture” and, together with all Series Supplements, the “Indenture”),
providing for the issuance from time to time of one or more Series of Notes
thereunder; and

WHEREAS, in connection with the Base Indenture, the Guarantors and the Trustee
have entered into the Guarantee and Collateral Agreement, dated as of August 1,
2018 (as amended, restated, supplemented or otherwise modified from time to
time, the “Guarantee and Collateral Agreement”) in favor of the Trustee for the
benefit of the Secured Parties;

WHEREAS, the Base Indenture requires the Additional Guarantor to become a party
to the Guarantee and Collateral Agreement; and

WHEREAS, the Additional Guarantor has agreed to execute and deliver this
Assumption Agreement in order to become a party to the Guarantee and Collateral
Agreement;

NOW, THEREFORE, IT IS AGREED:

1.    Guarantee and Collateral Agreement. By executing and delivering this
Assumption Agreement, the Additional Guarantor, as provided in Section 8.10 of
the Guarantee and Collateral Agreement, hereby becomes a party to the Guarantee
and Collateral Agreement as a Guarantor thereunder with the same force and
effect as if originally named therein as a Guarantor and, without limiting the
generality of the foregoing, hereby expressly assumes all obligations and
liabilities of a Guarantor thereunder. In furtherance of the foregoing, the
Additional Guarantor, as security for the payment and performance in full of the
Master Issuer Obligations, does (x) hereby create and grant to the Trustee for
the benefit of the Secured Parties a security interest in all of the Additional
Guarantor’s right, title and interest in and to the Collateral of the Additional
Guarantor in accordance with the terms of the Guarantee and Collateral Agreement
and subject to the exceptions set forth therein and (y) jointly and severally,
unconditionally and irrevocably hereby guarantees to the Trustee, for the
benefit of the Secured Parties, the prompt and complete payment and performance
by the Master Issuer when due (whether at the stated maturity, by acceleration
or otherwise, but after giving effect to all applicable grace periods) of the
Master Issuer Obligations. Each reference to a “Guarantor” in the Guarantee and
Collateral Agreement shall be deemed to include the Additional Guarantor. The
Guarantee and Collateral Agreement is hereby incorporated

 

A-1

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herein by reference. The information set forth in Annex 1-A hereto (A) is true
and correct as of the date hereof in all material respects and (B) is hereby
added to the information set forth in Schedule 4.5 to the Guarantee and
Collateral Agreement and such Schedule shall be deemed so amended. The
Additional Guarantor hereby represents and warrants that each of the
representations and warranties contained in Section 4 of the Guarantee and
Collateral Agreement applicable to it is true and correct on and as the date
hereof (after giving effect to this Assumption Agreement) as if made on and as
of such date.

2.    Representations of Additional Guarantor. The Additional Guarantor
represents and warrants to the Trustee for the benefit of the Secured Parties
that this Assumption Agreement has been duly authorized, executed and delivered
by it and constitutes its legal, valid and binding obligation, enforceable
against it in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors’ rights
generally and subject to general principles of equity, regardless of whether
considered in a proceeding in equity or at law.

3.    Counterparts; Binding Effect. This Assumption Agreement may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original, but all of which taken together shall
constitute a single contract. This Assumption Agreement shall become effective
when (a) the Trustee shall have received a counterpart of this Assumption
Agreement that bears the signature of the Additional Guarantor and (b) the
Trustee has executed a counterpart hereof. Delivery of an executed counterpart
of a signature page of this Assumption Agreement by telecopy or .pdf file shall
be effective as delivery of a manually executed counterpart of this Assumption
Agreement.

4.    Full Force and Effect. Except as expressly supplemented hereby, the
Guarantee and Collateral Agreement shall remain in full force and effect.

5.    Severability. In case any provision in this Agreement or any other Related
Document shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.

6.    Notices. All communications and notices hereunder shall be in writing and
given as provided in Section 8.2 of the Guarantee and Collateral Agreement. All
communications and notices hereunder to the Additional Guarantor shall be given
to it at the address set forth under its signature below.

7.    Fees and Expenses. The Additional Guarantor agrees to reimburse the
Trustee for its reasonable and documented out-of-pocket expenses in connection
with the execution and delivery of this Assumption Agreement, including the
reasonable fees and disbursements of outside counsel for the Trustee.

8.    Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO CONFLICTS OF LAW PRINCIPLES.

 

A-2

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IN WITNESS WHEREOF, the undersigned has caused this Assumption Agreement to be
duly executed and delivered as of the date first above written.

 

[ADDITIONAL GUARANTOR] By:       Name:   Title:   [Address]:   Attention:  
Facsimile:

 

AGREED TO AND ACCEPTED

 

CITIBANK, N.A., in its capacity as Trustee By:     Name:   Title:  

 

A-1

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Annex 1-A

GUARANTOR OWNERSHIP RELATIONSHIPS

 

ENTITY

 

 

OWNED BY

 

 

SUBSIDIARIES

 

               

 

A-2