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Exhibit 10.12  

 
  WAIVER AND FORBEARANCE OF COVENANT VIOLATIONS (INTEREST)
  FINANCE INDENTURE    
  

        TWG Finance Corp., a Delaware, U.S.A. corporation, the holder of one hundred percent (100%) of the total of $20,000,000.00 in aggregate principal amount of
Securities currently outstanding (the "Finance Noteholder") under the Indenture dated March 31, 1998, as supplemented by that certain First Supplemental Trust Indenture dated October 29,
1999, that certain Second Supplemental Trust Indenture dated October 15, 1999, and by that certain Third Supplemental Trust Indenture dated September 10, 2001 (collectively the "Finance
Indenture"), with TWG International U.S. Corporation, a Nevada U.S.A. Corporation (the "Issuer"), and The Bank of New York Trust Company of Florida, N.A., as successor in interest to the U.S. Trust
Company of Texas, N.A., as Trustee, and Value Partners, Ltd., a Texas limited partnership, the holder of $13,370,000.00 in aggregate principal amount of the total of $20,000,000.00 in aggregate
principal amount of Securities currently outstanding (the "Primary Note Majority Holder") under the Indenture dated March 31, 1998, as supplemented by that certain First Supplemental Trust
Indenture dated October 29, 1998, that certain Second Supplemental Trust Indenture dated October 15, 1999 and by that certain Third Supplemental Trust Indenture dated
September 10, 2001 (collectively the "Primary Indenture") with Trans World Corporation, a Nevada, U.S.A. corporation, and its wholly-owned subsidiaries, TWG International U.S. Corporation, a
Nevada, U.S.A. corporation, and TWG Finance Corp., a Delaware, U.S.A. corporation, and The Bank of New York Trust Company of Florida, N.A., as successor in interest to the U.S. Trust Company of Texas,
N.A., as Trustee, do hereby consent to the following:

 

        1.    The
Finance Noteholder, pursuant to Section 5.10 of the Indenture, by notice to the Issuer and the Trustee, hereby forbears the failure of the Issuer to pay when
due and payable as required in Section 3.1 of the Indenture (Payment of Principal and Interest) the following interest payments, but only to permit the Issuer to pay the following interest at a
later date as set forth herein: $424,200.00 of interest due the Holder on September 17, 2000, $799,200.00 of interest due on March 17, 2001, $799,200.00 of interest due on
September 17, 2001, $799,200.00 of interest due on March 17, 2002, $799,200.00 of interest due on September 17, 2002, $799,200.00 of interest due on March 17, 2003 and
$799,200.00 of interest due on September 17, 2003 (collectively the "Interest Payments"). Such Interest Payments shall all be due and payable on January 1, 2004 (together with additional
interest at the Default Rate, commencing on the date of non-payment of each installment, at which time such Interest Payments shall be "Defaulted Interest Payments"). Nothing herein shall
be construed to waive the
obligation to pay such interest. Rather, this waiver and forbearance shall permit the later payment of such interest pursuant to the terms hereof. Notwithstanding the above, all the Defaulted Interest
Payments and all accrued unpaid interest thereon shall be due and payable no later than ten (10) Business Days following (a) the receipt by Trans World Corporation or any Subsidiary
(direct or indirect) of an investment of the collective sum of $6,000,000.00 or more from any source, including borrowing or the sale of equity, whether payable in one or more installments, and
whether from one or more sources or methods of acquisition ("Qualified Loan"), which sums are collected on or after the date hereof; (b) the payment of Interest to another holder of the
Securities (as defined in the Primary Indenture); or (c) the commencement of a voluntary or involuntary insolvency proceeding against any Issuers of the Primary Indenture. For purposes of
clarification, the obligation to pay the Defaulted Interest Payments shall be from the $6,000,000.00 or more which constitutes the Qualified Loan. In the event a Qualified Loan occurs on or before
March 17, 2003, the accrued unpaid interest due as of March 17, 2003 shall be due on March 17, 2003. In the event a Qualified Loan occurs on or before September 17, 2003,
the accrued unpaid interest due as of September 17, 2003 shall be due on September 17, 2003. This waiver and forbearance is related solely to interest due Value Partners, Ltd.
under the Primary Indenture. All sums payable herein shall, upon receipt by the Finance Noteholder and payment to Trans World Corporation, be immediately payable, under the Finance Indenture and 

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Primary Indenture, to Value Partners, Ltd. This forbearance and waiver shall not extend to any subsequent or other default or impair any right consequent thereon. This forbearance and waiver
shall not extend to any provision of the Indenture regarding the payment of principal and/or interest, including the timely payment thereof, other than as set forth above. Upon this forbearance and
waiver, any action or omission by the Issuer which may constitute a default or Event of Default under the Indenture, as set forth above, shall cease to exist and be deemed to have been cured and not
to have occurred, for every purpose of the Indenture. In the event a payment required herein is not made, Value Partners, Ltd. (or its successors or assignees) may rescind this waiver upon
written Notice to the Issuer. The obligation to make the payments required herein is a covenant of the Issuer to insure payment of the securities issued Value Partners, Ltd. under the Primary
Indenture. Value Partners may enforce such covenants without waiver of any other right or remedy available to it or to the Trustee. 

        2.    Terms
not defined herein are defined as set forth in the Indenture. 

        3.    This
Waiver may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which counterparts when executed and
delivered shall be an original, but all of which shall together constitute one and the same instrument. A complete set of counterparts shall be lodged with the Issuer, the Trustee and the Holder. 

        4.    Pursuant
to Section 11.12 of the Finance Indenture (and Section 3.27 of the Primary Indenture), the holders of the same percentage of Securities issued
pursuant to the Primary Indenture who would be required to consent to an action under the Primary Indenture must also consent to the same action under the Finance Indenture. The Primary Note Majority
Holder consents for such purposes. 

        5.    Trans
World Corporation ("TWC") joins in this instrument to acknowledge and agree to the foregoing arrangement. Further, as a material inducement for the Trustee to
deliver this consent, TWC
agrees to indemnify the Trustee and hold it harmless against any loss, liability or expense incurred, arising out of or in connection with the action taken by the Holder hereby, including the costs
and expenses of defending itself against any claim or liability in connection therewith. 

        6.    This
Waiver shall not prevent Value Partners from participating in the Exchange Agreement presently being negotiated with Issuers and the other Holders of Securities, as
defined in and issued pursuant to the Primary Indenture, including the receipt by Value Partners of an interest note from TWC and TWG International U.S. Corporation for certain of the interest subject
to this waiver, or any other benefits accorded Value Partners in such exchange (including the receipt of common stock in exchange for the principal balance of the Securities, as defined in the Primary
Indenture, held by Value Partners). 

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Dated:
February 12, 2003 

	

 	

 	
 	

 	

 
	Attested hereto by:	 	TWG FINANCE CORP.
	

By:	

/s/ Paul Benkley
	
 	

By:	

/s/ Rami S. Ramadan

	Title: Secretary	 	Name: Rami S. Ramadan

Title: Vice President
	

 	

 	
 	

 	

 
	 	 	 	VALUE PARTNERS, LTD.

Ewing & Partners, a Texas general partnership
	

 	

 	
 	

By:	

/s/ Timothy G. Ewing
 Timothy G. Ewing

Managing Partner of Ewing & Partners,

General Partner of Value Partners, Ltd.

The undersigned acknowledges receipt of the above waiver. 

	 	 	THE BANK OF NEW YORK TRUST COMPANY OF FLORIDA, N.A. AS SUCCESSOR IN INTEREST TO U.S. TRUST COMPANY OF TEXAS, N.A. (Trustee)
	

 	
 	

By:	

/s/ Patrick T. Giordano
 Patrick T. Giordano

Vice President

Executed for purposes of agreement to perform covenants and for indemnity. 

	Attested hereto by:	 	TRANS WORLD CORPORATION
	

By:	

/s/ Paul Benkley
	
 	

By:	

/s/ Rami S. Ramadan

	Title: Secretary	 	Name: Rami S. Ramadan

Title: Chief Executive Officer
	

 	

 	
 	

 	

 
	Attested hereto by:	 	TWG INTERNATIONAL U.S. CORPORATION
	

By:	

/s/ Paul Benkley
	
 	

By:	

/s/ Rami S. Ramadan

	Title: Secretary	 	Name: Rami S. Ramadan

Title: Chief Executive Officer

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Exhibit 10.13  

 
 

INDEMNIFICATION AGREEMENT    
  

        This Indemnification Agreement (this "Agreement") is made and entered as of February 12, 2003, by and between Trans World Corporation, a Nevada corporation
(the "Company"), TWG International US Corporation, a Nevada Corporation ("International") and Value Partners, Ltd., a Texas limited partnership ("Value Partners").

 
 

BACKGROUND    
  

        A.    The
Company intends to effect an exchange of (i) 22,640 shares of its common stock or (ii) $1,000 principal amount Variable Rate Promissory Notes due
December 2009 (the "Replacement Notes"), for each of the Company's $1,000 principal amount 12% Senior Secured Notes due March 17, 2005 (the "Notes"). In addition, certain tendering
noteholders who have not been paid accrued interest under the Notes will receive an 8% Promissory Note due December 2005 (the "Interest Notes"). 

        B.    The
exchange offer will be made upon the terms and subject to the conditions set forth in the form of Prospectus (the "Prospectus") contained in the
Form S-4 Registration Statement, as amended, filed with the Securities and Exchange Commission (the "Commission") on November 5, 2002 (file number 333-101028)
(the "Registration Statement") and the related Letter of Transmittal filed therewith. 

        C.    Value
Partners currently owns 57.5% of the Company's issued and outstanding common stock, 66.6% of the Company's long-term debt and warrants to purchase an
aggregate of 2,600,000 shares of the Company's common stock. 

        D.    Upon
its review of the Company's Registration Statement, the Commission commented to the Company that Value Partners may be considered a bidder in the exchange offer and
as such is required by to make certain filings with the Commission in accordance with the rules of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). 

        E.    In
order to ensure a timely closing of the exchange offer, Value Partners intends to make filings with the Commission in accordance with the Commission's comment letter. 

        F.    Value
Partners has requested, and the Company and International have agreed to indemnify Value Partners against certain liabilities relating to, arising out of or
resulting from the exchange offer, on the terms set forth in this Agreement. 

        NOW,
THEREFORE, the parties agree as follows: 

        1.    Indemnification.    

        (a)  The
Company and International agree to indemnify and hold harmless Value Partners and Ewing & Partners, its general partner, and each person, if any, who controls
Value Partners or Ewing & Partners within the meaning of Section 15 of the Securities Act of 1933, as amended (the "Securities Act") or Section 20(a) of the Exchange Act, against
any and all losses, liabilities, claims, damages and expenses whatsoever as incurred (including but not limited to attorneys' fees and any and all expenses whatsoever incurred in investigating,
preparing or defending against any litigation, commenced or threatened, or any claim whatsoever, and any and all amounts paid in settlement of any claim or litigation), to which it may become subject
under the Securities Act, the Exchange Act or otherwise, insofar as such losses, liabilities, claims, damages or expenses (or actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the Registration Statement, as originally filed or any amendment thereof, or any related Preliminary Prospectus or the Prospectus,
or in any amendment thereof or supplement thereto, or arise out of or 

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are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading;  provided, however, that the
Company and International will not be liable in any such case to the extent but only to the extent that any such loss,
liability, claim, damage or expense arises out of or is based upon any such untrue statement or alleged untrue statement or omission or alleged omission made therein in reliance upon and in conformity
with written information furnished to the Company by or on behalf of Value Partners expressly for use therein. This indemnification shall be the joint and several obligation of the Company and
International. 

        (b)  Promptly
after receipt by an indemnified party of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under such subsection, notify each party against whom indemnification is to be sought in writing of the commencement thereof (but the failure so to notify an
indemnifying party shall not relieve it from any liability which it may have under this Section, except to the extent such failure prejudiced the indemnifying party). In case any such action is
brought against any indemnified party, and it notifies an indemnifying party of the commencement thereof, the indemnifying party will be entitled to participate therein, and to the extent it may elect
by written notice delivered to the indemnified party promptly after receiving the aforesaid notice from such indemnified party, to assume the defense thereof with counsel reasonably satisfactory to
such indemnified party. Notwithstanding the foregoing, the indemnified party or parties shall have the right to employ its or their own counsel in any such case, but the fees and expenses of such
counsel shall be at the expense of such indemnified party or parties unless (i) the employment of such counsel shall have been authorized in writing by one of the indemnifying parties in
connection with the defense of such action, (ii) the indemnifying parties shall not have employed counsel to have charge of the defense of such action within a reasonable time after notice of
commencement of the action, or (iii) such indemnified party or parties shall have received a written opinion of their counsel concluding that there may be defenses available to it or them which
are different from or additional to those available to one or all of the indemnifying parties (in which case the indemnifying parties shall not have the right to direct the defense of such action on
behalf of the indemnified party or parties), in any of which events such fees and expenses shall be borne by the indemnifying parties. Anything in this subsection to the contrary notwithstanding, an
indemnifying party shall not be liable for any settlement of any claim or action effected without its written consent; provided, however, that such
consent was not unreasonably withheld. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect
of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such
indemnified party from all liability or claims that are the subject matter of such proceeding. 

        2.    Contribution.    In order to provide for contribution in circumstances in which the indemnification provided for
in Section 1 is for any reason held to be unavailable from any indemnifying party or is insufficient to hold harmless a party indemnified
thereunder, then upon the occurrence of such circumstance, the Company and International shall contribute to the aggregate losses, claims, damages, liabilities and expenses of the nature contemplated
by such indemnification provision (including any investigation, legal and other expenses incurred in connection with, and any amount paid in settlement of, any action, suit or proceeding or any claims
asserted) as incurred to which Value Partners may be subject. Notwithstanding the provisions of this Section, no person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section, each person, if
any, who controls Value Partners or Ewing & Partners within the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act shall have the same rights to
contribution as Value Partners. Any party entitled to contribution will, promptly after receipt of notice of commencement of any action, suit or proceeding against such party in respect of 

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which a claim for contribution may be made against another party or parties, notify each party or parties from whom contribution may be sought, but the omission to so notify such party or parties
shall not relieve the party or parties from whom contribution may be sought from any obligation it or they may have under this Section or otherwise, except to the extent such failure prejudiced such
party. No party shall be liable for contribution with respect to any action or claim settled without its consent; provided, however, that such consent
was not unreasonably withheld. 

        3.    Notices.    All communications hereunder, except as may be otherwise specified, shall be in writing and, if sent
to Value Partners, shall be mailed, delivered, or telexed or telegraphed and confirmed in writing, to Ewing & Partners, 4514 Cole Avenue, Dallas, Texas 75205, Attention: Timothy G. Ewing, with
a copy to: Bergman & Bird LLP, 4514 Travis Walk, Suite 300, Dallas, Texas 75205, Attention: Jack R. Bird, Esq.; if sent to the Company and International, shall be mailed, delivered, or
telegraphed and confirmed in writing to Trans World Corporation, 545 Fifth Avenue, Suite 940, New York, New York 10017, Attention: Chief Executive Officer, with a copy to Elias, Matz, Tiernan &
Herrick L.L.P., 734 15th Street, N.W., 12th Floor, Washington, D.C. 20005, Attention: Jeffrey A. Koeppel, Esq. 

        4.    Parties.    This Agreement shall inure solely to the benefit of, and shall be binding upon, Value Partners, the
Company and International, and the controlling persons, directors, officers and others referred to in Sections 1 and 2, and their respective successors
and assigns, and no other person shall have or be construed to have any legal or equitable right, remedy or claim under or in respect of or by virtue of this Agreement or any provision herein
contained. The term "successors and assigns" shall not include a purchaser or acquiror, in its capacity as such, of common stock, Replacement Notes or Interest Notes from the Company. 

        5.    Governing Law.    This Agreement shall be governed by and construed in accordance with the laws of the State of
Delaware for contracts made and to be fully performed in such state without regard to principles of conflicts of law and by the laws of the United States of America. The parties recognize that it is
the position of the U.S. Securities and Exchange Commission that indemnification for violations of the federal securities laws is against public policy as expressed in the Securities Act of 1933, as
amended, and may be unenforceable. 

        6.    Counterparts.    This Agreement may be executed and delivered (including by facsimile transmission) in one or
more counterparts, and by the different parties hereto in separate counterparts, each of which when executed and delivered shall be deemed to be an original but all of which taken together shall
constitute one and the same agreement. 

        7.    Amendment.    This Agreement may not be amended except by an instrument signed by the parties. 

        8.    Waivers.    Either party may (i) extend the time for the performance of any of the obligations or other
act of the other party or (ii) waive compliance with any of the agreements contained herein. No waiver shall be effective unless signed by the parties. No waiver of any term shall be construed
as a subsequent waiver of the same term, or a waiver of any other term, of this Agreement. The failure of any party to assert any of its rights hereunder will not constitute a waiver of any such
rights. 

        9.    Severability.    If any provision of this Agreement is invalid, illegal or incapable of being enforced by any
rule of law or public policy, such provision shall be deemed severable and all other provisions of this Agreement shall nevertheless remain in full force and effect. 

        10.    Headings.    Section headings in this Agreement are included for convenience of reference only and shall not
constitute a part of this Agreement for any other purpose. 

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        IN
WITNESS WHEREOF, the parties have duly executed this Indemnification Agreement as of the date first above written. 

	

 	
 	

VALUE PARTNERS, LTD.
	

 	
 	

By:	
 	

EWING & PARTNERS

as General Partner
	

 	
 	

By:	
 	

/s/  TIMOTHY G. EWING      
 Timothy G. Ewing

Managing General Partner
	

 	
 	

TRANS WORLD CORPORATION
	

 	
 	

By:	
 	

/s/  RAMI S. RAMADAN      
  
	

 	
 	

Name:	
 	

Rami S. Ramadan
  
	

 	
 	

Title:	
 	

Chief Executive Officer
  
	

 	
 	

TWG INTERNATIONAL US CORPORATION
	

 	
 	

By:	
 	

/s/  RAMI S. RAMADAN      
  
	

 	
 	

Name:	
 	

Rami S. Ramadan
  
	

 	
 	

Title:	
 	

Chief Executive Officer
  

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INDEMNIFICATION AGREEMENT

BACKGROUND

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