Document:

exhibit10-2_050709.htm

    
      EXHIBIT
10.2

       

      

    

    AMENDED
AND RESTATED PLEDGE AND SECURITY AGREEMENT

    

    among

    

    

    Arby’s
Restaurant Group, Inc.

    as
a Grantor

    

    and

    

    Arby’s
Restaurant Holdings, LLC

    as
a Grantor

    

    Wendy’s
International Holdings, LLC

    as
a Grantor

    

    Wendy’s
International, Inc.

    as
a Grantor

    

    and

    

    Triarc
Restaurant Holdings, LLC

    as
a Grantor

    

    and

    

    Each
Other Grantor

    From
Time to Time Party Hereto

    

    and

    

    Citicorp
North America, Inc.

    as
Collateral Agent

     

    ________________________________

    

    Dated as
of July 25, 2005

    

    Amended
and Restated as of March 11, 2009

    ________________________________

     

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    TABLE
OF CONTENTS

     

    Page       

    
      
        
          
            
              
                
                  	
                          ARTICLE
      I

                        	
                          DEFINED
      TERMS

                        	2
	
                              Section
      1.1

                        	
                              Definitions

                        	
                          2

                        
	
                              Section
      1.2

                        	
                              Certain
      Other Terms

                        	
                          8

                        
	
                              Section
      1.3

                        	
                              Perfection
      Certificate

                        	
                          9

                        
	 	 	 
	
                          ARTICLE
      II

                        	
                          GRANT
      OF SECURITY INTEREST

                        	9
	
                              Section
      2.1

                        	
                              Collateral

                        	
                          9

                        
	
                              Section
      2.2

                        	
                              Grant
      of Security Interest in Collateral

                        	
                          10

                        
	 	 	 
	
                          ARTICLE
      III

                        	
                          REPRESENTATIONS
      AND WARRANTIES

                        	12
	
                              Section
      3.1

                        	
                              Title;
      No Other Liens

                        	
                          12

                        
	
                              Section
      3.2

                        	
                              Perfection and
      Priority

                        	
                          12

                        
	
                              Section
      3.3

                        	
                              Jurisdiction of
      Organization; Chief Executive Office

                        	
                          13

                        
	
                              Section
      3.4

                        	
                              Inventory and
      Equipment

                        	
                          13

                        
	
                              Section
      3.5

                        	
                              Pledged
      Collateral

                        	
                          13

                        
	
                              Section
      3.6

                        	
                              Accounts

                        	
                          14

                        
	
                              Section
      3.7

                        	
                              Intellectual
      Property

                        	
                          14

                        
	
                              Section
      3.8

                        	
                              Deposit
      Accounts, Securities Accounts and Commodity Accounts

                        	
                          15

                        
	
                              Section
      3.9

                        	
                              Commercial Tort
      Claims

                        	
                          15

                        
	 	 	 
	
                          ARTICLE
      IV

                        	
                          COVENANTS

                        	15
	
                              Section
      4.1

                        	
                              Generally

                        	
                          15

                        
	
                              Section
      4.2

                        	
                              Maintenance of
      Perfected Security Interest; Further Documentation

                        	
                          16

                        
	
                              Section
      4.3

                        	
                              Changes
      in Locations, Name, Etc.

                        	
                          16

                        
	
                              Section
      4.4

                        	
                              Pledged
      Collateral

                        	
                          17

                        
	
                              Section
      4.5

                        	
                              Accounts

                        	
                          18

                        
	
                              Section
      4.6

                        	
                              Delivery of
      Instruments and Chattel Paper

                        	
                          19

                        
	
                              Section
      4.7

                        	
                              Intellectual
      Property

                        	
                          19

                        
	
                              Section
      4.8

                        	
                              Vehicles

                        	
                          21

                        
	
                              Section
      4.9

                        	
                              Payment
      of Obligations

                        	
                          21

                        
	
                              Section
      4.10

                        	
                              Notice
      of Commercial Tort Claims

                        	
                          21

                        
	
                              Section
      4.11

                        	
                              Letter
      of Credit Rights

                        	
                          22

                        
	 	 	 
	
                          ARTICLE
      V

                        	
                          REMEDIAL
      PROVISIONS

                        	22
	
                              Section
      5.1

                        	
                              Code
      and Other Remedies

                        	
                          22

                        
	
                              Section
      5.2

                        	
                              Accounts and
      Payments in Respect of General Intangibles

                        	
                          23

                        
	
                              Section
      5.3

                        	
                              Pledged
      Collateral

                        	
                          24

                        
	
                              Section
      5.4

                        	
                              Application of
      Proceeds of Collateral and Other Payments

                        	
                          25

                        
	
                              Section
      5.5

                        	
                              Registration
      Rights

                        	
                          26

                        
	
                              Section
      5.6

                        	
                              Deficiency

                        	
                          27

                        

                

              

            

          

        

      

    

     

    
      
        

         

        i 

      

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    
      	
              ARTICLE
      VI

            	
              The
      Collateral Agent

            	
              27

            
	
                  Section
      6.1

            	
                  Collateral
      Agent’s Appointment as Attorney-in-Fact

            	
              27

            
	
                  Section
      6.2

            	
                  Duty of
      Collateral Agent

            	
              29

            
	
                  Section
      6.3

            	
                  Authorization
      of Financing Statements

            	
              29

            
	
                  Section
      6.4

            	
                  Authority of
      Collateral Agent

            	
              30

            

    

    
      
        	 	 	 
	
                ARTICLE
      VII

              	
                MISCELLANEOUS

              	30
	
                    Section
      7.1

              	
                    Amendments in
      Writing

              	
                30

              
	
                    Section
      7.2

              	
                    Notices

              	
                30

              
	
                    Section
      7.3

              	
                    No
      Waiver by Course of Conduct; Cumulative Remedies

              	
                30

              
	
                    Section
      7.4

              	
                    Successors and
      Assigns

              	
                31

              
	
                    Section
      7.5

              	
                    Counterparts

              	
                31

              
	
                    Section
      7.6

              	
                    Severability

              	
                31

              
	
                    Section
      7.7

              	
                    Section
      Headings

              	
                31

              
	
                    Section
      7.8

              	
                    Entire
      Agreement

              	
                31

              
	
                    Section
      7.9

              	
                    Governing
      Law

              	
                31

              
	
                    Section
      7.10

              	
                    Additional
      Grantors

              	
                32

              
	
                    Section
      7.11

              	
                    Release
      of Collateral

              	
                32

              
	
                    Section
      7.12

              	
                    Reinstatement

              	
                32

              
	
                    Section
      7.13

              	
                    Termination

              	
                33

              
	
                    Section
      7.14

              	
                    Obligations
      Absolute

              	
                33

              

      

    

    

    

    
      	
               
      

            	
              ANNEXES
      AND SCHEDULES

            

    

     

    
      	
               
      

            	
              Annex 1

            	
              Form
      of Deposit Account Control
Agreement

            

    

    
      	
               
      

            	
              Annex 2

            	
              Form
      of Securities Account Control
Agreement

            

    

    
      	
               
      

            	
              Annex 3

            	
              Form
      of Pledge Amendment

            

    

    
      	
               
      

            	
              Annex 4

            	
              Form
      of Joinder Agreement

            

    

    
      
        	
                 
      

              	
                Annex 5

              	
                Form
      of Short Form Intellectual Property Security Agreement

              
	 	 	 
	 	Schedule
      32	Exclusions
      to Perfection 

      

    

     

    
      
 

    

    
      
        
          

           

          ii

        

         

      

      
         

        
          

        

      

      
         

      

    

    Pledge and
Security Agreement, dated
as of July 25, 2005 and amended and restated as of March 11, 2009, by Arby’s
Restaurant Group, Inc., a Delaware corporation (“Borrower”), Arby’s Restaurant
Holdings, LLC, a Delaware limited liability company (“Holdco Co-Borrower”), Wendy’s
International, Inc., an Ohio corporation (“WII Co-Borrower”), Wendy’s
International Holdings, LLC, a Delaware limited liability company (“Ultimate Parent Co-Borrower”
and together with Holdco Co-Borrower, WII Co-Borrower and Borrower, “Borrowers”), Triarc Restaurant
Holdings, LLC, a Delaware limited liability company (“Parent”) and each of the other
entities listed on the signature pages hereof or that becomes a party hereto
pursuant to Section 7.10
hereof (each a “Grantor”
and collectively, together with Holdco Co-Borrower, Ultimate Parent Co-Borrower,
WII Co-Borrower, Parent and Borrower, the “Grantors”), in favor of
Citicorp North America, Inc. (“CNAI”), as collateral agent
for the Secured Parties (in such capacity, the “Collateral
Agent”).

     

    W
i t n e s s e t h:

     

    Whereas,
pursuant to the credit agreement dated as of July 25, 2005 (as amended up to,
but not including, the date hereof, the “Original
Credit Agreement”), among Holdco Co-Borrower, Parent, Borrower, CNAI as
administrative agent, the Lenders and Issuer party thereto, the Collateral
Agent, Bank of America, N.A. and Credit Suisse, Cayman Islands Branch, as
co-syndication agents, and Wachovia Bank, National Association, SunTrust Bank
and GE Capital Franchise Finance Corporation, as co-documentation agents, the
Lenders and the Issuer severally agreed to make extensions of credit to Holdco
Co-Borrower and Borrower upon the terms and subject to the conditions set forth
therein;

     

    Whereas,
the Grantors other than Borrower are party to the Guaranty pursuant to which
they guaranteed the Secured Obligations; and

     

    Whereas,
it was a condition precedent to the obligation of the Lenders and the Issuer to
make their respective extensions of credit to Holdco Co-Borrower and Borrower
under the Original Credit Agreement that the Grantors shall have executed and
delivered that certain pledge and security agreement, dated as of July 25, 2005,
among Borrower, Holdco Co-Borrower, Parent, and each of the other entities
listed on the signature pages thereof or that became a party thereto in favor of
CNAI as collateral agent prior to the Restatement Effective Date (the “Original
Security Agreement”);

     

    Whereas,
pursuant to Section
11.1 of the Original Credit Agreement, the Original Credit Agreement is
being amended and restated concurrently with the Restatement Effective Date with
the consent of the Requisite Lenders under the Original Credit
Agreement.

     

    Whereas,
it is a condition precedent to extensions of credit under the Credit
Agreement (defined below) that each Grantor shall have executed and delivered to
the Collateral Agent this Agreement;

     

    Whereas,
pursuant to Section
7.1 of the Original Security Agreement, the Original Security Agreement
is being amended and restated concurrently with the Restatement Effective Date
with the consent of the Requisite Lenders under the Original Credit
Agreement;

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Now,
therefore, in consideration of the foregoing and to induce the Lenders, the
Issuer, the Collateral Agent, and the other Agents to enter into the Credit
Agreement and to induce certain Lenders and the Issuer to make their respective
extensions of credit to Holdco Co-Borrower, Ultimate Parent Co-Borrower, WII
Co-Borrower and Borrower thereunder, each Grantor hereby agrees with the
Collateral Agent to amend and restate the Original Security Agreement as
follows:

     

    
      	
               
      

            	
              ARTICLE
      I

            	
              Defined
      Terms

            

    

     

    
      	
               
      

            	
              Section
      1.1

            	
              Definitions

            

    

     

    (a)           Unless
otherwise defined herein, terms defined in the Credit Agreement and used herein
have the meanings given to them in the Credit Agreement.

     

    (b)           Terms
used herein without definition that are defined in the UCC have the meanings
given to them in the UCC, including the following terms (which are capitalized
herein):

     

    “Account”

    “Account Debtor”

    “Certificated
Security”

    “Chattel Paper”

    “Commercial Tort
Claim”

    “Commodity
Account”

    “Control Account”

    “Deposit Account”

    “Documents”

    “Entitlement
Holder”

    “Entitlement
Order”

    “Equipment”

    “Financial Asset”

    “General
Intangible”

    “Goods”

    “Instruments”

    “Inventory”

    “Investment
Property”

    “Letter-of-Credit
Right”

    “Letters of
Credit”

    “Proceeds”

    “Securities
Account”

    “Securities
Intermediary”

    “Security”

    “Security
Entitlement”

    “Supporting
Obligations”

     

    
      
         

      

      
        -2-

        
          

        

      

      
         

      

    

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

     

    “2011/2014 Indenture” means
that certain Indenture, dated as of November 13, 2001, entered into by WII
Co-Borrower in connection with the issuance of the 2011 Notes and the 2014
Notes, together with all instruments and other agreements entered into by WII
Co-Borrower in connection therewith.

    

    “2011 Notes” means the 6.250%
Senior Notes due 2011, issued under the 2011/2014 Indenture.

    

    “2014 Notes” means the 6.20%
Senior Notes due 2014, issued under the 2011/2014 Indenture.

    

    “2025 Debentures” means the
7.00% Debentures due 2025, issued under the 2025 Indenture.

    

    “2025 Indenture” means that
certain Indenture, dated as of December 14, 1995, entered into by WII
Co-Borrower in connection with the issuance of the 2025 Debentures, together
with all instruments and other agreements entered into by WII Co-Borrower in
connection therewith.

    

     “Additional Pledged Collateral”
means any Pledged Collateral acquired by any Grantor after the Restatement
Effective Date and in which a security interest is granted pursuant to Section 2.2,
including, to the extent a security interest is granted therein pursuant to
Section 2.2,
(i) all Stock and Stock Equivalents of any Person that are acquired by any
Grantor after the Restatement Effective Date, together with all certificates,
instruments or other documents representing any of the foregoing and all
Security Entitlements of any Grantor in respect of any of the foregoing,
(ii) all additional Indebtedness from time to time owed to any Grantor by
any obligor on the Pledged Debt Instruments and the Instruments evidencing such
Indebtedness and (iii) all interest, cash, Instruments and other property
or Proceeds from time to time received, receivable or otherwise distributed in
respect of or in exchange for any of the foregoing.  “Additional Pledged Collateral”
may be General Intangibles, Instruments or Investment Property.

     

    “Agreement” means this Amended
and Restated Pledge and Security Agreement, as the same may be amended,
restated, supplemented or otherwise modified from time to time.

     

    “Collateral” has the meaning
specified in Section 2.1.

     

    “Copyright Licenses” means any
written agreement naming any Grantor as licensor or licensee granting any right
under any Copyright, including the grant of any right to reproduce, copy,
publicly perform, create derivative works, distribute, display, transmit, sue,
receive proceeds and damages thereunder, exploit or sell materials derived from
any Copyright, or otherwise exploit rights under any Copyright.

     

    “Copyrights” means (a) all
copyrights arising under the laws of the United States, any other country or any
political subdivision thereof (or any treaty or international organization or
body or political subdivision thereof), whether registered or unregistered and
whether published or unpublished, all registrations and recordings thereof and
all applications in 

     

    
      
         

      

      
        -3-

        
          

        

      

      
         

      

    

    connection
therewith, including all registrations, recordings and applications in the
United States Copyright Office or in any foreign counterparts thereof, and
(b) the right to obtain all renewals thereof.

     

    “Credit Agreement” means the
amended and restated credit agreement, dated as of the Restatement Effective
Date, among Borrower, Holdco Co-Borrower, WII Co-Borrower, Ultimate Parent
Co-Borrower, Parent, the Lenders party thereto, CNAI, as administrative agent
for the Lenders and the Issuers and as collateral agent for the Secured Parties,
Bank of America, N.A. and Credit Suisse, Cayman Islands Branch, as
co-syndication agents for the Lenders and the Issuers, Wachovia Bank, National
Association, Suntrust Bank and GE Capital Franchise Finance Corporation, as
co-documentation agents for the Lenders and the Issuers, as the same may be
amended, restated, supplemented or otherwise modified from time to
time.

     

    “Deposit Account Control
Agreement” means a letter agreement, substantially in the form of Annex 1 (with
such changes as may be agreed to by the Collateral Agent) or such other form as
agreed to by the Collateral Agent, executed by the Grantor, the Collateral Agent
and the relevant financial institution.

     

    “Excluded Equity” means (i) any
Voting Stock in excess of 65% of the total outstanding Voting Stock of any
Foreign Non-Guarantor that is a direct Subsidiary of a Loan Party and all stock
of any Foreign Non-Guarantor that is not a direct Subsidiary of a Loan Party,
(ii) the Stock of PVAC, LLC, so long as the Constituent Documents of PVAC, LLC
would prohibit the pledge of such Stock hereunder, (iii) the Stock of WNAP, (iv)
the Stock of Foreign Non-Guarantors that are Subsidiaries of WII Co-Borrower if
and only so long as such Subsidiaries are Immaterial Subsidiaries and (v) the
Stock of Pasta Pomodoro, Inc., so long as the pledge of such Stock would
constitute a “Qualified Transfer” under the Certificate of Designations of
Series C Preferred Stock referred to in the Third Amended and Restated
Stockholders’ Agreement, dated as of October 12, 2004, by and among Pasta
Pomodoro, Inc. and the stockholders listed on the signature pages
thereof.  For the purposes of this definition, “Voting Stock” means, as to any
issuer, the issued and outstanding shares of each class of capital stock or
other ownership interests of such issuer entitled to vote (within the meaning of
Treas. Reg. Section 1.956-2(c)(2)).

     

    “Excluded Property” means,
collectively, (i) Excluded Equity, (ii) any permit, lease, license, contract,
instrument or other agreement (including, without limitation, internet domain
names) held by any Grantor that prohibits or requires the consent of any Person
other than Borrowers and their Affiliates as a condition to the assignment
thereof or to the creation by such Grantor of a Lien thereon, or any permit,
lease, license, contract or other agreement held by any Grantor to the extent
that any Requirement of Law applicable thereto prohibits the creation of a Lien
thereon or the assignment thereof, but only, in each case, to the extent, and
for so long as, such prohibition is not terminated or rendered unenforceable or
otherwise deemed ineffective by the UCC or any other Requirement of Law, (iii)
Equipment owned by any Grantor that is subject to a purchase money Lien
(including, for the avoidance of doubt, in connection with purchase money
financings of Equipment entered into within 180 days after the purchase thereof
so long as the Lien in respect thereof is otherwise permitted under the Credit
Agreement) or a Capital Lease, in each case, permitted under the Credit
Agreement, if the contract or other agreement in which such Lien is granted (or
the documentation providing for such Capital Lease) prohibits, 

     

    
      
         

      

      
        -4-

        
          

        

      

      
         

      

    

    or
requires the consent of any Person other than Borrowers and their Affiliates as
a condition to, the creation of any other Lien on such Equipment, or establishes
any other condition for an assignment thereof that cannot be satisfied without
involving, or granting benefits to, a party other than the Borrowers and their
Affiliates, (iv) any Deposit Account or Securities Account established by one or
more Grantors for the sole purpose of depositing funds (or Cash Equivalents) in
connection with the discharge of the 2011 Notes as contemplated by the Credit
Agreement, (v) each U.S. application to register any Trademark prior to the
filing under applicable law of a verified statement of use (or equivalent) for
such Trademark, (vi) any Investment Property, Pledged Stock or Pledged Debt
Instrument or joint venture or similar agreement to the extent that a grant of a
security interest in such Investment Property, Pledged Stock or Pledged Debt
Instrument or agreement pursuant to this Agreement would be prohibited by or
requires any consent under the Joint Venture Agreement, dated as of April 18,
1990, between Wendy’s International, Inc. and Wyoming Realty, Inc. establishing
Wendcreek Venture, provided that such security interest shall attach immediately
at such time as the prohibition ceases to be in effect or such consent is
obtained and (vii) with respect to the New Entities, any aircraft; provided, however, that “Excluded
Property” listed in clauses (i), (ii), (v) and (vi) above shall not include any
Proceeds, substitutions or replacements of Excluded Property (unless such
Proceeds, substitutions or replacements would constitute Excluded
Property).

     

    “Indenture Threshold Amount”
has the meaning specified in Section
2.2.

     

    “Intellectual Property” means,
collectively, all rights, priorities and privileges of any Grantor, whether
arising under United States, multinational or foreign laws or otherwise, with
respect to Copyrights, Copyright Licenses, Patents, Patent Licenses, Trademarks,
Trademark Licenses, trade secrets and Internet domain names, and all rights to
sue at law or in equity for any rights thereunder (including, without
limitation, infringement, invalidity, dilution or other impairment thereof),
including the right to receive all proceeds and damages therefrom.

     

    “LLC” means each limited
liability company in which a Grantor has an interest, including those set forth
on Schedule 10(a)
and Schedule
10(b) to the Perfection Certificate.

     

    “LLC Agreement” means each
operating agreement with respect to a LLC, as each agreement has heretofore
been, and may hereafter be, amended, restated, supplemented or otherwise
modified from time to time.

     

    “Limited Entities” means the
collective reference to Scioto Insurance Company, a Vermont corporation, and
Oldemark LLC, a Vermont limited liability company, each a “Limited Entity,” in each case,
so long as and only so long as (i) Scioto Insurance Company is regulated as a
captive insurance company pursuant to chapter 141 of the Vermont Statutes
Annotated or successor statute, or other similar statute as may apply in the
event such entity changes its state of domicile, and (ii) in the case of
Oldemark LLC, (in addition to (i)) it is an asset of Scioto Insurance
Company.

     

    “Material Intellectual
Property” means Intellectual Property owned by or licensed to a Grantor
and material to the conduct of any Grantor’s business.

     

    
      “Original Credit Agreement” has
the meaning specified in the recitals hereto.

    

    
      
         

      

      
        -5-

        
          

        

      

      
         

      

    

     

    “Original Security Agreement”
has the meaning specified in the recitals hereto.

     

    “paid in full” and “payment in full” mean, with
respect to any Secured Obligation, the occurrence of all of the
following:  (a) with respect to such Secured Obligations other
than (i) contingent indemnification obligations, Hedging Contract
Obligations and Cash Management Obligations not then due and payable and
(ii) to the extent covered by clause (b) below, obligations with
respect to undrawn Letters of Credit, payment in full thereof in cash (or
otherwise to the written satisfaction of the Secured Parties owed such Secured
Obligations), (b) with respect to any undrawn Letter of Credit, the
obligations under which are included in such Secured Obligations, (i) the
cancellation thereof and payment in full of all resulting Secured Obligations
pursuant to clause (a) above or (ii) the receipt of cash collateral
(or a backstop letter of credit in respect thereof on terms acceptable to the
applicable Issuer of the Letters of Credit and the Administrative Agent) in an
amount at least equal to 102% of the Letter of Credit Obligations for such
Letter of Credit and (c) if such Secured Obligations consist of all the
Secured Obligations under one or more Facilities, termination of all Commitments
and all other obligations of the Secured Parties in respect of such Facilities
under the Loan Documents.

     

    “Partnership” means each
partnership in which a Grantor has an interest, including those set forth on
Schedule 10(a)
and Schedule
10(b) to the Perfection Certificate.

     

    “Partnership Agreement” means
each partnership agreement governing a Partnership, as each such agreement has
heretofore been, and may hereafter be, amended, restated, supplemented or
otherwise modified from time to time.

     

    “Patents” means (a) all patents
issued by the United States, any other country or any political subdivision
thereof (or any treaty or international organization or body or political
subdivision thereof) and all reissues and extensions thereof, (b) all patent
applications in the United States or any other country or any political
subdivision thereof (or any treaty or international organization or body or
political subdivision thereof) and all divisionals, continuations,
continuations-in-part, re-issues and extensions thereof and (c) all rights to
obtain any reissues or extensions of any of the foregoing.

     

    “Patent License” means any
written or material oral agreement providing for the grant by or to any Grantor
of any right under a Patent, including the right to manufacture, have
manufactured, use, import, sell or offer for sale any invention covered in whole
or in part by a Patent, including the right to sue and receive all proceeds
thereunder.

     

    “Perfection Certificate” means
the Perfection Certificate, dated as of the Restatement Effective Date, executed
by each of the Grantors and delivered to the Collateral Agent.

     

    “Pledged Certificated Stock”
means all Certificated Securities and any other Stock and Stock Equivalent of a
Person evidenced by a certificate, Instrument or other equivalent document, in
each case owned by any Grantor, including all Stock listed on Schedule 10(a)
or Schedule
10(b) to the Perfection Certificate other than Excluded
Equity.

     

    “Pledged
Collateral” means, collectively, the Pledged Stock, Pledged Debt
Instruments, any other 

    
 

    
      
        
           

        

        
          -6-

          
            

          

        

        
           

        

      

    

    

    Investment
Property of any Grantor, all chattel paper, certificates or other Instruments
representing any of the foregoing and all Security Entitlements of any Grantor
in respect of any of the foregoing.  Pledged Collateral may, without
limitation, be General Intangibles, Instruments or Investment
Property.

     

    “Pledged Debt Instruments”
means all Instruments evidencing any Indebtedness owed to such Grantor,
including all Indebtedness described on Schedule 11 to the
Perfection Certificate, issued by the obligors named therein.

     

    “Pledged Stock” means all
Pledged Certificated Stock and all Pledged Uncertificated Stock.  For
purposes of this Agreement, the term “Pledged Stock” shall not include any
Excluded Equity.

     

    “Pledged Uncertificated Stock”
means any Stock or Stock Equivalent of any Person that is not a Pledged
Certificated Stock, including all right, title and interest of any Grantor as a
limited or general partner in any Partnership or as a member of any LLC and all
right, title and interest of any Grantor in, to and under any Partnership
Agreement or LLC Agreement to which it is a party.

     

    “Restatement Effective Date”
means March 11, 2009.

     

    “Restricted Property” has the
meaning specified in Section
2.2.

     

     “Securities Account Control
Agreement” means a letter agreement, substantially in the form of Annex 2 (with
such changes as may be agreed to by the Collateral Agent) or such other form as
agreed to by the Collateral Agent, executed by the relevant Grantor, the
Collateral Agent and the relevant Approved Securities Intermediary.

     

    “Securities Act” means the U.S.
Securities Act of 1933, as amended.

     

    “Senior Note Indentures” means
the 2011/2014 Indenture and the 2025 Indenture.

     

    “Senior Notes” means the 2011
Notes, the 2014 Notes and the 2025 Debentures.

     

    “Trademark License” means any
written or material oral agreement providing for the grant by or to any Grantor
of any right to use any Trademark, including, without limitation, the right to
sue and receive proceeds and damages thereunder.

    

    “Trademarks” means (a) all
trademarks, trade names, corporate names, company names, business names,
fictitious business names, trade styles, service marks, designs, logos and other
source or business identifiers, and, in each case, all goodwill associated
therewith, whether now existing or hereafter adopted or acquired, all
registrations and recordings thereof and all applications in connection
therewith, in each case whether in the United States Patent and Trademark Office
or in any similar office or agency of the United States, any State thereof or
any other country or any political subdivision thereof (or any treaty or
international organization or body or political
subdivision thereof), and all common-law rights related thereto, and
(b) the right to obtain all renewals thereof.

     

    
      
         

      

      
        -7-

        
          

        

      

      
         

      

    

     

    “UCC” means the Uniform
Commercial Code as from time to time in effect in the State of New York; provided, however, that, in the event
that, by reason of mandatory provisions of law, any of the attachment,
perfection or priority of the Collateral Agent’s and any Secured Party’s
security interest in any Collateral is governed by the Uniform Commercial Code
as in effect in a jurisdiction other than the State of New York, the term “UCC”
shall mean the Uniform Commercial Code as in effect in such other jurisdiction
for purposes of the provisions hereof relating to such attachment, perfection or
priority and for purposes of definitions related to such
provisions.

     

    “Vehicles” means all vehicles
covered by a certificate of title law of any state.

     

    “Vermont Commissioner” means
the Commissioner of the Vermont Department of Banking, Insurance, Securities
& Health Care Administration.

     

    “WNAP” means Wendy’s National
Advertising Program, Inc., an Ohio corporation.

     

    
      	
               
      

            	
              Section
      1.2

            	
              Certain
      Other Terms

            

    

     

    (a)           In
this Agreement, in the computation of periods of time from a specified date to a
later specified date, the word “from” means “from and including” and the words
“to” and “until” each mean “to but excluding” and the word “through” means “to
and including.”

     

    (b)           The
terms “herein,” “hereof,” “hereto” and “hereunder” and similar terms refer to
this Agreement as a whole and not to any particular Article, Section, subsection
or clause in this Agreement.

     

    (c)           References
herein to an Annex, Schedule, Article, Section, subsection or clause refer to
the appropriate Annex or Schedule to, or Article, Section, subsection or clause
in this Agreement, unless otherwise specified.

     

    (d)           The
meanings given to terms defined herein shall be equally applicable to both the
singular and plural forms of such terms.

     

    (e)           Where
the context requires, provisions relating to any Collateral, when used in
relation to a Grantor, shall refer to such Grantor’s Collateral or any relevant
part thereof.

     

    (f)           Any
reference in this Agreement to a Loan Document shall include all appendices,
exhibits and schedules thereto, and, unless specifically stated otherwise all
amendments, restatements, supplements or other modifications thereto, and as the
same may be in effect at any time such reference becomes operative.

     

    (g)           The
term “including” means “including without limitation” except when used in the
computation of time periods.

     

    
      (h)           The
terms “Lender,” “Issuer,” “Administrative Agent,” “Collateral Agent,” “Agent” and
“Secured Party”
include their respective successors.

    

    
      
         

      

      
        -8-

        
          

        

      

      
         

      

    

     

    (i)           References
in this Agreement to any statute shall be to such statute as amended or modified
and in effect from time to time.

     

    
      	
               
      

            	
              Section
      1.3

            	
              Perfection
      Certificate

            

    

     

    The
parties hereto agree that the Perfection Certificate and all descriptions of
Collateral, schedules, amendments and supplements thereto are incorporated
herein and shall at all times remain a part of this Agreement.

     

    
      	
               
      

            	
              ARTICLE
      II

            	
              Grant
      of Security Interest

            

    

     

    
      	
               
      

            	
              Section
      2.1

            	
              Collateral

            

    

     

    For the
purposes of this Agreement, all of the following property now owned or at any
time hereafter acquired by a Grantor or in which a Grantor now has or at any
time in the future may acquire any right, title or interests is collectively
referred to as the “Collateral”:

     

    (a)           all
Accounts;

     

    (b)           all
Chattel Paper;

     

    (c)           all
Deposit Accounts;

     

    (d)           all
Documents;

     

    (e)           all
Equipment;

     

    (f)           all
General Intangibles;

     

    (g)           all
Instruments;

     

    (h)           all
Intellectual Property, other than intent-to-use applications until such
applications mature into registered trademarks;

     

    (i)           all
Inventory;

     

    (j)           all
Investment Property;

     

    (k)           all
Letter-of-Credit Rights;

     

    (l)           all
Vehicles;

     

    (m)           the
Commercial Tort Claims described on Schedule 13 to the
Perfection Certificate or of which the Collateral Agent is notified pursuant to
Section 4.10;

     

    (n)           to
the extent determined to be the property of any Grantor, the Escrow Account and
all interests in items in the Escrow Account;

     

    (o)           all
Supporting Obligations;

    
      
         

      

      
        -9-

        
          

        

      

      
         

      

    

     

    (p)           all
books and records pertaining to the other property described in this Section 2.1;

     

    (q)           all
property of any Grantor held by the Collateral Agent (including in its capacity
as Escrow Agent under the Escrow Agreement) or any other Secured Party,
including all property of every description, in the possession or custody of or
in transit to the Collateral Agent or such Secured Party for any purpose,
including safekeeping, collection or pledge, for the account of such Grantor or
as to which such Grantor may have any right or power;

     

    (r)           all
other Goods and personal property of such Grantor, whether tangible or
intangible and wherever located; and

     

    (s)           to
the extent not otherwise included, all Proceeds of any of the
foregoing;

    

    provided, however, (i) that
“Collateral” shall not include any Excluded Property and (ii) that if and when
any property shall cease to be Excluded Property, such property shall be deemed
at all times from and after the date of the Original Security Agreement to
constitute Collateral.

     

    In
addition, notwithstanding any of the other provisions set forth in this Article II or
anything else contained in this Agreement or any other Loan Document, the amount
of all Secured Obligations secured by the Limited Entities’ assets shall not at
any time in the aggregate exceed the lesser of (i) $200,000,000 and (ii) 90% of
the excess, as reflected on the Limited Entities’ most recent audited financial
statements as of the date of determination of the Limited Entities’ liabilities
hereunder, of the Limited Entities’ total assets (including any note receivable
from an affiliate, but only to the extent that a demand on such note receivable
has been made and has been satisfied since the date of the Limited Entities’
most recent audited financial statements) over the Limited Entities’ total
liabilities.

     

    Notwithstanding
anything herein or in any other Loan Document to the contrary, it is hereby
acknowledged and agreed that (a) the perfection and priority of the security
interests granted by the Limited Entities, (b) the delivery of any Collateral by
the Limited Entities to the Collateral Agent and (c) if it would result in an
impairment of surplus of the Limited Entities to the extent that the surplus is
less than the amount prescribed by the Vermont Commissioner pursuant to Section
6004(b) of Title 8 of the Vermont Statutes Annotated, the enforcement of rights
and remedies of the Secured Parties are, in each case, subject to the prior
consent of the Vermont Commissioner.

     

    
      	
               
      

            	
              Section
      2.2

            	
              Grant
      of Security Interest in Collateral

            

    

     

    Each
Grantor that is not a New Entity hereby confirms its mortgage, pledge,
hypothecation and grant of a security interest in all of its right title and
interest in the Collateral to the Collateral Agent for the benefit of the
Secured Parties pursuant to the Original Security Agreement.  Each
Grantor, as collateral security for the full, prompt and complete payment and
performance when due (whether at stated maturity, by acceleration or otherwise)
of the Secured Obligations of such Grantor, hereby mortgages, pledges and
hypothecates to the Collateral Agent for the benefit of the Secured Parties, and
grants to the Collateral Agent for the benefit of the Se-

     

    
      
         

      

      
        -10-

        
          

        

      

      
         

      

    

    cured
Parties a lien on and security interest in, all of its right, title and interest
in, to and under the Collateral; provided, however, that if
and when any property of a Grantor that at any time constituted Excluded
Property becomes Collateral, the Collateral Agent shall have, and at all times
from and after the date of the Original Security Agreement, be deemed to have
had, a lien on and security interest in such property.

     

    This
Agreement amends and restates the Original Security Agreement.  The
obligations of the Grantors under the Original Security Agreement and the grant
of security interest in the Collateral by the Grantors under the Original
Security Agreement shall continue under this Agreement and shall not in any
event be terminated, extinguished or annulled, but shall hereafter be governed
by this Agreement.  It is understood and agreed that the Original
Security Agreement is being amended and restated by entry into this Agreement by
the consent of the Requisite Lenders under the Original Credit Agreement in
accordance with Section 7.1 of the
Original Security Agreement and in connection with their approval of the
amendment and restatement of the Original Credit Agreement on the Restatement
Effective Date.  All references in other Loan Documents to the
“Security Agreement” shall refer to this Agreement.

     

    Notwithstanding
any of the other provisions set forth in this Article II or anything else
contained in this Agreement or any other Loan Document, the aggregate amount of
all Secured Obligations secured under the Collateral Documents by Principal
Property (as defined in each Senior Note Indenture) or any shares of capital
stock or evidences of Indebtedness (as defined in each Senior Note Indenture)
issued by any Domestic Subsidiary (as defined in each Senior Note Indenture) and
owned by Wendy’s International, Inc. or any Domestic Subsidiary (as defined in
each Senior Note Indenture) (collectively, the “Restricted Property”) shall
not, at any time, exceed the aggregate amount (such amount, the “Indenture Threshold Amount”)
of Indebtedness (as defined in each Senior Note Indenture) that may be secured
by Restricted Property under each Senior Note Indenture, determined in
accordance with the terms of each Senior Note Indenture, without requiring
holders of the applicable Senior Notes to be equally and ratably secured in
accordance with the terms of such Senior Note Indenture.  It is
understood and acknowledged by the parties hereto (including, by its acceptance
of the benefit of this Agreement, each Secured Party) that (v) as of the
Restatement Effective Date, the total amount of Secured Obligations is in excess
of the Indenture Threshold Amount as of the Restatement Effective Date, (w) from
time to time after the Restatement Effective Date, the total amount of the
Secured Obligations may be in excess of the Indenture Threshold Amount then in
effect, (x) as of the Restatement Effective Date, the Secured Obligations in
excess of the Indenture Threshold Amount are not secured by any Restricted
Property hereunder or under any other Collateral Document, (y) at any time after
the Restatement Effective Date, any Secured Obligations in excess of the
Indenture Threshold Amount in effect at such time shall not be secured by any
Restricted Property hereunder or under any other Collateral Document and (z) in
no event shall any Lien (as defined in each Senior Note Indenture) on any
Restricted Property in favor of any Secured Party  created hereunder
or under any other Collateral Document at any time secure any Secured
Obligations in excess of the Indenture Threshold Amount then in
effect.  For the avoidance of doubt, the calculation of the Indenture
Threshold Amount at any date of determination shall take into account all
outstanding Attributable Value (as defined in each Senior Note Indenture) of all
Sale and Lease-Back Transactions (as defined in each Senior Note Indenture)
permitted pursuant to the last paragraph of Section 1009 of each Senior Note
Indenture as of such date 

     

    
      
         

      

      
        -11-

        
          

        

      

      
         

      

    

    and all
Indebtedness (as defined in each Senior Note Indenture) of Wendy’s
International, Inc. and its Domestic Subsidiaries (as defined in each Senior
Note Indenture) secured by Liens (as defined in each Senior Note Indenture)
permitted pursuant to the last paragraph of Section 1008 of each Senior Note
Indenture as of such date.

     

    
      	
               
      

            	
              ARTICLE
      III

            	
              Representations
      and Warranties

            

    

     

    To induce
the Lenders, the Issuer, the Collateral Agent and the other Agents to enter into
the Credit Agreement, each Grantor hereby represents and warrants each of the
following to the Collateral Agent, the Lenders, the Issuer and the other Secured
Parties:

     

    
      	
               
      

            	
              Section
      3.1

            	
              Title;
      No Other Liens

            

    

     

    Except
for Liens granted to the Collateral Agent pursuant to this Agreement and the
other Liens permitted to exist on the Collateral under the Credit Agreement,
such Grantor (a) is the record and beneficial owner of the Pledged
Collateral pledged by it hereunder constituting Certificated Securities, (b) is
the owner of the Pledged Collateral pledged by it hereunder constituting
Instruments, (c) is the Entitlement Holder of all such Pledged Collateral
constituting Investment Property held in a Securities Account and (d) subject to
the last sentence of Section 2.1, has
rights in or the power to transfer each other item of Collateral in which a Lien
is granted by it hereunder, free and clear of any other Lien.

     

    
      	
               
      

            	
              Section
      3.2

            	
              Perfection
      and Priority

            

    

     

    The
security interests granted pursuant to this Agreement shall constitute valid
and, except as set forth in Schedule 3.2,
continuing perfected security interests in favor of the Collateral Agent in the
Collateral for which perfection is governed by the UCC or filing with the United
States Patent and Trademark Office or the United States Copyright Office upon
(i) in the case of all Collateral in which a security interest may be
perfected by filing a financing statement under the UCC, the timely and proper
completion of the filings and other actions specified on Schedules 6 and 12(c)
to the Perfection Certificate (which, in the case of all filings and other
documents referred to on such schedules, have been delivered to the Collateral
Agent in completed and duly executed form), (ii) the delivery to the
Collateral Agent of all Collateral consisting of Instruments and Certificated
Securities, in each case properly endorsed for transfer to the Collateral Agent
or in blank, (iii) the execution of Securities Account Control Agreements
with respect to all Securities Accounts, (iv) the execution of Deposit
Account Control Agreements with respect to all Deposit Accounts of a Grantor,
(v) in the case of Collateral in which a security interest may be perfected
by filing with the United States Patent and Trademark Office, filing of a
short-form security agreement in the form attached hereto as Annex 5 with the
United States Patent and Trademark Office and (vi) in the case of Collateral in
which a security interest may be perfected by filing with the United States
Copyright Office, filing of a short-form security agreement in the form attached
hereto as Annex
5 with the United States Copyright Office.  Security interests
in collateral that is subject to foreign jurisdiction Requirements of Law may
require additional actions in accordance with the Requirements of Law of such
jurisdictions.  The security interest created hereunder in favor of
the Collateral Agent for the benefit of the Secured Parties is prior to all
other Liens on the Collateral except for Customary Permitted Liens
having

     

    
      
         

      

      
        -12-

        
          

        

      

      
         

      

    

     priority
over the Collateral Agent’s Lien by operation of law or otherwise as permitted
under the Credit Agreement.

     

    
      	
               
      

            	
              Section
      3.3

            	
              Jurisdiction
      of Organization; Chief Executive
Office

            

    

     

    Such
Grantor’s jurisdiction of organization, legal name, type of entity, Federal
Taxpayer Identification Number and organizational identification number, if any,
in each case as of the Restatement Effective Date, is specified on Schedule 1(a) to the
Perfection Certificate.  Any other corporate or organizational name
such Grantor has had in the past five years, together with the date of the
relevant change, is specified on Schedule 1(b) to the
Perfection Certificate.  Any other name (including trade names or
similar appellations) used by such Grantor, or any other business or
organization to which such Grantor became the successor by merger,
consolidation, acquisition, change in form, nature or jurisdiction of
organization or otherwise, during the five years preceding the Restatement
Effective Date, together with the date of the relevant change, is specified on
Schedule 1(c)
to the Perfection Certificate.  Also specified on Schedule 1(c) to the
Perfection Certificate is any other name used by any other business or
organization to which such Grantor become the successor by merger,
consolidation, acquisition, change in form, nature or jurisdiction of
organization or otherwise, during the five years preceding the Restatement
Effective Date, together with the name of the other business or organization,
type of entity, jurisdiction of organization and date of the relevant
change.  The location of such Grantor’s chief executive office, as of
the Restatement Effective Date, is specified on Schedule 2(a) to
the Perfection Certificate and Schedule 3(a) to
the Perfection Certificate lists all other locations of such Grantor’s chief
executive office for the four months preceding the Restatement Effective
Date.

     

    
      	
               
      

            	
              Section
      3.4

            	
              Inventory
      and Equipment

            

    

     

    On the
Restatement Effective Date, such Grantor’s Inventory and Equipment (other than
mobile goods and Inventory or Equipment in transit) are kept at the locations
listed on Schedules
2(a), (b), (c), (d) and/or (e) to the Perfection
Certificate.  Schedule 3(a) to the
Perfection Certificate lists the locations of Inventory and Equipment listed on
Schedules 2(a),
(b), (c), (d) and (e) to the Perfection
Certificate for the four months preceding the Restatement Effective
Date.

     

    
      	
               
      

            	
              Section
      3.5

            	
              Pledged
      Collateral

            

    

     

    (a)           The
Pledged Stock pledged hereunder by such Grantor on the Restatement Effective
Date is listed on Schedules 10(a) and
10(b) to the Perfection
Certificate and constitutes that percentage of the issued and outstanding equity
of all classes of each issuer thereof as set forth on Schedule 10(a) or
10(b) to the
Perfection Certificate.

     

    (b)           All
of the Pledged Stock (other than Pledged Stock in limited liability companies
and partnerships) has been duly authorized, validly issued and is fully paid and
nonassessable.

     

    (c)           Each
of the Pledged Stock constitutes the legal, valid and binding obligation of the
obligor with respect thereto, enforceable in accordance with its terms, subject
to the effects of applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium

     

    
      
         

      

      
        -13-

        
          

        

      

      
         

      

    

     and
other similar laws relating to or affecting creditors’ rights generally, and
general equitable principles (whether considered in a proceeding in equity or at
law).

     

    (d)           All
Pledged Collateral and, if applicable, any Additional Pledged Collateral,
consisting of Certificated Securities or Instruments has been delivered to the
Collateral Agent in accordance with Section 4.4(a) hereof and Section 7.11 of the
Credit Agreement.

     

    (e)           All
Pledged Collateral held by a Securities Intermediary in a Securities Account is
in a Control Account.

     

    (f)           Other
than Pledged Stock constituting General Intangibles, there is no Pledged
Collateral other than that represented by Certificated Securities or Instruments
in the possession of the Collateral Agent, or that consists of Financial Assets
held in a Control Account or that consists of Financial Assets (and, for the
avoidance of doubt, money market funds and uncertificated securities) not
required to be in a Control Account pursuant to Section 7.12(a) of the Credit
Agreement.

     

    (g)           The
Constituent Documents of any Person governing any Pledged Stock of any limited
liability company, partnership or similar entity do not, upon the occurrence and
during the continuance of an Event of Default, (i) prevent the Collateral Agent
from exercising all of the rights of the Grantor granting the security interest
therein, (ii) prevent a transferee or assignee of Stock of such Person from
becoming a member partner or, as the case may be, other holder of such Pledged
Stock to the same extent as the Grantor in such Person entitled to participate
in the management of such Person or (iii) provide that upon the transfer of the
entire interest of such Grantor, the transferee of such interest ceases to be a
member, partner or, as the case may be, other holder of such Pledged Stock, in
each case, other than requirements that transfers be effected in compliance with
applicable securities laws.

     

    
      	
               
      

            	
              Section
      3.6

            	
              Accounts

            

    

     

    No amount
payable to such Grantor under or in connection with any Account is evidenced by
any Instrument or Chattel Paper that has not been delivered to the Collateral
Agent properly endorsed for transfer, to the extent delivery is required by
Section 4.4.

     

    
      	
               
      

            	
              Section
      3.7

            	
              Intellectual
      Property

            

    

     

    (a)           Schedules 12(a) and
12(b) to the
Perfection Certificate list all United States and/or Canada registrations for
and issuances of Intellectual Property and applications therefor, and material
unregistered trademarks and copyrights owned by such Grantor on the Restatement
Effective Date.  Schedules 12(a) and
12(b) to the
Perfection Certificate also list all material license agreements pursuant to
which Material Intellectual Property is licensed to such Grantor on the
Restatement Effective Date.

     

    (b)           Except
as set forth on Schedules 12(a) and
12(b) to the
Perfection Certificate, to the knowledge of the Grantor, all registered
Intellectual Property owned by such Grantor is valid, subsisting, unexpired and
enforceable, has not been adjudged invalid and has not been abandoned and, to
the knowledge of the Grantor, the use thereof in the business of such Grantor

    
      
         

      

      
        -14-

        
          

        

      

      
         

      

    

    does not
infringe, misappropriate, dilute or otherwise violate the intellectual property
rights of any other Person in any material respect.

     

    (c)           Except
as set forth in Schedules 12(a) and
12(b) to the
Perfection Certificate, none of the Material Intellectual Property owned by such
Grantor is the subject of any material license pursuant to which such Grantor is
the licensor on the Restatement Effective Date.

     

    (d)           No
holding, decision or judgment has been rendered against such Grantor by any
Governmental Authority that would reasonably be interpreted to, in whole or in
part, limit, impair, cancel or question the validity of, or such Grantor’s
rights in, any Material Intellectual Property.

     

    (e)           No
action or proceeding seeking to, in whole or in part, limit, impair, cancel or
question the validity of any Material Intellectual Property owned by such
Grantor or such Grantor’s ownership interest therein is pending against such
Grantor or, to the knowledge of such Grantor, threatened.  There are
no outstanding final claims, judgments or settlements to be paid by such Grantor
relating to the Material Intellectual Property.

     

    
      	
               
      

            	
              Section
      3.8

            	
              Deposit
      Accounts, Securities Accounts and Commodity
  Accounts

            

    

     

    The only
Deposit Accounts, Securities Accounts and Commodity Accounts maintained by any
Grantor on the Restatement Effective Date are those listed on Schedule 14 to the
Perfection Certificate which sets forth such information separately for each
Grantor.

     

    
      	
               
      

            	
              Section
      3.9

            	
              Commercial
      Tort Claims

            

    

     

    The only
Commercial Tort Claims of any Grantor in excess of $2.0 million existing on the
Restatement Effective Date are those listed on Schedule 13 to the
Perfection Certificate, which sets forth such information separately for each
Grantor.

     

    
      	
               
      

            	
              ARTICLE
      IV

            	
              Covenants

            

    

     

    Each
Grantor agrees with the Collateral Agent to the following until all Secured
Obligations are paid in full, unless the Requisite Lenders otherwise consent in
writing:

     

    
      	
               
      

            	
              Section
      4.1

            	
              Generally

            

    

     

    Such
Grantor shall (a) not create or suffer to exist any Lien upon or with
respect to any Collateral, except Liens permitted under Section 8.2 of
the Credit Agreement, (b) not use any Collateral, and use commercially
reasonable efforts not to permit any Collateral to be used, unlawfully or in
violation of any provision of this Agreement, any other Loan Document, any
Closing Date Related Document, any Requirement of Law or any policy of insurance
covering the Collateral, in each case in any material respect, (c) except
as permitted under the Credit Agreement, not enter into any agreement or
undertaking restricting the right or ability of such Grantor or the Collateral
Agent to sell, assign or transfer any Collateral if such restriction would have
a Material Adverse Effect and (d) promptly notify the Collateral Agent of
its entry into any

     

    
      
         

      

      
        -15-

        
          

        

      

      
         

      

    

     agreement
or assumption of undertaking that restricts the ability to sell, assign or
transfer any Collateral regardless of whether or not it has a Material Adverse
Effect.

     

    
      	
               
      

            	
              Section
      4.2

            	
              Maintenance
      of Perfected Security Interest; Further
  Documentation

            

    

     

    (a)           Such
Grantor shall maintain the security interests created by this Agreement as
security interests having at least the priority described in Section 3.2 and
Section
2.2  and
shall defend such security interests and such priority against the claims and
demands of all Persons to the extent adverse to such Grantor’s ownership rights
or otherwise inconsistent with this Agreement or the other Loan Documents; provided, however, that
security interests that relate solely to Collateral the aggregate value of which
does not exceed $1,000,000 are deemed invalid or unenforceable, such invalidity
or unenforceability may remain to the extent not constituting an Event of
Default under Section
9.1(j) of
the Credit Agreement for the period specified therein.

     

    (b)           Such
Grantor shall furnish to the Collateral Agent from time to time statements and
schedules further identifying and describing the Collateral and such other
reports in connection with the Collateral as the Collateral Agent may reasonably
request, all in reasonable detail and in form and substance reasonably
satisfactory to the Collateral Agent.

     

    (c)           At
any time and from time to time, upon the reasonable written request of the
Collateral Agent, and at the sole expense of such Grantor, such Grantor shall
promptly and duly execute and deliver, and have recorded or authorize the
recording of, such further instruments and documents and take such further
action as the Collateral Agent may reasonably request for the purpose of
obtaining or preserving the benefits of this Agreement and of the rights and
powers herein granted, including the filing of any financing or continuation
statement under the UCC (or any other Requirement of Law relating to
registration of Liens over Intellectual Property or other personal property) in
effect in any jurisdiction with respect to the security interests created hereby
and, subject to Section 7.12 of the
Credit Agreement, the execution and delivery of Deposit Account Control
Agreements and Securities Account Control Agreements.

     

    
      	
               
      

            	
              Section
      4.3

            	
              Changes
      in Locations, Name, Etc.

            

    

     

    (a)           Except
upon ten days’ prior written notice to the Collateral Agent and subsequent
prompt delivery to the Collateral Agent of all additional financing statements
and other documents reasonably requested by the Collateral Agent to maintain the
validity, perfection and priority of the security interests provided for
herein:

     

    (i)       change
its jurisdiction of organization or its location, in each case from that
referred to in Section 3.3;
or

     

    (ii)                  change
its legal name or organizational identification number, if any, or corporation,
limited liability company or other organizational structure to such an extent
that any financing statement filed or other filing or registration made in
connection with this Agreement would become misleading or otherwise
ineffective.

    
      
         

      

      
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    (b)           Such
Grantor shall keep and maintain at its own cost and expense, and in accordance
with its standard operating procedures, satisfactory records of the
Collateral.

     

    
      	
               
      

            	
              Section
      4.4

            	
              Pledged
      Collateral

            

    

     

    (a)           Such
Grantor shall deliver to the Collateral Agent all certificates and Instruments
representing or evidencing any Pledged Collateral (including Additional Pledged
Collateral but excluding (i) Instruments that are not, individually or in the
aggregate, in excess of $1.0 million and (ii) checks received in the ordinary
course of business and other Instruments received in the ordinary course of
business that are deposited into Deposit Accounts or Securities Accounts of such
Grantor), whether now existing or hereafter acquired, in suitable form for
transfer by delivery or, as applicable, accompanied by such Grantor’s
endorsement, where necessary, or duly executed instruments of transfer or
assignment in blank, all in form and substance reasonably satisfactory to the
Collateral Agent, together, in respect of any Additional Pledged Collateral,
with a Pledge Amendment, duly executed by the Grantor, in substantially the form
of Annex 3, or such
other documentation reasonably acceptable to the Collateral
Agent.  Such Grantor authorizes the Collateral Agent to attach each
Pledge Amendment to this Agreement.  The Collateral Agent shall have
the right, at any time upon the occurrence and during the continuance of any
Event of Default, in its discretion and without notice to the Grantor, to
transfer to or to register in its name or in the name of its nominees any
Pledged Collateral.  The Collateral Agent shall have the right at any
time upon the occurrence and during the continuance of any Event of Default, to
exchange any certificate or instrument representing or evidencing any Pledged
Collateral for certificates or instruments of smaller or larger
denominations.

     

    (b)           Except
as provided in Article
V, such Grantor shall be entitled to receive all dividends paid in
respect of the Pledged Collateral with respect to the Pledged
Collateral.  Any sums paid upon or in respect of any Pledged
Collateral upon the liquidation or dissolution of any issuer of any Pledged
Collateral, any distribution of capital made on or in respect of any Pledged
Collateral or any property distributed upon or with respect to any Pledged
Collateral pursuant to the recapitalization or reclassification of the capital
of any issuer of Pledged Collateral or pursuant to the reorganization thereof
shall, unless otherwise subject to perfected Requisite Liens in favor of the
Collateral Agent, be delivered to the Collateral Agent to be held by it
hereunder as additional collateral security for the Secured
Obligations.  If any such sum of money or property so paid or
distributed in respect of any Pledged Collateral shall be received by such
Grantor and not otherwise be subject to perfected Requisite Liens in favor of
the Collateral Agent, such Grantor shall, until such money or property is paid
or delivered to the Collateral Agent, hold such money or property in trust for
the Collateral Agent, segregated from other funds of such Grantor, as additional
security for the Secured Obligations.

     

    (c)           Except
as provided in Article
V, such Grantor shall be entitled to exercise all voting, consent and
corporate, partnership, limited liability company and similar rights with
respect to the Pledged Collateral; provided, however, that no vote shall
be cast, consent given or right
exercised or other action taken by such Grantor that would materially impair the
Collateral, be inconsistent with or result in any violation of any provision of
the Credit Agreement, this Agreement or any other Loan
Document.

     

    
      
         

      

      
        -17-

        
          

        

      

      
         

      

    

     

    (d)           Such
Grantor shall not grant “control” (within the meaning of such term under Article
9-106 of the UCC) over any Securities Accounts or Deposit Accounts (other than
any Excluded Property) of such Grantor to any Person other than the Collateral
Agent.

     

    (e)           In
the case of each Grantor that is an issuer of Pledged Collateral, such Grantor
agrees to be bound by the terms of this Agreement relating to the Pledged
Collateral issued by it, to comply with such terms insofar as such terms are
applicable to it and to comply with all instructions from the Collateral Agent
with respect to any Pledged Collateral after an Event of Default (without the
consent of the owner of such Pledged Collateral).  In the case of any
Grantor that is a holder of any Stock or Stock Equivalent in any Person that is
an issuer of Pledged Collateral, such Grantor consents to (i) the exercise
of the rights granted to the Collateral Agent hereunder (including those
described in Section 5.3), and (ii) the
pledge by each other Grantor, pursuant to the terms hereof, of the Pledged Stock
in such Person and to the transfer of such Pledged Stock after the occurrence
and during the continuance Event of Default to the Collateral Agent or its
nominee and to the substitution of the Collateral Agent or its nominee as a
holder of such Pledged Stock with all the rights, powers and duties of other
holders of Pledged Stock of the same class and, if the Grantor having pledged
such Pledged Stock hereunder had any right, power or duty at the time of such
pledge or at the time of such substitution beyond that of such other holders,
with all such additional rights, powers and duties.  Such Grantor
agrees to execute and deliver to the Collateral Agent such certificates,
agreements and other documents as may be reasonably necessary to evidence,
formalize or otherwise give effect to the consents given in this
clause (e).

     

    (f)           Such
Grantor shall not, without the consent of the Collateral Agent (and to the
extent required pursuant to Section 8.11 of the
Credit Agreement, any Lender or Agent), agree to any amendment of any
Constituent Document that in any way materially adversely affects the perfection
of the security interests of the Collateral Agent in any Pledged Collateral
pledged by any Grantor hereunder, including any amendment electing to treat any
membership interest or partnership interest that is part of the Pledged
Collateral as a “security” under Section 8-103 of the UCC, or any election
to turn any previously uncertificated Stock that is part of the Pledged
Collateral into certificated Stock.

     

    
      	
               
      

            	
              Section
      4.5

            	
              Accounts

            

    

     

    (a)           Such
Grantor shall not, other than as permitted by the Credit Agreement,
(i) grant any extension of the time of payment of any Account,
(ii) compromise or settle any Account for less than the full amount
thereof, (iii) release, wholly or partially, any Person liable for the
payment of any Account, (iv) allow any credit or discount on any Account or
(v) amend, supplement or modify any Account in any manner that could
materially adversely affect the value thereof.

     

    (b)           Subject
to the limitations in Section 7.6 of the
Credit Agreement, the Collateral Agent shall have the right to make test
verifications of the Accounts in any manner and through
any medium that it reasonably considers advisable, and such Grantor shall use
commercially reasonable efforts to furnish all such assistance and information
as the Collateral Agent may reasonably require in connection
therewith.

     

    
      
         

      

      
        -18-

        
          

        

      

      
         

      

    

     

    
      	
               
      

            	
              Section
      4.6

            	
              Delivery
      of Instruments and Chattel Paper

            

    

     

    If any
amount in excess of $1.0 million payable under or in connection with any
Collateral owned by such Grantor shall be or become evidenced by an Instrument
or Chattel Paper, such Grantor shall promptly deliver such Instrument or Chattel
Paper to the Collateral Agent, duly indorsed in a manner reasonably satisfactory
to the Collateral Agent.

     

    
      	
               
      

            	
              Section
      4.7

            	
              Intellectual
      Property

            

    

     

    (a)           Such
Grantor (either itself or through licensees) shall, to the extent such Grantor
deems necessary and beneficial to such Grantor’s business in accordance with its
reasonable business judgment, (i) continue to use each Trademark owned by
such Grantor that is Material Intellectual Property in order to maintain such
Trademark in full force and effect with respect to each class of goods for which
such Trademark is currently used that is material to such Grantor’s business or
the business of the Grantors taken as a whole, free from any claim of
abandonment for non-use, (ii) maintain the quality of products and services
offered under such Trademark such that no rights under such Trademark are
cancelled, impaired, genericized or otherwise negatively affected,
(iii) use such Trademark with all appropriate notices and legends required
by applicable Requirements of Law, (iv) not adopt or use any Trademark that
is confusingly similar or a colorable imitation of such Trademark unless the
Collateral Agent shall obtain perfected Requisite Liens in such mark pursuant to
this Agreement and (v) not (and not knowingly permit any licensee or
sublicensee thereof to) knowingly do any act or omit to do any act whereby such
Trademark (or any goodwill associated therewith) that constitutes Material
Intellectual Property may become destroyed, invalidated, impaired or harmed in
any material respect; provided that clauses (i),
(ii) and (v) above shall not apply to any advertising slogan so long as (x) such
slogan is no longer in use by such Grantors or the franchisees of the Grantors
(in such Grantor’s reasonable estimation) and (y) such Grantor does not, in its
reasonable estimation, expect to use such slogan (or any substantially similar
slogan) in the future.

     

    (b)           Such
Grantor (either itself or through licensees) shall, in accordance with its
reasonable business judgment, not knowingly do any act, or omit to do any act,
whereby any Patent that is Material Intellectual Property may become forfeited,
limited, cancelled in whole or in part, invalidated in whole or in part,
abandoned or dedicated to the public (except for Patents expiring at the end of
their statutory terms).

     

    (c)           Such
Grantor (either itself or through licensees), in accordance with its reasonable
business judgment, shall not (either itself or through licensees) knowingly do
any act whereby any portion of the Copyrights that is Material Intellectual
Property may fall into the public domain (except for Copyrights expiring at the
end of their statutory terms).

     

    (d)           Such
Grantor (either itself or through licensees) shall not do any unreasonable act,
or knowingly omit to do any act, whereby any trade secret that is Material
Intellectual Property may become publicly available or otherwise
unprotectable.  For the avoidance of doubt, it
shall not be an unreasonable act for such Grantor to make any trade secret
publicly available for the purpose of disclosure in any patent application by
such Grantor.

     

    
      
         

      

      
        -19-

        
          

        

      

      
         

      

    

     

    (e)           Such
Grantor (either itself or through licensees) shall not knowingly do any act that
uses any Material Intellectual Property to infringe, dilute, misappropriate,
violate or otherwise harm the intellectual property rights of any other Person
in any material respect.

     

    (f)           Such
Grantor shall notify the Collateral Agent promptly if it knows, or has reason to
know, that any application or registration relating to any Material Intellectual
Property owned by such Grantor may become forfeited, abandoned or dedicated to
the public, or of any material adverse determination or material development
(including the institution of, or any such determination or development in, any
proceeding in the United States Patent and Trademark Office, the United States
Copyright Office, or any other Governmental Authority or any international
agency or similar authority, but excluding any non-final office actions or
ordinary course correspondence issued by such Governmental Authorities),
regarding such Grantor’s ownership of, right to use, interest in, or the
validity of, any Material Intellectual Property or such Grantor’s right to
register the same or to own and maintain the same.

     

    (g)           Whenever
such Grantor, either by itself or through any agent, licensee or designee, shall
file an application for the registration of any Intellectual Property with the
United States Patent and Trademark Office, the United States Copyright Office,
or any similar Governmental Authority of or within the United States or Canada,
such Grantor shall report such filing to the Collateral Agent within 10 Business
Days after the last day of the Fiscal Quarter in which such filing
occurs.  Upon request of the Collateral Agent, such Grantor shall
execute and deliver, and have recorded, all agreements, instruments, documents
and papers as the Collateral Agent may reasonably request to evidence the
Collateral Agent’s security interest in any Copyright, Patent or Trademark
(other than Excluded Property) and the goodwill of such Grantor relating thereto
or represented thereby.

     

    (h)           Such
Grantor shall take all reasonable actions necessary or appropriate or requested
by the Collateral Agent, including in any proceeding before the United States
Patent and Trademark Office, the United States Copyright Office, any similar
Governmental Authority of or within the United States or Canada and any Internet
domain name registrar, to maintain and pursue each application (and to obtain
the relevant registration) and to maintain each registration of any Copyright,
Trademark, Patent or Internet domain name that is Material Intellectual
Property, including filing of applications for renewal, affidavits of use,
affidavits of incontestability, opposition and interference and cancellation
proceedings, and payment of all applicable fees, except to the extent that such
Grantor determines in its reasonable business judgment that the maintenance or
pursuit of any such registration or application is no longer necessary or
beneficial to the conduct of Grantor’s business.

     

    (i)           In
the event that any Material Intellectual Property is or has been materially
infringed upon or misappropriated or diluted by a third party, such Grantor
shall notify the Collateral Agent promptly after such Grantor learns
thereof.  Such Grantor shall take appropriate action in accordance
with its reasonable business judgment in response to such infringement,
misappropriation or dilution, including promptly bringing suit for infringement,
misappropriation or dilution and/or other cause of action and to recover all
damages, injunctive relief and declaratory judgments in connection with such
infringement, misappropriation, dilution or other cause of action (unless such
Grantor has a good faith reason not to bring such suits), and shall
take

     

    
      
         

      

      
        -20-

        
          

        

      

      
         

      

    

     such
other actions as may be appropriate in its reasonable judgment under the
circumstances to protect such Material Intellectual Property.

     

    (j)           Unless
otherwise agreed to by the Collateral Agent, such Grantor shall execute and
deliver to the Collateral Agent for filing (i) in the United States
Copyright Office, a short-form copyright security agreement in the form attached
hereto as Annex 5,
(ii) in the United States Patent and Trademark Office, a short-form patent
security agreement in the form attached hereto as Annex 5, and
(iii) in the United States Patent and Trademark Office, a short-form
trademark security agreement in form attached hereto as Annex 5.

     

    
      	
               
      

            	
              Section
      4.8

            	
              Vehicles

            

    

     

    Upon the
occurrence and during the continuance of any Event of Default, if requested by
the Collateral Agent, within 30 days after the date of such request, such
Grantor shall file all applications for certificates of title or ownership
indicating the Collateral Agent’s Requisite Liens in the Vehicle covered by such
certificate and any other necessary documentation, in each office in each
jurisdiction that the Collateral Agent shall deem advisable to perfect the
Collateral Agent’s Requisite Liens in the Vehicles.

     

    
      	
               
      

            	
              Section
      4.9

            	
              Payment
      of Obligations

            

    

     

    Such
Grantor shall pay and discharge or otherwise satisfy at or before maturity or
before they become delinquent, as the case may be, all federal taxes and all
material other taxes, assessments and governmental charges or levies imposed
upon the Collateral or in respect of income or profits therefrom, as well as all
claims of any kind (including claims for labor, materials and supplies) against
or with respect to the Collateral, except that no such charge need be paid if
the amount or validity thereof is currently being contested in good faith by
appropriate proceedings, reserves in accordance with GAAP with respect thereto
have been provided on the books of such Grantor and such proceedings could not
reasonably be expected to result in the sale, forfeiture or loss of any material
portion of the Collateral.

     

    
      	
               
      

            	
              Section
      4.10

            	
              Notice
      of Commercial Tort Claims 

            

    

     

    Such
Grantor agrees that, if it shall acquire any interest in any Commercial Tort
Claim (whether from another Person or because such Commercial Tort Claim shall
have come into existence) in excess of $2.0 million, (i) such Grantor shall
deliver to the Collateral Agent, in each case in form and substance reasonably
satisfactory to the Collateral Agent, a notice of the existence and nature of
such Commercial Tort Claim and grant to the Collateral Agent in such notice a
security interest therein and in the Proceeds thereof within 10 Business Days
after the last day of the Fiscal Quarter in which such Commercial Tort Claim is
acquired and (ii) the provisions of Section 2.1 shall apply to such
Commercial Tort Claim.

     

    
      
        	
                 
      

              	
                Section
      4.11

              	
                Letter
      of Credit Rights

              

      

    

                                    

    Such
Grantor agrees that if such Grantor is at any time a beneficiary under a Letter
of Credit in excess of $500,000 now or hereafter issued, such Grantor shall
notify the Collateral Agent thereof within 10 Business Days after the last day
of the Fiscal Quarter in which such

    
 

    
      
        
           

        

        
          -21-

          
            

          

        

        
           

        

      

    

     

     right
is acquired and such Grantor shall, at the request of the Collateral Agent,
pursuant to an agreement in form and substance reasonably satisfactory to the
Collateral Agent, either (i) arrange for the issuer and any confirmer of such
Letter of Credit to consent to an assignment to the Collateral Agent of the
proceeds of any drawing under the Letter of Credit or (ii) arrange for the
Collateral Agent to become the transferee beneficiary of such Letter of Credit,
with the Collateral Agent agreeing, in each case, that the proceeds of any
drawing under the Letter of Credit are to be applied as provided in the Credit
Agreement.

     

    
      	
               
      

            	
              ARTICLE
      V

            	
              Remedial
      Provisions

            

    

     

    
      	
               
      

            	
              Section
      5.1

            	
              Code
      and Other Remedies

            

    

     

    During
the continuance of an Event of Default, the Collateral Agent may exercise, in
addition to all other rights and remedies granted to it in this Agreement and in
any other instrument or agreement securing, evidencing or relating to the
Secured Obligations, all rights and remedies of a secured party under the UCC or
any other applicable law.  Without limiting the generality of the
foregoing, the Collateral Agent, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by law referred to below) to or upon any Grantor or any other Person
(all and each of which demands, defenses, advertisements and notices are hereby
waived to the fullest extent permitted by law), may in such circumstances
forthwith collect, receive, appropriate and realize upon any Collateral, and may
forthwith sell, lease, assign, give option or options to purchase, or otherwise
dispose of and deliver any Collateral (or contract to do any of the foregoing),
in one or more parcels at public or private sale or sales, at any exchange,
broker’s board or office of the Collateral Agent or any Lender or elsewhere upon
such terms and conditions as it may deem advisable and at such prices as it may
deem best, for cash or on credit or for future delivery without assumption of
any credit risk.  The Collateral Agent shall have the right upon any
such public sale or sales, and, to the extent permitted by the UCC and other
applicable law, upon any such private sale or sales, to purchase the whole or
any part of the Collateral so sold, free of any right or equity of redemption of
any Grantor, which right or equity is hereby waived and
released.  Each Grantor further agrees, at the Collateral Agent’s
request, to assemble the Collateral and make it available to the Collateral
Agent at places that the Collateral Agent shall reasonably select, whether at
such Grantor’s premises or elsewhere.  The Collateral Agent shall
apply the net proceeds of any action taken by it pursuant to this Section 5.1,
after deducting all reasonable costs and expenses of every kind incurred in
connection therewith or incidental to the care or safekeeping of any Collateral
or in any way relating to the Collateral or the rights of the Collateral Agent
and any other applicable Secured Party hereunder, including reasonable
attorneys’ fees and disbursements, to the payment in whole or in part of the
Secured Obligations, in such order as the Credit Agreement shall prescribe, and
only after such application and after the payment by the Collateral Agent of any
other amount required by any provision of law, need the Collateral Agent account
for the surplus, if any, to any Grantor.  To the extent permitted by
applicable law, each Grantor waives
all claims, damages and demands it may acquire against the Collateral Agent or
any other Secured Party arising out of the exercise by them of any rights
hereunder.  If any notice of a proposed sale or other disposition of
Collateral shall be required by law, such notice shall be deemed reasonable and
proper if given at least ten days before such sale or other
disposition.

     

    
      
         

      

      
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              Section
      5.2

            	
              Accounts
      and Payments in Respect of General
Intangibles

            

    

     

    (a)           In
addition to, and not in substitution for, any similar requirement in the Credit
Agreement, if required by the Collateral Agent at any time during the
continuance of an Event of Default, any payment of Accounts or payment in
respect of General Intangibles, when collected by any Grantor, shall be
forthwith (and, in any event, within five Business Days) deposited
by such Grantor in the exact form received, duly indorsed by such Grantor to the
Collateral Agent, in an Approved Deposit Account or a Cash Collateral
Account.  Subject to the subordination provisions described in Schedule 5.2, until
so turned over, such payment shall be held by such Grantor in trust for the
Collateral Agent, segregated from other funds of such Grantor.  Each
such deposit of Proceeds of Accounts and payments in respect of General
Intangibles shall be accompanied by a report identifying in reasonable detail
the nature and source of the payments included in the deposit.

     

    (b)           At
the Collateral Agent’s request, during the continuance of an Event of Default,
each Grantor shall deliver to the Collateral Agent all original and other
documents evidencing, and relating to, the agreements and transactions that gave
rise to the Accounts or payments in respect of General Intangibles in its
possession, including all original orders, invoices and shipping receipts in its
possession.

     

    (c)           The
Collateral Agent may, without prior notice (it being agreed that the Collateral
Agent shall give prompt written notice to a Borrower after taking such action),
at any time during the continuance of an Event of Default, limit or terminate
the authority of a Grantor to collect its Accounts or amounts due under General
Intangibles or any thereof.

     

    (d)           The
Collateral Agent in its own name or in the name of others may at any time during
the continuance of an Event of Default, upon prior written notice to the
applicable Grantor, communicate with Account Debtors to verify with them to the
Collateral Agent’s satisfaction the existence, amount and terms of any Account
or amounts due under any General Intangible and the Collateral Agent, to the
extent permitted under applicable Requirements of Law, shall give written notice
to the relevant Grantor on, prior to or promptly after such exercise of the
Collateral Agent’s intent to exercise its corresponding rights under this Section 5.2; provided, however, that the
failure of the Collateral Agent to give notice shall not affect the rights of
the Collateral Agent hereunder and shall not otherwise result in any liability
for the Collateral Agent.

     

    (e)           Upon
the request of the Collateral Agent at any time during the continuance of an
Event of Default, and to the extent permitted under applicable Requirements of
Law, if the Collateral Agent shall have given written notice to the relevant
Grantor on, prior to or promptly after such exercise of the Collateral Agent’s
intent to exercise its corresponding rights under this Section 5.2 (provided, however, that the
failure to give notice shall not affect the rights of the Collateral Agent
hereunder and shall not otherwise result in any liability for the Collateral
Agent), each Grantor shall notify Account Debtors that the Accounts or General
Intangibles have been
collaterally assigned to the Collateral Agent and that payments in respect
thereof shall be made directly to the Collateral Agent.  In addition,
the Collateral Agent may at any time during the continuance of an Event of
Default enforce such Grantor’s rights against such Account Debtors and obligors
of General Intangibles.

     

    
      
         

      

      
        -23-

        
          

        

      

      
         

      

    

     

    (f)           Anything
herein to the contrary notwithstanding, each Grantor shall remain liable under
each of the Accounts and payments in respect of General Intangibles to observe
and perform all the conditions and obligations to be observed and performed by
it thereunder, all in accordance with the terms of any agreement giving rise
thereto.  No Collateral Agent and no other Secured Party shall have
any obligation or liability under any agreement giving rise to an Account or a
payment in respect of a General Intangible by reason of or arising out of this
Agreement or the receipt by the Collateral Agent or any other Secured Party of
any payment relating thereto, and neither the Collateral Agent nor any other
Secured Party shall be obligated in any manner to perform any obligation of any
Grantor under or pursuant to any agreement giving rise to an Account or a
payment in respect of a General Intangible, to make any payment, to make any
inquiry as to the nature or the sufficiency of any payment received by it or as
to the sufficiency of any performance by any party thereunder, to present or
file any claim, to take any action to enforce any performance or to collect the
payment of any amounts that may have been assigned to it or to which it may be
entitled at any time.

     

    
      	
               
      

            	
              Section
      5.3

            	
              Pledged
      Collateral

            

    

     

    (a)           During
the continuance of an Event of Default, upon written notice by the Collateral
Agent to the relevant Grantor or Grantors, (i) the Collateral Agent shall
have the right to receive any Proceeds of the Pledged Collateral in order to
make application thereof to the Secured Obligations in the order set forth in
the Credit Agreement and (ii) the Collateral Agent or its nominee may
exercise (A) any voting, consent, corporate and other right pertaining to
the Pledged Collateral at any meeting of shareholders, partners or members, as
the case may be, of the relevant issuer or Issuer of Pledged Collateral or
otherwise and (B) any right of conversion, exchange and subscription and
any other right, privilege or option pertaining to the Pledged Collateral as if
it were the absolute owner thereof (including the right to exchange at its
discretion any of the Pledged Collateral upon the merger, amalgamation,
consolidation, reorganization, recapitalization or other fundamental change in
the corporate or equivalent structure of any issuer of Pledged Stock, the right
to deposit and deliver any Pledged Collateral with any committee, depositary,
transfer agent, registrar or other designated agency upon such terms and
conditions as the Collateral Agent may reasonably determine), all without
liability except to account for property actually received by it; provided, however, that the Collateral
Agent shall not have any duty to any Grantor to exercise any such right,
privilege or option and the Collateral Agent shall not be responsible for any
failure to do so or delay in so doing.

     

    (b)           In
order to permit the Collateral Agent to exercise the voting and other consensual
rights that it may be entitled to exercise pursuant hereto and to receive all
dividends and other distributions that it may be entitled to receive hereunder,
during the continuance of any Event of Default (i) each Grantor shall
promptly execute and deliver (or cause to be executed and delivered) to
Collateral Agent all such proxies, dividend payment orders and other instruments
as the Collateral Agent may from time to time reasonably request and
(ii) without limiting the effect of clause (i) above, each such
Grantor hereby grants to the Collateral Agent an irrevocable proxy to vote all
or any part of the Pledged Collateral and to exercise all other rights, powers,
privileges and remedies to which a holder of the Pledged Collateral would be
entitled (including giving or withholding written consents of shareholders,
partners or members, as the case may be, calling special meetings of
shareholders, partners or members, as the case may be, and voting at such

     

    
      
         

      

      
        -24-

        
          

        

      

      
         

      

    

    meetings),
which proxy shall be effective, automatically and without the necessity of any
action (including any transfer of any Pledged Collateral on the record books of
the issuer thereof) by any other person (including the issuer of such Pledged
Collateral or any officer or agent thereof) during the continuance of an Event
of Default and which proxy shall only terminate upon the payment in full of the
Secured Obligations.

     

    (c)           Each
Grantor hereby expressly authorizes and instructs each issuer of any Pledged
Collateral pledged hereunder by such Grantor to (i) comply with any
instruction received by it from the Collateral Agent in writing that
(A) states that an Event of Default has occurred and is continuing and
(B) is otherwise in accordance with the terms of this Agreement, without
any other or further instructions from such Grantor, and each Grantor agrees
that such issuer shall be fully protected in so complying and (ii) unless
otherwise expressly provided hereby, pay any dividend or other payment with
respect to the Pledged Collateral directly to the Collateral Agent.

     

    
      	
               
      

            	
              Section
      5.4

            	
              Application
      of Proceeds of Collateral and Other
Payments

            

    

     

    Proceeds
of Collateral received by the Collateral Agent that, pursuant to Section 2.13(g) of
the Credit Agreement, are required to be applied pursuant to this Agreement,
shall be applied to the Secured Obligations as follows:

     

    (a)           first, to pay interest on and
then principal of any portion of any Loan that the Administrative Agent or the
Collateral Agent may have advanced on behalf of any Lender for which the
Administrative Agent has not then been reimbursed by such Lender or Borrowers or
Co-Borrowers;

     

    (b)           second, to pay Secured
Obligations in respect of any expense reimbursements or indemnities then due to
the Administrative Agent and the Collateral Agent;

     

    (c)           third, to pay Secured
Obligations in respect of any expense reimbursements or indemnities then due to
the other Secured Parties;

     

    (d)           fourth, to pay Secured
Obligations in respect of any fees then due to the Secured Parties;

     

    (e)           fifth, to pay interest then
due and payable in respect of all Loans and Reimbursement
Obligations;

     

    (f)           sixth, to pay or prepay
principal payments on all Loans, all Reimbursement Obligations, Cash Management
Obligations and all Obligations under Hedging Contracts then due and payable by
any Loan Party and to provide cash collateral for oustanding Letter of Credit
Undrawn Amounts in the manner described in Section 9.3 of
the Credit
Agreement, ratably to the aggregate principal amount of such Loans,
Reimbursement Obligations, obligations under Hedging Contracts, Cash Management
Obligations and Letter of Credit Undrawn Amounts; and

       

      (g)           seventh, to the ratable
payment of all other Secured Obligations;

    

     

    
      
        
          

           

          --

        

         

      

      
        -25-

        
          

        

      

      
         

      

    

     

    provided, however, that if
sufficient funds are not available to fund all payments to be made in respect of
any of the Secured Obligations set forth in any of clauses (a) through (g)
above, the available funds being applied with respect to any such Secured
Obligation (unless otherwise specified in such clause) shall be allocated to the
payment of such Secured Obligations ratably, based on the proportion of each
Agent’s and each Lender’s or Issuer’s interest in the aggregate outstanding
Secured Obligations described in such clauses; provided, however, that payments that
would otherwise be allocated to the Revolving Credit Lenders shall be allocated
first to repay Swing
Loans until such Loans are paid in full and then to repay the Revolving
Loans.  Any balance remaining after the Secured Obligations have been
paid in full shall be paid to the person lawfully entitled thereto (including
the applicable Loan Party or its successors or assigns) or as a court of
competent jurisdiction may direct.

     

    
      	
               
      

            	
              Section
      5.5

            	
              Registration
      Rights

            

    

     

    (a)           If
the Collateral Agent shall exercise its rights to sell any of the Pledged
Collateral pursuant to Section 5.1, and
if in the opinion of the Collateral Agent it is necessary or advisable to have
the Pledged Collateral, or any portion thereof to be registered under the
provisions of the Securities Act, the relevant Grantor shall cause the issuer
thereof to (i) execute and deliver, and use commercially reasonable efforts
to cause the directors and officers of such issuer to execute and deliver, all
such instruments and documents, and do or cause to be done all such other acts
as may be, in the opinion of the Collateral Agent, necessary or advisable to
register the Pledged Collateral, or that portion thereof to be sold, under the
provisions of the Securities Act, (ii) use its best efforts to cause the
registration statement relating thereto to become effective and to remain
effective for a period of two years from the date of the first public offering
of the Pledged Collateral, or that portion thereof to be sold and
(iii) make all amendments thereto or to the related prospectus that, in the
reasonable opinion of the Collateral Agent, are necessary or advisable, all in
accordance with the requirements of the Securities Act and the rules and
regulations of the Securities and Exchange Commission applicable
thereto.  Each Grantor agrees to cause such issuer to comply with the
provisions of the securities or “Blue Sky” laws of any jurisdiction that the
Collateral Agent shall designate and to make available to its security holders,
as soon as practicable, an earnings statement (which need not be audited)
satisfying the provisions of Section 11(a) of the Securities
Act.

     

    (b)           Each
Grantor recognizes that the Collateral Agent may be unable to effect a public
sale of any Pledged Collateral by reason of certain prohibitions contained in
the Securities Act and applicable state securities laws or otherwise or may
determine that a public sale is impracticable or not commercially reasonable
and, accordingly, may resort to one or more private sales thereof to a
restricted group of purchasers that shall be obliged to agree, among other
things, to acquire such securities for their own account for investment and not
with a view to the distribution or resale thereof.  Each Grantor
acknowledges and agrees that any such private sale may result in prices and
other terms less favorable than if such sale were a public sale and, notwithstanding
such circumstances, agrees that any such private sale shall be deemed to have
been made in a commercially reasonable manner.  The Collateral Agent
shall not be under any obligation to delay a sale of any Pledged Collateral for
the period of time necessary to permit the issuer thereof to register such
securities for public sale under the Securities Act, or under applicable state
securities laws, even if such issuer would agree to do so.

     

    
      
         

      

      
        -26-

        
          

        

      

      
         

      

    

     

    (c)           Each
Grantor agrees to use commercially reasonable efforts to do or cause to be done
all such other acts as may be necessary to make such sale or sales of all or any
portion of the Pledged Collateral pursuant to this Section 5.5 valid and binding and
in compliance with all other applicable Requirements of Law.  Each
Grantor further agrees that a breach of any covenant contained in this Section 5.5 will cause irreparable
injury to the Collateral Agent and other Secured Parties, that the Collateral
Agent and the other Secured Parties have no adequate remedy at law in respect of
such breach and, as a consequence, that each and every covenant contained in
this Section 5.5
shall be specifically enforceable against such Grantor, and such Grantor hereby
waives, to the fullest extent permitted by law, and agrees not to assert any
defense against an action for specific performance of such covenants except for
a defense that no Event of Default has occurred under the Credit Agreement or
that the Secured Obligations have been paid in full or that such covenants have
been fully performed.

     

    
      	
               
      

            	
              Section
      5.6

            	
              Deficiency

            

    

     

    Each
Grantor shall remain liable for any deficiency if the proceeds of any sale or
other disposition of the Collateral are insufficient to pay the Secured
Obligations and the reasonable fees and out-of-pocket disbursements of any
attorney employed by the Collateral Agent or any other Secured Party to collect
such deficiency.

     

    
      	
               
      

            	
              ARTICLE
      VI

            	
              The
      Collateral Agent

            

    

     

    
      	
               
      

            	
              Section
      6.1

            	
              Collateral
      Agent’s Appointment as
Attorney-in-Fact

            

    

     

    (a)           Until
such time as all Secured Obligations shall have been paid in full, each Grantor
hereby irrevocably constitutes and appoints the Collateral Agent and any officer
or agent thereof, with full power of substitution, as its true and lawful
attorney-in-fact with full irrevocable power and authority in the place and
stead of such Grantor and in the name of such Grantor or in its own name, for
the purpose of carrying out the terms of this Agreement, to take any appropriate
action and to execute any document or instrument that may be necessary or
desirable to accomplish the purposes of this Agreement, and, without limiting
the generality of the foregoing, each Grantor hereby gives the Collateral Agent
the power and right, on behalf of such Grantor, without notice to or assent by
such Grantor, to do any of the following:

     

    (i)       in
the name of such Grantor or its own name, or otherwise, take possession of and
endorse and collect any check, draft, note, acceptance or other instrument for
the payment of moneys due under any Account or General Intangible or with
respect to any other Collateral and file any claim or take any other action or
proceeding in any court of law or equity or otherwise deemed appropriate by the
Collateral Agent for the purpose of
collecting any such moneys due under any Account or General Intangible or with
respect to any other Collateral whenever payable;

     

    (ii)                  in
the case of any Intellectual Property, execute and deliver, and have recorded,
any agreement, instrument, document or paper with any Governmental Authority of
or within the United States or Canada as the Collateral Agent may reasonably
request to evidence the Collateral Agent’s security interests in such
Intellectual Property and the goodwill and General Intangibles of such Grantor
relating thereto or represented thereby;

    
      
         

      

      
        -27-

        
          

        

      

      
         

      

    

     

     

    (iii)                  pay
or discharge taxes and Liens levied or placed on or threatened against the
Collateral, effect any repair or pay any insurance called for by the terms of
this Agreement (including all or any part of the premiums therefor and the costs
thereof);

     

    (iv)                  execute,
in connection with any sale provided for in Section 5.1
or 5.5, any endorsement,
assignment or other instrument of conveyance or transfer with respect to the
Collateral; or

     

    (v)                  (A) direct
any party liable for any payment under any Collateral to make payment of any
moneys due or to become due thereunder directly to the Collateral Agent or as
the Collateral Agent shall direct, (B) ask or demand for, collect, and
receive payment of and receipt for, any moneys, claims and other amounts due or
to become due at any time in respect of or arising out of any Collateral,
(C) sign and endorse any invoice, freight or express bill, bill of lading,
storage or warehouse receipt, draft against debtors, assignment, verification,
notice and other document in connection with any Collateral, (D) commence
and prosecute any suit, action or proceeding at law or in equity in any court of
competent jurisdiction to collect any Collateral and to enforce any other right
in respect of any Collateral, (E) defend any suit, action or proceeding
brought against such Grantor with respect to any Collateral, (F) settle,
compromise or adjust any such suit, action or proceeding and, in connection
therewith, give such discharges or releases as the Collateral Agent may deem
appropriate, (G) assign any Copyright, Patent or Trademark (along with the
goodwill of the business to which any such Trademark pertains) throughout the
world for such term or terms, on such conditions, and in such manner as the
Collateral Agent shall in its sole discretion determine, including the execution
and filing of any document necessary to effectuate or record such assignment and
(H) generally, sell, transfer, pledge and make any agreement with respect
to or otherwise deal with any Collateral as fully and completely as though the
Collateral Agent were the absolute owner thereof for all purposes, and do, at
the Collateral Agent’s option and such Grantor’s expense, at any time, or from
time to time, all acts and things that the Collateral Agent deems necessary to
protect, preserve or realize upon the Collateral and the Collateral Agent’s and
the other Secured Parties’ security interests therein and to effect the intent
of this Agreement, all as fully and effectively as such Grantor might
do.

     

    Anything
in this clause (a) to the contrary notwithstanding, the Collateral Agent
agrees that it shall not exercise any right under the power of attorney provided
for in this clause (a) unless an Event of Default shall be
continuing.

     

    (b)           If
any Grantor fails to perform or comply with any of its agreements contained
herein, the Collateral Agent, at its option, but without any obligation so to
do, may, after notifying such Grantor in writing, perform or comply, or
otherwise cause performance or compliance, with such agreement.

     

    (c)           The
reasonable expenses of the Collateral Agent incurred in connection with actions
undertaken as provided in this Section 6.1,
together with interest thereon at a rate per annum equal to the rate per annum
at which interest would then be payable on Revolving Loans that are Base Rate
Loans under the Credit Agreement, from the date of payment by the

     

    
      
         

      

      
        -28-

        
          

        

      

      
         

      

    

     

     

    Collateral
Agent to the date reimbursed by the relevant Grantor, shall be payable by such
Grantor to the Collateral Agent on demand.

     

    (d)           Each
Grantor hereby ratifies all that said attorneys shall lawfully do or cause to be
done by virtue hereof.  All powers, authorizations and agencies
contained in this Agreement are coupled with an interest and are irrevocable
until this Agreement is terminated and the security interests created hereby are
released.

     

    
      	
               
      

            	
              Section
      6.2

            	
              Duty
      of Collateral Agent

            

    

     

    The
Collateral Agent’s sole duty with respect to the custody, safekeeping and
physical preservation of the Collateral in its possession shall be to deal with
it in the same manner as the Collateral Agent deals with similar property for
its own account.  The Collateral Agent shall not and no other Secured
Party, nor any of their respective officers, directors, employees or agents,
shall be liable for failure to demand, collect or realize upon any Collateral or
for any delay in doing so or shall be under any obligation to sell or otherwise
dispose of any Collateral upon the request of any Grantor or any other Person or
to take any other action whatsoever with regard to any
Collateral.  The powers conferred on the Collateral Agent hereunder
are solely to protect the Collateral Agent’s interest in the Collateral and
shall not impose any duty upon the Collateral Agent or any other Secured Party
to exercise any such powers.  The Collateral Agent and the other
Secured Parties shall be accountable only for amounts that they actually receive
as a result of the exercise of such powers and neither they nor any of their
respective officers, directors, employees or agents shall be responsible to any
Grantor for any act or failure to act hereunder, except for their own gross
negligence or willful misconduct and the gross negligence or willful misconduct
of any of their own officers, directors, employees or agents.

     

    
      	
               
      

            	
              Section
      6.3

            	
              Authorization
      of Financing Statements

            

    

     

    Each
Grantor authorizes the Collateral Agent and its Affiliates, counsel and other
representatives, at any time and from time to time, to file or record financing
statements, amendments to financing statements, and other filing or recording
documents or instruments with respect to the Collateral in such form and in such
offices as the Collateral Agent reasonably determines appropriate to perfect the
security interests of the Collateral Agent under this Agreement, and such
financing statements and amendments may describe the Collateral covered thereby
as “all assets of the debtor,” “all personal property of the debtor” or words of
similar effect.  Each Grantor hereby also authorizes the Collateral
Agent and its Affiliates, counsel and other representatives, at any time and
from time to time, to file continuation statements with respect to previously
filed financing statements.  A photographic or other reproduction of
this Agreement
shall be sufficient as a financing statement or other filing or recording
document or instrument for filing or recording in any
jurisdiction.

     

    
      	
               
      

            	
              Section
      6.4

            	
              Authority
      of Collateral Agent

            

    

     

    Each
Grantor acknowledges that the rights and responsibilities of the Collateral
Agent under this Agreement with respect to any action taken by it or the
exercise or non-exercise by the Collateral Agent 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 Collateral 

    
 

    
      
        
           

        

        
          -29-

          
            

          

        

        
           

        

      

    

    

    Agent and
the other Secured Parties, be governed by the Credit Agreement and by such other
agreements with respect thereto as may exist from time to time among them, but,
as between the Collateral Agent and the Grantors, the Collateral Agent shall be
conclusively presumed to be acting as agent for the other Secured Parties it
represents as collateral agent with full and valid authority so to act or
refrain from acting, and no Grantor shall be under any obligation, or
entitlement, to make any inquiry respecting such authority.

     

    
      	
              ARTICLE
      VII

            	
              Miscellaneous

            

    

     

    
      	
               
      

            	
              Section
      7.1

            	
              Amendments
      in Writing

            

    

     

    None of
the terms or provisions of this Agreement may be waived, amended, supplemented
or otherwise modified except in accordance with Section 11.1 of
the Credit Agreement; provided, however, that this Agreement
may be supplemented (but no existing provisions may be modified) through Pledge
Amendments and Joinder Agreements, in substantially the form of Annex 3 and
Annex 4
respectively, in each case duly executed by the Collateral Agent and each
Grantor directly affected thereby.

     

    
      	
               
      

            	
              Section
      7.2

            	
              Notices

            

    

     

    All
notices, requests and demands to or upon the Collateral Agent or any Grantor
hereunder shall be effected in the manner provided for in Section 11.8 of the Credit
Agreement; provided,
however, that any such
notice, request or demand to or upon any Grantor shall be addressed to
Borrower’s notice address set forth in such Section
11.8.

     

    
      	
               
      

            	
              Section
      7.3

            	
              No
      Waiver by Course of Conduct; Cumulative
Remedies

            

    

     

    The
Collateral Agent shall not, and no other Secured Party shall, by any act (except
by a written instrument pursuant to Section 7.1),
delay, indulgence, omission or otherwise be deemed to have waived any right or
remedy hereunder or to have acquiesced in any Default or Event of
Default.  No failure to exercise, nor any delay in exercising, on the
part of the Collateral Agent or any other Secured Party, any right, power or
privilege hereunder shall operate as a waiver thereof.  No single or
partial exercise of any right, power or privilege hereunder shall preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege.  A waiver by the Collateral Agent or any other Secured
Party of any right or remedy hereunder on any one occasion shall not be
construed as a bar to any right or remedy that the Collateral Agent or such
other Secured Party would otherwise have on any future occasion.  The
rights and remdies
herein provided are cumulative, may be exercised singly or concurrently and are
not exclusive of any other rights or remedies provided by
law.

     

    
      	
               
      

            	
              Section
      7.4

            	
              Successors
      and Assigns

            

    

     

    This
Agreement shall be binding upon the successors and assigns of each Grantor and
shall inure to the benefit of the Collateral Agent and each other Secured Party
and their successors and assigns; provided, however, that no Grantor may
assign, transfer or delegate any of its rights or obligations under this
Agreement without the prior written consent of the Collateral 

    
 

    
      
        
           

        

        
          -30-

          
            

          

        

        
           

        

      

    

    Agent,
except pursuant to mergers, liquidations or dissolutions permitted pursuant to
Section
8.7 of the
Credit Agreement.

     

    
      	
               
      

            	
              Section
      7.5

            	
              Counterparts

            

    

     

    This
Agreement may be executed by one or more of the parties to this Agreement on any
number of separate counterparts (including by telecopy), each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.  Signature pages may be
detached from multiple counterparts and attached to a single counterpart so that
all signature pages are attached to the same document.  Delivery of an
executed counterpart by telecopy shall be effective as delivery of a manually
executed counterpart.

     

    
      	
               
      

            	
              Section
      7.6

            	
              Severability

            

    

     

    Any
provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

     

    
      	
               
      

            	
              Section
      7.7

            	
              Section
      Headings

            

    

     

    The
Article and Section titles contained in this Agreement are, and shall be,
without substantive meaning or content of any kind whatsoever and are not part
of the agreement of the parties hereto.

     

    
      	
               
      

            	
              Section
      7.8

            	
              Entire
      Agreement

            

    

     

    This
Agreement together with the other Loan Documents represents the entire agreement
of the parties and supersedes all prior agreements and understandings relating
to the subject matter hereof.

     

    
      	
               
      

            	
              Section
      7.9

            	
              Governing
      Law

            

    

     

    This
Agreement and the rights and obligations of the parties hereto shall be governed
by, and construed and interpreted in accordance with, the laws of the State of
New York.

     

    
      
        	
                 
      

              	
                Section
      7.10 

              	
                Additional
      Grantors

              

      

    

                          

    If,
pursuant to Section 7.11 of the Credit
Agreement, any Grantor shall be required to cause any Subsidiary of any Loan
Party or any other Person that is not a Grantor to become a Grantor hereunder,
such Subsidiary or other Person shall execute and deliver to the Collateral
Agent a Joinder Agreement substantially in the form of Annex 4 and
shall thereafter for all purposes be a party hereto and have the same rights,
benefits and obligations as a Grantor party hereto on the Restatement Effective
Date.

    
      
         

      

      
        -31-

        
          

        

      

      
         

      

    

     

    
      	
               
      

            	
              Section
      7.11

            	
              Release
      of Collateral

            

    

     

    If any
Collateral shall be sold or otherwise disposed of or liquidated (other than any
such sale or disposition to another Grantor) (or as a result of a purchase money
financing permitted under the Credit Agreement comes within the definition of
Excluded Property) by any Grantor in a transaction permitted by the Credit
Agreement (or such sale or other disposition or liquidation has been approved in
writing by those Secured Parties whose approval is required by the applicable
Loan Documents), such Collateral shall be released from the Lien created
hereby.  In connection therewith, the Collateral Agent, at the request
and sole expense of Borrowers, shall execute and deliver to a Borrower all
releases or other documents, including, without limitation, UCC termination
statements, reasonably necessary or desirable for the release of the Lien
created hereby on such Collateral.  At the request and sole expense of
Borrowers, a Grantor shall be released from its obligations hereunder in the
event that all the capital stock of such Grantor shall be sold or disposed or
such Grantor is designated as an Unrestricted Subsidiary in accordance with the
Credit Agreement; provided, however, that a Borrower
shall have delivered to the Collateral Agent, at least five Business Days prior
to the date of the proposed release, a written request for release identifying
the relevant Grantor and the terms of the sale, other disposition or designation
in reasonable detail, together with a certification by a Borrower in form and
substance satisfactory to the Collateral Agent stating that such transaction is
in compliance with the Credit Agreement and the other Loan
Documents.

     

    
      	
               
      

            	
              Section
      7.12

            	
              Reinstatement

            

    

     

    Each
Grantor further agrees that, if any payment made by any Loan Party or other
Person and applied to the Secured Obligations is at any time annulled, avoided,
set aside, rescinded, invalidated, declared to be fraudulent or preferential or
otherwise required to be refunded or repaid, or the proceeds of Collateral are
required to be returned by any Secured Party to such Loan Party, its estate,
trustee, receiver or any other party, including any Grantor, under any
bankruptcy law, state or federal law, common law or equitable cause, then, to
the extent of such payment or repayment, any Lien or other Collateral securing
such liability shall be and remain in full force and effect, as fully as if such
payment had never been made or, if prior thereto the Lien granted hereby or
other Collateral securing such liability hereunder shall have been released or
terminated by virtue of such cancellation or surrender, such Lien or other
Collateral shall be reinstated in full force and effect, and such prior
cancellation or surrender shall not diminish, release, discharge, impair or
otherwise affect any Lien or other Collateral securing the obligations of any
Grantor in respect of the amount of such payment.

     

    
       

      
        	
                 
      

              	
                Section
      7.13

              	
                Termination

              

      

    

                                    

    This
Agreement (other than the reinstatement provisions of Section 7.12) shall
terminate upon the payment in full of the Secured Obligations.  Upon
termination of this Agreement the Collateral shall be released from the Lien of
this Agreement.  Upon such release or any release of Collateral or any
part thereof in accordance with the provisions of the Credit Agreement, the
Collateral Agent shall, upon the request and at the sole cost and expense of the
Grantors, assign, transfer and deliver to such Grantors, against receipt and
without recourse to or warranty by the Collateral Agent except as to the fact
that the Collateral Agent has not encumbered the released assets, such of the
Collateral or any part thereof to be released as may be in posses-

    
 

    
      
        
           

        

        
          -32-

          
            

          

        

        
           

        

      

    

    

    sion of
the Collateral Agent and as shall not have been sold or otherwise applied
pursuant to the terms hereof, and, with respect to any other Collateral, proper
documents and instruments (including UCC-3 termination financing statements or
releases) acknowledging the termination hereof or the release of such
Collateral, as the case may be.

     

    
      	
               
      

            	
              Section
      7.14

            	
              Obligations
      Absolute

            

    

     

    All
obligations of each Grantor hereunder shall be absolute and unconditional
irrespective of:

     

    (i)       any
bankruptcy, insolvency, reorganization, arrangement, readjustment, composition,
liquidation or the like of any other Grantor;

     

    (ii)                  any
lack of validity or enforceability of the Credit Agreement or any other Loan
Document, or any other agreement or instrument relating thereto or relating to a
Secured Obligation;

     

    (iii)                  any
change in the time, manner or place of payment of, or in any other term of, all
or any of the Secured Obligations, or any other amendment or waiver of or any
consent to any departure from the Credit Agreement or any other Loan Document or
any other agreement or instrument relating thereto or relating to any Secured
Obligation;

     

    (iv)                  any
pledge, exchange, release or non-perfection of any other collateral, or any
release or amendment or waiver of or consent to any departure from any
guarantee, for all or any of the Secured Obligations;

     

    (v)                  any
exercise, non-exercise or waiver of any right, remedy, power or privilege under
or in respect hereof, the Credit Agreement or any other Loan Document or
document relating to a Secured Obligation except as specifically set forth in a
waiver granted pursuant to the provisions of Section 7.1
hereof; or

     

    (vi)                  any
other circumstances which might otherwise constitute a defense available to, or
a discharge of, any Grantor other than payment in full of the Secured
Obligations.

    
       

      [Signature
Pages Follow]

    

    
      
         

      

      
        -33-

        
          

        

      

      
         

      

    

    In
witness whereof, each of the undersigned has caused this Amended and
Restated Pledge and Security Agreement to be duly executed and delivered as of
the date first above written.

     

     

    
      	
               
      

            	
              ARBY’S
      RESTAURANT GROUP, INC.

            

    

    
      	
               
      

            	
                 
      as Grantor

            

    

     

         
By:  /s/ Daniel
T.
Collins                                                           
                                                      

                                                 
Name:  Daniel T. Collins

                                         
Title:  Sr. Vice President & Treasurer

     

     

    
      	
               
      

            	
              ARBY’S
      RESTAURANT HOLDINGS, LLC,

            

    

    
      	
               
      

            	
                  
      as Grantor

            

    

     

         
By:   /s/
Daniel T.
Collins                                                                                                                  

                                           
Name:  Daniel T. Collins

                                           
Title:  Sr. Vice President & Treasurer

     

     

    
      	
               
      

            	
              TRIARC
      RESTAURANT HOLDINGS, LLC,

            

    

    
      	
               
      

            	
                  
      as Grantor

            

    

     

          
By:  /s/ Daniel
T.
Collins                                                                                                                  

                                           Name:  Daniel
T. Collins

                                          
Title:  Sr. Vice President & Treasurer

     

     

    
      	
               
      

            	
              WENDY’S
      INTERNATIONAL HOLDINGS, LLC

            

    

    
      	
               
      

            	
                  
      as Grantor

            

    

     

          
By:  /s/ Daniel
T.
Collins                                                            
                                                      

                                           Name:  Daniel
T. Collins

                                          
Title:  Sr. Vice President & Treasurer

     

    WENDY’S
INTERNATIONAL, INC.

    as
Grantor

     

    By: /s/ Daniel T.
Collins                                                                                                              

           Name:  Daniel
T. Collins

           Title:  Sr.
Vice President & Treasurer

     

     

    
      
        
          [Signature Page to the Amended and
Restated Pledge and Security Agreement]

        

         

      

      
         

        
          

        

      

      
         

      

    

    

     

    
      	
               
      

            	
              ARBY’S
      SUPPORT CENTER, LLC,

            

    

    
      	
               
      

            	
                  
      as Grantor

            

    

     

          
By:  /s/ Daniel
T.
Collins                                                             
                                                      

                                          
Name:  Daniel T. Collins

                                          
Title:  Sr. Vice President & Treasurer

     

     

    
      	
               
      

            	
              ARG
      SERVICES, INC.,

            

    

    
      	
               
      

            	
                  
      as Grantor

            

    

     

         
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                         
Name:  Daniel T. Collins

                                         
Title:  Sr. Vice President & Treasurer

     

     

    
      	
               
      

            	
              FRANCHISE
      ASSOCIATES, LLC,

            

    

    
      	
               
      

            	
                  
      as Grantor

            

    

     

          
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                           Name:  Daniel
T. Collins

                                          
Title:  Sr. Vice President & Treasurer

     

     

    
      	
               
      

            	
              ARBY’S,
      LLC,

            

    

    
      	
               
      

            	
                  
      as Grantor

            

    

     

          
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                          
Name:  Daniel T. Collins

                                          
Title:  Sr. Vice President & Treasurer

     

     

    
      	
               
      

            	
              ARBY’S
      RESTAURANT, LLC,

            

    

    
      	
               
      

            	
                  
      as Grantor

            

    

     

          
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                           Name:  Daniel
T. Collins

                                          
Title:  Sr. Vice President & Treasurer

     

     

     

    
      
        
          [Signature Page to the Amended and
Restated Pledge and Security Agreement]

        

         

      

      
         

        
          

        

      

      
         

      

    

     

         
ARBY’S IP HOLDER TRUST,

              
as Grantor

     

         
By:  /s/
Daniel T.
Collins                                                                                                                    

                                                 
Name:  Daniel T. Collins

                                                 
Title:  Sr. Vice President & Treasurer

     

     

    
      	
               
      

            	
              RTM,
      LLC,

            

    

    
      	
               
      

            	
                  
      as Grantor

            

    

     

          
By:  /s/
Daniel T.
Collins                                                                                                                    

                                          
Name:  Daniel T. Collins

                                          
Title:  Sr. Vice President & Treasurer

     

     

    
      	
               
      

            	
              RTM
      PARTNERS, LLC,

            

    

    
      	
               
      

            	
                  
      as Grantor

            

    

     

           By:  /s/ Daniel T.
Collins                                                                                                                    

                                          
Name:  Daniel T. Collins

                                          
Title:  Sr. Vice President & Treasurer

     

     

    
      	
               
      

            	
              RTM
      OPERATING COMPANY, LLC,

            

    

    
      	
               
      

            	
                  
      as Grantor

            

    

     

          
By:  /s/
Daniel T.
Collins                                                                                                                    

                                          
Name:  Daniel T. Collins

                                          
Title:  Sr. Vice President & Treasurer

     

     

         
RTM DEVELOPMENT COMPANY, LLC,

                                               
as Grantor

     

     

         
By:  /s/
Daniel T.
Collins                                                                                                                    

                                               
  Name:  Daniel T. Collins

                                                 
Title:  Sr. Vice President & Treasurer

     

     

     

    
      [Signature Page to the Amended and
Restated Pledge and Security Agreement]

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    
      

       

      
        	
                 
      

              	
                ARG RESOURCES,
      LLC,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

            
By:  /s/ Daniel
T.
Collins                                                             
                                                      

                                            
Name:  Daniel T. Collins

                                            
Title:  Sr. Vice President & Treasurer

       

       

      
        	
                 
      

              	
                RTMSC,
      LLC,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

           
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                           
Name:  Daniel T. Collins

                                           
Title:  Sr. Vice President & Treasurer

       

       

      
        	
                 
      

              	
                RTM
      GEORGIA, LLC,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

            
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                             Name:  Daniel
T. Collins

                                            
Title:  Sr. Vice President & Treasurer

       

       

      
        	
                 
      

              	
                RTM
      ALABAMA, LLC,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

            
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                            
Name:  Daniel T. Collins

                                            
Title:  Sr. Vice President & Treasurer

       

       

      
        	
                 
      

              	
                RTM
      WEST, LLC,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

            
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                             Name:  Daniel
T. Collins

                                            
Title:  Sr. Vice President & Treasurer

    

     

     

    
      
        
          [Signature Page to the Amended and
Restated Pledge and Security Agreement]

        

         

      

      
         

        
          

        

      

      
         

      

    

    
      

       

      
        	
                 
      

              	
                RTM
      SEA-TAC, LLC,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

            
By:  /s/ Daniel
T.
Collins                                                             
                                                      

                                            
Name:  Daniel T. Collins

                                            
Title:  Sr. Vice President & Treasurer

       

       

      
        	
                 
      

              	
                RTM
      INDIANAPOLIS, INC.,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

           
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                           
Name:  Daniel T. Collins

                                           
Title:  Sr. Vice President & Treasurer

       

       

      
        	
                 
      

              	
                RTM
      SAVANNAH, LLC,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

            
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                             Name:  Daniel
T. Collins

                                            
Title:  Sr. Vice President & Treasurer

       

       

      
        	
                 
      

              	
                RTM
      GULF COAST, LLC,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

            
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                            
Name:  Daniel T. Collins

                                            
Title:  Sr. Vice President & Treasurer

       

       

      
        	
                 
      

              	
                RTM
      PORTLAND, LLC,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

            
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                             Name:  Daniel
T. Collins

                                            
Title:  Sr. Vice President & Treasurer

    

     

    
      
        
          [Signature Page to the Amended and
Restated Pledge and Security Agreement]

        

         

      

      
         

        
          

        

      

      
         

      

    

    
      

       

      
        	
                 
      

              	
                RTM
      MID-AMERICA, LLC,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

            
By:  /s/ Daniel
T.
Collins                                                             
                                                      

                                            
Name:  Daniel T. Collins

                                            
Title:  Sr. Vice President & Treasurer

       

       

      
        	
                 
      

              	
                RTM
      ACQUISITION COMPANY, LLC,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

           
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                           
Name:  Daniel T. Collins

                                           
Title:  Sr. Vice President & Treasurer

       

       

      
        	
                 
      

              	
                SYBRA,
      LLC,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

            
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                             Name:  Daniel
T. Collins

                                            
Title:  Sr. Vice President & Treasurer

       

       

      
        	
                 
      

              	
                WENDY'S
      OLD FASHIONED HAMBURGERS OF NEW YORK,
INC.,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

            
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                            
Name:  Daniel T. Collins

                                            
Title:  Sr. Vice President & Treasurer

       

       

      
        	
                 
      

              	
                WENDY'S
      OF DENVER, INC.,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

            
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                             Name:  Daniel
T. Collins

                                            
Title:  Sr. Vice President & Treasurer

    

     

     

    
      
        
          [Signature Page to the Amended and
Restated Pledge and Security Agreement]

        

         

      

      
         

        
          

        

      

      
         

      

    

    
      

       

      
        	
                 
      

              	
                WENDY'S
      OF N.E. FLORIDA, INC.,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

            
By:  /s/ Daniel
T.
Collins                                                             
                                                      

                                            
Name:  Daniel T. Collins

                                            
Title:  Sr. Vice President & Treasurer

       

       

      
        	
                 
      

              	
                THE
      NEW BAKERY CO. OF OHIO, INC.,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

           
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                           
Name:  Daniel T. Collins

                                           
Title:  Sr. Vice President & Treasurer

       

       

      
        	
                 
      

              	
                SCIOTO
      INSURANCE COMPANY,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

            
By:  /s/ Chris A.
Varin                                                                                                                    

                                             Name:  Chris
A. Varin

                                            
Title:  Vice President, Assistant Secretary

       

       

      
        	
                 
      

              	
                OLDEMARK,
      LLC,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

            
By:  /s/ Chris A.
Varin                                                                                                                    

                                            
Name:  Chris A. Varin

                                            
Title:  Vice President, Assistant Secretary

       

       

       

      
        
          [Signature Page to the Amended and
Restated Pledge and Security Agreement]

           

          

        

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                BDJ
      71112, LLC,

              

      

      
        	
                 
      

              	
                    
      as Grantor

              

      

       

            
By:  /s/ Daniel
T.
Collins                                                                                                                    

                                             Name:  Daniel
T. Collins

                                            
Title:  Sr. Vice President & Treasurer

    

     

     

    
      
        
          [Signature Page to the Amended and
Restated Pledge and Security Agreement]

           

          

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    

     

    
      
        
          

           

          [Signature
Page to Pledge and Security Agreement]

        

         

      

      
         

        
          

        

      

      
         

      

    

    Accepted
and Agreed

    as of the
date first above written:

     

    Citicorp
North America, Inc.

       as Collateral
Agent

     

    By:  /s/ David
Leland                                             
                                                       

           
Name: David Leland

           
Title: Vice President

    
      
        
          

           

          [ Signature Page to
the Amended and Restated Pledge and Security Agreement ]

        

         

      

      
         

        
          

        

      

      
         

      

    

    Annex
1

    to

    Pledge
and Security Agreement

    

     

    Form
of Deposit Account Control Agreement

     

    ___________,
____

     

    [Financial
Institution]

    [Address]

     

    Ladies
and Gentlemen:

     

    Reference
is made to account no. [__________] maintained with you (the “Bank”) by
[                      ]
(the “Company”), into
which funds are deposited from time to time (the “Account”).  The
Company has entered into a Pledge and Security Agreement, dated as of July 25,
2005 and amended and restated as of March 11, 2009 (as the same may be amended,
restated, supplemented or otherwise modified from time to time, the “Amended and Restated Pledge and
Security Agreement”), among Arby’s Restaurant Group,
Inc., Arby’s Restaurant Holdings, LLC, Wendy’s International Holdings, LLC,
Wendy’s International, Inc., Triarc Restaurant Holdings, LLC, certain of their
subsidiaries and/or affiliates party thereto and Citicorp North America, Inc. as
collateral agent for the Secured Parties referred to therein (in such capacity,
the “Collateral
Agent”).

     

    Pursuant
to the Amended and Restated Pledge and Security Agreement and related documents,
the Company has granted to the Collateral Agent, for the benefit of the Secured
Parties, security interests in certain property of the Company, including, among
other things, accounts, inventory, equipment, instruments, general intangibles
and all proceeds thereof (the “Collateral”).  Payments
with respect to the Collateral are or hereafter may be made to the
Account.  You, the Company and the Collateral Agent are entering into
this letter agreement to perfect the security interests of the Collateral Agent
in the Account.

     

    The
Company hereby transfers to the Collateral Agent control of the Account and all
funds and other property on deposit therein.  By your execution of
this letter agreement, you (i) agree that you shall comply with
instructions originated by the Collateral Agent directing disposition of the
funds in the Account without further consent of the Company and (ii) acknowledge
and agree that the Collateral Agent now has exclusive control of the Account,
that all funds and other property on deposit in the Account shall be transferred
to the Collateral Agent as provided herein, that the Account is being maintained
by you for the benefit of the Collateral Agent and that all amounts and other
property therein are held by you as custodian for the Collateral
Agent.

     

    Except as
provided in clause (d) below, the Account
shall not be subject to deduction, set-off, banker’s lien, counterclaim,
defense, recoupment or any other right in favor of any person or entity other
than the Collateral Agent.  By your execution of this letter agreement
you

     

    
      
        
          

           

          A1-1

        

         

      

      
         

        
          

        

      

      
         

      

    

    also
acknowledge that, as of the date hereof, you have received no notice of any
other pledge or assignment of the Account and have not executed any agreements
with third parties covering the disposition of funds in the
Account.  You agree with the Collateral Agent as follows:

     

    (a)           Except
as set forth in clause (b) below, notwithstanding anything to the contrary or
any other agreement relating to the Account, the Account is and shall be
maintained for the benefit of the Collateral Agent and shall be entitled “Citicorp North America, Inc. [name
of Company] Account” and shall be subject to written instructions only
from an authorized officer of the Collateral Agent.

     

    (b)           Prior
to the delivery to you of a written notice from the Collateral Agent in the form
of Exhibit A hereto
(a “Blockage Notice”),
you are authorized to comply with instructions from the Company with respect to
the Account.

     

    (c)           From
and after the delivery to you of a Blockage Notice, you shall transfer on each
business day (by wire transfer or other method of transfer mutually acceptable
to you and the Collateral Agent that sent such Blockage Notice) the entire
Balance in the Account to the account of the Collateral Agent set forth in the
Blockage Notice or to such other account as the Collateral Agent may otherwise
designate in writing after the delivery of such Blockage Notice (the “Collateral Agent Concentration
Account”).

     

    (d)           All
customary service charges and fees with respect to the Account shall be debited
to the Account.  In the event insufficient funds remain in the Account
to cover such customary service charges and fees, the Company shall pay and
indemnify you for the amounts of such customary service charges and
fees.

     

    This
letter agreement shall be binding upon and shall inure to the benefit of you,
the Company, the Collateral Agent, the Secured Parties referred to in the
Amended and Restated Pledge and Security Agreement and the respective
successors, transferees and assigns of any of the foregoing.  This
letter agreement may not be modified except upon the mutual consent of the
Collateral Agent, the Company and you. You may terminate the letter agreement
only upon 30 days’ prior written notice to the Company and the Collateral
Agent.  The Collateral Agent may terminate this letter agreement upon
prior 15 days’ written notice to you and the Company.  Upon such
termination you shall close the Account and transfer all funds in the Account to
the Collateral Agent Concentration Account or as otherwise directed by the
Collateral Agent.  After any such termination, you shall nonetheless
remain obligated promptly to transfer to the Collateral Agent Concentration
Account or as the Collateral Agent may otherwise direct all funds and other
property received in respect of the Account.

     

    This
letter agreement may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed shall be
deemed to be an original and all of which when taken together shall constitute
one and the same agreement.  Delivery of an executed counterpart of a
signature page to this letter agreement by telecopier shall be effective as
delivery of a manually executed counterpart of this letter
agreement.

     

    This letter agreement supersedes all prior agreements, oral or
written, with respect to the subject matter hereof and may not be amended,
modified or supplemented except by a

    
      
        
          

           

          A1-2

        

         

      

      
         

        
          

        

      

      
         

      

    

     writing
signed by the Collateral Agent, the Company and you.  You have not,
and, without the prior consent of the Collateral Agent and the Company, you
shall not, agree with any third party to comply with instructions or other
directions concerning the Account or the disposition of funds in the Account
originated by such third party.

     

    The
Company hereby agrees to indemnify and hold you, your directors, officers,
agents and employees harmless against all claims, causes of action, liabilities,
lawsuits, demands and damages, including, without limitation, all court costs
and reasonable attorney fees, in each case in any way related to or arising out
of or in connection with this letter agreement or any action taken or not taken
pursuant hereto, except to the extent caused by your gross negligence or willful
misconduct.

     

    Except as
otherwise provided herein, your obligations hereunder shall continue in effect
until the security interests of the Collateral Agent in the Account and all
funds therein or credited thereto have been terminated pursuant to the terms of
the Amended and Restated Pledge and Security Agreement and the Collateral Agent
has notified you of such termination in writing.

     

    This
letter agreement shall be governed by, and construed in accordance with, the law
of the State of New York.  For purposes of the Uniform Commercial
Code, the State of New York shall be deemed the Bank’s
jurisdiction.

     

    
      
        
          

           

          A1-3

        

         

      

      
         

        
          

        

      

      
         

      

    

    Upon
acceptance of this letter agreement it shall be the valid and binding obligation
of the Company, the Collateral Agent, and you, in accordance with its
terms.

     

     

    
      	
               
      

            	
              Very
      truly yours,

            

    

    
      	
               
      

            	
              [Name
      of Company]

            

    

     

         
By: 
_________________________________________                      

                                         
Name:

                                         
Title:

     

     

    
      	
               
      

            	
              Citicorp
      North America, Inc.,

            

    

    
      	
               
      

            	
                  
      as Collateral Agent

            

    

     

          
By: 
_________________________________________                      

                                          
Name:

                                          
Title:

     

    Acknowledged
and Agreed

    as of the
date first above written:

     

    [Financial
Institution]

     

    By: 
_________________________________________

           
Name:

           
Title:

    
      
        
          

           

          [Signature
Page to Deposit Account Control Account Agreement]

        

         

      

      
         

        
          

        

      

      
         

      

    

    Exhibit
A

    to

    Deposit
Account Control Agreement

    

     

    Form
of Collateral Agent Blockage Notice

     

    [Financial
Institution]

    [Address]

     

    Re:  Account
No. ________________ (the “Account”)

     

    Ladies
and Gentlemen:

     

    Reference
is made to the Account and that certain Deposit Account Control Agreement dated
__________, 20__ among you, Citicorp North America, Inc., as Collateral Agent
(in such capacity, the “Collateral Agent”), and
[_____________] (the “Deposit
Account Control Agreement”).  Capitalized terms used herein
shall have the meanings given to them in the Deposit Account Control
Agreement.

     

    The
Collateral Agent hereby notifies you that, from and after the date of this
notice, you are hereby directed to transfer (by wire transfer or other method of
transfer mutually acceptable to you and the Collateral Agent) to the Collateral
Agent, in same day funds, on each business day, the entire balance in the
Account to the following account:

     

    ABA
Number:_________________________________________

    Name of
Bank:

    Address:

     

    Account
Name:________________________________________

    Account
Number:_______________________________________

    Reference:____________________________________________

    Attn:________________________________________________

     

    or to
such other account as the Collateral Agent may from time to time designate in
writing.

     

     

    
      	
               
      

            	
              Very
      truly yours,

            

    

    
      	
               
      

            	
              Citicorp
      North America, Inc.,

            

    

    
      	
               
      

            	
                  
      as Collateral Agent

            

    

     

          
By:  _________________________________________

                                          
Name:

                                          
Title:

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Annex
2

    to

    Pledge
and Security Agreement

    

     

    Form
of Securities Account Control Agreement

     

    ___________,
20__

     

    [Name and
Address

    of
Approved Securities

    Intermediary]

     

    Ladies
and Gentlemen:

     

    The
undersigned ___________________ (the “Pledgor”) together with
certain of its affiliates are party to a Pledge and Security Agreement, dated as
of July 25, 2005 and amended and restated as of March 11, 2009 (the “Amended and Restated Pledge and
Security Agreement”), in favor of Citicorp North America, Inc., as the
collateral agent for the Secured Parties referred to therein (in such capacity,
the “Collateral Agent”)
pursuant to which security interests are granted by the Pledgor in all present
and future Assets (hereinafter defined) in Account No. _______ of the Pledgor
(the “Pledge”).

     

    In
connection therewith, the Pledgor hereby instructs you (the “Approved Securities
Intermediary”) to do all of the following:

     

    1.           maintain
the Account, as “__________ - Citicorp North America, Inc. Control
Account”;

     

    2.           hold
in the Account the assets, including, without limitation, all financial assets,
securities, security entitlements and all other property and rights now or
hereafter received in such Account (collectively the “Assets”), including, without
limitation, those assets listed on Schedule A
attached hereto and made a part hereof;

     

    3.           provide
to the Collateral Agent with a duplicate copy to the Pledgor, a monthly
statement of Assets and a confirmation statement of each transaction effected in
the Account after such transaction is effected; and

     

    4.           honor
only the instructions or entitlement orders (within the meaning of
Section 8-102 of the UCC (as defined below) (the “Entitlement Orders”) in regard
to or in connection with the Account given by an Authorized Officer of the
Collateral Agent, except as provided in the following sentence.  Until
such time as the Collateral Agent gives a written notice in the form of Exhibit A hereto to
the Approved Securities Intermediary that the Pledgor’s rights under this
sentence have been terminated (on which notice the Approved Securities
Intermediary may rely exclusively), the Pledgor acting through an Authorized
Officer of the Pledgor may (a) exercise any voting right that
it

     

    
      
        
          

           

          A2-1

        

         

      

      
         

        
          

        

      

      
         

      

    

    may have
with respect to any Asset, (b) give Entitlement Orders and otherwise give
instructions to enter into purchase or sale transactions in the Account and
(c) withdraw and receive for its own use all regularly scheduled interest
and dividends paid with respect to the Assets and all cash proceeds of any sale
of Assets (“Permitted
Withdrawals”); provided, however, that, unless the
Collateral Agent has consented to the specific transaction, the Pledgor shall
not instruct the Approved Securities Intermediary to deliver and, except as may
be required by law or by court order, the Approved Securities Intermediary shall
not deliver, cash, securities, or proceeds from the sale of, or distributions
on, such securities out of the Account to the Pledgor or to any other person or
entity other than Permitted Withdrawals.

     

    By its
signature below, the Approved Securities Intermediary agrees to comply with the
Entitlement Orders and instructions of an Authorized Officer of the Collateral
Agent (including, without limitation, any instruction with respect to sales,
trades, transfers and withdrawals of cash or other of the Assets) without the
further consent of the Pledgor or any other person (it being understood and
agreed by the Pledgor that the Approved Securities Intermediary shall have no
duty or obligation whatsoever to have knowledge of the terms of the Amended and
Restated Pledge and Security Agreement or to determine whether or not an event
of default exists thereunder).  The Pledgor hereby agrees to indemnify
and hold harmless the Approved Securities Intermediary, its affiliates, officers
and employees from and against all claims, causes of action, liabilities,
lawsuits, demands and damages, including, without limitation, all court costs
and reasonable attorney’s fees, that may result by reason of the Approved
Securities Intermediary complying with such instructions of the Collateral
Agent, except to the extent caused by the gross negligence or willful misconduct
of the Approved Securities Intermediary.

     

    Any
Authorized Officer of the Collateral Agent who shall give oral instructions
hereunder shall confirm the same in writing to the Approved Securities
Intermediary within five days after such oral instructions are
given.

     

    For the
purpose of this Agreement, the term “Authorized Officer of the
Pledgor” shall refer in the singular to ___________________ or
___________________ (each of whom is, on the date hereof, an officer or director
of the Pledgor) and “Authorized Officer of the
Collateral Agent” shall refer in the singular to any person who is a vice
president or managing director of the Collateral Agent.  In the event
that the Pledgor shall find it advisable to designate a replacement for any
Authorized Officer of the Pledgor, written notice of any such replacement shall
be given to the Approved Securities Intermediary and the Collateral
Agent.

     

    Except
with respect to the obligations and duties as set forth herein, this Agreement
shall not impose or create any obligation or duty upon the Approved Securities
Intermediary greater than or in addition to the customary and usual obligations
and duties of the Approved Securities Intermediary to the Pledgor.

     

    As long
as the Assets are pledged to the Collateral Agent, (i) the Approved
Securities Intermediary shall not invade the Assets to cover margin debits or
calls in any other account of the Pledgor and (ii) the Approved Securities
Intermediary agrees that, except for liens resulting from customary commissions,
fees, or charges based upon transactions in the Account, it subordinates in
favor of the Collateral Agent, any security interest, lien or right of setoff
the

     

    
      
        
          

           

          A2-2

        

         

      

      
         

        
          

        

      

      
         

      

    

    Approved
Securities Intermediary may have.  The Approved Securities
Intermediary acknowledges that it has not received notice of any other security
interest in the Account or the Assets.  In the event any such notice
is received, the Approved Securities Intermediary shall promptly notify the
Collateral Agent.  The Pledgor herein represents that the Assets are
free and clear of any lien or encumbrance and agrees that, with the exception of
the security interests granted to the Collateral Agent, no lien or encumbrance
shall be placed by it on the Assets without the express written consent of the
Collateral Agent, and the Approved Securities Intermediary.

     

    This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns and it and the rights and
obligations of the parties hereto shall be governed by, and construed and
interpreted in accordance with, and the law of the Approved Securities
Intermediary’s jurisdiction for the purposes of Section 8-110 of the
Uniform Commercial Code in effect in the State of New York (the “UCC”) shall be, the
law of the State of New York.

     

    The
Approved Securities Intermediary shall treat all property at any time held by
the Approved Securities Intermediary in the Account as Financial Assets within
the meaning of the UCC.  The Approved Securities Intermediary
acknowledges that this Agreement constitutes written notification to the
Approved Securities Intermediary, pursuant to the UCC and any applicable federal
regulations for the Federal Reserve Book Entry System, of the Collateral Agent’s
security interests in the Assets.  The Pledgor, the Collateral Agent
and Approved Securities Intermediary are entering into this Agreement to provide
for the Collateral Agent’s control of the Assets and to confirm the security
interest of the Collateral Agent in the Assets.

     

    If any
term or provision of this Agreement is determined to be invalid or
unenforceable, the remainder of this Agreement shall be construed in all
respects as if the invalid or unenforceable term or provision were
omitted.  This Agreement may not be altered or amended in any manner
without the express written consent of the Pledgor, the Collateral Agent, and
the Approved Securities Intermediary.  This Agreement may be executed
in any number of counterparts, all of which shall constitute one original
agreement.

     

    The
Pledgor hereby agrees to indemnify and hold you, your directors, officers,
agents and employees harmless against all claims, causes of action, liabilities,
lawsuits, demands and damages, including, without limitation, all court costs
and reasonable attorney fees, in each case in any way related to or arising out
of or in connection with this letter agreement or any action taken or not taken
pursuant hereto, except to the extent caused by your gross negligence or willful
misconduct.

     

    This
Agreement may be terminated by the Approved Securities Intermediary upon 30
days’ prior written notice to the Pledgor and the Collateral
Agent.  Upon expiration of such 30-day period, the Approved Securities
Intermediary shall be under no further obligation except to hold the Assets in
accordance with the terms of this Agreement, pending receipt of written
instructions from the Collateral Agent, regarding the further disposition of the
pledged Assets.

     

    Except as
otherwise provided herein, the obligations of the Approved Securities
Intermediary hereunder shall continue in effect until the security interests of
the Collateral Agent in the Account and any and all Assets held therein or
credited thereto have been terminated pur-

     

    
      
        
          

           

          A2-3

        

         

      

      
         

        
          

        

      

      
         

      

    

    suant to
the terms of the Amended and Restated Pledge and Security Agreement and the
Collateral Agent has notified the Approved Securities Intermediary of such
termination in writing

     

    The
Pledgor acknowledges that this Agreement supplements any existing agreement of
the Pledgor with the Approved Securities Intermediary and, except as expressly
provided herein, is in no way intended to abridge any right that the Approved
Securities Intermediary might otherwise have.

     

    
      
        
          

           

          A2-4

        

         

      

      
         

        
          

        

      

      
         

      

    

    In
witness whereof, the Pledgor and the Collateral Agent have caused this Agreement
to be executed by their duly authorized officers all as of the date first above
written.

     

     

    
      	
               
      

            	
              [Name
      of Pledgor]

            

    

     

         
By: 
_________________________________________                      

                                         
Name:

                                         
Title:

     

     

    
      	
               
      

            	
              Citicorp
      North America, Inc.,

            

    

    
      	
               
      

            	
                  
      as Collateral Agent

            

    

     

         
By: 
_________________________________________                      

                                         
Name:

                                         
Title:

     

    Accepted
and Agreed

    as of the
date first above written:

     

    [Approved
Financial Intermediary]

     

    By: 
_________________________________________

           
Name:

           
Title:

    
      
        
          

           

          [Signature
Page to Securities Account Control Agreement]

        

         

      

      
         

        
          

        

      

      
         

      

    

    Schedule A

    to

    Securities
Account Control Agreement

     

    

     

    

     

    Pledged
Collateral Account Number:__________________________

     

    

    
      
        
          

           

          [Signature
Page to Securities Account Control Agreement]

        

         

      

      
         

        
          

        

      

      
         

      

    

    Exhibit A

    to

    Securities
Account Control Agreement

    

     

    Form
of Notice of Control

     

    [Securities
Intermediary]

    [Address]

     

    Re:  Account
No. ________________ (the “Account”)

     

    Ladies
and Gentlemen:

     

    Reference
is made to the Account and that certain Securities Account Control Agreement
dated __________, 20__ among you, Citicorp North America, Inc., as Collateral
Agent (in such capacity, the “Collateral Agent”), and
_____________ (the “Pledgor”) (such agreement, the
“Securities Account Control
Agreement”).  Capitalized terms used herein shall have the
meanings given to them in the Securities Account Control Agreement.

     

    The
Collateral Agent hereby notifies you that, from and after the date of this
notice, the Pledgor’s rights to give Entitlement Orders with respect to the
Account and the other rights afforded to the Pledgor under paragraph 4 of the
Securities Account Control Agreement are terminated.  From and after
the delivery of this notice to you, you shall honor only the Entitlement Orders
in regard to or in connection with the Account and/or the financial assets
contained therein given by an Authorized Officer of the Collateral
Agent.

     

     

    
      	
               
      

            	
              Very
      truly yours,

            

    

     

    
      	
               
      

            	
              Citicorp
      North America, Inc.,

            

    

    
      	
               
      

            	
                  
      as Collateral
      Agent

            

    

     

         
By: 
_________________________________________                      

                                         
Name:

                                         
Title:

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Annex
3

    to

    Pledge
and Security Agreement

    

     

    Form
of Pledge Amendment

     

     

    This
Pledge
Amendment, dated as of __________, 20__, is delivered pursuant to Section 4.4(a) of the Pledge and
Security Agreement, dated as of July 25, 2005 and amended and restated as of
March 11, 2009, by Arby’s Restaurant Group,
Inc. (“Borrower”), Arby’s Restaurant
Holdings, LLC (“Holdco
Co-Borrower”), Wendy’s
International, Inc., an Ohio corporation (“WII Co-Borrower”), Wendy’s International
Holdings, LLC (“Ultimate
Parent Co-Borrower” and, together with
Holdco Co-Borrower, WII Co-Borrower and Borrower, “Borrowers”), Triarc Restaurant
Holdings, LLC, the undersigned Grantor and the other subsidiaries and
affiliates of Borrowers from time to time party thereto as Grantors in favor of
Citicorp North America, Inc., as collateral agent for the Secured Parties
referred to therein (the “Amended and Restated Pledge and
Security Agreement”).  The undersigned hereby agrees that this
Pledge Amendment may be attached to the Amended and Restated Pledge and Security
Agreement and that the Pledged Collateral listed on this Pledge Amendment shall
be and become part of the Collateral referred to in the Amended and Restated
Pledge and Security Agreement and shall secure all Secured Obligations of the
undersigned.  Capitalized terms used herein but not defined herein are
used herein with the meaning given them in the Amended and Restated Pledge and
Security Agreement.

     

     

    
      	
               
      

            	
              [Grantor]

            

    

     

         
By: 
_________________________________________                      

                                         
Name:

                                         
Title:

     

    
      	
              Pledged
      Stock

            
	
              
                Issuer

              

            	
              
                Class

              

            	
              
                Certificate
      No(s).

              

            	
              
                Par
      Value

              

            	
              
                Number
      of Shares, Units or Interests

              

            
	
              
    	
              
    	
              
    	
              
    	
              
    
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      

    

    

    
      	
              Pledged
      Debt Instruments

            
	
              
                Issuer

              

            	
              
                Description

                of
      Debt

              

            	
              
                Certificate
      No(s).

              

            	
              
                Final
      Maturity

              

            	
              
                Principal
      Amount

              

            
	
              
    	
              
    	
              
    	
              
    	
              
    
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      

    

    

    
      
        
          

           

          A3-1 

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    Acknowledged
and Agreed

    as of the
date first above written:

     

    Citicorp
North America, Inc.,

       as Collateral
Agent

     

    By: __________________________________

          
Name:

          
Title:

    
      
        

         

        A3-2 

      

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Annex
4

    to

    Pledge
and Security Agreement

    

     

    Form
of Joinder Agreement

     

     

    This
Joinder
Agreement, dated as of __________, 20__, is delivered pursuant to Section 7.10 of the Pledge and
Security Agreement, dated as of July 25, 2005 and amended and restated as of
March 11, 2009, by Arby’s Restaurant Group,
Inc. (“Borrower”), Arby’s Restaurant
Holdings, LLC (“Holdco
Co-Borrower”), Wendy’s
International, Inc., an Ohio corporation (“WII Co-Borrower”) Wendy’s International
Holdings, LLC (“Ultimate
Parent Co-Borrower” and, together with
Holdco Co-Borrower, WII Co-Borrower and Borrower, “Borrowers”), Triarc Restaurant
Holdings, LLC, and the subsidiaries and affiliates of Borrowers listed on
the signature pages thereof in favor of Citicorp North America, Inc., as agent
for the Secured Parties (in such capacity, the “Collateral Agent”) referred to
therein (the “Amended and
Restated Pledge and Security Agreement”).  Capitalized terms
used herein but not defined herein are used with the meanings given them in the
Amended and Restated Pledge and Security Agreement.

     

    By
executing and delivering this Joinder Agreement, the undersigned, as provided
in Section 7.10 of the Amended and
Restated Pledge and Security Agreement, hereby becomes a party to the Amended
and Restated Pledge and Security Agreement as a Grantor thereunder with the same
force and effect as if originally named as a Grantor therein and, without
limiting the generality of the foregoing, hereby grants to the Collateral Agent,
as collateral security for the full, prompt and complete payment and performance
when due (whether at stated maturity, by acceleration or otherwise) of the
Secured Obligations of the undersigned, hereby collaterally assigns, mortgages,
pledges and hypothecates to the Collateral Agent and grants to the Collateral
Agent a Lien on and security interest in, all of its right, title and interest
in, to and under the Collateral of the undersigned and expressly assumes all
obligations and liabilities of a Grantor thereunder.

     

    The
information set forth in Annex 1-A is all information that
would be required to be set forth in Schedules 1 through 15 to the Perfection Certificate
(as defined in the Amended and Restated Pledge and Security Agreement) if the
undersigned were executing the Perfection Certificate on the date hereof. [By
acknowledging and agreeing to this Joinder Agreement, the undersigned hereby
agree that this Joinder Agreement may be attached to the Amended and Restated
Pledge and Security Agreement and that the Pledged Collateral listed on Annex 1-A to this Pledge
Amendment shall be and become part of the Collateral referred to in the Amended
and Restated Pledge and Security Agreement and shall secure all Secured
Obligations of the undersigned.]1

     

    
________________________  

    
      
        	
                1

              	
                Insert
      to pledge Stock of the new Subsidiary without doing a Pledge
      Amendment.

              

      

       

    

    
      
        
          

           

          A4-1

        

         

      

      
         

        
          

        

      

      
         

      

    

    The
undersigned hereby represents and warrants that each of the representations and
warranties contained in Article III of the
Amended and Restated Pledge and Security Agreement applicable to it is true and
correct on and as the date hereof as if made on and as of such
date.

     

    
      
        
          

           

          A4-2

        

         

      

      
         

        
          

        

      

      
         

      

    

    In
witness whereof, the undersigned has caused this Joinder Agreement to be duly
executed and delivered as of the date first above written.

     

     

    
      	
               
      

            	
              [Additional
      Grantor]

            

    

     

         
By: 
__________________________________                      

                                         
Name:

                                         
Title:

     

    
      
        
          

           

          A4-3

        

         

      

      
         

        
          

        

      

      
         

      

    

    Acknowledged
and Agreed

    as of the
date first above written:

     

     

    Citicorp
North America, Inc.,

       as Collateral
Agent

     

    By: __________________________________        

          
Name:

          
Title:

    
      
        
          

           

          A4-4

        

         

      

      
         

        
          

        

      

      
         

      

    

    Annex
1-A

    

    
      
        
          

           

          A4-5

        

         

      

      
         

        
          

        

      

      
         

      

    

    Annex
5

    to

    Pledge
and Security Agreement

    

     

    Form of
Short Form Intellectual
Property Security Agreement2

     

     

    [Copyright]
[Patent] [Trademark] Security Agreement, dated
as of ___________, 20__, by each of the entities listed on the signature pages
hereof [or that becomes a party hereto pursuant to Section 7.10 of the Amended and
Restated Security Agreement referred to below] (each a “Grantor” and, collectively,
the “Grantors”), in
favor of Citicorp North America, Inc. (“CNAI”), as agent for the Secured
Parties.

     

    W
i t n e s s e t h:

     

    Whereas,
pursuant to the Credit Agreement, dated as of July 25, 2005 and amended and
restated as of March 11, 2009, (as the same may be amended, restated,
supplemented or otherwise modified from time to time, the “Credit Agreement”), among
Arby’s Restaurant
Group, Inc., a Delaware corporation (“Borrower”), Arby’s Restaurant
Holdings, LLC, a Delaware limited liability company (“Holdco
Co-Borrower”), Wendy’s
International, Inc., an Ohio corporation (“WII Co-Borrower”), Wendy’s International
Holdings, LLC (“Ultimate
Parent Co-Borrower” and together with Holdco
Co-Borrower, WII Co-Borrower and Borrower, “Borrowers”), Triarc Restaurant
Holdings, LLC , a Delaware limited liability company, the Lenders and
Issuer party thereto and CNAI, as administrative agent for the Lenders and the
Issuer (in such capacity, the “Administrative Agent”) and as
collateral agent for the Secured Parties referred to therein (in such capacity,
the “Collateral Agent”),
Banc of America Securities, LLC and Credit Suisse, Cayman Islands Branch, as
co-syndication agents for the Lenders and Issuer, and Wachovia Bank, National
Association, SunTrust Bank and GE Capital Franchise Finance Corporation, as
co-documentation agents for the Lenders and Issuer, the Lenders and the Issuer
have severally agreed to make extensions of credit to Borrowers upon the terms
and subject to the conditions set forth therein;

     

    Whereas,
the Grantors other than Borrower are party to the Guaranty pursuant to which
they have guaranteed the Secured Obligations; and

     

    Whereas,
all the Grantors are party to an Amended and Restated Pledge and Security
Agreement of even date herewith in favor of the Collateral Agent (the “Security
Agreement”) pursuant to which the Grantors are required to execute
and deliver this [Copyright] [Patent] [Trademark] Security
Agreement;

     

    Now,
Therefore, in consideration of the premises and to induce the Lenders,
the Issuer and the Collateral Agent to enter into the Credit Agreement and to
induce the Lenders and 

     

    __________________________  

    
      
        	
                2

              	
                Separate
      short form agreements should be filed relating to each Grantor’s
      respective copyrights, patents and
trademarks.

              

      

       

    

    
      
        
          

           

          A5-1 

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    the Issuer to make their respective extensions of credit to Borrowers
thereunder, each Grantor hereby agrees with the Collateral Agent as
follows:

     

    Section
1.                                Defined
Terms

     

    Unless
otherwise defined herein, terms defined in the Credit Agreement or in the
Security Agreement and used herein have the meaning given to them in the Credit
Agreement or the Security Agreement.

     

    Section
2.                                Grant
of Security Interest in [Copyright] [Trademark] [Patent] Collateral

     

    [Each
Grantor, as collateral security for the full, prompt and complete payment and
performance when due (whether at stated maturity, by acceleration or otherwise)
of the Secured Obligations of such Grantor, hereby mortgages, pledges and
hypothecates to the Collateral Agent for the benefit of the Secured Parties a
lien on and security interest in, all of its right, title and interest in, to
and under the following Collateral of such Grantor] (the “[Copyright] [Patent] [Trademark]
Collateral”):

     

    [(a)           all
of its Copyrights, including, without limitation, those referred to on Schedule I
hereto;

     

    (b)           all
reissues, continuations or extensions of the foregoing; and

     

    (c)           all
Proceeds of the foregoing, including, without limitation, any claim by Grantor
against third parties for past, present, future infringement or dilution of any
Copyright.]

     

    or

     

    [(a)           all
of its Patents, including, without limitation, those referred to on Schedule I hereto;

     

    (b)           all
divisionals, continuations, continuations-in-part, re-issues or extensions of
the foregoing; and

     

    (c)           all
Proceeds of the foregoing, including, without limitation, any claim by Grantor
against third parties for past, present or future infringement or dilution of
any Patent.]

     

    or

     

    [(a)           all
of its Trademarks, including, without limitation, those referred to on Schedule I
hereto, other than intent-to-use applications until such applications mature
into registered trademarks;

     

    
      
        

         

        A5-2 

      

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (b)           all
reissues, continuations or extensions of the foregoing;

     

    (c)           all
goodwill of the business connected with the use of, and symbolized by, each
Trademark;  and

     

    (d)           all
Proceeds of the foregoing, including, without limitation, any claim by Grantor
against third parties for past, present, future (i) infringement or
dilution of any Trademark or (ii) injury to the goodwill associated with
any Trademark.]

     

    Section
3.                                Security
Agreement

     

    The
security interest granted pursuant to this [Copyright] [Patent] [Trademark]
Security Agreement is granted in conjunction with the security interest granted
to the Collateral Agent pursuant to the Security Agreement and each Grantor
hereby acknowledges and affirms that the rights and remedies of the Collateral
Agent with respect to the security interests in the [Copyright] [Patent]
[Trademark] Collateral made and granted hereby are more fully set forth in the
Security Agreement, the terms and provisions of which are incorporated by
reference herein as if fully set forth herein.

     

    [Signature
Pages Follow]

    

      
        

         

        A5-3

      

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    In
witness whereof, each Grantor has caused this [Copyright] [Patent] [Trademark]
Security Agreement to be executed and delivered by its duly authorized offer as
of the date first set forth above.

     

     

    
      	
               
      

            	
              Very
      truly yours,

            

    

     

    
      	
               
      

            	
              [Grantor],

            

    

    
      	
               
      

            	
                  
      as Grantor

            

    

     

         
By: 
____________________________________                      

                                         
Name:

                                         
Title:

     

    Accepted
and Agreed

    as of the
date first above written:

     

    Citicorp
North America, Inc.,

       as Collateral
Agent

     

    By: ____________________________________         

          
Name:

          
Title:

     

    
      

       

      A5-4exh10_5.htm

    EXHIBIT 10.5

    CHANGE
IN CONTROL AGREEMENT

    

    

    THIS
CHANGE IN CONTROL AGREEMENT (this “Agreement”) is made
as of  February 25, 2009  by and between Frozen Food Express
Industries, Inc., a Texas corporation (the “Company”)  and Ronald J.
Knutson (the “Executive”).

    

     

    RECITALS

    

    A.           The
Board of Directors of Company (the “Board”) has
determined that the interests of the Company will be advanced by providing the
key executives of the Company with certain benefits in the event of the
termination of employment of any such executive in connection with or following
a Change in Control (as hereinafter defined).

    

    B.           The
Board believes that such benefits will enable the Company to continue to attract
and retain competent and qualified executives, will assure continuity and
cooperation of management and will encourage such executives to diligently
perform their duties without personal financial concerns, thereby enhancing
shareholder value and ensuring a smooth transition.

    

    C.           The
Executive is a key executive of the Company.

     

    AGREEMENTS

    

    NOW,
THEREFORE, for good and valuable consideration, including the mutual covenants
set forth herein, the parties hereto agree as follows:

    

    1.           Definitions.  The
following terms shall have the following meanings for purposes of this
Agreement.

    

    “Affiliate”
means any entity controlled by, controlling or under common control with, the
Company.

    

    “Annual
Pay” means the sum of (a) an amount equal to the sum of the current annual base
salary, the current annual car allowance and Christmas bonus payable to the
Executive by the Company or any Related Corporation at the time of the
termination of his employment, provided such base salary shall not be less than
the base salary of the Executive at the time of Change in Control, plus (b) an
amount equal to the Bonus for the Executive for the fiscal year in which his
termination of employment occurs.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    “Bonus”
means the sum of (a) an amount equal to ninety percent  (90%) of the
Executive’s base pay for the year of termination of his employment plus (b) an
amount equal to the Incentive Bonus Plan’s total incentive bonus payable to the
Executive under the plan for the year of termination of his
employment.

    

    “Cause”
means the Executive’s (a) willful and intentional material breach of this
Agreement, (b) willful and intentional misconduct or gross negligence in the
performance of or willful neglect of, the Executive’s duties, which has caused
material injury (monetary or otherwise) to the Company or any Related
Corporation, or (c) conviction of, or plea of nolo contendere to, a felony;
provided, however, that no act or omission shall constitute “Cause” for purposes
of this Agreement unless the Board or the Chief Executive Officer of the Company
provides to the Executive (i) written notice clearly and fully describing the
particular acts or omissions which the Board or the Chief Executive Officer of
the Company reasonably believes in good faith constitutes “Cause” and (ii) an
opportunity, within thirty (30) days following his receipt of such notice, to
meet in person with the Board or the Chief Executive Officer of the Company to
explain or defend the alleged acts or omissions relied upon by the Board or the
Chief Executive Officer of the Company and, to the extent practicable to cure
such acts or omissions.  Further, no act or omission shall be
considered as “willful” or “intentional” if the Executive reasonably believed
such acts or omissions were in the best interests of the Company.

    

    “Change
in Control” means (a) any “person” (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) that
does not currently own a five percent (5%) or greater equity interest in the
Company or any Related Corporation who becomes the “beneficial owner” (as
determined pursuant to Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Company or any Related Corporation representing
fifteen percent (15%) or more of the combined voting power of the Company’s or
Related Corporation’s, as the case may be, then outstanding voting securities;
or (b) a change in the composition of the Board occurring within a two (2) year
period, as a result of which fewer than a majority of the directors are
Incumbent Directors; or (c) the Company or any Related Corporation shall merge
with or consolidate into any other corporation, other than a merger or
consolidation which would result in the holders of the voting securities of the
Company or any Related Corporation, as the case may be, outstanding immediately
prior thereto holding immediately thereafter securities representing more than
sixty percent (60%) of the combined voting power of the voting securities of the
Company or any Related Corporation, as the case may be, or such surviving entity
(or its ultimate parent, if applicable) outstanding immediately after such
merger or consolidation; or (d) the equity holders of the Company or any Related
Corporation approve a plan of complete liquidation of the Company or any Related
Corporation or the consummation of an agreement for the sale or disposition by
the Company or any Related Corporation of all or substantially all of the
Company’s or Related Corporation’s assets and such plan or agreement becomes
effective, other than liquidation or sale which would result in the Company
directly or indirectly owning such interest or assets.

    

    “Code”
means the Internal Revenue Code of 1986, as amended.

    

    “Confidential
Information” means all information, whether oral or written, previously or
hereafter developed, acquired or used by the Company or any Affiliate and
relating to the business of the Company or any Affiliate that is not generally
known to others in the Company’s area of business, including without limitation
trade secrets, methods or practices developed by the Company or any Affiliate,
financial results or plans, customer or client lists, personnel information,
information relating to negotiations with clients or prospective clients,
proprietary software, databases, programming or data transmission methods, or
copyrighted materials (including without limitation, brochures, layouts,
letters, art work, copy, photographs or illustrations).  It is
expressly understood that the foregoing list shall be illustrative only and is
not intended to be an exclusive or exhaustive list of “Confidential
Information.”

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    “First
Window Period” shall mean the ten (10) day period immediately following a Change
in Control.

    

    “Good
Reason” means any of the following events occurring, without the Executive’s
prior written consent specifically referring to this Agreement, within the
Transition Period following a Change in Control:

    

    (a)           (i)
any reduction in the amount of the Executive’s Annual Pay, (ii) any reduction in
the amount of Executive’s other long-term aggregate incentive compensation
opportunities, or (iii) any significant reduction in the aggregate value of the
Executive’s benefits as in effect from time to time (unless in the case of
either (ii) or (iii), such reduction is pursuant to a general change in
compensation or benefits applicable to all similarly situated employees of the
Company and its Affiliates);

    

     (b)           (i)
the removal of the Executive from the position held by him immediately prior to
the Change in Control, or (ii) any other significant reduction in the nature or
status of the Executive’s duties or responsibilities from those in effect
immediately prior to the Change in Control;

    

    (c)           the
failure by the Company or Related Corporation to pay Executive any portion of
Executive’s current compensation, or to pay Executive any portion of an
installment of deferred compensation under any compensation program of the
Company or Related Corporation within seven (7) days of the date such
compensation is due;

    

    (d)           the
failure by the Company or Related Corporation to provide Executive with the
number of paid vacation days to which Executive is entitled on the basis of
years of service with the Company or Related Corporation in accordance with the
Company’s or Related Corporation’s normal vacation policy in effect at the time
of the Change in Control;

    

    (e)           transfer
of the Executive’s principal place of employment to a metropolitan area other
than that of the Executive’s place of employment immediately prior to the Change
in Control without the Executive’s consent; or

    

    (f)           failure
by the Company or Related Corporation to obtain the assumption agreement
referred to in Section 11 of this Agreement prior to the effectiveness of any
succession referred to therein, unless the purchaser, successor or assignee
referred to therein is bound to perform this Agreement by operation of
law.

    

    “Incumbent
Directors” means directors who either (a) are directors of the Company as of the
date hereof or (b) are elected, or nominated for election, to the Board with the
affirmative votes of at least a majority of the Incumbent Directors at the time
of such election or nomination (but shall not include an individual whose
election or nomination is in connection with an actual or threatened proxy
contest relating to the election of directors of the Company).

    

    “Related
Corporation” shall mean FFE, Inc., a Delaware corporation and wholly owned
subsidiary of the Company, and FFE Transportation Services, Inc., a Delaware
corporation and wholly owned subsidiary of FFE, Inc.

    

    “Second
Window Period” shall mean the thirty (30) day period immediately following the
Transition Period.

    

    “Termination
Pay” means a payment made by the Company to the Executive pursuant to Sections
2(a)(ii) and (iii).

    

    “Transition
Period” shall mean the six (6) month period immediately following a
Change  in Control.

    

    “Without
Cause” means a termination of the Executive’s employment by the Company or
Related Corporation other than due to disability or for Cause.

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    2.           Termination
Payment and Benefits.

    

    (a)           Termination Following Change
in Control.  In the event that the Executive’s employment with
the Company or Related Corporation is terminated during the Transition Period by
the Company or Related Corporation Without Cause, or by the Executive for Good
Reason during the Transition Period or in the event the Executive terminates his
employment for any reason during the First Window Period or the Second Window
Period, the Executive shall be entitled to the following payments and other
benefits:

    

    (i)           A
cash payment in an amount equal to the sum of (a) the Executive’s accrued and
unpaid base salary, car allowance and Christmas bonus as the date of termination
plus (b) his accrued and unpaid bonus, if any, for the prior fiscal year plus
(c) a percentage of the year worked times the Bonus for the current year. This
amount shall be paid on the date of the Executive’s termination of
employment.

    

    (ii)           A
cash payment in an amount equal to two and nine-tenths  (2.9) times
the Executive’s Annual Pay.  This amount shall be paid in accordance
with Section 2(c) hereof.

    

    (iii)           A
cash payment in an amount equal to the Executive’s unvested account balance
under the Company’s or Related Corporation’s 401(k) Savings Plan and 401(k) Wrap
Plan.  This amount shall be paid in accordance with Section 2(c)
hereof.

    

    (iv)           Executive
and his eligible dependents shall be entitled for a period of two (2) years
following his date of termination of employment to continued coverage, at the
same premium rate charged when actively employed, under the Company’s or any
Related Corporation’s group health, dental, long-term disability, Exec-U-Care
Medical Reimbursement Insurance Plan and life insurance as in effect from time
to time (but not any other welfare benefit plans or any retirement plans);
provided that coverage under any particular benefit plan shall expire with
respect to the period after the Executive becomes covered under another
employer’s plan providing for a similar type of benefit.  In the event
the Company or Related Corporation is unable to provide such coverage on account
of any limitations under the terms of any applicable contract with an insurance
carrier or third party administrator, the Company or Related Corporation shall
pay the Executive an amount equal to the cost of such coverage.

    

                   
(v)           All of the
Executive’s unvested options, restricted stock, stock units, performance share
or other awards, if any, based on or related to equity securities of the Company
or its Affiliates under any plan in which the Executive participates and which
was identified as an executive compensation plan in the exhibits to the
Company’s most recent filing with the SEC that shall automatically vest on a
Change in Control (as defined in the applicable plan).  The Company
shall promptly cause any related award agreements to be amended as necessary to
provide for such accelerated vesting.  In the event of any conflict
between this provision and the provisions of any stock option, restricted or
similar award agreements entered into before or after the effective date of this
Agreement, the foregoing provision shall control.

     

    

    (b)           No Duplication; Other
Severance Pay.  There shall be no duplication of severance pay
in any manner.  In this regard, the Executive shall not be entitled to
termination payments hereunder for more than one position with the Company and
its Affiliates.  If the Executive is entitled to any notice or payment
in lieu of any notice of termination of employment required by Federal, state or
local law, including but not limited to the Worker Adjustment and Restraining
Notification Act, the severance compensation to which the Executive would
otherwise be entitled under this Agreement shall be reduced by the amount of any
such payment, in lieu of notice.  If Executive is entitled to any
severance or termination payments under any employment or other agreement with
the Company or any of its Affiliates, the severance compensation to which
Executive would otherwise be entitled under this Agreement shall be reduced by
the amount of such payment.  Except as set forth above, the foregoing
payments and benefits shall be in addition to and not in lieu of any payments or
benefits to which the Executive and his dependents may otherwise be entitled to
under the Company’s or Related Corporation’s compensation and employee benefit
plans.  Nothing herein shall be deemed to restrict the right of the
Company or Related Corporation from amending or terminating any such plan in a
manner generally applicable to similarly situated active employees of the
Company and its Affiliates, in which event the Executive shall be entitled to
participate on the same basis (including payment of applicable contributions) as
similarly situated active executives of the Company and its
Affiliates.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (c)           Mutual
Release.  Termination Pay shall be conditioned upon the
execution by the Executive and the Company of a valid mutual release, in the
form attached hereto as Exhibit A, pursuant to which the Executive and the
Company shall each mutually release each other, to the maximum extent permitted
by law, from any and all claims either party may have against the other as of
the date of termination that relate to or arise out of the employment or
termination of employment of the Executive, except such claims arising under
this Agreement, any employee benefit plan, or any other written plan or
agreement (a “Mutual
Release”).  The full amount of Termination Pay shall be paid in
a lump sum in cash to the Executive within ten (10) days following receipt by
the Company of a Mutual Release which is properly executed by the Executive;
provided, however, that in the event applicable law allows the Executive to
revoke the Mutual Release for a period of time, and the Mutual Release is not
revoked during such period, the full amount of Termination Pay shall be paid to
the Executive following the expiration of such period.

    

                   
3.           Additional
Change in Control Benefits.  Except to the extent released under the
terms of the Mutual Release, Executive shall be entitled to such additional
change in control benefits as are provided under the Frozen Food Express
Industries, Inc. 2005 Stock Incentive Plan, the FFE Transportation Services,
Inc. Supplemental Executive Retirement Plan, the FFE Transportation Services,
Inc. 1999 Executive Bonus and Phantom Stock Plan, the FFE Transportation
Services, Inc. 2005 Executive Bonus and Restricted Stock Plan , the FFE
Transportation Services, Inc. 1994 Incentive Bonus Plan, Frozen Food Express
Industries, Inc. 401(k) Savings Plan and the FFE Transportation Services, Inc.
401(k) Wrap Plan, as approved and adopted by the Board.

    

    
      
      

    

    
      
      

                      
4.          Excise
Taxes.

    (a)           Gross-Up
Payment.  Anything in this Agreement to the contrary
notwithstanding and except as set forth below, if it is determined that any
payment or distribution (a “Payment”) by the
Company to or for the benefit of the Executive (whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or
otherwise) including, without limitation, vesting of options, would be subject
to the excise tax imposed by Section 4999 of the Code, or if any interest or
penalties are incurred by the Executive with respect to such excise tax (such
excise tax, together with any such interest and penalties, being hereinafter
collectively referred to as the “Excise Tax”), then
the Executive shall be entitled to receive an additional payment (a “Gross-Up Payment”) in
an amount sufficient to pay all taxes (including any interest or penalties
imposed with respect to such taxes), including, without limitation, any income
taxes (and any interest and penalties imposed with respect thereto) and Excise
Tax imposed upon the Gross-Up Payment.

    

    (b)           Calculation of Gross-Up
Payment.  Subject to the provisions of paragraph (c) of
this Section 5, all determinations required to be made under this Section 5,
including whether and when a Gross-Up Payment is required and the amount of such
Gross-Up Payment and the assumptions to be used in arriving at such
determination, shall be made by a certified public accounting firm selected by
the Company and reasonably acceptable to the Executive (the “Accounting Firm”),
which shall be retained to provide detailed supporting calculations both to the
Company and the Executive.  If the Accounting Firm is serving as
accountant or auditor for the individual, entity or group effecting the Change
in Control, the Executive shall have the right to appoint another nationally
recognized accounting firm to make the determinations required hereunder (which
accounting firm shall then be referred to as the Accounting Firm
hereunder).  All fees and expenses of the Accounting Firm shall be
paid solely by the Company.  Any Gross-Up Payment, as determined
pursuant to this Section 5, shall be paid by the Company to the Executive within
five (5) days of the receipt of the Accounting Firm’s
determination.  Any determination by the Accounting Firm shall be
binding upon the Company and the Executive.  As a result of the
uncertainty in the application of Section 4999 of the Code at the time of the
initial determination by the Accounting Firm hereunder, it is possible that
Gross-Up Payments which should have been made will not have been made by the
Company (“Underpayment”),
consistent with the calculations required to be made hereunder.  If
the Company exhausts its remedies pursuant to paragraph (c) of this Section 5
and the Executive thereafter is required to pay an Excise Tax in an amount that
exceeds the Gross-Up Payment received by the Executive, the Accounting Firm
shall determine the amount of the Underpayment that has occurred and any such
Underpayment shall be paid by the Company to or for the benefit of the
Executive.

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (c)           Contested
Taxes.  The Executive shall notify the Company in writing of
any claim by the Internal Revenue Service that, if successful, would result in
an Underpayment.  Such notification shall be given as soon as
practicable but not later than ten (10) business days after the Executive is
informed in writing of such claim and shall apprise the Company of the nature of
such claim and the date on which such claim is requested to be paid or
appealed.  The Executive shall not pay such claim prior to the
expiration of the 30-day period following the date on which it gives such notice
to the Company (or such shorter period ending on the date that any payment of
taxes with respect to such claim is due).  If the Company notifies the
Executive in writing prior to the expiration of such period that it desires to
contest such claim, the Executive shall:

    

    (i)            
give the Company any information reasonably requested by the Company relating to
such claim,

    

    (ii)          
 take such action in connection with contesting such claims as the Company
shall reasonably request in writing from time to time, including, without
limitation, accepting legal representation with respect to such claim by an
attorney reasonably selected by the Company,

    

    (iii)           cooperate
with the Company in good faith in order to effectively contest such claim,
and

    

    (iv)           permit
the Company to participate in any proceedings relating to such
claim;

    

    provided, however, that the
Company shall bear and pay directly all costs and expenses (including additional
interest and penalties) incurred in connection with such contest and shall
indemnify and hold the Executive harmless, on an after-tax basis, for any Excise
Tax or income tax (including interest and penalties with respect thereto)
imposed as a result of such representation and payment of costs and
expenses.  Without limitation on the foregoing provisions of this
paragraph (c), the Company shall control all proceedings taken in connection
with such contest and, at its sole option, may pursue or forego any and all
administrative appeals, proceedings, hearings and conferences with the taxing
authority in respect of such claim and may, at its sole option, either direct
the Executive to pay the tax claimed and sue for a refund or to contest the
claim in any permissible manner, and the Executive agrees to prosecute such
contest to a determination before any administrative tribunal, in a court of
initial jurisdiction and in one or more appellate courts, as the Company shall
determine; provided,
however, that if the Company directs the Executive to pay such claim and
sue for a refund, the Company shall advance the amount of such payment to the
Executive, on an interest-free basis, and shall indemnify and hold the Executive
harmless, on an after-tax basis, from any Excise Tax or indemnity and hold the
Executive harmless, on an after-tax basis, from any Excise Tax or income tax
(including interest or penalties with respect thereto) imposed with respect to
such advance or with respect to any imputed income with respect to such advance;
and further provided
that any extension of the statute of limitations relating to payment of taxes
for the taxable year of the Executive with respect to which such contested
amount is claimed to be due is limited solely to such contested
amount.  Furthermore, the Company’s control of the contest shall be
limited to issues with respect to the amount of the Gross-Up Payment, and the
Executive shall be entitled to settle or contest, as the case may be, any other
issue raised by the Internal Revenue Service or any other taxing
authority.

    

    (d)           Refunds.  If,
after the receipt by the Executive of an amount advanced by the Company pursuant
to this Section 5, the Executive becomes entitled to receive any refund with
respect to such claim, the Executive shall promptly pay to the Company the
amount of such refund (together with any interest paid or credited thereon after
taxes applicable thereto).

    

    5.          
Legal Fees.   The Company shall reimburse the Executive for all
legal fees and other costs incurred in enforcing this Agreement.

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    6.          
Certain Covenants by the Executive.

    

    (a)           Covenant Not to
Compete.  For the consideration described in this Agreement to
be paid to Executive, Executive agrees that during the term of his employment
with the Company or Related Corporation and for a period of one (1) year
following the close of business on the date of the termination his of employment
he will not (except as a consultant to the Company or an Affiliate), jointly or
independently, directly or indirectly, engage in and/or participate in the
cold-storage warehousing business or the motor carrier business for
transportation of dry (non-perishable and non-temperature controlled),
perishable and/or temperature controlled truckload, less-than-truckload (“LTL”) and/or
distribution shipments rated as LTL shipments or distribution shipments,
respectively, according to the provisions of tariffs and shipper contracts to
which the Company or an Affiliate is a party, either as a common motor carrier,
contract motor carrier, freight transportation broker, third-party logistics
provider or otherwise, in interstate commerce, in intrastate commerce and/or in
international commerce (the “Competing Business”)
within the forty-eight (48) contiguous states of the continental United
States.  It is recognized and agreed that Executive has conducted
motor carrier operations in interstate commerce, in intrastate commerce and in
international commerce for several years and has accumulated expertise and
familiarity with operations involving the Competing Business on a national and
international basis. Executive further agrees, acknowledges and solemnly
declares that he has appreciable knowledge, experience and expertise in the
motor freight business, the freight transportation broker business and the
third-party logistics provider business, and that his being in competition with
the Company or any Affiliate would be extremely detrimental to the Company or
the Affiliate, and accordingly, Executive covenants, warrants and agrees that
during the term of his employment and during the one (1) year period described
herein, he will not, jointly or independently, directly or indirectly, take or
permit to be taken on his behalf any action making use of such expertise,
knowledge or information in a Competing Business (provided that the Executive
shall not be restricted hereby from owning or acquiring 5% or less of the
outstanding voting securities of a public company that engages in such
business), provided that, the foregoing restriction will terminate immediately
if the Executive’s employment with the Company or Related Corporation is
terminated by the Company or the Related Corporation Without Cause or by the
Executive for Good Reason.  The foregoing provision is not intended to
override, supersede, reduce, modify or affect in any manner any other
noncompetition covenant or agreement entered into between Executive and the
Company or any of its Affiliates.  Any such covenant or agreement
shall remain in full force and effect in accordance with its
terms.  Executive agrees that at any time during the non-competition
period he will not, without the prior written consent of the
Company:

     

    
                      (i)     request
or advise any customer or client of the Company or of any Affiliate (including
but not limited to any customers or clients of the Company or of any Affiliate
who are shippers, receivers, freight transportation brokers or third-party
logistics providers) having or expected to have business dealings with the
Company or any Affiliate pertaining to the Competing Business to withdraw,
curtail or cancel such business or business dealings, or to take any business to
a competitor of the Company or any Affiliate; or

        
                          (ii)    provide
any person a partial or complete list, whether orally or in writing, of
customers having business dealings with the Company or any Affiliate pertaining
to the Competing Business or who are known to him to have had business dealings
with the Company or the Affiliate pertaining to the Competing
Business.

        

      

    
      
      

    

     

    
              (b)         Protection of Confidential
Information.  The Executive agrees that he will not at any time
during or following his employment by the Company or Related Corporation,
without the Company’s or Related Corporation’s prior written consent, divulge
any Confidential Information to any other person or entity or use any
Confidential Information for his own benefit.  Upon termination of
employment, for any reason whatsoever, regardless of whether either party may be
at fault, the Executive will return to the Company or Related Corporation all
physical Confidential Information in the Executive’s
possession.

    

    

    (c)           Non-Solicitation of
Employees.  The Executive agrees, for so long as the Executive
remains employed by the Company or Related Corporation, and for a period of two
years following termination of the Executive’s employment, that the Executive
shall not, either for the Executive’s own account, or on behalf of any other
person or entity, solicit, suggest or request that any other person employed by
the Company or one of the Affiliates leave such employment for the purpose of
becoming employed by the Executive or any other person or entity, or in any way
violate any agreement between the Company or the Affiliate and such
person.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    (d)           Extent of
Restrictions. If the scope of any restriction contained in this
non-competition agreement is found by any Court of competent jurisdiction to be
too broad to permit enforcement of such restriction to its full extent, then
such restriction shall be enforced to the maximum extent permitted by law, and
Executive agrees and consents that such scope may be judicially modified
accordingly in any proceeding brought to enforce such
restriction.  Executive acknowledges that any breach of the agreements
contained in this non-competition agreement would cause irreparable injury to
the Company and/or a Related Corporation and that the remedy at law for any
breach would be inadequate, and agrees and consents that temporary and
injunctive relief may be granted in any proceeding which may be brought to
enforce any provision of this non-competition agreement without the necessity of
proof of actual damages.  Executive hereby acknowledges that the
Company or Related Corporation would be entitled to enforce all of the
agreements and covenants contained in this non-competition agreement for the
Company or a Related Corporation’s own benefit or for the benefit of any of the
Affiliates.  Nothing contained in this non-competition agreement shall
prevent the Company or a Related Corporation or any Affiliates from bringing an
action at law and recovering actual damages to the extent the same are provable,
as all remedies herein granted shall each be independent causes of
action.  The invalidity of any provision of this Agreement or of this
non-competition agreement shall not affect the validity of any other provisions
of this non-competition agreement.  “Affiliate” for purposes of this
Section 7 shall mean the Company and all of its present or future direct and
indirect subsidiaries.  For purposes of this Section 7 “Person”
includes individuals, firms, partnerships, associations, corporations,
companies, entities, enterprises, joint ventures and any other business
organizations.

    

    7.           Joinder
for Limited Purposes.   For purposes under Sections 2, 3, 4, 5
and 6 the term “Company” shall also include “Related Corporations” who will be
jointly and severally liable for the obligations under such provisions of this
Agreement.

    

    8.           Tax
Withholdings.   Each payment to the Executive under this
Agreement will be subject to the withholding of all taxes imposed on Executive
with respect to such payment and required by applicable law to be withheld by
the Company.

    

    9.           Severability.  In
the event that any provision or portion of this Agreement shall be determined to
be invalid or unenforceable for any reason, the remaining provisions of this
Agreement shall be unaffected thereby and shall remain in full force and
effect.

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    10.           Successors.  This
Agreement shall be binding upon and inure to the benefit of the Company and any
successor of the Company.  The Company and any Related Corporation
will require any successor to all or substantially all of the business and/or
assets of the Company or any Related Corporation, as the case may be to
expressly assume and agree to perform this Agreement in the same manner and to
the same extent that the Company or any Related Corporation would be required to
perform if no succession had taken place.

    

    11.           Entire
Agreement.  This Agreement constitutes the entire agreement between
the parties hereto with respect to the subject matter hereof.  This
Agreement may not be modified in any manner except by a written instrument
signed by both the Company and the Executive.

    

    12.           Notices.  Any
notice required under this Agreement shall be in writing and shall be delivered
by certified mail return receipt requested to each of the parties as
follows:

    

    To the
Executive:

    

    Ronald J.
Knutson

    2341 Kane
Lane

    Batavia,
IL 60510

    

    To the
Company:

    

    Frozen
Food Express Industries, Inc.

    1145
Empire Central Place

    Dallas,
Texas 75247-4309

    Attention:
President

    

    13.           Governing
Law.  The provisions of this Agreement shall be construed in
accordance of the laws of the State of Texas, except to the extent preempted by
ERISA or other federal laws, as applicable, without reference to the conflicts
of laws provisions thereof.

    

    

    IN
WITNESS WHEREOF, the Executive and the Company have executed this Agreement as
of the date and year first above written and the Related Corporations join for
the purposes specified in Section 8.

    

    COMPANY

    

    FROZEN
FOOD EXPRESS INDUSTRIES, INC.

    

    By: /s/Stoney M. Stubbs,
Jr.

    Its:
President

    

    RELATED
CORPORATION

    

    FFE
TRANSPORTATION SERVICES, INC.

    

    By: /s/Stoney M. Stubbs,
Jr.

    Its:
President

    

    EXECUTIVE

    

    /s/ Ronald J.
Knutson

    Ronald J.
Knutson

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