Exhibit 10.13


 


AGREEMENT
MODIFYING LOAN TERMS


 


This AGREEMENT MODIFYING LOAN TERMS (“Agreement”) dated as
of the 12th day of July, 2001, by and among WELLS FARGO BANK MINNESOTA, NATIONAL
ASSOCIATION, f/k/a Norwest Bank N.A., as Indenture Trustee under
that certain Indenture dated as of November 1, 1999 (“Lender”), and DAVCO
RESTAURANTS, INC., a Delaware corporation (“DavCo”), DAVCO
ACQUISITION HOLDING INC., a Delaware corporation (“Holdings”),
FRIENDCO
RESTAURANTS, INC., a Maryland corporation (“FriendCo”), and HERON REALTY
CORPORATION, a Maryland corporation (“Heron”) (DavCo and
Holdings are hereinafter referred to individually as “Borrower” and
collectively as “Borrowers”; Borrowers, FriendCo and
Heron are hereinafter collectively referred to as “Loan Parties”).


 


RECITALS


 


WHEREAS, DavCo and Holdings are the owners and operators of certain
Wendy’s restaurants located in the State of Maryland; and


 


WHEREAS, FriendCo and Heron are the owners and operators of certain
Friendly’s restaurants located in the States of Maryland, Virginia and
Delaware; and


 


WHEREAS, Lender is the holder of those certain promissory notes made by
the Loan Parties and more particularly described on Exhibit “A” attached
hereto and by this reference made a part hereof (the “Promissory Notes”),
which Promissory Notes evidence certain Loans made by Lender’s predecessors in
interest to the Loan Parties (“Loans”); and


 


WHEREAS, the Promissory Notes are secured by those certain loan
documents more particularly described on Exhibit “B” attached hereto and,
together with all instruments, certificates and other ancillary agreements
delivered in connection therewith, by this reference made a part hereof (the “Loan
Documents”), which Loan Documents are currently held by
Collateral Agent; and


 


WHEREAS, the Loan Documents encumber and affect the Wendy’s Restaurant
Properties (“Restaurants”) more particularly described on Exhibit
“C” attached hereto and by this reference made a part hereof
(the “Collateral”),
and


 


WHEREAS, the Loan Parties are parties to (a) that certain Intercreditor
and Restructuring Agreement of even date herewith, (b) that certain Collateral
Exchange and Agency Agreement of even date herewith, and that certain
Collateral Agency Agreement Regarding Wendy’s Assets (collectively, the “Workout
Documents”); and


 


WHEREAS, the Lender has agreed to be bound by certain terms of the
Workout Documents in return for the exchange of its lien against certain
Friendly’s collateral for a lien against the Collateral; and


 

















 


WHEREAS, pursuant to the terms of the Workout Documents, Lender and the
Loan Parties have agreed to modify the Loan Documents as set forth below.


 


NOW, THEREFORE, in consideration of the foregoing premises and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereby agree as follows:


 


1.             RECITALS.  The foregoing recitals are true and correct
and are incorporated herein.


 


2.             REPRESENTATIONS AND WARRANTIES.
In order to induce Lender and Collateral Agent to enter into this Agreement,
each Loan Party hereby acknowledges, represents and warrants to Lender as
follows:


 


(a)           It is a corporation duly formed,
validly existing and in good standing under the laws of the state of its
incorporation with powers adequate to own all property owned by it, to carry
out the business conducted by it, to enter into and perform this Agreement and
the other documents and instruments executed and delivered in connection
herewith, and to carry out the transactions contemplated hereby and thereby.


 


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(b)           The execution and delivery of this
Agreement and the other documents executed in connection herewith by each
Borrower and the performance of the obligations of each Borrower hereunder and
thereunder have been duly authorized by proper corporate action.


 


(c)           This Agreement, the Workout
Documents, the Promissory Notes, the Loan Documents and all other documents
executed in connection herewith constitute legal, valid and binding obligations
of the Loan Parties, enforceable in accordance with their respective terms.
This Agreement, when executed and delivered to the Lender by the Loan Parties,
creates legal, valid and binding obligations of the Loan Parties, enforceable
in accordance with the terms of the Agreement.


 


(d)           No Loan Party has any defenses,
affirmative defenses, setoffs, claims, counterclaims, rights of recoupment,
actions or causes of action of any kind or nature whatsoever against Lender,
any predecessor in interest of Lender or any of their respective past, present
or future directors, officers, employees, agents, attorneys, legal
representatives, predecessors, affiliates, successors or assigns, directly or
indirectly, arising out of, based upon, or in any manner connected with any
transaction, event, circumstance, action, failure to act, or occurrence of any
type, which occurred, existed, was taken, permitted or begun


 


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prior to the
execution of this Agreement, pursuant to or in connection with any Loan, or the
terms of any of the Loan Documents, or the administration or enforcement
thereof which relates to any Property.


 


(e)           All financial statements heretofore
delivered by the Loan Parties to Lender fairly present the financial condition and
results of operations of the Loan Parties as of the dates thereof in accordance
with generally accepted accounting principles.


 


(f)            None of the Borrowers have entered
into or is bound by any agreement to sell, transfer, encumber or convey any
Restaurant or Premises or any rights thereto or interest therein to any Person,
including, without limitation, any government or governmental agency, other
than such agreement as may be set forth in the initial Lease for such
Restaurant or Premises.


 


(g)           There is no litigation or proceeding,
at law or in equity, before any federal, state, or other court or governmental
or administrative agency or any arbitrator pending or, to the knowledge of any
Loan Party, threatened against any of the Loan Parties (i) affecting any
Restaurant, Premises or Collateral, which has not been disclosed to Lender in
writing, or (ii) which could reasonably be expected to have a Material Adverse
Effect.


 


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(h)           Neither the execution and delivery of
this Agreement, nor the consummation of the transactions herein contemplated,
nor compliance with the terms and provisions hereof, has constituted or
resulted in or will constitute or result in (i) a breach of the corporate
charter or by-laws of any of the Loan Parties, or the violation of any law,
order, writ, injunction, or decree of any court or governmental department,
commission, board, bureau, agency, or instrumentality applicable to any Loan
Party, or (ii) any breach (except for a breach that has been waived) of any of
the terms, covenants, conditions, or provisions of, or constitute a default
under, any indenture, mortgage, instrument, document, agreement, or contract of
any kind to which any Loan Party may be bound or subject.


 


(i)            Each Loan Party has derived and will
derive direct benefits from this Amendment and the transactions contemplated
hereby.


 


(j)            All documents, reports,
certificates, and statements furnished to Lender by or on behalf of the Loan
Parties in connection with the transactions contemplated hereby are true,
correct, and complete; do not contain any untrue statement of material fact;
and do not omit any fact necessary to make the information contained therein
not misleading.


 


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(k)           All property taxes and other taxes,
assessments, levies, license fees, permit fees and all other charges heretofore
levied, assessed, confirmed, or imposed upon, or in respect of, or which might
become a lien upon, any Restaurant or Premises have been paid in full prior to
becoming delinquent.


 


(l)            After giving effect to the
amendments set forth herein, Borrowers are in compliance with all of their
duties, covenants and obligations contained in the Loan Documents, including
without limitation, all conditions precedent to the effectiveness of this
Agreement.


 


3.             DEFINITIONS.  Notwithstanding any definitions to the
contrary in the Loan Documents, the definitions that follow shall control for
the purposes of this Agreement and all modifications to the Loan Documents
effectuated by this Agreement. In the event of a conflict between definitions,
the definitions set forth in this Agreement shall supersede any definitions in
the Loan Documents.


 


“Borrowers”:
as defined in the preamble.


 


“Budgeted Cash
Needs Amount”: As indicated by a cash flow budget


 


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“Budget”:
(i) for the fiscal year ending on or about September 30, 2001, the business
plan model including projections of the consolidated and consolidating operating
budget for DavCo, Holdings and FriendCo, as prepared by DavCo as of July 2,
2001, as previously submitted to and initialed by Global Alliance Finance
Company, L.L.C. (“GAFCO”), and (ii) for all subsequent
fiscal years, the business plan model including consolidated and consolidating
projections of the operating budget for DavCo, Holdings and FriendCo as updated
by DavCo for the current fiscal year and succeeding fiscal year and delivered
to GAFCO consistent with the terms of that certain Third Amendment to Credit
Agreement by and between DavCo, Holdings and GAFCO of even date herewith, which
business plan model shall become the Budget for the purposes hereof when the
total amounts of revenues and expenses projected therein have been approved by
GAFCO.


 


“Capital Assets”:
fixed assets, both tangible (such as land, buildings, fixtures, machinery and
equipment) and intangible (such as patents, copyrights, trademarks, franchises
and good will); provided that Capital Assets shall not include any item
customarily charged directly to expense or depreciated over a useful life of
twelve (12) months or less in accordance with GAAP.


 


“Capital
Expenditures”: amounts paid or indebtedness
incurred by any Loan Party or any of their subsidiaries in connection with the
purchase or lease by such Loan Party or


 


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subsidiary of
Capital Assets that would be required to be capitalized and shown on the
balance sheet of such person in accordance with GAAP.


 


“CIT”:
The CIT Group/Equipment Financing, Inc.


 


“Collateral”:
as defined in the recitals.


 


“Collateral Agency
Agreement Regarding Wendy’s Assets”: The
Collateral Agency Agreement Regarding Certain Wendy’s Assets dated as of the
date hereof among the Loan Parties, Lender, CNL Financial VII, LP, GAFCO, CIT,
SunTrust, Wells Fargo Bank Minnesota, National Association, and the Global
Franchise Trust Trustee.


 


“Collateral
Exchange and Agency Agreement”: The Collateral
Exchange and Agency Agreement dated as of the date hereof among the Loan
Parties, Lender, CIT, CNL Financial VII, LP, Wells Fargo Bank Minnesota,
National Association, CNL Financial Services, LP as collateral agent, and
GAFCO.


 


“Collateral Agency
Agreements”: Collectively, the Collateral Agency
Agreement Regarding Wendy’s Assets and the Collateral Exchange and Agency
Agreement.


 


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“Disposition”:
any sale, exchange, or other disposition of an asset and any loss, theft,
damage, destruction, or taking or other eminent domain action with respect to
such asset.


 


“EBITDA”:
of any Loan Party for any period, the sum of (i) Net Income of the Loan Party
for such period plus, to the extent any of the following were deducted
in determining Net Income of the Loan Party for such period, (ii) the sum of
(A) Interest Expense of the Loan Party for such period, (B) income taxes paid
or accrued by the Loan Party during such period, (C) depreciation of fixed or
capital assets of the Loan Party during such period (D) amortization of
intangible assets of the Loan Party during such period and (E) non-recurring
expenses allowed under GAAP, all on a consolidated basis where appropriate.


 


“Fixed Charges”:
with respect to DavCo, for any period, the sum (without duplication) of (a)
Interest Expense of DavCo for such period; (b) required amortization of
Indebtedness of DavCo for such period (including, without limitation, the
Loan), and (c) Lease Expense of DavCo for such period.


 


“Fixed Charge
Coverage Ratio”: for any period of four
consecutive fiscal quarters of the Loan Parties, the ratio of (i) the sum of
EBITDA for of the Applicable Parties for such period plus, without duplication,
to the extent included in the calculation of EBITDA of the Applicable Parties,
(w) the amount of any losses recorded from the disposition of assets as part of
the liquidation of FriendCo pursuant to the Workout Documents, and (x) solely
with respect to


 


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the fiscal
year ending September 30, 2001, to the extent that any restructuring expenses
and/or restructuring fees paid during such year in connection with the
execution and delivery of the Workout Documents are deducted for the purpose of
calculating EBITDA, the amount of such restructuring expenses and restructuring
fees, provided that the amount added pursuant to this clause (x) shall not
exceed $4,000,000.00, plus (y) to the extent deducted for the purposes of
calculating EBITDA, Lease Expense of the Applicable Parties for such period, us
(z) to the extent deducted for the purposes of calculating EBITDA, Extension
Condition Payments (as defined in the GAFCO Third Amendment to Credit
Agreement) made during the applicable period, to (ii) Fixed Charges of the
Applicable Parties for such period. For the purposes of this definition, the “Applicable
Party” is (1) DavCo for the purpose of determining the Fixed
Charge Coverage Ratio of DavCo and (2) Holdings and all of its subsidiaries for
the purpose of determining the Fixed Charge Coverage Ratio of the Holdings on a
consolidated basis.


 


“Friendly’s
Collateral Agent”: The Collateral Agent under the
Collateral Exchange and Agency Agreement Regarding Friendly Assets.


 


“GAFCO”:
Global Alliance Finance Company, L.L.C.


 


“Intercreditor and
Restructuring Agreement”: The Intercreditor and Restructuring
Agreement dated as of the date hereof Date among the Loan Parties, Lender, CNL
Financial VII, LP, Wells Fargo Bank Minnesota, National Association, CNL
Financial Services,


 


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LP, as
collateral agent, the Global Alliance Finance Company, U.S. Bank National
Association, CIT, and SunTrust.


 


“Interest Expense”:
with respect to DavCo for any period, the amount of interest expense, both
expensed and capitalized, of DavCo, determined in accordance with GAAP, for
such period on the aggregate principal amount of its Indebtedness (including,
without limitation, the Loan).


 


“Lease Expense”:
with respect to DavCo for any period, the aggregate amount of fixed and
contingent rentals payable by DavCo during such period with respect to leases
of real and personal property (including, without limitation, any such rentals
payable in respect of the Premises).


 


“Loan Parties”:
as defined in the preamble.


 


“Material Adverse
Change”: with respect to any event, act, condition
or occurrence of whatever nature (including any adverse determination in any
litigation, arbitration or governmental investigation or proceeding), whether
singly or in conjunction with any other event or events, act or acts, condition
or conditions, occurrence or occurrences, whether or not related, a material
adverse change in, or a material adverse effect upon, any of (a) the financial
condition, operations, business or properties of DavCo, (b) the ability of
DavCo to perform its


 


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obligations
under any of the Loan Documents, or (c) the legality, validity or
enforceability of this Agreement or any of the Loan Documents, the Collateral
Agency Agreements, the Intercreditor Agreement, or the New CNL Amendment.


 


“Permitted
Encumbrances”: (a) Liens for taxes not yet due and
payable or being actively contested as permitted by the Loan Documents; (b)
carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like
Liens arising in the ordinary course of business, payment for which is not yet
due or which are being actively contested in good faith and by appropriate,
lawful proceedings; (c) pledges or deposits in connection with worker’s
compensation, unemployment insurance and other social security legislation; (d)
deposits to secure the performance of utilities, leases, statutory obligations
and surety and appeal bonds and other obligations of a like nature arising by
statute, in the ordinary course of business or under customary terms regarding
depositary relationships on deposits held by financial institutions with whom
Borrower has a banker-customer relationship; (e) typical restrictions imposed
by licenses and leases of software (including location and transfer
restrictions); (f) Liens in favor of Lender; (g) Liens existing and created
pursuant to the Restructuring Documents; (h) imperfections of title, none of
which, individually or in the aggregate, materially detracts from the value of
the affected property, or materially impairs the use of the affected property
in the manner such property is currently being used by the business, or
materially impairs the operation of the business; (i) zoning or land use
ordinances, none of which materially detracts from the value of


 


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the affected
property, or impairs the use of the affected property in the manner such
property is currently being used by the affected Person, or which impairs the
operation of the business of the affected Person; (j) any exception to title,
acceptable to Lender, which are contained in the title insurance policies
delivered in connection herewith; (k) statutory Liens for the benefit of the
landlord and fee owner of the property, if different, and Liens permitted under
the applicable lease and sublease agreements; (1) Liens in existence on the
Closing Date (other than on the Property) and disclosed by the Borrower; (m)
Liens securing debt of a subsidiary to the Borrower (other than on the
Property) consisting of judgment or judicial attachment liens; provided that
the enforcement of such liens is effectively stayed or payment of which is
covered in full (subject to a customary deductible); (n) Liens securing
obligations in respect of operating and equipment leases; (o) Liens arising
pursuant to “build to suit” leases; and (p) Liens arising pursuant to the
acquisition of Property located in the Mills Mall in Anne Arundel County,
Maryland.


 


“Restructuring
Documents”: means the Intercreditor Agreement
dated as of July 3, 2001, along with each of the following agreements, as each
such agreement is defined in the Intercreditor Agreement: (a) the GAFCO Credit
Agreement; (b) the CIT Franchise Loan Agreement; (c) the SunTrust Loan
Agreement; (d) the CNL F7 FriendCo Loan Documents; (e) the CNL F7 DavCo Loan
Documents; (f) the CNL FLP DavCo Loan Documents; (g) the CNL 99-1 FriendCo Loan
Documents; (h) the Global Franchise Trust Loan Documents; (i) the


 


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Collateral
Exchange and Agency Agreement; (j) the Collateral Exchange Agreement Regarding
Wendy’s Assets; and all documents required by the terms of any of the
Restructuring Documents to be executed or delivered on the date hereof.


 


“Security Document”:
the collective reference to (a) the Leasehold Mortgages, the Mortgages, the
Security Agreement and the Escrow Agreement, (b) all mortgages, deeds of trust,
security agreements and other documents pursuant to which collateral is granted
to the Wendy’s Collateral Agent, and (c) all mortgages, deeds of trust,
security agreements and other documents pursuant to which collateral is granted
to the Friendly’s Collateral Agent.


 


4.             REPORTING COVENANTS.  All provisions contained in the Loan
Documents relating to the provision of financial reports and/or reporting of
financial information by the Borrowers to the Lender are hereby deleted in
their entirety and replaced with the requirements set forth below. The Loan
Parties shall be responsible for providing the following information to Lender:


 


(a)           Financial Reporting.


 


(i)            As soon as available, but in any
event within ninety (90) days after the end of each fiscal year of the
Borrowers, a copy of the consolidating balance sheet of Holdings and its “Consolidated


 


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Subsidiaries”
(DavCo and FriendCo) as at the end of such year and the related consolidating
statements of income and retained earnings and of cash flows for such year,
setting forth in each case in comparative form the figures for the previous year,
reported on without a “going concern” or like qualification or exception, or
qualification arising out of the scope of the audit, by Arthur Andersen LLP or
other independent certified public accountants of nationally recognized
standing; and


 


(ii)           As soon as available, but in any
event within forty-five (45) days after the end of the first three quarterly
periods of each fiscal year of the Borrowers, the unaudited consolidating
balance sheet of Holdings and its Consolidated Subsidiaries as at the end of
such quarter and the related consolidated statements of income of Holdings and
its Consolidated Subsidiaries and retained earnings and of cash flows of
Holdings and its Consolidated Subsidiaries for such quarter and the portion of
the fiscal year through the end of such quarter, setting forth in each case in
comparative form the figures for the previous year, certified by a Responsible
Officer, as being fairly stated in all material respects (subject to normal
year-end audit adjustments);


 


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(iii)          As soon as available, but in any event
within thirty (30) days after the end of each calendar month, the unaudited
consolidated and consolidating balance sheet of Holdings and its Consolidated
Subsidiaries as at the end of such month and the related unaudited consolidated
and consolidating statements of income and retained earnings and of cash flows
of Holdings and its Consolidated Subsidiaries for such quarter and the portion
of the fiscal year through the end of such month, setting forth in each case in
comparative form the figures for the previous year, certified by a Responsible
Officer as being fairly stated in all material respects (subject to normal
year-end audit adjustments);


 


(iv)          As soon as available, but in any event
not later than thirty (30) days after the end of each calendar month, an
unaudited statement, in form satisfactory to the Lender of the sales, gross
profits and losses during such month for each restaurant;


 


(v)           Within thirty (30) days after the end
of each September, December, March and June thereafter, the Borrower’s
auditors, Arthur Andersen LLP, shall deliver to Lender an expense and free cash
flow reconciliation for the immediately preceding fiscal quarter.;


 


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All such financial statements shall be completed and correct in all
material respects and shall be prepared in reasonable detail and in accordance
with GAAP applied consistently throughout the periods reflected therein and
with prior periods (except as approved by such accountants or officer, as the
case may be, and disclosed therein). The financial statements described above
(including, without limitation, the statements referred to in clause (iv))
shall be made available to the Lender on computer disk, or in other form
reasonably satisfactory to the Lender.


 


(b)           Certifications.


 


(i)            Concurrently with the delivery of
the financial statements referred to in Paragraph 7(a)(i) above, a certificate
of the independent certified public accountants reporting on such financial
statements stating that in making the examination necessary therefore no
knowledge was obtained of any Default or Event of Default under the Loan
Documents, Workout Documents’ or this Agreement, except as specified in such
certificate;


 


(ii)           Concurrently with the delivery of the
financial statements referred to in Paragraphs 7(a)(ii), 7(a)(iii) and 7(a)(iv)
above, a certificate of a Responsible Officer (i) stating that, to the best of
such Responsible


 


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Officer’s
knowledge, the Borrowers during such period have observed or performed all of
their covenants and other agreements, and satisfied every condition, contained
in this Agreement and the other Loan Documents to be observed, performed or
satisfied by them, and that such Responsible Officer has obtained no knowledge
of any default or event of default under any Loan Documents except as specified
in such certificate, and (ii) showing in detail the calculations supporting
such Responsible Officer’s certification of the Borrowers’ compliance with the
requirements of this Paragraph 6;


 


(c)           Financial Projections and
Operating Budget.  Notwithstanding
anything contained in the Loan Documents to the contrary, not later than fifteen
(15) days prior to the end of each fiscal year of the Borrowers, a copy of the
projections by the Obligors of the operating budget and cash flow budget of
Holdings, DavCo and FriendCo for the succeeding fiscal year, such projections
to be accompanied by a certificate of a Responsible Officer to the effect that
such projections have been prepared on the basis of sound financial planning
practice and that such Responsible Officer has no reason to believe they are
incorrect or misleading in any material respect;


 


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(d)           Investor Communications.  Within five (5) days after the same are
sent, copies of all financial statements and reports which Borrowers send to
their stockholders, and within five (5) days after the same are filed, copies
of all financial statements and reports which the Borrowers may make to, or
file with, the Securities and Exchange Commission or any successor or analogous
governmental authority;


 


(e)           Proof of Insurance.  During the month of October in each calendar
year, a report of a reputable insurance broker with respect to the insurance
maintained by the Borrowers in accordance with the requirements set forth in
the Loan Documents, and such supplemental reports as the Lender may from time
to time request; and


 


(f)            Additional Information.  Notwithstanding the foregoing, Borrowers
shall provide promptly to Lender such additional financial and other
information as the Lenders may from time to time reasonably request.


 


5.             FIXED-CHARGE COVERAGE RATIO.  Any current covenants or requirements
contained in the Loan Documents regarding the Loan Parties’ or the Borrowers’
duty to maintain a certain Fixed-Charge Coverage Ratio, or any other financial
covenants or maintenance tests, are hereby deleted in their entirety and
replaced with the following: “Loan


 


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Parties agree, so long as
any amount remains owing to Lender under the Loan Documents, the Loan Parties
shall not:


 


(a)           Permit the Fixed Charge Coverage
Ratio of DavCo for (i) the five (5) consecutive fiscal quarters ending on the
last day of Borrowers’ 2002 fiscal year (i.e., approximately September 30,
2002) to be less that 1.1 to 1.0, and (ii) any period of four (4) consecutive
fiscal quarters ending (A) after the first day of Borrowers’ 2003 fiscal year
(i.e., approximately October 1, 2,002) and on and before the end of Borrowers’
2003 fiscal year (i.e., approximately September 30, 2003) to be less than 1.15
to 1:00, and (B) on and at all times and after the first day of Borrower’s 2004
fiscal year (i.e., approximately October l, 2003) to be less than 1.2 to 1:0.


 


(b)           Permit the Fixed Charge Coverage
Ratio of Holdings on a consolidated basis (i) for the three (3) consecutive
fiscal quarters ending on March 31, 2002 to be less than 1.0 to 1.0, and (ii)
for any period of four (4) consecutive fiscal quarters ending (A) after March
31, 2002 and on and before the last day of Borrowers’ 2002 fiscal year (i.e.,
approximately September 30, 2002) to be less than 1.05 to 1:0, (B) after the
last day of Borrowers’ 2002 fiscal year and on and before the last day of
Borrowers’ 2003 fiscal year (i.e., approximately September 30, 2003) to be less
than 1.1 to 1:0, (C) after the last day of Borrowers 2003 fiscal


 


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year and on and
before the last day of Borrowers’ 2004 fiscal year (i.e., approximately
September 30, 2004) to be less than 1.15 to 1:0, and (D) on and at all times
after the first day of Borrowers’ 2005 fiscal year to be less than 1.2 to 1:0.”


 


6.             NEGATIVE PLEDGE.  Any provisions in any of the Loan Documents
prohibiting liens and encumbrances are hereby deleted in their entirety and
replaced with the following provision: “The Loan Parties shall not encumber or
otherwise place or allow the placement of any lien or encumbrance against the
Property, except for such liens and encumbrances as are contemplated by and
allowed under the definition of “Permitted Encumbrances” set forth above.


 


7.             EVENTS OF DEFAULT.  All Defaults, Events of Default or other
events giving rise to the right of Lender to accelerate the indebtedness due
under the Promissory Notes, the Instrument, or the other Loan Documents are
hereby deleted in their entirety and replaced with the matters set forth below.
It shall be an Event of Default under the Loan Documents if any of the
following events shall occur and be continuing:


 


(a)           Any Borrower shall fail to pay any
principal of any Loan when due in accordance with the terms thereof or hereof;
or any Borrower shall fail to pay any interest on any Loan, or any other amount
payable hereunder or under the


 


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other Loan
Documents or the Commitment Letter, within five days after any such interest or
other amount becomes due in accordance with the terms thereof or hereof; or


 


(b)           Any representation or warranty made
or deemed made by any Borrower herein or in any of the Workout Documents or in
any of the Loan Documents or which is contained in any certificate, document or
financial or other statement furnished by it at any time under or in connection
with this Agreement, the Workout Documents or any such other Loan Document
shall prove to have been incorrect in any material respect on or as of the date
made or deemed made; or


 


(c)           Any Borrower shall default in the
observance or performance of any obligation, responsibility or duty set forth
in the Loan Documents to (a) continuously maintain its corporate existence in
good standing in each respective State in which it does business, (b) provide
notice to Lenders of events affecting the Collateral or the Borrowers’
corporate existence, or (c) refrain from taking any action at the corporate
level or with regard to the Collateral; or


 


(d)           Any Borrower shall default in the
observance or performance of any obligation, responsibility or duty contained
in this Agreement, the Workout


 


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Documents, or any
other Loan Document (other than as provided in paragraphs (a) through (c) of
this Section), and such default shall continue unremedied for a period of 30
days following notice or actual knowledge; or


 


(e)           Any Borrower shall fail to perform
any of its obligations under any Franchise Agreement or any other Franchise Document
and such failure shall not have been cured or waived on or before the first
date on which such Franchise Agreement or such other Franchise Document may be
terminated by reason of such failure; or (ii) Any Borrower shall fail to
perform any of its obligations under any lease or any other material
contractual obligation and such failure shall continue for thirty (30) days
after notice from the Lender; or


 


(f)            Any Borrower shall (i) default in
any payment of principal of or interest of any Indebtedness, including any
forward commitments entered into between the Lender and Borrowers and any loans
made pursuant thereto, (other than the Loans) or in the payment of any
Guarantee Obligation, beyond the period of grace (not to exceed 30 days), if
any, provided in the instrument or agreement under which such Indebtedness or
Guarantee Obligation was created, if the aggregate amount of the Indebtedness
and/or Guarantee Obligations in respect of which such default or defaults shall
have occurred is at least $1,000,000; or (ii) default in the observance or
performance of any other agreement or condition


 


23

















 


relating to any
such Indebtedness or Guarantee Obligation or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event shall
occur or condition exist, the effect of which default or other event or
condition is to cause, or to permit the holder or holders of such Indebtedness
or beneficiary or beneficiaries of such Guarantee Obligation (or a trustee or
agent on behalf of such holder or holders or beneficiary or beneficiaries) to
cause, with the giving of notice if required, such Indebtedness to become due
prior to its stated maturity or such Guarantee Obligation to become payable; or


 


(g)           Any Loan Party shall commence any
case, proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief
entered with respect to it, or seeking to adjudicate it a bankrupt or
insolvent, or seeking reorganization, arrangement, adjustment, winding-up,
liquidation, dissolution, composition or other relief with respect to it or its
debts, or (B) seeking appointment of a receiver, trustee, custodian,
conservator or other similar official for it or for all or any substantial part
of its assets, or any Borrower shall make a general assignment for the benefit
of its creditors; or (ii) there shall be commenced against any Borrower any
case, proceeding or other action of a nature referred to in clause (i) above
which (A)


 


24

















 


results in the
entry of an order for relief or any such adjudication or appointment or (B)
remains undismissed, undischarged or unbonded for a period of 60 days; or (iii)
there shall be commenced against any Borrower any case, proceeding or other
action seeking issuance of a warrant of attachment, execution, distraint or
similar process against all or any substantial part of its assets which results
in the entry of an order for any such relief which shall not have been vacated,
discharged, or stayed or bonded pending appeal within 60 days from the entry
thereof; or (iv) any Borrower shall take any action in furtherance of, or
indicating its consent to, approval of, or acquiescence in, any of the acts set
forth in clause (i), (ii), or (iii) above; or (v) Any Borrower shall generally
not, or shall be unable to, or shall admit in writing its inability to, pay its
debts as they become due; or


 


(h)           Any Loan Party shall engage in any
“prohibited transaction” (as defined in Section 406 of ERISA or Section 4975 of
the Code) involving any Plan, (ii) any “accumulated funding deficiency” (as
defined in Section 302 of ERISA), whether or not waived, shall exist with
respect to any Plan or any Lien in favor of the PBGC or a Plan shall arise on
the assets of any Borrower or any commonly controlled entity, (iii) a
Reportable Event shall occur with respect to, or proceedings shall commence to
have a trustee appointed, or a trustee shall be appointed, to administer or to
terminate, any Single Employer Plan, which


 


25

















 


Reportable Event
or commencement of proceedings or appointment of a trustee is, in the
reasonable opinion of the Lenders, likely to result in the termination of such
Plan for purposes of Title N of ERISA, (iv) any Single Employer Plan shall
terminate for purposes of Title N of ERISA, (v) DavCo or any Commonly
Controlled Entity shall, or in the reasonable opinion of the Lender is likely
to, incur any liability in connection with a withdrawal from, or the Insolvency
or Reorganization of, a Multi-Employer Plan or (vi) any other event or
condition shall occur or exist with respect to a Plan; and in each case in
clauses (i) through (vi) above, such event or condition, together with all
other such events or conditions, if any, could reasonably be expected to have a
Material Adverse Effect; or


 


(i)            One or more judgments or decrees
shall be entered against any Borrower involving in the aggregate a liability
(not paid or fully covered by insurance) of $1,000,000 or more, and all such
judgments or decrees shall not have been vacated, discharged, stayed or bonded
pending appeal within 30 days from the entry thereof; or


 


(j)            Any of the Loan Documents or
Franchise Documents shall cease, for any reason, to be in full force and
effect, or any Borrower shall so assert or (ii)


 


26

















 


the Lien created
by any of the Security Documents shall cease to be enforceable and of the same
effect and priority purported to be created thereby; or


 


(k)           Borrowers shall fail to liquidate the
Collateral and deliver the Net Proceeds to CFS as set forth herein and in the
Workout Documents, and within the time set forth in Exhibit E.


 


(l)            Loan Parties shall fail to deposit
any Excess Cash Flow to the Excess Cash Flow Account as set forth herein and in
the Collateral Exchange Agreement Regarding Certain Wendy’s Assets.


 


(m)          Any Event of Default arising out of or
under the Workout Documents.


 


(n)           Any Material Adverse Change shall
occur.


 


(o)           DavCo shall default in any material
respect in the payment or performance of any Material Agreement, which default
entitles a party to such Material Agreement to terminate or repudiate such
contract, and such party does terminate or repudiate such contract.


 


27

















 


8.             NO DISTRIBUTIONS OR INCREASE IN
PAYMENTS TO SHAREHOLDERS OR MANAGEMENT PRIOR TO PAYMENT OF LENDERS’ CLAIMS.  Until such time as all amounts due and owing
under any and all promissory notes currently existing and payable to Lender,
GAFCO, CIT, SunTrust and their successors and/or assigns have been repaid in
full to Lender, GAFCO, CIT, SunTrust and their successors and/or assigns,
Borrowers shall make no debt repayments to affiliates or owners, equity advance
loan repayments to affiliates or owners, or owner distributions (other than
repayments to DavCo for monies advanced to support FriendCo operations as
permitted under the Intercreditor Agreement and GAFCO Third Amendment to Credit
Agreement; for the purposes of this paragraph, any payment by DavCo of interest
on the CNL F7 DavCo Loans, CNL F7 FriendCo Loans, or the CNL FLP DavCo Loan,
will be deemed and advance by DavCo to FriendCo). The violation of this section
shall constitute a Default hereunder and under the Loan Documents.


 


9.             RELEASE OF CLAIMS BY LOAN
PARTIES.


 


(a)           Release of Lender. Each of the
Loan Parties, each for itself and its successors and assigns, hereby knowingly
and voluntarily RELEASES, DISCHARGES, and FOREVER WAIVES and RELINQUISHES any
and all claims, demands, obligations, liabilities, defenses, affirmative
defenses, setoffs, rights of recoupment, counterclaims, actions, and causes of
action of whatsoever kind or nature, whether known or unknown, which it has,
may have, or might


 


28

















 


have or may assert
now or in the future against the Lender, its parents or subsidiaries,
predecessors in interest, or any of their past, present, or future directors,
officers, employees, agents, attorneys, legal representatives, predecessors,
affiliates, successors, or assigns, directly or indirectly, arising out of,
based upon, or in any manner connected with any transaction, event,
circumstance, action, failure to act, or occurrence of any sort or type,
whether known or unknown, which occurred, existed, was taken, permitted, or
begun prior to the execution of this Agreement, pursuant to or in connection
with any Loan, the administration or enforcement of the Loans or any of the
terms of any of the Loan Documents, or which was related or connected in any
manner, directly or indirectly, to any Restaurant or Collateral. Each of the
Loan Parties hereby acknowledges and agrees that the execution of this
Agreement by Lender shall not constitute an acknowledgment of or admission by
Lender of the existence of any such claims or of liability for any matter or
precedent upon which any liability may be asserted. Each of the Loan Parties
hereby further acknowledges and agrees that, to the extent that any such claims
may exist, they are of a speculative nature so as to be incapable of objective
valuation and that, in any event, the value to Loan Parties of the covenants
and obligations of Lender contained in this Agreement and the other documents
and instruments executed and delivered in


 


29

















 


connection
herewith substantially and materially exceeds any and all value of any kind or
nature whatsoever of any such claims.


 


(b)           No Assignment. Each of the
Loan Parties warrants and represents to Lender that no Borrower has sold,
assigned, transferred, conveyed or otherwise disposed of any claims which are
the subject of this Section. The inclusion of this provision shall not be
deemed to be an admission by Lender that any such inclusion exist.


 


(c)           Discovery of Unknown or Different
Facts. Each of the Loan Parties acknowledges and agrees that the facts with
respect to which the release of claims contained in this Section is executed
may hereafter be found to be different from the facts now believed by Loan
Parties to be true, and each of the Loan Parties expressly accepts and assumes
the risks of such possible differences and agrees that the release of claims
contained in this Section shall be and remain effective notwithstanding such
differences in fact.


 


10.           WAIVER.  The Loan Parties acknowledge that they have
failed to meet various covenants and agreements under the Loan Documents, thus
causing Events of Default under each of the Loan Documents (the “Existing
Events of Default”). Subject to the terms and


 


30

















 


provisions of this
Agreement and the Workout Documents, Lender hereby waives such Existing Events
of Default.


 


11.           OTHER LIENS.  Notwithstanding anything contained in the
Loan Documents (including, but not limited to, the definition of “Permitted
Encumbrances” contained in the Instrument) to the contrary, Lender expressly
acknowledges and permits the Loan Parties to obtain such financing and place
such liens against its properties as set forth in and contemplated by the
Restructuring Documents.


 


12.           NOTICES.  In addition to the parties to be provided
notice under the Loan Documents, copies of all notices shall also be provided
to: James H.M. Sprayregen, Kirkland & Ellis, 200 East Randolph Drive,
Chicago, IL 60601.


 


13.           REVIEW BY LOAN PARTIES WITH
INDEPENDENT COUNSEL.  EACH OF THE
LOAN PARTIES ACKNOWLEDGES AND AGREES THAT (A) IT HAS CAREFULLY READ AND
UNDERSTANDS ALL OF THE TERMS OF THIS AMENDMENT; (B) IT HAS EXECUTED THIS
AGREEMENT FREELY AND VOLUNTARILY, AFTER HAVING CONSULTED WITH ITS INDEPENDENT
LEGAL COUNSEL AND AFTER HAVING HAD ALL OF THE TERMS OF THIS AGREEMENT EXPLAINED
TO IT BY ITS INDEPENDENT LEGAL COUNSEL; (C) THE WAIVERS AND RELEASES CONTAINED
IN THIS AGREEMENT ARE REASONABLE, NOT CONTRARY


 


31

















 


TO PUBLIC POLICY OR LAW,
AND HAVE BEEN INTENTIONALLY, INTELLIGENTLY, KNOWINGLY, AND VOLUNTARILY AGREED
TO BY IT; (D) THE WAIVERS AND RELEASES CONTAINED IN THIS AGREEMENT HAVE BEEN
AGREED TO BY EACH BORROWER WITH FULL KNOWLEDGE OF THEIR SIGNIFICANCE AND
CONSEQUENCES, INCLUDING FULL KNOWLEDGE OF THE SPECIFIC NATURE OF ANY RIGHTS OR
DEFENSES WHICH BORROWERS HAVE AGREED TO WAIVE OR RELEASE PURSUANT TO THIS
AGREEMENT; (E) IT HAS HAD A FULL AND ADEQUATE OPPORTUNITY TO NEGOTIATE THE
TERMS CONTAINED IN THIS AGREEMENT; (F) IT IS EXPERIENCED IN AND FAMILIAR WITH
LOAN TRANSACTIONS OF THE TYPE EVIDENCED BY THIS AGREEMENT; AND (G) THE WAIVERS
AND RELEASES CONTAINED IN THIS AGREEMENT ARE MATERIAL INDUCEMENTS TO THE
LENDER’S EXECUTION OF THIS AGREEMENT, AND THE LENDER HAS RELIED ON SUCH WAIVERS
AND RELEASES IN ENTERING INTO THIS AGREEMENT AND WILL CONTINUE TO RELY ON SUCH
WAIVERS AND RELEASES IN ANY RELATED FUTURE DEALINGS WITH BORROWERS.


 


14.           EXPENSES.  The Loan Parties shall reimburse the Lender
in immediately available funds on the date hereof for the fees and expenses
incurred by Lender (including, without limitation, reasonable attorneys’ and
paralegals’ fees and expenses) in connection with negotiating, executing and
completing this Agreement and the Workout Documents. Nothing


 


32

















 


herein shall (a) diminish
or otherwise limit any obligation that the Loan Parties may have under the Loan
Documents with respect to payment of the Lender’s costs and expenses, or (b)
prevent the Lender from requiring the Loan Parties to pay all such costs and
expenses.


 


15.           COUNTERPARTS.  This Agreement may be executed by one or
more of the parties to this Agreement and any number of separate counterparts,
each of which when so executed, shall be deemed an original and all said counterparts
when taken together shall be deemed to constitute but one and the same
instrument.


 


16.           SUCCESSORS AND ASSIGNS.  This Agreement shall be binding upon and
inure to the benefit of each party hereto and their successors and assigns.


 


17.           SURVIVAL.  All covenants, agreements, representations,
and warranties made in this Agreement and in the Loan Documents shall survive
the execution of this Agreement and shall continue in full force and effect.


 


18.           FURTHER ASSURANCE.  The Loan Parties hereby agree from time to
time, as and when requested by the Lender, to execute and deliver or cause to
be executed and delivered, all such documents, instruments and agreements and
to take or cause to be taken such further or other action as the Lender may
reasonably deem necessary or desirable in order to


 


33

















 


carry out the intent and
purposes of this Agreement, the Loan Documents, and the Workout Documents.


 


19.           WAIVER OF JURY TRIAL.  EACH PARTY TO THIS AGREEMENT AGREES THAT ANY
SUIT, ACTION, OR PROCEEDING BROUGHT OR INSTITUTED BY ANY PARTY HERETO OR ANY
SUCCESSOR OR ASSIGN OF ANY PARTY ON OR WITH RESPECT TO THIS AGREEMENT, ANY OF
THE DOCUMENTS EXECUTED IN CONNECTION WITH THIS AGREEMENT, ANY OF THE LOAN
DOCUMENTS OR WHICH IN ANY WAY RELATES, DIRECTLY OR INDIRECTLY TO THE
OBLIGATIONS UNDER THIS AGREEMENT OR ANY OF THE LOAN DOCUMENTS OR ANY EVENT,
TRANSACTION OR OCCURRENCE ARISING OUT OF OR IN ANY WAY CONNECTED THEREWITH, OR
THE DEALINGS OF THE PARTIES WITH RESPECT THERETO, SHALL BE TRIED ONLY BY A
COURT AND NOT A JURY. EACH PARTY HEREBY EXPRESSLY WAIVES ANY RIGHT TO A TRIAL
BY JURY IN ANY SUCH SUIT, ACTION, OR PROCEEDING. LOAN PARTIES ACKNOWLEDGE AND
AGREE THAT THIS PROVISION IS A SPECIFIC AND MATERIAL ASPECT OF THIS AMENDMENT
BETWEEN THE PARTIES HERETO AND THAT THE LENDER WOULD NOT AGREE TO THE
AGREEMENTS SET FORTH HEREIN IF THIS WAIVER OF JURY TRIAL PROVISION WERE NOT A
PART OF THIS AGREEMENT.


 


34

















 


20.           GOVERNING LAW.  THIS AMENDMENT SHALL BE GOVERNED BY AND
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE
STATE OF FLORIDA, WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES.


 


21.           FURTHER ASSURANCES COOPERATION.  Prior to and at all times following the execution
of this Agreement, each of the Loan Parties agrees to execute and deliver, or
to cause to be executed and delivered, such documents and to do, or cause to be
done, such other acts and things as might reasonably be requested by Lender to
assure that the benefits of this Agreement are realized.


 


22.           RELATIONSHIP OF PARTIES.  Nothing contained in this Amendment or the
other Loan Documents constitutes or shall be construed as the formation of a
partnership, joint venture, tenancy-in-common, or any other form of
co-ownership, between the Lender and Borrowers or any other person or the
creation of any confidential or fiduciary relationship of any kind between the
Lender and Loan Parties or any other person. The Lender shall not be deemed to
be a partner, joint venturer, co-tenant, trustee, or fiduciary with respect to
any Loan Party or any other person as a result of this Amendment, any of the
other Loan Documents, or any of the transactions contemplated by this Amendment
or any of the other Loan Documents. Loan Parties acknowledge and agree that the
Lender has at all times acted and shall at all times continue to be acting only
as a lender to Loan Parties within the normal and usual scope of activities of
a lender.


 


35

















 


23.           MISCELLANEOUS.  This Agreement, the exhibits hereto and
other documents executed in connection herewith, constitute the entire
agreement concerning this subject matter and supersede any prior or
contemporaneous representations or agreements not contained herein concerning
the subject matter of this Agreement.    Section
headings used herein are for convenience only and shall not be used to
interpret any term hereof. Masculine, feminine, or neuter gender and the
singular and the plural number, shall each be considered to include the other
whenever the context so requires. If any Party consists of more than one
person, each such person shall be jointly and severally liable.


 


24.           SEVERABILITY.  Wherever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement shall be
prohibited by or invalid under such law, such provision shall be ineffective to
the extent of such prohibition or invalidity without invalidating the remainder
of such provision or the remaining provisions of this Agreement.


 


25.           AMENDMENT.  Neither this Agreement nor any of the
provisions hereof may be changed, waived, discharged or terminated, except by
an instrument in writing and signed by each of the parties against whom
enforcement of the change, waiver, discharge or termination is sought.


 


36

















 


26.           LIMITATION OF MODIFICATIONS.  The Loan Documents remain in full force and
effect and in accordance with their respective terms, remain valid and binding
obligations of Loan Parties and (except as previously modified or amended in
writing by the parties and as expressly modified and amended herein) have not
been modified or amended, and are hereby ratified by the parties hereto. The
liens, security interests and assignments created by the Loan Documents are and
continue to be valid, effective, properly perfected and enforceable and are
hereby ratified and confirmed in all respects. Notwithstanding the foregoing,
Lender agrees and covenants that, to the extent the terms of any of the Loan
Documents are inconsistent with the agreements contained herein, the Lender
shall not take any actions which are inconsistent with the provisions contained
herein. In the event of a conflict between the terms of this Agreement and any
Loan Document, the terms of this Agreement shall prevail.


 


[Signatures commence on the following page]


 


37

















 


IN WITNESS WHEREOF, the patties have executed this Amendment as of the
date set forth above.


 


 


	
   

  	
  WELLS FARGO BANK MINNESOTA,

  NATIONAL ASSOCIATION f/k/a NORWEST

  BANK MINNESOTA, N.A., as Indenture Trustee

  under that certain Indenture and Servicing Agreement

  dated as of November l, 1999

  
	
   

  	
   

  
	
   

  	
  By: CNL
  FINANCIAL SERVICES, LP, a Delaware

  limited partnership, as attorney-in-fact

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/  JOHN L. FARREN

  	
   

  
	
   

  	
   

  	
  Name:  John L. Farren

  
	
   

  	
   

  	
  Title:  Senior Vice President

  



 


38

















 


	
   

  	
  DAVCO RESTAURANTS, INC.,
  a Delaware

  corporation

  
	
   

  	
   

  
	
   

  	
  /s/  DAVID J. NORMAN

  	
   

  
	
   

  	
  David J. Norman, Secretary

  
	
   

  	
   

  
	
   

  	
   

  	
  (CORPORATE
  SEAL)

  
	
   

  	
   

  
	
   

  	
  DAVCO ACQUISITION HOLDING INC.,
  a

  Delaware corporation

  
	
   

  	
   

  
	
   

  	
  /s/  DAVID J. NORMAN

  	
   

  
	
   

  	
  David J. Norman, Secretary

  
	
   

  	
   

  
	
   

  	
   

  	
  (CORPORATE SEAL)

  
	
   

  	
   

  
	
   

  	
  FRIENDCO RESTAURANTS, INC., a
  Maryland

  
				



 


39

















 


	
   

  	
  corporation

  
	
   

  	
   

  
	
   

  	
  /s/  DAVID J. NORMAN

  	
   

  
	
   

  	
  David J. Norman, Secretary

  
	
   

  	
   

  
	
   

  	
   

  	
  (CORPORATE
  SEAL)

  
	
   

  	
   

  
	
   

  	
  HERON REALTY CORPORATION, a
  Maryland

  corporation

  
	
   

  	
   

  
	
   

  	
  /s/  DAVID J. NORMAN

  	
   

  
	
   

  	
  David J. Norman, Secretary

  
	
   

  	
   

  
	
   

  	
   

  	
  (CORPORATE
  SEAL)

  
						



 


40

















 


EXHIBIT “A”


 


(Promissory Notes)


 


Promissory Note from FriendCo Restaurants, Inc. to and in favor of CNL
Financial Services, Inc. in the amount of $1,288,000.00, dated May 11, 1999.


 


Promissory Note from FriendCo Restaurants, Inc. to and in favor of CNL
Financial Services, Inc. in the amount of $1,020,000.00, dated May 11, 1999.


 


Promissory Note from FriendCo Restaurants, Inc. to and in favor of CNL
Financial Services, Inc. in the amount of $972,000.00, dated May 17, 1999.


 


Promissory Note from FriendCo Restaurants, Inc. to and in favor of CNL
Financial Services, Inc. in the amount of $930,000.00, dated May 17, 1999.


 


Promissory Note from FriendCo Restaurants, Inc., DavCo Restaurants,
Inc., and DavCo Acquisition Holding, Inc. to and in favor of CNL APF Partners,
LP in the amount of $882,000.00, dated December 13, 1999.


 


41

















 


Promissory Note from FriendCo Restaurants, Inc., DavCo Restaurants,
Inc., and DavCo Acquisition Holding; Inc. to and in favor of CNL APF Partners,
LP in the amount of $1,477,000.00, dated December 13, 1999.


 


Promissory Note from FriendCo Restaurants, Inc., DavCo Restaurants,
Inc., and DavCo Acquisition Holding, Inc. to and in favor of CNL APF Partners,
LP in the amount of $750,000.00, dated December 13, 1999.


 


Promissory Note from FriendCo Restaurants, Inc., DavCo Restaurants,
Inc., and DavCo Acquisition Holding, Inc. to and in favor of CNL APF Partners,
LP in the amount of $1,750,000.00, dated December 13, 1999.


 


Promissory Note from FriendCo Restaurants, Inc., DavCo Restaurants,
Inc., and DavCo Acquisition Holding, Inc. to and in favor of CNL APF Partners,
LP in the amount of $672,000.00, dated March 28, 2000.


 


42

















 


EXHIBIT “B”


 


(Loan Documents)


 


1.             Loan Agreement by and between Wells
Fargo Bank Minnesota in its capacity as Indenture Trustee and the Loan Parties.


 


2.             Commercial Deed of Trust to and in
favor of Wells Fargo Bank Minnesota in its capacity as Indenture Trustee from
Loan Parties dated as of July 12, 2001 for recordation in Baltimore County,
Maryland.


 


3.             Commercial Deed of Trust to and in
favor of Wells Fargo Bank Minnesota in its capacity as Indenture Trustee from
Loan Parties dated as of July 12, 2001 for recordation in the City of
Baltimore, Maryland.


 


4.             Commercial Deed of Trust to and in
favor of Wells Fargo Bank Minnesota in its capacity as Indenture Trustee from
Loan Parties dated as of July 12, 2001 for recordation in Prince George’s
County, Maryland.


 


43

















 


5.             Commercial Deed of Trust to and in
favor of Wells Fargo Bank Minnesota in its capacity as Indenture Trustee from
Loan Parties dated as of July 12, 2001 for recordation in Howard County,
Maryland.


 


6.             Commercial Deed of Trust to and in
favor of Wells Fargo Bank Minnesota in its capacity as Indenture Trustee from
Loan Parties dated as of July 12, 2001 for recordation in St. Mary’s County,
Maryland.


 


7.             Commercial Deed of Trust to and in
favor of Wells Fargo Bank Minnesota in its capacity as Indenture Trustee from
Loan Parties dated as of July 12, 2001 for recordation in Wicomoco County,
Maryland.


 


8.             Commercial Deed of Trust to and in
favor of Wells Fargo Bank Minnesota in its capacity as Indenture Trustee from
Loan Parties dated as of July 12, 2001 for recordation in Anne Arundel County,
Maryland.


 


9.             Commercial Deed of Trust to and in
favor of Wells Fargo Bank Minnesota in its capacity as Indenture Trustee from
Loan Parties dated as of July 12, 2001 for recordation in Harford County,
Maryland.


 


10.           Assignment of Warranties, Contracts
and Permits.


 


44

















 


11.           Environmental Indemnity Agreement.


 


45

















 


EXHIBIT “C”


 


(List of Wendy’s Restaurants-’Collateral”)


 


Unit 150-Wendy’s restaurant located at 3620 Washington Boulevard,
Baltimore, Baltimore County, MD


 


Unit 152-Wendy’s restaurant located at 8308 Annapolis Road, New
Carrollton, Prince George’s County, MD


 


Unit 153-Wendy’s restaurant located at 1589 West Nursery Road,
Linthicum, Anne Arundel County, MD


 


Unit 169-Wendy’s restaurant located at 40804 Merchant Lane, Leondardtown,
St. Mary’s County, MD


 


Unit 166-Wendy’s restaurant located at 6411 Eastern Avenue, Baltimore,
Baltimore County, MD


 


Unit 164-Wendy’s restaurant located at 5801 Clarksville Square Road,
Clarksville, Howard County, MD


 


46

















 


Unit 160-Wendy’s restaurant located at 403 Punkin Court, Salisbury,
Wicomico County, MD


 


Unit 161-Wendy’s restaurant located at 498 Richie Highway, Severna,
Anne Arundel County, MD


 


Unit 159-Wendy’s restaurant located at 30272 Triangle Drive, Charlotte
Hall, Charles/St. Mary’s County, MD


 


Unit 162-Wendy’s restaurant located at 1344 Eastern Boulevard,
Baltimore, Baltimore County, MD


 


Unit 157-Wendy’s restaurant located at 11818 Reisterstown Road,
Reisterstown, Baltimore County, MD


 


Unit 158-Wendy’s restaurant located at 15400 Chrysler Drive, Upper
Marlboro, Prince George’s County, MD


 


Unit 85-Wendy’s restaurant located at 8700 Blair Road, Baltimore, MD


 


Unit 130-Wendy’s restaurant located at 1060 Joppa Farm Road,
Joppatowne, MD


 


47