Document:

Exhibit 10.1

 

CREDIT AGREEMENT

 

DATED AS OF JANUARY 27, 2003

 

AMONG

 

PAPA JOHN’S INTERNATIONAL, INC.

 

THE LENDERS,

 

BANK ONE, KENTUCKY, NA

AS ADMINISTRATIVE AGENT

 

PNC BANK, NATIONAL ASSOCIATION

AS SYNDICATION AGENT

 

AND

 

BANC ONE CAPITAL MARKETS, INC.

AS LEAD ARRANGER AND SOLE BOOK RUNNER

 

$175,000,000 AGGREGATE COMMITMENT

 

 

TABLE
OF CONTENTS

 

	
  ARTICLE 1. DEFINITIONS

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2. THE CREDITS

  
	
   

  	
  2.1

  	
  Commitment at Closing

  
	
   

  	
  2.2

  	
  Required Payments; Termination

  
	
   

  	
  2.3

  	
  Ratable
  Loans

  
	
   

  	
  2.4

  	
  Types of Advances

  
	
   

  	
  2.5

  	
  Facility Fee; Reductions in Aggregate
  Commitment

  
	
   

  	
  2.6

  	
  Minimum Amount of Each Advance

  
	
   

  	
  2.7

  	
  Optional Principal Payments

  
	
   

  	
  2.8

  	
  Method of Selecting Types and Interest
  Periods for New Advances

  
	
   

  	
  2.9

  	
  Conversion and Continuation of Outstanding Advances

  
	
   

  	
  2.10

  	
  Changes in Interest Rate, etc

  
	
   

  	
  2.11

  	
  Rates Applicable After Default

  
	
   

  	
  2.12

  	
  Method of Payment

  
	
   

  	
  2.13

  	
  Noteless Agreement; Evidence of
  Indebtedness.

  
	
   

  	
  2.14

  	
  Telephonic Notices

  
	
   

  	
  2.15

  	
  Interest Payment Dates; Interest and Fee
  Basis

  
	
   

  	
  2.16

  	
  Notification of Advances, Interest Rates,
  Prepayments and Commitment Reductions

  
	
   

  	
  2.17

  	
  Lending Installations

  
	
   

  	
  2.18

  	
  Non-Receipt of Funds by the Agent

  
	
   

  	
  2.19

  	
  Facility
  LCs

  
	
   

  	
  2.20

  	
  Extension of Facility Termination Date

  
	
   

  	
  2.21

  	
  Replacement of Lender

  
	
   

  	
  2.22

  	
  Limitation of Interest

  
	
   

  	
  2.23

  	
  Increase in Commitments.

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3. YIELD PROTECTION; TAXES

  
	
   

  	
  3.1

  	
  Yield Protection

  
	
   

  	
  3.2

  	
  Changes in Capital Adequacy Regulations

  
	
   

  	
  3.3

  	
  Availability of Types of Advances

  
	
   

  	
  3.4

  	
  Funding Indemnification

  
	
   

  	
  3.5

  	
  Taxes

  
	
   

  	
  3.6

  	
  Lender Statements; Survival of Indemnity

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4. CONDITIONS PRECEDENT

  
	
   

  	
  4.1

  	
  Initial Credit Extension

  
	
   

  	
  4.2

  	
  Each Credit Extension

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5. REPRESENTATIONS AND WARRANTIES

  
	
   

  	
  5.1

  	
  Existence and Standing

  

 

i

 

	
   

  	
  5.2

  	
  Authorization and Validity

  
	
   

  	
  5.3

  	
  No Conflict; Government Consent

  
	
   

  	
  5.4

  	
  Financial Statements

  
	
   

  	
  5.5

  	
  Material Adverse Change

  
	
   

  	
  5.6

  	
  Taxes

  
	
   

  	
  5.7

  	
  Litigation and Contingent Obligations

  
	
   

  	
  5.8

  	
  Subsidiaries

  
	
   

  	
  5.9

  	
  ERISA

  
	
   

  	
  5.10

  	
  Accuracy of Information

  
	
   

  	
  5.11

  	
  Regulation
  U

  
	
   

  	
  5.12

  	
  Material Agreements

  
	
   

  	
  5.13

  	
  Compliance With Laws

  
	
   

  	
  5.14

  	
  Ownership
  of Properties

  
	
   

  	
  5.15

  	
  Plan Assets; Prohibited Transactions

  
	
   

  	
  5.16

  	
  Environmental
  Matters

  
	
   

  	
  5.17

  	
  Investment Company Act

  
	
   

  	
  5.18

  	
  Public Utility Holding Company Act

  
	
   

  	
  5.19

  	
  Subordinated Indebtedness

  
	
   

  	
  5.20

  	
  Post-Retirement Benefits

  
	
   

  	
  5.21

  	
  Insurance

  
	
   

  	
  5.22

  	
  Solvency

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6. COVENANTS

  
	
   

  	
  6.1

  	
  Financial Reporting

  
	
   

  	
  6.2

  	
  Use
  of Proceeds

  
	
   

  	
  6.3

  	
  Notice of Default

  
	
   

  	
  6.4

  	
  Conduct of Business

  
	
   

  	
  6.5

  	
  Taxes

  
	
   

  	
  6.6

  	
  Insurance

  
	
   

  	
  6.7

  	
  Compliance with Laws

  
	
   

  	
  6.8

  	
  Maintenance of Properties

  
	
   

  	
  6.9

  	
  Inspection

  
	
   

  	
  6.10

  	
  Dividends

  
	
   

  	
  6.11

  	
  Indebtedness

  
	
   

  	
  6.12

  	
  Merger,
  etc

  
	
   

  	
  6.13

  	
  Sale
  of Assets

  
	
   

  	
  6.14

  	
  Investments and Acquisitions

  
	
   

  	
  6.15

  	
  Liens

  
	
   

  	
  6.16

  	
  Affiliates

  
	
   

  	
  6.17

  	
  Financial Covenants.

  
	
   

  	
  6.18

  	
  Subsidiaries, Partnerships and Joint
  Ventures

  
	
   

  	
   

  	
   

  
	
  ARTICLE 7. DEFAULTS

  
	
   

  	
   

  	
   

  
	
  ARTICLE 8. ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES

  
	
   

  	
  8.1

  	
  Acceleration; Facility LC Collateral
  Account

  
	
   

  	
  8.2

  	
  Amendments

  
	
   

  	
  8.3

  	
  Preservation of Rights

  
	
   

  	
   

  	
   

  
	
  ARTICLE 9. GENERAL PROVISIONS

  
	
   

  	
  9.1

  	
  Survival of Representations

  

 

ii

 

	
   

  	
  9.2

  	
  Governmental Regulation

  
	
   

  	
  9.3

  	
  Headings

  
	
   

  	
  9.4

  	
  Entire Agreement

  
	
   

  	
  9.5

  	
  Several Obligations; Benefits of this Agreement

  
	
   

  	
  9.6

  	
  Expenses; Indemnification.

  
	
   

  	
  9.7

  	
  Numbers of Documents

  
	
   

  	
  9.8

  	
  Accounting

  
	
   

  	
  9.9

  	
  Severability of Provisions

  
	
   

  	
  9.10

  	
  Nonliability of Lenders

  
	
   

  	
  9.11

  	
  Confidentiality

  
	
   

  	
  9.12

  	
  Nonreliance

  
	
   

  	
  9.13

  	
  Course of Dealing

  
	
   

  	
  9.14

  	
  Time
  of Essence

  
	
   

  	
  9.15

  	
  Acceptance of Partial Performance not a
  Waiver

  
	
   

  	
   

  	
   

  
	
  ARTICLE 10. THE AGENT

  
	
   

  	
  10.1

  	
  Appointment; Nature of Relationship

  
	
   

  	
  10.2

  	
  Powers

  
	
   

  	
  10.3

  	
  General Immunity

  
	
   

  	
  10.4

  	
  No Responsibility for Loans, Recitals, etc

  
	
   

  	
  10.5

  	
  Action on Instructions of Lenders

  
	
   

  	
  10.6

  	
  Employment of Agents and Counsel

  
	
   

  	
  10.7

  	
  Reliance on Documents; Counsel

  
	
   

  	
  10.8

  	
  Agent’s Reimbursement and Indemnification

  
	
   

  	
  10.9

  	
  Notice of Default

  
	
   

  	
  10.10

  	
  Rights as a Lender

  
	
   

  	
  10.11

  	
  Lender Credit Decision

  
	
   

  	
  10.12

  	
  Successor
  Agent

  
	
   

  	
  10.13

  	
  Agent and Arranger Fees

  
	
   

  	
  10.14

  	
  Delegation to Affiliates

  
	
   

  	
   

  	
   

  
	
  ARTICLE 11. SETOFF; RATABLE PAYMENTS

  
	
   

  	
  11.1

  	
  Setoff

  
	
   

  	
  11.2

  	
  Ratable Payments

  
	
   

  	
   

  	
   

  
	
  ARTICLE 12. BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS

  
	
   

  	
  12.1

  	
  Successors and Assigns

  
	
   

  	
  12.2

  	
  Participations

  
	
   

  	
  12.3

  	
  Assignments

  
	
   

  	
  12.4

  	
  Dissemination of Information

  
	
   

  	
  12.5

  	
  Tax
  Treatment

  
	
   

  	
   

  	
   

  
	
  ARTICLE 13. NOTICES

  
	
   

  	
  13.1

  	
  Notices

  
	
   

  	
  13.2

  	
  Change of Address

  
	
   

  	
   

  	
   

  
	
  ARTICLE 14. COUNTERPARTS AND FACSIMILES

  

 

iii

 

	
  ARTICLE 15. CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY
  TRIAL

  
	
   

  	
  15.1

  	
  CHOICE OF LAW

  
	
   

  	
  15.2

  	
  CONSENT TO JURISDICTION

  
	
   

  	
  15.3

  	
  WAIVER OF JURY TRIAL

  
	
   

  	
   

  	
   

  
	
  PRICING
  SCHEDULE

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 2.8 BORROWING NOTICE

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 2.9 FORM OF CONVERSION/CONTINUATION
  NOTICE

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 2.13 NOTE

  
	
   

  	
  SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
  TO NOTE

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 1 SUBSIDIARIES AND OTHER
  INVESTMENTS

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 2 EXISTING INDEBTEDNESS AND LIENS

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 2.23 FORM OF LENDER JOINDER

  
	
   

  	
  ANNEX I
  TERMS AND CONDITIONS FOR LENDER JOINDER

  
	
   

  	
  SCHEDULE 1 ADMINISTRATIVE QUESTIONNAIRE

  
	
   

  	
  SCHEDULE 1 US AND NON-US TAX INFORMATION
  REPORTING REQUIREMENTS

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 4.1 (vi) FORM OF OPINION

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 4.1 (viii) LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 6.1 COMPLIANCE CERTIFICATE

  
	
   

  	
  SCHEDULE 1 TO COMPLIANCE CERTIFICATE

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 6.14 FORM OF ACQUISITION COMPLIANCE
  CERTIFICATE

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 12.3 ASSIGNMENT AND ASSUMPTION
  AGREEMENT

  
	
   

  	
  ANNEX 1 TERMS AND CONDITIONS FOR ASSIGNMENT
  AND ASSUMPTION

  
	
   

  	
  SCHEDULE 1 ADMINISTRATIVE QUESTIONNAIRE

  
	
   

  	
  SCHEDULE 1 US AND NON-US TAX INFORMATION
  REPORTING REQUIREMENTS

  
	
   

  	
   

  	
   

  
	
  TRANSFERRED LETTERS OF CREDIT SCHEDULE

  

 

iv

 

CREDIT AGREEMENT

 

This Credit Agreement, dated as of January 27, 2003, is entered into
among PAPA
JOHN’S INTERNATIONAL, INC., a Delaware corporation, the LENDERS, PNC
BANK, NATIONAL ASSOCIATION, as Syndication Agent, and BANK ONE,
KENTUCKY, NA, as Administrative Agent.  The parties hereto agree as follows:

 

ARTICLE 1.

 

DEFINITIONS

 

Each reference in this Agreement to a Schedule or Exhibit shall mean a
Schedule or Exhibit to this Agreement unless expressly otherwise indicated and
all such Schedules and Exhibits are incorporated by reference herein.  As used in this Agreement:

 

“Acquisition” means any transaction, or any series of related
transactions, consummated on or after the date of this Agreement, by which the
Borrower or any of its Subsidiaries (i) acquires any going business or all or
substantially all of the assets of any firm, corporation or limited liability
company, or division thereof, whether through purchase of assets, merger or
otherwise or (ii) directly or indirectly acquires (in one transaction or as the
most recent transaction in a series of transactions) at least a majority (in
number of votes) of the securities of a corporation which have ordinary voting
power for the election of directors (other than securities having such power
only by reason of the happening of a contingency) or a majority (by percentage
or voting power) of the outstanding ownership interests of a partnership or
limited liability company.

 

“Acquisition Compliance Certificate” is defined in Section 6.14.

 

“Administrative Agent” means Bank One acting as the Agent.

 

“Advance” means a borrowing hereunder, (i) made by the Lenders on the
same Borrowing Date, or (ii) converted or continued by the Lenders on the same
date of conversion or continuation, consisting, in either case, of the
aggregate amount of the several Loans of the same Type and, in the case of
Eurodollar Loans, for the same Interest Period.

 

“Affiliate” of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person.  A Person shall be deemed to control another
Person if the controlling Person owns 10% or more of any class of voting
securities (or other ownership interests) of the controlled Person or
possesses, directly or indirectly, the power to direct or cause the direction
of the management or policies of the controlled Person, whether through
ownership of stock, by contract or otherwise.

 

“Agent” means Bank One in its capacity as contractual representative of
the Lenders pursuant to Article 10, and not in its individual capacity as a
Lender, and any successor Agent appointed pursuant to Article 10.

 

1

 

“Aggregate Commitment” means the aggregate of the Commitments of all
the Lenders, in the initial amount of $175,000,000, as increased or reduced
from time to time pursuant to the terms hereof.

 

“Aggregate Outstanding Credit Exposure” means, at any time, the
aggregate of the Outstanding Credit Exposure of all the Lenders.

 

“Agreement” means this credit agreement, as it may be amended or
modified and in effect from time to time.

 

“Alternate Base Rate” means, for any day, a rate of interest per annum
equal to the higher of (i) the Prime Rate for such day and (ii) the sum of the
Federal Funds Effective Rate for such day plus 1/2% per annum.

 

“Annual Administrative Agent’s Fee” is defined in Section 10.13.

 

“Applicable Fee Rate” means, at any time, the percentage rate per annum
at which Commitment Fees are accruing on the unused portion of the Aggregate
Commitment at such time as set forth in the Pricing Schedule.

 

“Applicable Margin” means, with respect to Advances of any Type at any
time, the percentage rate per annum which is applicable at such time with
respect to Advances of such Type as set forth in the Pricing Schedule.

 

“Approved Fund” means any Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.

 

“Arrangement Fee” is defined in Section 10.13.

 

“Arranger” means Banc One Capital Markets, Inc., a Delaware
corporation, and its successors, in its capacity as Lead Arranger and Sole Book
Runner.

 

“Article” means an article of this Agreement unless another document is
specifically referenced.

 

“Assignment and Assumption Agreement” is defined in Section 12.3.1.

 

“Authorized Officer” means any of the following officers of the
Borrower, acting singly: Chairman, Chief Administrative Officer, Senior Vice
President of Finance, Chief Development Officer, General Counsel, and
Secretary.

 

“Available Aggregate Commitment” means, at any time, the Aggregate
Commitment then in effect minus the Aggregate Outstanding Credit Exposure at
such time.

 

“Bank One” means Bank One, Kentucky, NA, a national banking association
having its principal office in Louisville, Kentucky, in its individual
capacity, and its successors.

 

“Base Amount” is defined in Section 6.17.

 

“Borrower” means Papa John’s International, Inc., a Delaware
corporation, and its successors and assigns.

 

2

 

“Borrowing Date” means a date on which an Advance is made hereunder.

 

“Borrowing Notice” is defined in Section 2.8.

 

“Business Day” means (i) with respect to any borrowing, payment or rate
selection of Eurodollar Advances, a day (other than a Saturday or Sunday) on
which banks generally are open in Louisville, Kentucky and New York City for
the conduct of substantially all of their commercial lending activities,
interbank wire transfers can be made on the Fedwire system and dealings in
United States dollars are carried on in the London interbank market and (ii)
for all other purposes, a day (other than a Saturday or Sunday) on which banks
generally are open in Louisville, Kentucky for the conduct of substantially all
of their commercial lending activities and interbank wire transfers can be made
on the Fedwire system.

 

“Capital Expenditures” means, without duplication, any expenditures for
any purchase or other acquisition of any asset which would be classified as a
fixed or capital asset on a consolidated balance sheet of the Borrower and its
Subsidiaries prepared in accordance with GAAP.

 

“Capitalized Lease” of a Person means any lease of Property by such
Person as lessee which would be capitalized on a balance sheet of such Person
prepared in accordance with GAAP.

 

“Capitalized Lease Obligations” of a Person means the amount of the
obligations of such Person under Capitalized Leases which would be shown as a
liability on a balance sheet of such Person prepared in accordance with GAAP.

 

“Cash Equivalent Investments” means (i) obligations of, or fully
guaranteed by, the United States of America, (ii) commercial paper rated A-1 or
better by S&P or P-1 or better by Moody’s, (iii) demand deposit accounts
maintained in the ordinary course of business, and (iv) certificates of deposit
issued by and time deposits with commercial banks (whether domestic or foreign)
having capital and surplus in excess of $100,000,000; provided in each case that
the same provides for payment of both principal and interest (and not principal
alone or interest alone), is not subject to any contingency regarding the
payment of principal or interest, and has a maturity of one year or less.

 

“Change in Control” means (i) the acquisition by any Person, or two or
more Persons acting in concert, of beneficial ownership (within the meaning of
Rule 13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934) of 50% or more of the outstanding shares of voting stock
of the Borrower; or (ii) any individual who as of the date of this Agreement
has beneficial ownership of 20% or more of the outstanding shares of voting
stock of the Borrower and is a member of the board of directors of Borrower
ceases to own beneficially at least 20% of the outstanding shares of the voting
stock of the Borrower or to be a member of the board of directors of Borrower
as a result, in either case, of circumstances other than the death or
disability of such individual.

 

“Closing” means the satisfaction of all of the conditions to the
initial Credit Extension as set forth in Article 4.

 

“Code” means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.

 

3

 

“Collateral Shortfall Amount” is defined in Section 8.1.

 

“Compliance Certificate” is defined in Section 6.1.

 

“Commitment” means, for each Lender, the obligation of such Lender to
make Loans to, and participate in Facility LCs issued upon the application of,
the Borrower in an aggregate amount not exceeding the amount set forth opposite
its signature below, as it may be modified as a result of any increase thereof
pursuant to Section 2.23, or any assignment that has become effective pursuant
to Section 12.3.2 or as otherwise modified from time to time pursuant to the
terms of this Agreement.

 

“Commitment Increase Effective Date” is defined in Section 2.23.3.

 

“Consolidated Capital Expenditures” means, with reference to any
period, the Capital Expenditures of the Borrower and its Subsidiaries
calculated on a consolidated basis for such period.

 

“Consolidated EBITDA” means Consolidated Net Income plus,
to the extent deducted from revenues in determining Consolidated Net Income,
(i) Consolidated Interest Expense, (ii) income tax expense, (iii)
depreciation, (iv) amortization and (v) other non-cash charges to net income, minus,
to the extent included in Consolidated Net Income, non-cash credits to
Consolidated Net Income, all calculated for the Borrower and its Subsidiaries
on a consolidated basis.

 

“Consolidated Indebtedness” means at any time the Indebtedness of the
Borrower (and all of its Subsidiaries, unless expressly otherwise indicated)
calculated on a consolidated basis as of such time.

 

“Consolidated Interest Expense” means, with reference to any period,
the interest expense of the Borrower and its Subsidiaries calculated on a
consolidated basis for such period.

 

“Consolidated Net Income” means, with reference to any period, the net
income (or loss) of the Borrower and its Subsidiaries calculated on a
consolidated basis for such period.

 

“Consolidated Net Worth” means at any time the consolidated
stockholders’ equity of the Borrower and its Subsidiaries calculated on a
consolidated basis as of such time.

 

“Consolidated Rentals” means, with reference to any period, the Rentals
of the Borrower and its Subsidiaries calculated on a consolidated basis for
such period.

 

“Contingent Obligation” of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person
(including pursuant to a Guaranty Agreement), or agrees to maintain the net
worth or working capital or other financial condition of any other Person, or
otherwise assures any creditor of such other Person against loss, including,
without limitation, any comfort letter, operating agreement, take-or-pay
contract, reimbursement obligations under Letters of Credit, or the obligations
of any such Person as general partner of a partnership with respect to the
liabilities of the partnership.

 

“Conversion/Continuation Notice” is defined in Section 2.9.

 

4

 

“Controlled Group” means all members of a controlled group of
corporations or other business entities and all trades or businesses (whether
or not incorporated) under common control which, together with the Borrower or
any of its Subsidiaries, are treated as a single employer under Section 414 of
the Code.

 

“Credit Extension” means the making of an Advance or the issuance of a
Facility LC hereunder.

 

“Credit Extension Date” means the Borrowing Date for an Advance or the
issuance date for a Facility LC.

 

“Default” means an event described in Article 7.

 

“Environmental Laws” means any and all federal, state, local and
foreign statutes, laws, judicial decisions, regulations, ordinances, rules,
judgments, orders, decrees, plans, injunctions, permits, concessions, grants,
franchises, licenses, agreements and other governmental restrictions relating
to (i) the protection of the environment, (ii) the effect of the environment on
human health, (iii) emissions, discharges or releases of pollutants,
contaminants, hazardous substances or wastes into surface water, ground water
or land, or (iv) the manufacture, processing, distribution, use, treatment,
storage, disposal, transport or handling of pollutants, contaminants, hazardous
substances or wastes or the clean-up or other remediation thereof.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.

 

“Eurodollar Advance” means an Advance which, except as otherwise
provided in Section 2.11, bears interest at the applicable Eurodollar Rate.

 

“Eurodollar Base Rate” means, with respect to a Eurodollar Advance for
the relevant Interest Period, the applicable British Bankers’ Association LIBOR
rate for deposits in U.S. dollars as reported by any generally recognized
financial information service as of 11:00 a.m. (London time) two Business Days
prior to the first day of such Interest Period, and having a maturity equal to
such Interest Period, provided that, if no such British Bankers’
Association LIBOR rate is available to the Agent, the applicable Eurodollar
Base Rate for the relevant Interest Period shall instead be the rate determined
by the Agent to be the rate at which Bank One or one of its Affiliate banks
offers to place deposits in U.S. dollars with first-class banks in the London
interbank market at approximately 11:00 a.m. (London time) two Business Days
prior to the first day of such Interest Period, in the approximate amount of
Bank One’s relevant Eurodollar Loan and having a maturity equal to such
Interest Period.

 

“Eurodollar Loan” means a Loan which, except as otherwise provided in
Section 2.11, bears interest at the applicable Eurodollar Rate.

 

“Eurodollar Rate” means, with respect to a Eurodollar Advance for the
relevant Interest Period, the sum of (i) the quotient of (a) the Eurodollar
Base Rate applicable to such Interest Period, divided by (b) one minus the
Reserve Requirement (expressed as a decimal) applicable to such Interest
Period, plus (ii) the Applicable Margin.

 

“Excluded Domestic Subsidiary” means any Subsidiary that is neither a
Foreign Subsidiary nor a Loan Party.

 

5

 

“Excluded Subsidiary” means any Subsidiary that is not a Loan Party.

 

“Excluded Taxes” means, in the case of each Lender or applicable
Lending Installation and the Agent, taxes imposed on its overall net income,
and franchise taxes imposed on it, by (i) the jurisdiction under the laws of
which such Lender or the Agent is incorporated or organized or (ii) the
jurisdiction in which the Agent’s or such Lender’s principal executive office
or such Lender’s applicable Lending Installation is located.

 

“Exhibit” refers to an exhibit to this Agreement, unless another
document is specifically referenced.

 

“Existing Lender” is defined in Section 2.23.

 

“Extension Request” is defined in Section 2.20.

 

“Facility Fee” is defined in Section 2.5.

 

“Facility Fee Payment Date” means the last Business Day during each
calendar quarter.

 

“Facility LC” is defined in Section 2.1; the term shall include the RSC
Facility LC if and for so long as the RSC Letter of Credit is issued as a
Facility LC.

 

“Facility LC Application” is defined in Section 2.19.3.

 

“Facility LC Collateral Account” is defined in Section 2.19.11.

 

“Facility Termination Date” means January 15, 2006 or any later date as
may be specified as the Facility Termination Date in accordance with Section
2.19 or any earlier date on which the Aggregate Commitment is reduced to zero
or otherwise terminated pursuant to the terms of this Agreement.

 

“Federal Funds Effective Rate” means, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day which
is a Business Day, the average of the quotations at approximately 10:00 a.m.
(Chicago time) on such day on such transactions received by the Agent from
three Federal funds brokers of recognized standing selected by the Agent in its
sole discretion.

 

“Fee Letter” is defined in Section 10.13.

 

“Financial Contract” of a Person means (i) any exchange-traded or
over-the-counter futures, forward, swap or option contract or other financial
instrument with similar characteristics, and (ii) any Rate Management Transaction.

 

“Flex-Pricing Provision” means any term or provision of any fee letter,
commitment letter or term sheet delivered in connection with the transaction
which is the subject of this Agreement which purports to permit the Agent or
the Arranger to change any or all of the structure, terms or pricing of the
credit facility evidenced by this Agreement either before or after

 

6

 

the closing of this Agreement in order to allow the Agent and/or
Arranger to successfully syndicate such credit facility either before or after
the closing of this Agreement.

 

“Floating Rate” means, for any day, a rate per annum equal to (i) the
Alternate Base Rate for such day plus (ii) the Applicable Margin, in each case
changing when and as the Alternate Base Rate changes.

 

“Floating Rate Advance” means an Advance which, except as otherwise
provided in Section 2.11, bears interest at the Floating Rate.

 

“Floating Rate Loan” means a Loan which, except as otherwise provided
in Section 2.11, bears interest at the Floating Rate.

 

“Foreign Subsidiary” means any Subsidiary that is organized under the
laws of a country other than the United States of America.

 

“Fund” means any Person (other than a natural person) that is (or will
be) engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.

 

“GAAP” means generally accepted accounting principles as in effect from
time to time applied on a consistent basis both as to classification and
amounts.

 

“Guarantor” means the Initial Guarantors and other Persons now or at
anytime hereafter that guarantee payment of all or any portion of the
Obligations.

 

“Guaranty” or “Guaranties” of any Person shall mean any obligation of
such Person guaranteeing or in effect guaranteeing any liability or obligation
of any other Person in any manner, whether directly or indirectly, including
any agreement to indemnify or hold harmless any other Person, any performance
bond or other suretyship arrangement and any other form of assurance against
loss, except endorsement of negotiable or other instruments for deposit or
collection in the ordinary course of business.

 

“Guaranty Agreement” means a document in form and substance acceptable
to Lender establishing the guaranty of any Guarantor.

 

“Indebtedness” of a Person means such Person’s (i) obligations for
borrowed money, (ii) obligations representing the deferred purchase price of
Property or services (other than accounts payable arising in the ordinary
course of such Person’s business payable on terms customary in the trade),
(iii) obligations, whether or not assumed, secured by Liens or payable out of
the proceeds or production from Property now or hereafter owned or acquired by
such Person, (iv) obligations that are evidenced by notes, acceptances, or
other instruments, (v) obligations of such Person to purchase securities or
other Property arising out of or in connection with the sale of the same or
substantially similar securities or Property, (vi) Capitalized Lease
Obligations, (vii) any other obligation for borrowed money or other financial
accommodation which in accordance with GAAP would be shown as a liability on
the consolidated balance sheet of such Person, (viii) Contingent Obligations,
including pursuant to Letters of Credit and Guaranties, (ix) obligations under
or in connection with Rate Management Transactions and other Financial
Contracts, (x) Off-Balance Sheet Liabilities, including Sale Leaseback
Transactions, and (xi) obligations under Operating Leases; provided, however,
it is expressly agreed that the Indebtedness of Borrower pursuant to the
RSC/Borrower Letter of Credit, for so long as the same has not been drawn

 

7

 

against and to the extent of not more than $18,000,000 at any time
outstanding, shall not be deemed Indebtedness under this Agreement for the
purposes of calculating the Leverage Ratio pursuant to either (a) Section
6.17.1, or (b) the Pricing Schedule.

 

“Initial Guarantors” means, collectively, Papa John’s USA, Inc., Papa
John’s Support Services, Inc., Capital Delivery, Ltd., Risk Services Corp. and
PJ Food Service, Inc., each a Kentucky corporation, and PJFS of Mississippi,
Inc., a Mississippi corporation.

 

“Interest Period” means, with respect to a Eurodollar Advance, a period
of one, two, three, six or twelve months commencing on a Business Day selected
by the Borrower pursuant to this Agreement. 
Such Interest Period shall end on the day which corresponds numerically
to such date one, two, three, six or twelve months thereafter, provided,
however, that if there is no such numerically corresponding day in
such next, second, third, sixth or twelfth succeeding month, such Interest
Period shall end on the last Business Day of such next, second, third, sixth or
twelfth succeeding month.  If an
Interest Period would otherwise end on a day which is not a Business Day, such
Interest Period shall end on the next succeeding Business Day, provided,
however, that if said next succeeding Business Day falls in a new
calendar month, such Interest Period shall end on the immediately preceding
Business Day.

 

“Investment” of a Person means any loan, advance (other than
commission, travel and similar advances to officers and employees made in the
ordinary course of business), extension of credit (other than accounts
receivable arising in the ordinary course of business on terms customary in the
trade) or contribution of capital by such Person; stocks, bonds, mutual funds,
partnership interests, notes, debentures or other securities owned by such
Person; any deposit accounts and certificate of deposit owned by such Person;
and structured notes, derivative financial instruments and other similar
instruments or contracts owned by such Person.

 

“Jeffersontown IRB” means that certain $7,500,000 Industrial Revenue
Bond issued by the City of Jeffersontown, Kentucky on December 27, 1997 and the
$62,700,000 Industrial Revenue Bond issued by the City of Jeffersontown,
Kentucky on November 9, 1999, and the $10,000,000 Industrial Revenue Bond
issued by the City of Jeffersontown, Kentucky on December 20, 2000, the same
being supported by the sale and leaseback of property located at 2002 Papa
John’s Boulevard, Jeffersontown, Kentucky.

 

“LC Fee” is defined in Section 2.19.4.

 

“LC Issuer” means (a) on the date of Closing, PNC in the case of the
Transferred Letters of Credit that are to become Facility LCs as a condition to
Closing pursuant to Section 4.1 and, (b) in the case of each other Facility LC,
Bank One (or any subsidiary or affiliate of Bank One designated by Bank One)
and any other Lender selected by Borrower (or by RSC in the case of the RSC
Facility LC) with the consent of that Lender and with the consent of the Agent
(provided such consent from the Agent is not unreasonably withheld) in its
capacity as issuer of one or more Facility LCs hereunder.

 

“LC Obligations” means, at any time, the sum, without duplication, of
(i) the aggregate undrawn stated amount under all Facility LCs outstanding at
such time plus (ii) the aggregate unpaid amount at such time of all
Reimbursement Obligations.

 

“LC Obligations Limit” means (i) $20,000,000 from the date of this
Agreement until December 31, 2003, (ii) $25,000,000 on December 31, 2003 and thereafter
until December 31, 2004, and (iii) $30,000,000 on December 31, 2004 until the
Facility Termination Date.

 

8

 

“LC Payment Date” is defined in Section 2.19.5.

 

“Lender Joinder” is defined in Section 2.23.

 

“Lenders” means the lending institutions listed on the signature pages
of this Agreement and their respective successors and assigns.

 

“Lending Installation” means, with respect to a Lender or the Agent,
the office, branch, subsidiary or affiliate of such Lender or the Agent listed
on the signature pages hereof or on a Schedule or otherwise selected by such
Lender or the Agent pursuant to Section 2.17.

 

“Letter of Credit” of a Person means a standby or commercial letter of
credit or similar instrument which is issued upon the application of such
Person or upon which such Person is an account party or for which such Person
is in any way liable.

 

“Leverage Ratio” is defined in Section 6.17.

 

“Lien” means any lien (statutory or other), mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance or preference, priority or other
security agreement or preferential arrangement of any kind or nature whatsoever
(including, without limitation, the interest of a vendor or lessor under any
conditional sale, Capitalized Lease or other title retention agreement).

 

“Loan” means, with respect to a Lender, such Lender’s loan made
pursuant to Article 2 (or any conversion or continuation thereof).

 

“Loan Documents” means this Agreement, the Facility LC Applications,
any Notes issued pursuant to Section 2.13, any Guaranty Agreement and each
other document entered into to evidence, guarantee, secure or otherwise in
connection with the Obligations.

 

“Loan Party” means the Borrower and the Guarantors.

 

“Material Adverse Effect” means a material adverse effect on (i) the
business, Property, condition (financial or otherwise), results of operations,
or prospects of the Borrower and its Subsidiaries taken as a whole, (ii) the
ability of the Borrower to perform its obligations under the Loan Documents to
which it is a party, or (iii) the validity or enforceability of any of the Loan
Documents or the rights or remedies of the Agent, the LC Issuer or the Lenders
thereunder.

 

“Material Indebtedness” means Indebtedness in an outstanding principal
amount of $5,000,000 or more in the aggregate (or the equivalent thereof in any
currency other than U.S. dollars).

 

“Material Indebtedness Agreement” means any agreement under which any
Material Indebtedness was created or is governed or which provides for the
incurrence of Indebtedness in an amount which would constitute Material
Indebtedness (whether or not an amount of Indebtedness constituting Material
Indebtedness is outstanding thereunder).

 

“Modify” and “Modification” are defined in Section 2.19.1.

 

“Moody’s” means Moody’s Investors Service, Inc.

 

9

 

“Multiemployer Plan” means a Plan maintained pursuant to a collective
bargaining agreement or any other arrangement to which the Borrower or any
member of the Controlled Group is a party to which more than one employer is
obligated to make contributions.

 

“New Commitment Provider” is defined in Section 2.23.

 

“New Lender” is defined in Section 2.23.

 

“Non-U.S. Lender” is defined in Section 3.5(iv).

 

“Note” is defined in Section 2.13.

 

“Obligations” means all unpaid principal of and accrued and unpaid
interest on the Loans, all Reimbursement Obligations, all accrued and unpaid
fees and all expenses, reimbursements, indemnities and other obligations of the
Borrower to the Lenders or to any Lender, the Agent, the LC Issuer or any
indemnified party arising under the Loan Documents.

 

“Off-Balance Sheet Liability” of a Person means (i) any repurchase
obligation or liability of such Person with respect to accounts or notes
receivable sold by such Person, (ii) any liability under any Sale and Leaseback
Transaction which is not a Capitalized Lease, (iii) any liability under any
so-called “synthetic lease” transaction entered into by such Person, or (iv)
any obligation arising with respect to any other transaction which is the
functional equivalent of or takes the place of borrowing but which does not
constitute a liability on the balance sheets of such Person, but excluding from
this clause (iv) Operating Leases.

 

“Operating Lease” of a Person means any lease of Property (other than a
Capitalized Lease) by such Person as lessee which has an original term
(including any required renewals and any renewals effective at the option of
the lessor) of one year or more.

 

“Other Taxes” is defined in Section 3.5(ii).

 

“Outstanding Credit Exposure” means, as to any Lender at any time, the
sum of (i) the aggregate principal amount of its Loans outstanding at such
time, plus (ii) an amount equal to its Pro Rata Share of the LC Obligations at
such time.

 

“Participants” is defined in Section 12.2.1.

 

“Payment Date” means the last Business Day of each calendar month
occurring after the date of this Agreement.

 

“PBGC” means the Pension Benefit Guaranty Corporation, or any successor
thereto.

 

“Permitted Acquisition” is defined in Section 6.14.

 

“Person” means any natural person, corporation, firm, joint venture,
partnership, limited liability company, association, enterprise, trust or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.

 

“Plan” means an employee pension benefit plan which is covered by Title
IV of ERISA or subject to the minimum funding standards under Section 412 of
the Code as to which the Borrower or any member of the Controlled Group may
have any liability.

 

10

 

“PNC” means PNC Bank, National Association, a national banking
association having its principal office in Pittsburgh, Pennsylvania, in its
individual capacity, and its successors.

 

“Pricing Schedule” means the Pricing Schedule attached to this
Agreement and identified as such.

 

“Prime Rate” means a rate per annum equal to the prime rate of interest
announced from time to time by Bank One or its parent (which is not necessarily
the lowest rate charged to any customer), changing when and as said prime rate
changes.

 

“Prior Credit Agreement” is defined in Section 4.1.

 

“Property” of a Person means any and all property, whether real,
personal, tangible, intangible, or mixed, of such Person, or other assets
owned, leased or operated by such Person.

 

“Pro Rata Share” means, with respect to a Lender, a portion equal to a
fraction the numerator of which is such Lender’s Commitment and the denominator
of which is the Aggregate Commitment.

 

“Purchasers” is defined in Section 12.3.1.

 

“Rate Management Obligations” of a Person means any and all obligations
of such Person, whether absolute or contingent and howsoever and whensoever created,
arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (i) any and all Rate
Management Transactions, and (ii) any and all cancellations, buy backs,
reversals, terminations or assignments of any Rate Management Transactions.

 

“Rate Management Transaction” means any transaction (including an
agreement with respect thereto) now existing or hereafter entered by the
Borrower which is a rate swap, basis swap, forward rate transaction, commodity
swap, commodity option, equity or equity index swap, equity or equity index
option, bond option, interest rate option, foreign exchange transaction, cap
transaction, floor transaction, collar transaction, forward transaction,
currency swap transaction, cross-currency rate swap transaction, currency
option or any other similar transaction (including any option with respect to
any of these transactions) or any combination thereof, whether linked to one or
more interest rates, foreign currencies, commodity prices, equity prices or
other financial measures.

 

“Regulation D” means Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor thereto
or other regulation or official interpretation of said Board of Governors
relating to reserve requirements applicable to member banks of the Federal
Reserve System.

 

“Regulation U” means Regulation U of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor or
other regulation or official interpretation of said Board of Governors relating
to the extension of credit by banks for the purpose of purchasing or carrying
margin stocks applicable to member banks of the Federal Reserve System.

 

11

 

“Reimbursement Obligations” means, at any time, the aggregate of all
obligations of the Borrower and RSC then outstanding under Section 2.19 to
reimburse the LC Issuer for amounts paid by the LC Issuer in respect of any one
or more drawings under Facility LCs.

 

“Rentals” of a Person means the aggregate fixed amounts payable by such
Person under any Operating Lease.

 

“Reportable Event” means a reportable event as defined in Section 4043
of ERISA and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC has by regulation waived
the requirement of Section 4043(a) of ERISA that it be notified within 30 days
of the occurrence of such event, provided, however, that a failure to meet
the minimum funding standard of Section 412 of the Code and of Section 302 of
ERISA shall be a Reportable Event regardless of the issuance of any such waiver
of the notice requirement in accordance with either Section 4043(a) of ERISA or
Section 412(d) of the Code.

 

“Required Consolidated Net Worth” is defined in Section 6.17.3.

 

“Required Lenders” means Lenders in the aggregate having greater than
fifty percent (50%) of the Aggregate Commitment or, if the Aggregate Commitment
has been terminated, Lenders in the aggregate holding at least a majority of
the Aggregate Outstanding Credit Exposure.

 

“Reserve Requirement” means, with respect to an Interest Period, the
maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on
Eurocurrency liabilities.

 

“Response Date” is defined in Section 2.20.

 

“RSC” means RSC Insurance Services Ltd., a Bermuda corporation that is
a Subsidiary of Borrower.

 

“RSC/Borrower Letter of Credit” means a Letter of Credit, in an amount
not greater than the amount from time to time of the RSC Letter of Credit,
issued for the account of Borrower in favor of RSC to facilitate the
underwriting by RSC of insurance for franchisees of Borrower in the ordinary
course of Borrower’s business and that Borrower intends to be drawn against
promptly following, and in an amount equal to the amount of, any drafts drawn
under the RSC Letter of Credit.

 

“RSC Facility LC” means the RSC Letter of Credit if, and only for so
long as, the same is a Facility LC.

 

“RSC Guaranty” means the absolute, unconditional guaranty of payment to
Lenders by the Guarantors of the Reimbursement Obligations of RSC.

 

“RSC Guaranty Agreement” means a document in form and substance satisfactory
to Lender establishing the RSC Guaranty.

 

“RSC Letter of Credit” means a Letter of Credit issued for the account
of RSC in favor of a reinsurance company incidental to the underwriting by RSC
of insurance for franchisees of Borrower in the ordinary course of Borrower’s
business.

 

12

 

“S&P” means Standard and Poor’s Ratings Services, a division of The
McGraw Hill Companies, Inc.

 

“Sale and Leaseback Transaction” means any sale or other transfer of
Property by any Person with the intent to lease such Property as lessee.

 

“Schedule” refers to a specific schedule to this Agreement, unless
another document is specifically referenced.

 

“Section” means a numbered section of this Agreement, unless another
document is specifically referenced.

 

“Single Employer Plan” means a Plan maintained by the Borrower or any
member of the Controlled Group for employees of the Borrower or any member of
the Controlled Group.

 

“Subordinated Indebtedness” of a Person means any Indebtedness of such
Person the payment of which is subordinated to payment of the Obligations to
the written satisfaction of the Required Lenders.

 

“Subsidiary” of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or
more of its Subsidiaries or by such Person and one or more of its Subsidiaries,
or (ii) any partnership, limited liability company, association, joint venture
or similar business organization more than 50% of the ownership interests
having ordinary voting power of which shall at the time be so owned or
controlled.  Unless otherwise expressly
provided, all references herein to a “Subsidiary” shall mean a Subsidiary of
the Borrower.

 

“Substantial Portion” means, with respect to the Property of the
Borrower and its Subsidiaries, Property which represents more than 10% of the
consolidated assets of the Borrower and its Subsidiaries or property which is
responsible for more than 10% of the consolidated net sales or of the
consolidated net income of the Borrower and its Subsidiaries, in each case, as
would be shown in the consolidated financial statements of the Borrower and its
Subsidiaries as at the beginning of the twelve-month period ending with the
month in which such determination is made (or if financial statements have not
been delivered hereunder for that month which begins the twelve-month period,
then the financial statements delivered hereunder for the quarter ending
immediately prior to that month).

 

“Syndication Agent” means PNC in its capacity as syndication agent for
the Lenders, and any successors to PNC in such capacity designated by the
Required Lenders with the consent of the Borrower.

 

“Taxes” means any and all present or future taxes, duties, levies,
imposts, deductions, charges or withholdings, and any and all liabilities with
respect to the foregoing, but excluding Excluded Taxes and Other Taxes.

 

“Transferee” is defined in Section 12.4.

 

“Transferred Letters of Credit” means Letters of Credit outstanding on
the date of this Agreement that were issued by PNC for the account of Borrower
or RSC, as applicable, and that are more particularly described on the Transferred
Letters of Credit Schedule.

 

13

 

“Type” means, with respect to any Advance, its nature as a Floating
Rate Advance or a Eurodollar Advance and with respect to any Loan, its nature
as a Floating Rate Loan or a Eurodollar Loan.

 

“Unfunded Liabilities” means the amount (if any) by which the present
value of all vested and unvested accrued benefits under all Single Employer
Plans exceeds the fair market value of all such Plan assets allocable to such
benefits, all determined as of the then most recent valuation date for such
Plans using PBGC actuarial assumptions for single employer plan terminations.

 

“Unmatured Default” means an event which but for the lapse of time or
the giving of notice, or both, would constitute a Default.

 

“Upfront Fee” is defined in Section 4.1.

 

“Wholly-Owned Subsidiary” of a Person means (i) any Subsidiary all of
the outstanding voting securities of which shall at the time be owned or
controlled, directly or indirectly, by such Person or one or more Wholly-Owned
Subsidiaries of such Person, or by such Person and one or more Wholly-Owned
Subsidiaries of such Person, or (ii) any partnership, limited liability
company, association, joint venture or similar business organization 100% of
the ownership interests having ordinary voting power of which shall at the time
be so owned or controlled.

 

The foregoing definitions shall be equally applicable to both the
singular and plural forms of the defined terms.

 

ARTICLE 2.

 

THE CREDITS

 

2.1                                 Commitment at Closing.  From and including the date of this
Agreement and prior to the Facility Termination Date, each Lender severally
agrees, on the terms and conditions set forth in this Agreement, to (i) make
Loans to the Borrower and (ii) participate in (a) Letters of Credit issued upon
the request and for the account of the Borrower, and (b) the RSC Letter of
Credit if issued upon the request and for the account of RSC (the Letters of
Credit issued pursuant to clauses (a) and (b) of this sentence are referred to
collectively as “Facility LCs”) provided that, after giving effect to the
making of each such Loan and the issuance of each such Facility LC, such
Lender’s Outstanding Credit Exposure shall not exceed its Commitment and
conditioned, in the case of the RSC Facility LC, upon the execution and
delivery to Agent prior to the issuance thereof of the RSC Guaranty Agreement
and, if requested by Agent, a certified copy of resolutions of the governing
body of RSC authorizing the request for the issuance of the RSC Facility LC.  Subject to the terms of this Agreement, the
Borrower may borrow, repay and reborrow at any time prior to the Facility
Termination Date.  The Commitments to
extend credit hereunder shall expire on the Facility Termination Date.  The LC Issuer will issue Facility LCs
hereunder on the terms and conditions set forth in Section 2.19.

 

2.2                                 Required Payments; Termination.  The Aggregate Outstanding Credit Exposure
and all other unpaid Obligations shall be paid in full by the Borrower on the
Facility Termination Date.

 

2.3                                 Ratable
Loans.  Each Advance hereunder
shall consist of Loans made from the several Lenders ratably according to their
Pro Rata Shares.

 

14

 

2.4                                 Types of Advances.  The Advances may be Floating Rate Advances or Eurodollar
Advances, or a combination thereof, selected by the Borrower in accordance with
Sections 2.8 and 2.9.

 

2.5                                 Facility Fee; Reductions in
Aggregate Commitment.  The
Borrower agrees to pay to the Agent for the account of each Lender according to
its Pro Rata Share a facility fee (“Facility Fee”) at a per annum rate equal to
the Applicable Fee Rate on the average daily Available Aggregate Commitment
from the date hereof to and including the Facility Termination Date, payable on
each Facility Fee Payment Date hereafter and on the Facility Termination
Date.  The Borrower may permanently
reduce the Aggregate Commitment in whole, or in part ratably among the Lenders
in integral multiples of $10,000,000, upon at least five Business Days’ written
notice to the Agent, which notice shall specify the amount of any such
reduction, provided,
however, that the amount of the Aggregate Commitment may not be
reduced below the Aggregate Outstanding Credit Exposure.  All accrued commitment fees shall be payable
on the effective date of any termination of the obligations of the Lenders to
make Credit Extensions hereunder.

 

2.6                                 Minimum Amount of Each Advance.  Each Eurodollar Advance shall be in the
minimum amount of $5,000,000 (and in multiples of $1,000,000 if in excess
thereof), and each Floating Rate Advance shall be in the minimum amount of
$1,000,000 (and in multiples of $1,000,000 if in excess thereof), provided,
however, that any Floating Rate Advance may be in the amount of the
Available Aggregate Commitment.

 

2.7                                 Optional Principal Payments.  The Borrower may from time to time pay,
without penalty or premium, all outstanding Floating Rate Advances, or, in a
minimum aggregate amount of $1,000,000 or any integral multiple of $1,000,000
in excess thereof, any portion of the outstanding Floating Rate Advances upon
two Business Days’ prior notice to the Agent. 
The Borrower may from time to time pay, subject to the payment of any
funding indemnification amounts required by Section 3.4 but without penalty or
premium, all outstanding Eurodollar Advances, or, in a minimum aggregate amount
of $5,000,000 or any integral multiple of $1,000,000 in excess thereof, any
portion of the outstanding Eurodollar Advances upon three Business Days’ prior
notice to the Agent.

 

2.8                                 Method of Selecting Types and
Interest Periods for New Advances. 
The Borrower shall select the Type of Advance and, in the case of each
Eurodollar Advance, the Interest Period applicable thereto from time to
time.  The Borrower shall give the Agent
irrevocable notice (a “Borrowing Notice”) not later than 10:00 a.m.
(Louisville, Kentucky time) at least one Business Day before the Borrowing Date
of each Floating Rate Advance and three Business Days before the Borrowing Date
for each Eurodollar Advance, specifying:

 

(i)                                     the Borrowing
Date, which shall be a Business Day, of such Advance,

 

(ii)                                  the aggregate amount
of such Advance,

 

(iii)                               the Type of Advance
selected, and

 

(iv)                              in
the case of each Eurodollar Advance, the Interest Period applicable thereto.

 

A Borrowing Notice may be made verbally, but if so shall be immediately
confirmed in writing by Borrower to Agent substantially in the form of Exhibit
2.8.  Not later than noon
(Louisville, Kentucky time) on each Borrowing Date, each Lender shall make
available its Loan or Loans in

 

15

 

funds immediately available in Louisville, Kentucky to the Agent at its
address specified pursuant to Article 13. 
The Agent will make the funds so received from the Lenders available to
the Borrower at the Agent’s aforesaid address.

 

2.9                                 Conversion and Continuation of
Outstanding Advances.  Floating Rate
Advances shall continue as Floating Rate Advances unless and until such
Floating Rate Advances are converted into Eurodollar Advances pursuant to this
Section 2.9 or are repaid in accordance with Section 2.7.  Each Eurodollar Advance shall continue as a
Eurodollar Advance until the end of the then applicable Interest Period
therefor, at which time such Eurodollar Advance shall be automatically
converted into a Floating Rate Advance unless (x) such Eurodollar Advance is or
was repaid in accordance with Section 2.7 or (y) the Borrower shall have given
the Agent a Conversion/Continuation Notice (as defined below) requesting that,
at the end of such Interest Period, such Eurodollar Advance continue as a
Eurodollar Advance for the same or another Interest Period.  Subject to the terms of Section 2.6, the
Borrower may elect from time to time to convert all or any part of a Floating
Rate Advance into a Eurodollar Advance. 
The Borrower shall give the Agent irrevocable notice (a
“Conversion/Continuation Notice”) of each conversion of a Floating Rate Advance
into a Eurodollar Advance or continuation of a Eurodollar Advance, substantially
in the form of Exhibit 2.9, not later than 10:00 a.m.
(Louisville, Kentucky time) at least three Business Days prior to the date of
the requested conversion or continuation, specifying:

 

	
  (i)

  	
  the requested date, which shall be a Business Day, of such conversion
  or continuation,

  
	
   

  	
   

  
	
  (ii)

  	
  the aggregate amount and Type of the Advance which is to be converted
  or continued, and

  
	
   

  	
   

  
	
  (iii)

  	
  the amount of such Advance which is to be converted into or continued
  as a Eurodollar Advance and the duration of the Interest Period applicable
  thereto.

  

 

2.10                           Changes
in Interest Rate, etc. 
Each Floating Rate Advance shall bear interest on the outstanding
principal amount thereof, for each day from and including the date such Advance
is made or is automatically converted from a Eurodollar Advance into a Floating
Rate Advance pursuant to Section 2.9, to but excluding the date it is paid or
is converted into a Eurodollar Advance pursuant to Section 2.9 hereof, at a
rate per annum equal to the Floating Rate for such day.  Changes in the rate of interest on that
portion of any Advance maintained as a Floating Rate Advance will take effect
simultaneously with each change in the Alternate Base Rate.  Each Eurodollar Advance shall bear interest
on the outstanding principal amount thereof from and including the first day of
the Interest Period applicable thereto to (but not including) the last day of
such Interest Period at the interest rate determined by the Agent as applicable
to such Eurodollar Advance based upon the Borrower’s selections under Sections
2.8 and 2.9 and otherwise in accordance with the terms hereof.  No Interest Period may end after the
Facility Termination Date.

 

2.11                           Rates Applicable After Default.  Notwithstanding anything to the contrary
contained in Section 2.8, 2.9 or 2.10, during the continuance of a Default or
Unmatured Default the Required Lenders may, at their option, by notice to the
Borrower (which notice may be revoked at the option of the Required Lenders
notwithstanding any provision of Section 8.2 requiring unanimous consent of the
Lenders to changes in interest rates), declare that no Advance may be made as,
converted into or continued as a Eurodollar Advance.  During the

 

16

 

continuance of a Default the Required Lenders may, at their option, by
notice to the Borrower (which notice may be revoked at the option of the
Required Lenders notwithstanding any provision of Section 8.2 requiring
unanimous consent of the Lenders to changes in interest rates), declare that
(i) each Eurodollar Advance shall bear interest for the remainder of the
applicable Interest Period at the rate otherwise applicable to such Interest
Period plus 2% per annum, (ii) each Floating Rate Advance shall bear interest
at a rate per annum equal to the Floating Rate in effect from time to time plus
2% per annum and (iii) the LC Fee shall be increased by 2% per annum, provided
that, during the continuance of a Default under Section 7.6 or 7.7, the
interest rates set forth in clauses (i) and (ii) above and the increase in the
LC Fee set forth in clause (iii) above shall be applicable to all Credit
Extensions without any election or action on the part of the Agent or any
Lender.

 

2.12                           Method
of Payment.  All payments of the
Obligations hereunder shall be made, without setoff, deduction, or
counterclaim, in immediately available funds to the Agent at the Agent’s
address specified pursuant to Article 13, or at any other Lending Installation
of the Agent specified in writing by the Agent to the Borrower, by noon (local
time) on the date when due and shall (except in the case of Reimbursement
Obligations for which the LC Issuer has not been fully indemnified by the
Lenders, or as otherwise specifically required hereunder) be applied ratably by
the Agent among the Lenders.  Each
payment delivered to the Agent for the account of any Lender shall be delivered
promptly by the Agent to such Lender in the same type of funds that the Agent
received at its address specified pursuant to Article 13 or at any Lending
Installation specified in a notice received by the Agent from such Lender.  The Agent is hereby authorized to charge the
account of the Borrower maintained with Bank One for each payment of principal,
interest, Reimbursement Obligations and fees as it becomes due hereunder.  Each reference to the Agent in this Section
2.12 shall also be deemed to refer, and shall apply equally, to the LC Issuer,
in the case of payments required to be made by the Borrower to the LC Issuer
pursuant to Section 2.19.6.

 

	
  2.13

  	
  Noteless Agreement;
  Evidence of Indebtedness.

  
	
   

  	
   

  
	
  (i)

  	
  Each Lender shall maintain in accordance with its usual practice an
  account or accounts evidencing the indebtedness of the Borrower to such
  Lender resulting from each Loan made by such Lender from time to time,
  including the amounts of principal and interest payable and paid to such
  Lender from time to time hereunder.

  
	
   

  	
   

  
	
  (ii)

  	
  The Agent shall also maintain accounts in which it will record (a)
  the amount of each Loan made hereunder, the Type thereof and the Interest
  Period with respect thereto, (b) the amount of any principal or interest due
  and payable or to become due and payable from the Borrower to each Lender
  hereunder, (c) the original stated amount of each Facility LC and the amount
  of LC Obligations outstanding at any time, and (d) the amount of any sum
  received by the Agent hereunder from the Borrower and each Lender’s share
  thereof.

  
	
   

  	
   

  
	
  (iii)

  	
  The entries maintained in the accounts maintained pursuant to
  paragraphs (i) and (ii) above shall be prima facie evidence of the existence
  and amounts of the Obligations therein recorded; provided, however, that
  the failure of the Agent or any Lender to maintain such accounts or any error
  therein shall not in any manner affect the obligation of the Borrower to
  repay the Obligations in accordance with their terms.

  

 

17

 

	
  (iv)

  	
  Any Lender may request that its Loans be evidenced by a promissory
  note (a “Note”). In such event, the Borrower shall prepare, execute and
  deliver to such Lender a Note payable to the order of such Lender in a form
  supplied by the Agent substantially conforming to Exhibit 2.13.  Thereafter, the Loans evidenced by such
  Note and interest thereon shall at all times (prior to any assignment pursuant
  to Section 12.3) be represented by one or more Notes payable to the order of
  the payee named therein, except to the extent that any such Lender
  subsequently returns any such Note for cancellation and requests that such
  Loans once again be evidenced as described in paragraphs (i) and (ii) above.

  

 

2.14                           Telephonic
Notices.  The Borrower hereby
authorizes the Lenders and the Agent to extend, convert or continue Advances,
effect selections of Types of Advances and to transfer funds based on
telephonic notices made by any person or persons the Agent or any Lender in
good faith believes to be acting on behalf of the Borrower, it being understood
that the foregoing authorization is specifically intended to allow Borrowing
Notices and Conversion/Continuation Notices to be given telephonically.  The Borrower agrees to deliver promptly to
the Agent a written confirmation, if such confirmation is requested by the
Agent or any Lender, of each telephonic notice signed by an Authorized Officer.
If the written confirmation differs in any material respect from the action
taken by the Agent and the Lenders, the records of the Agent and the Lenders
shall govern absent manifest error.

 

2.15                           Interest Payment Dates; Interest and
Fee Basis.  Interest accrued on each
Floating Rate Advance shall be payable on each Payment Date, commencing with
the first such date to occur after the date hereof and at maturity.  Interest accrued on each Eurodollar Advance
shall be payable on the last day of its applicable Interest Period, on any date
on which the Eurodollar Advance is prepaid, whether by acceleration or
otherwise, and at maturity.  Interest
accrued on each Eurodollar Advance having an Interest Period longer than three
months shall also be payable on the last day of each three-month interval
during such Interest Period.  Interest,
commitment fees and LC Fees shall be calculated for actual days elapsed on the
basis of a 360-day year.  Interest shall
be payable for the day an Advance is made but not for the day of any payment on
the amount paid if payment is received prior to noon (local time) at the place
of payment.  If any payment of principal
of or interest on an Advance shall become due on a day which is not a Business
Day, such payment shall be made on the next succeeding Business Day and, in the
case of a principal payment, such extension of time shall be included in
computing interest in connection with such payment.

 

2.16                           Notification of Advances, Interest
Rates, Prepayments and Commitment Reductions.  Promptly after receipt thereof, the Agent will notify each Lender
of the contents of each Aggregate Commitment reduction notice, Borrowing
Notice, Conversion/Continuation Notice, and repayment notice received by it
hereunder.  Promptly after notice from
the LC Issuer, the Agent will notify each Lender of the contents of each
request for issuance of a Facility LC hereunder.  The Agent will notify each Lender of the interest rate applicable
to each Eurodollar Advance promptly upon determination of such interest rate
and will give each Lender prompt notice of each change in the Alternate Base
Rate.

 

2.17                           Lending Installations.  Each Lender may book its Loans and its
participation in any LC Obligations and the LC Issuer may book the Facility LCs
at any Lending Installation selected by such Lender or the LC Issuer, as the
case may be, and may change its Lending Installation from time to time.  All terms of this Agreement shall apply to
any such Lending Installation and the Loans, Facility LCs, participations in LC
Obligations and any Notes issued

 

18

 

hereunder shall be deemed held by each Lender or the LC Issuer, as the
case may be, for the benefit of any such Lending Installation.  Each Lender and the LC Issuer may, by
written notice to the Agent and the Borrower in accordance with Article 13,
designate replacement or additional Lending Installations through which Loans
will be made by it or Facility LCs will be issued by it and for whose account
Loan payments or payments with respect to Facility LCs are to be made.

 

2.18                           Non-Receipt
of Funds by the Agent. 
Unless the Borrower or a Lender, as the case may be, notifies the Agent
prior to the date on which it is scheduled to make payment to the Agent of (i)
in the case of a Lender, the proceeds of a Loan or (ii) in the case of the
Borrower, a payment of principal, interest or fees to the Agent for the account
of the Lenders, that it does not intend to make such payment, the Agent may
assume that such payment has been made. 
The Agent may, but shall not be obligated to, make the amount of such
payment available to the intended recipient in reliance upon such
assumption.  If such Lender or the
Borrower, as the case may be, has not in fact made such payment to the Agent,
the recipient of such payment shall, on demand by the Agent, repay to the Agent
the amount so made available together with interest thereon in respect of each
day during the period commencing on the date such amount was so made available
by the Agent until the date the Agent recovers such amount at a rate per annum
equal to (x) in the case of payment by a Lender, the Federal Funds Effective
Rate for such day for the first three days and, thereafter, the interest rate
applicable to the relevant Loan or (y) in the case of payment by the Borrower,
the interest rate applicable to the relevant Loan.

 

2.19                        Facility LCs.

 

2.19.1                  Issuance.  The LC Issuer hereby agrees, on the terms
and conditions set forth in this Agreement, to issue Facility LCs, and to
renew, extend, increase, decrease or otherwise modify each Facility LC
(“Modify,” and each such action a “Modification”), from time to time from and
including the date of this Agreement and prior to the Facility Termination Date
upon the request of the Borrower (or RSC, in the case of the RSC Facility LC); provided
that immediately after each such Facility LC is issued or Modified, (i) the
aggregate amount of the outstanding LC Obligations shall not exceed the LC
Obligations Limit, and (ii) the Aggregate Outstanding Credit Exposure shall not
exceed the Aggregate Commitment.  No
Facility LC shall have an expiry date later than the earlier of (x) the fifth
Business Day prior to the Facility Termination Date and (y) one year after its
issuance.  Facility LCs may be
denominated in foreign currencies acceptable to the LC Issuer and the Agent.

 

2.19.2                  Participations.  Upon the issuance or Modification by the LC
Issuer of a Facility LC in accordance with this Section 2.19, the LC Issuer
shall be deemed, without further action by any party hereto, to have
unconditionally and irrevocably sold to each Lender, and each Lender shall be
deemed, without further action by any party hereto, to have unconditionally and
irrevocably purchased from the LC Issuer, a participation in such Facility LC
(and each Modification thereof) and the related LC Obligations in proportion to
its Pro Rata Share.

 

2.19.3                  Notice.  Subject to Section 2.19.1, the Borrower (or
RSC, in the case of the RSC Facility LC) shall give the LC Issuer (and the
Agent, if the Agent is not the LC Issuer in the case of the Facility LC being
requested) notice prior to 10:00 a.m. (Louisville, Kentucky time) at least five
Business Days prior to the proposed date of issuance or Modification of each
Facility LC, specifying the beneficiary, the proposed

 

19

 

date of issuance (or Modification) and the expiry date of such Facility
LC, and describing the proposed terms of such Facility LC and the nature of the
transactions proposed to be supported thereby. 
Upon receipt of such notice, the LC Issuer shall promptly notify the
Agent, and the Agent shall promptly notify each Lender, of the contents thereof
and of the amount of such Lender’s participation in such proposed Facility
LC.  The issuance or Modification by the
LC Issuer of any Facility LC shall, in addition to the conditions precedent set
forth in Article 4 (the satisfaction of which the LC Issuer shall have no duty
to ascertain), be subject to the conditions precedent that such Facility LC
shall be satisfactory to the LC Issuer and that the Borrower shall have
executed and delivered such application agreement and/or such other instruments
and agreements relating to such Facility LC as the LC Issuer shall have
reasonably requested (each, a “Facility LC Application”).  In the event of any conflict between the
terms of this Agreement and the terms of any Facility LC Application, the terms
of this Agreement shall control.

 

2.19.4                  LC Fees.  The Borrower shall pay to the Agent (on
behalf of RSC, in the case of the RSC Facility LC), for the account of the
Lenders ratably in accordance with their respective Pro Rata Shares, (i) with
respect to each standby Facility LC, a letter of credit fee at a per annum rate
equal to the Applicable Margin for Eurodollar Loans in effect from time to time
on the average daily undrawn stated amount under such standby Facility LC, such
fee to be payable in arrears on each Payment Date, and (ii) with respect to
each commercial Facility LC, a one-time letter of credit fee in an amount equal
to 1% of the initial stated amount (or, with respect to a Modification of any
such commercial Facility LC which increases the stated amount thereof, such
increase in the stated amount) thereof, such fee to be payable on the date of
such issuance or increase (each such fee described in this sentence an “LC
Fee”).  The Borrower (on behalf of RSC,
in the case of the RSC Facility LC) shall also pay to the LC Issuer for its own
account (x) at the time of issuance of each Facility LC that is a standby
Letter of Credit, a fronting fee in an amount equal to 0.125% of the face
amount of the Letter of Credit, and (y) documentary and processing charges in
connection with the issuance or Modification of and draws under Facility LCs in
accordance with the LC Issuer’s standard schedule for such charges as in effect
from time to time.

 

2.19.5                  Administration; Reimbursement by
Lenders.  Upon receipt from the
beneficiary of any Facility LC of any demand for payment under such Facility
LC, the LC Issuer shall notify the Agent and the Agent shall promptly notify
the Borrower and each other Lender as to the amount to be paid by the LC Issuer
as a result of such demand and the proposed payment date (the “LC Payment
Date”).  The responsibility of the LC
Issuer to the Borrower (and RSC, if applicable) and each Lender shall be only
to determine that the documents (including each demand for payment) delivered
under each Facility LC in connection with such presentment shall be in
conformity in all material respects with such Facility LC.  The LC Issuer shall endeavor to exercise the
same care in the issuance and administration of the Facility LCs as it does
with respect to letters of credit in which no participations are granted, it
being understood that in the absence of any gross negligence or willful
misconduct by the LC Issuer, each Lender shall be unconditionally and
irrevocably liable without regard to the occurrence of any Default or any
condition precedent whatsoever, to reimburse the LC Issuer on demand for (i)
such Lender’s Pro Rata Share of the amount of each payment made by the LC
Issuer under each Facility LC to the extent such amount is not reimbursed by
the Borrower pursuant to Section 2.19.6 below, plus (ii) interest on the
foregoing amount to be reimbursed by such Lender, for each day from the date of
the LC Issuer’s demand for such reimbursement (or,

 

20

 

if such demand is made after 11:00 a.m. (Louisville, Kentucky time) on
such date, from the next succeeding Business Day) to the date on which such
Lender pays the amount to be reimbursed by it, at a rate of interest per annum
equal to the Federal Funds Effective Rate for the first three days and,
thereafter, at a rate of interest equal to the rate applicable to Floating Rate
Advances.

 

2.19.6                  Reimbursement by Borrower.  The Borrower (and RSC, if applicable) shall
be irrevocably and unconditionally obligated to reimburse the LC Issuer on or
before the applicable LC Payment Date for any amounts to be paid by the LC
Issuer upon any drawing under any Facility LC, without presentment, demand,
protest or other formalities of any kind; provided that neither the Borrower nor any
Lender shall hereby be precluded from asserting any claim for direct (but not
consequential) damages suffered by the Borrower or RSC or such Lender to the
extent, but only to the extent, caused by (i) the willful misconduct or gross
negligence of the LC Issuer in determining whether a request presented under
any Facility LC issued by it complied with the terms of such Facility LC or
(ii) the LC Issuer’s failure to pay under any Facility LC issued by it after
the presentation to it of a request strictly complying with the terms and
conditions of such Facility LC.  All such
amounts paid by the LC Issuer and remaining unpaid by the Borrower shall bear
interest, payable on demand, for each day until paid at a rate per annum equal
to (x) the rate applicable to Floating Rate Advances for such day if such day
falls on or before the applicable LC Payment Date and (y) the sum of 2% plus
the rate applicable to Floating Rate Advances for such day if such day falls
after such LC Payment Date.  The LC
Issuer will pay to each Lender ratably in accordance with its Pro Rata Share
all amounts received by it from the Borrower for application in payment, in
whole or in part, of the Reimbursement Obligation in respect of any Facility LC
issued by the LC Issuer, but only to the extent such Lender has made payment to
the LC Issuer in respect of such Facility LC pursuant to Section 2.19.5.  Subject to the terms and conditions of this
Agreement (including without limitation the submission of a Borrowing Notice in
compliance with Section 2.8 and the satisfaction of the applicable conditions
precedent set forth in Article 4), the Borrower may request an Advance
hereunder for the purpose of satisfying any Reimbursement Obligation.

 

2.19.7                  Obligations Absolute.  The Borrower’s (and RSC’s, if applicable)
obligations under this Section 2.19 shall be absolute and unconditional under
any and all circumstances and irrespective of any setoff, counterclaim or
defense to payment which the Borrower or RSC may have or have had against the
LC Issuer, any Lender or any beneficiary of a Facility LC.  The Borrower further agrees with the LC
Issuer and the Lenders that the LC Issuer and the Lenders shall not be
responsible for, and the Reimbursement Obligation in respect of any Facility LC
shall not be affected by, among other things, the validity or genuineness of
documents or of any endorsements thereon, even if such documents should in fact
prove to be in any or all respects invalid, fraudulent or forged, or any
dispute between or among the Borrower, any of its Affiliates, the beneficiary
of any Facility LC or any financing institution or other party to whom any
Facility LC may be transferred or any claims or defenses whatsoever of the
Borrower or of any of its Affiliates against the beneficiary of any Facility LC
or any such transferee.  The LC Issuer
shall not be liable for any error, omission, interruption or delay in
transmission, dispatch or delivery of any message or advice, however
transmitted, in connection with any Facility LC.  The Borrower agrees that any action taken or omitted by the LC
Issuer or any Lender under or in connection with each Facility LC and the
related drafts and documents, if done without gross negligence or willful
misconduct,

 

21

 

shall be binding upon the Borrower and shall not put the LC Issuer or
any Lender under any liability to the Borrower.  Nothing in this Section 2.19.7 is intended to limit the right of
the Borrower to make a claim against the LC Issuer for damages as contemplated
by the proviso to the first sentence of Section 2.19.6.

 

2.19.8                  Actions of LC Issuer.  The LC Issuer shall be entitled to rely, and
shall be fully protected in relying, upon any Facility LC, draft, writing,
resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, telecopy, telex or teletype message, statement, order or other document
believed by it to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons, and upon advice and statements of legal
counsel, independent accountants and other experts selected by the LC Issuer.  The LC Issuer shall be fully justified in
failing or refusing to take any action under this Agreement unless it shall
first have received such advice or concurrence of the Required Lenders as it
reasonably deems appropriate or it shall first be indemnified to its reasonable
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action.
Notwithstanding any other provision of this Section 2.19, the LC Issuer shall
in all cases be fully protected in acting, or in refraining from acting, under
this Agreement in accordance with a request of the Required Lenders, and such
request and any action taken or failure to act pursuant thereto shall be
binding upon the Lenders and any future holders of a participation in any
Facility LC.

 

2.19.9                  Indemnification.  The Borrower hereby agrees to indemnify and
hold harmless each Lender, the LC Issuer and the Agent, and their respective
directors, officers, agents and employees from and against any and all claims
and damages, losses, liabilities, costs or expenses which such Lender, the LC
Issuer or the Agent may incur (or which may be claimed against such Lender, the
LC Issuer or the Agent by any Person whatsoever) by reason of or in connection
with the issuance, execution and delivery or transfer of or payment or failure
to pay under any Facility LC or any actual or proposed use of any Facility LC,
including, without limitation, any claims, damages, losses, liabilities, costs
or expenses which the LC Issuer may incur by reason of or in connection with
(i) the failure of any other Lender to fulfill or comply with its
obligations to the LC Issuer hereunder (but nothing herein contained shall
affect any rights the Borrower may have against any defaulting Lender) or
(ii) by reason of or on account of the LC Issuer issuing any Facility LC
which specifies that the term “Beneficiary” included therein includes any
successor by operation of law of the named Beneficiary, but which Facility LC
does not require that any drawing by any such successor Beneficiary be
accompanied by a copy of a legal document, satisfactory to the LC Issuer,
evidencing the appointment of such successor Beneficiary; provided that the Borrower
shall not be required to indemnify any Lender, the LC Issuer or the Agent for
any claims, damages, losses, liabilities, costs or expenses to the extent, but
only to the extent, caused by (x) the willful misconduct or gross negligence of
the LC Issuer in determining whether a request presented under any Facility LC
complied with the terms of such Facility LC or (y) the LC Issuer’s failure to
pay under any Facility LC after the presentation to it of a request strictly
complying with the terms and conditions of such Facility LC. Nothing in this
Section 2.19.9 is intended to limit the obligations of the Borrower under any
other provision of this Agreement.

 

2.19.10            Lenders’ Indemnification.  Each Lender shall, ratably in accordance
with its Pro Rata Share, indemnify the LC Issuer, its affiliates and their

 

22

 

respective directors, officers, agents and employees (to the extent not
reimbursed by the Borrower) against any cost, expense (including reasonable
counsel fees and disbursements), claim, demand, action, loss or liability
(except such as result from such indemnitees’ gross negligence or willful
misconduct or the LC Issuer’s failure to pay under any Facility LC after the
presentation to it of a request strictly complying with the terms and
conditions of the Facility LC) that such indemnitees may suffer or incur in
connection with this Section 2.19 or any action taken or omitted by such
indemnitees hereunder.

 

2.19.11            Facility LC Collateral Account.  The Borrower agrees that it will, upon the
request of the Agent or the Required Lenders and until the final expiration
date of any Facility LC and thereafter as long as any amount is payable to the
LC Issuer or the Lenders in respect of any Facility LC, maintain a special
collateral account pursuant to arrangements satisfactory to the Agent (the
“Facility LC Collateral Account”) at the Agent’s office at the address
specified pursuant to Article 13, in the name of such Borrower but under the
sole dominion and control of the Agent, for the benefit of the Lenders and in
which such Borrower shall have no interest other than as set forth in Section
8.1.  The Borrower hereby pledges,
assigns and grants to the Agent, on behalf of and for the ratable benefit of
the Lenders and the LC Issuer, a security interest in all of the Borrower’s
right, title and interest in and to all funds which may from time to time be on
deposit in the Facility LC Collateral Account to secure the prompt and complete
payment and performance of the Obligations; provided, however,
that Borrower shall be under no obligation and Agent shall have no entitlement
to deposit funds of Borrower into the Facility LC Collateral Account except
after the occurrence and during the continuance of a Default.  The Agent will invest any funds on deposit
from time to time in the Facility LC Collateral Account in certificates of
deposit of Bank One having a maturity not exceeding 30 days.  Nothing in this Section 2.19.11 shall either
obligate the Agent to require the Borrower to deposit any funds in the Facility
LC Collateral Account or limit the right of the Agent to release any funds held
in the Facility LC Collateral Account in each case other than as required by
Section 8.1.

 

2.19.12            Rights as a Lender.  In its capacity as a Lender, the LC Issuer
shall have the same rights and obligations as any other Lender.

 

2.20                        Extension of Facility Termination Date.  The Borrower may request a one-year
extension of the Facility Termination Date by submitting a request for an
extension to the Agent (an “Extension Request”) no more than 90 and no less
than 45 days prior to the third anniversary of the closing of this
Agreement.  Promptly upon receipt of an
Extension Request, and provided no Default or Unmatured Default is then
existing, the Agent shall notify each Lender thereof and shall request each
Lender to inform the Agent whether it approves the Extension Request.  Each Lender approving the Extension Request
shall deliver its written consent by the date (the “Response Date”) that is no
later than 30 days prior to such third anniversary of the closing of this
Agreement.  If the consent of each of
the Lenders is received by the Agent, the Facility Termination Date shall be
extended by one year and the Agent shall promptly notify the Borrower and each
Lender of the new Facility Termination Date. 
Each Lender may elect to approve or disapprove the Extension Request in
the exercise of its sole and absolute discretion.

 

2.21                           Replacement
of Lender.  If the Borrower is
required pursuant to Section 3.1, 3.2 or 3.5 to make any additional payment to
any Lender or if any Lender’s obligation to make or continue, or to convert
Floating Rate Advances into, Eurodollar Advances shall be suspended

 

23

 

pursuant to Section 3.3 (any Lender so affected an “Affected Lender”),
the Borrower may elect, if such amounts continue to be charged or such
suspension is still effective, to replace such Affected Lender as a Lender
party to this Agreement, provided that no Default or Unmatured
Default shall have occurred and be continuing at the time of such replacement,
and provided
further that, concurrently with such replacement, (i) another bank
or other entity which is reasonably satisfactory to the Borrower and the Agent
shall agree, as of such date, to purchase for cash the Advances and other
Obligations due to the Affected Lender pursuant to an Assignment and Assumption
Agreement and to become a Lender for all purposes under this Agreement and to
assume all obligations of the Affected Lender to be terminated as of such date
and to comply with the requirements of Section 12.3 applicable to assignments,
and (ii) the Borrower shall pay to such Affected Lender in same day funds on
the day of such replacement (A) all interest, fees and other amounts then
accrued but unpaid to such Affected Lender by the Borrower hereunder to and
including the date of termination, including without limitation payments due to
such Affected Lender under Sections 3.1, 3.2 and 3.5, and (B) an amount, if
any, equal to the payment which would have been due to such Lender on the day
of such replacement under Section 3.4 had the Loans of such Affected Lender
been prepaid on such date rather than sold to the replacement Lender.

 

2.22                           Limitation of Interest. The Borrower, the
Agent and the Lenders intend to strictly comply with all applicable laws,
including applicable usury laws. 
Accordingly, the provisions of this Section 2.22 shall govern and
control over every other provision of this Agreement or any other Loan Document
which conflicts or is inconsistent with this Section 2.22, even if such
provision declares that it controls.  As
used in this Section 2.22, the term “interest” includes the aggregate of all
charges, fees, benefits or other compensation which constitute interest under
applicable law, provided that, to the maximum extent permitted by applicable
law, (a) any non-principal payment shall be characterized as an expense or as
compensation for something other than the use, forbearance or detention of
money and not as interest, and (b) all interest at any time contracted for,
reserved, charged or received shall be amortized, prorated, allocated and
spread, in equal parts during the full term of the Obligations.  In no event shall the Borrower or any other
Person be obligated to pay, or any Lender have any right or privilege to
reserve, receive or retain any interest in excess of the maximum amount of
nonusurious interest permitted under the laws of the Commonwealth of Kentucky
or the applicable laws (if any) of the United States or of any other applicable
state.

 

2.23                        Increase in Commitments.

 

2.23.1                  Amount of Increase in Commitments.  The Borrower may at any time, with the
consent of the Agent but without the consent of the Lenders except as provided
in this Section 2.23, increase the Commitments up to an amount not to exceed
$225,000,000, subject to satisfaction of each of the requirements contained in
this Section 2.23.

 

2.23.2                  Eligibility.  Each Lender who provides an increase in the
Commitments (each a “New Commitment Provider”) shall be either an existing
Lender at the time of the increase (each an “Existing Lender”) or a financial
institution reasonably acceptable to Agent that is not then currently a Lender
(each a “New Lender”) provided, that the Borrower shall first offer any
increase in the Commitments to the Existing Lenders by giving notice thereof to
each of the Existing Lenders and thirty (30) Business Days to respond to such
notice (failure to respond shall be deemed a rejection).

 

24

 

2.23.3                  Notice.  The Borrower and the Agent jointly shall
notify the Lenders at least thirty (30) Business Days before the date
(“Commitment Increase Effective Date”) any increase in the Commitments shall
become effective.  Such notice shall
state the amount of the increase in the Commitments, the names of the Lenders
providing the additional Commitments and the Commitment Increase Effective
Date.

 

2.23.4                  Minimum Amount.  Any increase in the Commitments provided by
any individual Lender shall be in an amount not less than $5,000,000 and
integral multiples of $1,000,000 in excess thereof.

 

2.23.5                  Implementation of Increase.  On the Commitment Increase Effective Date:

 

	
  (i)

  	
  Joinder.  Each New Commitment
  Provider shall execute and deliver to the Agent two Business Days prior to
  the Commitment Increase Effective Date a Joinder in the form attached as Exhibit
  2.23 (“Lender Joinder”), which shall become effective on the
  Commitment Increase Effective Date. The Lender Joinder shall set forth the
  Commitment provided by the New Commitment Provider if it is a New Lender and
  the new amount of the Commitment and the increase in the Commitment to be
  provided if it is an Existing Lender. If the New Commitment Provider is a New
  Lender it shall on the Effective Date join and become a party to this
  Agreement and the other Loan Documents as a Lender for all purposes hereunder
  and thereunder, subject to the provisions of this Section 2.23, having a
  Commitment as set forth in the Lender Joinder tendered by the same.

  
	
   

  	
   

  
	
  (ii)

  	
  Floating Rate Loans.  Each New
  Commitment Provider shall (i) purchase from the other lenders its Pro Rata
  Share in any Floating Rate Loans outstanding on the Commitment Increase
  Effective Date, and (ii) share ratably in all Floating Rate Loans borrowed by
  the Borrower after the Commitment Increase Effective Date.

  
	
   

  	
   

  
	
  (iii)

  	
  Eurodollar Rate Loans.  Each
  New Commitment Provider shall (a) purchase from the other Lenders its
  Pro Rata Share in each outstanding Eurodollar Loan on the date on which the
  Borrower either renews its Eurodollar Loan election with respect to the
  Eurodollar Loan in question or converts such Eurodollar Loan to a Floating
  Rate Loan.  The New Commitment
  Provider shall not purchase an interest in such Loans from the other Lenders
  on the Commitment Increase Effective Date (unless the Commitment Increase
  Effective Date is a renewal or conversion date, as applicable, in which case
  the preceding sentence shall apply), and (b) shall participate in all new
  Eurodollar Loans borrowed by the Borrower on and after the Commitment
  Increase Effective Date.

  
	
   

  	
   

  
	
  (iv)

  	
  Facility LCs.  Each New
  Commitment Provider shall participate in all Facility LCs outstanding on the
  Commitment Increase Effective Date according to its Pro Rata Share.

  
	
   

  	
   

  
	
  (v)

  	
  Limit on Amount.  Any increase
  in the Commitments pursuant to this Section 2.23 may not cause the total
  amount of the Commitments to exceed $225,000,000.

  
	
   

  	
   

  
	
  (vi)

  	
  No Default or Unmatured Default. 
  There shall exist no Default or Unmatured Default on the Commitment
  Increase Effective Date. If a Default or Unmatured Default exists, the
  Borrower shall not request an increase of, and may not increase, the
  Commitments.

  

 

25

 

2.23.6                  No Obligation.  No Existing Lender shall be required to
increase its Commitment in the event that the Borrower asks such Existing
Lender to provide all or a portion of any increase in the Commitments desired
by the Borrower.

 

ARTICLE 3.

 

YIELD
PROTECTION; TAXES

 

3.1                                 Yield Protection.  If, on or after the date of this Agreement, the adoption of any
law or any governmental or quasi-governmental rule, regulation, policy,
guideline or directive (whether or not having the force of law), or any change
in the interpretation or administration thereof by any governmental or
quasi-governmental authority, central bank or comparable agency charged with
the interpretation or administration thereof, or compliance by any Lender or
applicable Lending Installation or the LC Issuer with any request or directive
(whether or not having the force of law) of any such authority, central bank or
comparable agency:

 

	
  (i)

  	
  subjects any Lender or any applicable Lending Installation or the LC
  Issuer to any Taxes, or changes the basis of taxation of payments (other than
  with respect to Excluded Taxes) to any Lender or the LC Issuer in respect of
  its Eurodollar Loans, Facility LCs or participations therein, or

  
	
   

  	
   

  
	
  (ii)

  	
  imposes or increases or deems applicable any reserve, assessment,
  insurance charge, special deposit or similar requirement against assets of,
  deposits with or for the account of, or credit extended by, any Lender or any
  applicable Lending Installation or the LC Issuer (other than reserves and
  assessments taken into account in determining the interest rate applicable to
  Eurodollar Advances), or

  
	
   

  	
   

  
	
  (iii)

  	
  imposes any other condition the result of which is to increase the
  cost to any Lender or any applicable Lending Installation or the LC Issuer of
  making, funding or maintaining its Eurodollar Loans or of issuing or
  participating in Facility LCs or reduces any amount receivable by any Lender
  or any applicable Lending Installation or the LC Issuer in connection with
  its Eurodollar Loans, Facility LCs or participations therein, or requires any
  Lender or any applicable Lending Installation or the LC Issuer to make any
  payment calculated by reference to the amount of Eurodollar Loans held or
  interest received by it, by an amount deemed material by such Lender,

  

 

and the result of any of the foregoing is to increase the cost to such
Lender or applicable Lending Installation or the LC Issuer, as the case may be,
of making or maintaining its Eurodollar Loans or Commitment or of issuing or
participating in Facility LCs or to reduce the return received by such Lender
or applicable Lending Installation or the LC Issuer, as the case may be, in
connection with such Eurodollar Loans, Commitment, Facility LCs or
participations therein, then, within 15 days of demand by such Lender or the LC
Issuer, as the case may be, the Borrower shall pay such Lender or the LC
Issuer, as the case may be, such additional amount or amounts as will
compensate such Lender or the LC Issuer, as the case may be, for such increased
cost or reduction in amount received.

 

3.2                                 Changes in Capital Adequacy
Regulations.  If a Lender or the LC
Issuer determines the amount of capital required or expected to be maintained
by such Lender or the LC Issuer, any Lending Installation of such Lender or the
LC Issuer, or any corporation controlling such Lender or the LC Issuer is
increased as a result of a Change, then, within 15 days of

 

26

 

demand by such Lender or the LC Issuer, the Borrower shall pay such
Lender or the LC Issuer the amount necessary to compensate for any shortfall in
the rate of return on the portion of such increased capital which such Lender
or the LC Issuer determines is attributable to this Agreement, its Outstanding
Credit Exposure or its Commitment to make Loans and issue or participate in
Facility LCs, as the case may be, hereunder (after taking into account such
Lender’s or the LC Issuer’s policies as to capital adequacy).  “Change” means (i) any change after the date
of this Agreement in the Risk-Based Capital Guidelines or (ii) any adoption of
or change in any other law, governmental or quasi-governmental rule,
regulation, policy, guideline, interpretation, or directive (whether or not
having the force of law) after the date of this Agreement which affects the
amount of capital required or expected to be maintained by any Lender or the LC
Issuer or any Lending Installation or any corporation controlling any Lender or
the LC Issuer.  “Risk-Based Capital
Guidelines” means (i) the risk-based capital guidelines in effect in the United
States on the date of this Agreement, including transition rules, and (ii) the
corresponding capital regulations promulgated by regulatory authorities outside
the United States implementing the July 1988 report of the Basle Committee on
Banking Regulation and Supervisory Practices Entitled “International
Convergence of Capital Measurements and Capital Standards,” including
transition rules, and any amendments to such regulations adopted prior to the
date of this Agreement.

 

3.3                                 Availability of Types of Advances.  If any Lender determines that maintenance of
its Eurodollar Loans at a suitable Lending Installation would violate any
applicable law, rule, regulation, or directive, whether or not having the force
of law, or if the Required Lenders determine that (i) deposits of a type and
maturity appropriate to match fund Eurodollar Advances are not available or
(ii) the interest rate applicable to Eurodollar Advances does not accurately
reflect the cost of making or maintaining Eurodollar Advances, then the Agent
shall suspend the availability of Eurodollar Advances and require any affected
Eurodollar Advances to be repaid or converted to Floating Rate Advances,
subject to the payment of any funding indemnification amounts required by
Section 3.4.

 

3.4                                 Funding Indemnification.  If any payment of a Eurodollar Advance
occurs on a date which is not the last day of the applicable Interest Period,
whether because of acceleration, prepayment or otherwise, or a Eurodollar
Advance is not made on the date specified by the Borrower for any reason other
than default by the Lenders, the Borrower will indemnify each Lender for any
loss or cost incurred by it resulting therefrom, including, without limitation,
any loss or cost in liquidating or employing deposits acquired to fund or
maintain such Eurodollar Advance.

 

3.5                              Taxes.

 

	
  (i)

  	
  All payments by the Borrower to or for the account of any Lender, the
  LC Issuer or the Agent hereunder or under any Note or Facility LC Application
  shall be made free and clear of and without deduction for any and all Taxes.  If the Borrower shall be required by law
  to deduct any Taxes from or in respect of any sum payable hereunder to any
  Lender, the LC Issuer or the Agent, (a) the sum payable shall be increased as
  necessary so that after making all required deductions (including deductions
  applicable to additional sums payable under this Section 3.5) such Lender,
  the LC Issuer or the Agent (as the case may be) receives an amount equal to
  the sum it would have received had no such deductions been made, (b) the
  Borrower shall make such deductions, (c) the Borrower shall pay the full
  amount deducted to the relevant authority in

  

 

27

 

	
   

  	
  accordance with applicable law and (d) the Borrower shall furnish to
  the Agent the original copy of a receipt evidencing payment thereof within 30
  days after such payment is made.

  
	
   

  	
   

  
	
  (ii)

  	
  In addition, the Borrower hereby agrees to pay any present or future
  stamp or documentary taxes and any other excise or property taxes, charges or
  similar levies which arise from any payment made hereunder or under any Note
  or Facility LC Application or from the execution or delivery of, or otherwise
  with respect to, this Agreement or any Note or Facility LC Application
  (“Other Taxes”).

  
	
   

  	
   

  
	
  (iii)

  	
  The Borrower hereby agrees to indemnify the Agent, the LC Issuer and
  each Lender for the full amount of Taxes or Other Taxes (including, without
  limitation, any Taxes or Other Taxes imposed on amounts payable under this
  Section 3.5) paid by the Agent, the LC Issuer or such Lender as a result of
  its Commitment, any Loans made by it hereunder, or otherwise in connection
  with its participation in this Agreement and any liability (including
  penalties, interest and expenses) arising therefrom or with respect thereto.  Payments due under this indemnification
  shall be made within 30 days of the date the Agent, the LC Issuer or such
  Lender makes demand therefor pursuant to Section 3.6.

  
	
   

  	
   

  
	
  (iv)

  	
  Each Lender that is not incorporated under the laws of the United
  States of America or a state thereof (each a “Non-U.S. Lender”) agrees that
  it will, not more than ten Business Days after the date of this Agreement,
  (i) deliver to the Agent two duly completed copies of United States Internal
  Revenue Service Form W-8BEN or W-8ECI, certifying in either case that such
  Lender is entitled to receive payments under this Agreement without deduction
  or withholding of any United States federal income taxes, and (ii) deliver to
  the Agent a United States Internal Revenue Form W-8 or W-9, as the case may
  be, and certify that it is entitled to an exemption from United States backup
  withholding tax.  Each Non-U.S. Lender
  further undertakes to deliver to each of the Borrower and the Agent (x)
  renewals or additional copies of such form (or any successor form) on or
  before the date that such form expires or becomes obsolete, and (y) after the
  occurrence of any event requiring a change in the most recent forms so
  delivered by it, such additional forms or amendments thereto as may be
  reasonably requested by the Borrower or the Agent.  All forms or amendments described in the preceding sentence
  shall certify that such Lender is entitled to receive payments under this
  Agreement without deduction or withholding of any United States federal income
  taxes, unless
  an event (including without limitation any change in treaty, law or
  regulation) has occurred prior to the date on which any such delivery would
  otherwise be required which renders all such forms inapplicable or which
  would prevent such Lender from duly completing and delivering any such form
  or amendment with respect to it and such Lender advises the Borrower and the
  Agent that it is not capable of receiving payments without any deduction or
  withholding of United States federal income tax.

  
	
   

  	
   

  
	
  (v)

  	
  For any period during which a Non-U.S. Lender has failed to provide
  the Borrower with an appropriate form pursuant to clause (iv), above (unless
  such failure is due to a change in treaty, law or regulation, or any change
  in the interpretation or administration thereof by any governmental authority,
  occurring

  

 

28

 

	
   

  	
  subsequent to the date on which a form originally was required to be
  provided), such Non-U.S. Lender shall not be entitled to indemnification
  under this Section 3.5 with respect to Taxes imposed by the United States; provided
  that, should a Non-U.S. Lender which is otherwise exempt from or subject to a
  reduced rate of withholding tax become subject to Taxes because of its
  failure to deliver a form required under clause (iv), above, the Borrower
  shall take such steps as such Non-U.S. Lender shall reasonably request to
  assist such Non-U.S. Lender to recover such Taxes.

  
	
   

  	
   

  
	
  (vi)

  	
  Any Lender that is entitled to an exemption from or reduction of
  withholding tax with respect to payments under this Agreement or any Note
  pursuant to the law of any relevant jurisdiction or any treaty shall deliver
  to the Borrower (with a copy to the Agent), at the time or times prescribed
  by applicable law, such properly completed and executed documentation prescribed
  by applicable law as will permit such payments to be made without withholding
  or at a reduced rate.

  
	
   

  	
   

  
	
  (vii)

  	
  If the U.S. Internal Revenue Service or any other governmental
  authority of the United States or any other country or any political subdivision
  thereof asserts a claim that the Agent did not properly withhold tax from
  amounts paid to or for the account of any Lender (because the appropriate
  form was not delivered or properly completed, because such Lender failed to
  notify the Agent of a change in circumstances which rendered its exemption
  from withholding ineffective, or for any other reason), such Lender shall
  indemnify the Agent fully for all amounts paid, directly or indirectly, by
  the Agent as tax, withholding therefor, or otherwise, including penalties and
  interest, and including taxes imposed by any jurisdiction on amounts payable
  to the Agent under this subsection, together with all costs and expenses
  related thereto (including attorneys fees and time charges of attorneys for
  the Agent, which attorneys may be employees of the Agent).  The obligations of the Lenders under this
  Section 3.5(vii) shall survive the payment of the Obligations and termination
  of this Agreement.

  

 

3.6                                 Lender Statements; Survival of
Indemnity.  To the extent reasonably
possible, each Lender shall designate an alternate Lending Installation with
respect to its Eurodollar Loans to reduce any liability of the Borrower to such
Lender under Sections 3.1, 3.2 and 3.5 or to avoid the unavailability of
Eurodollar Advances under Section 3.3, so long as such designation is not, in
the judgment of such Lender, disadvantageous to such Lender.  Each Lender shall deliver a written
statement of such Lender to the Borrower (with a copy to the Agent) as to the
amount due, if any, under Section 3.1, 3.2, 3.4 or 3.5.  Such written statement shall set forth in
reasonable detail the calculations upon which such Lender determined such
amount and shall be final, conclusive and binding on the Borrower in the
absence of manifest error.  Determination
of amounts payable under such Sections in connection with a Eurodollar Loan
shall be calculated as though each Lender funded its Eurodollar Loan through
the purchase of a deposit of the type and maturity corresponding to the deposit
used as a reference in determining the Eurodollar Rate applicable to such Loan,
whether in fact that is the case or not. 
Unless otherwise provided herein, the amount specified in the written
statement of any Lender shall be payable on demand after receipt by the Borrower
of such written statement.  The
obligations of the Borrower under Sections 3.1, 3.2, 3.4 and 3.5 shall survive
payment of the Obligations and termination of this Agreement.

 

29

 

ARTICLE 4.

 

CONDITIONS PRECEDENT

 

4.1                                 Initial Credit Extension.  The Lenders shall not be required to make
the initial Credit Extension hereunder unless the Borrower has furnished to the
Agent with sufficient copies for the Lenders of each document described below,
each in form and substance satisfactory to Agent, and each other condition set
forth below has been fulfilled to the satisfaction of Agent:

 

(i)                                     Copies of the
articles or certificate of incorporation of the Borrower and each Initial
Guarantor, together with all amendments, and a certificate of good standing,
each certified by the appropriate governmental officer in its jurisdiction of
incorporation.

 

(ii)                                  Copies, certified by
the Secretary or Assistant Secretary of the Borrower and each Initial
Guarantor, of its bylaws and of its Board of Directors’ resolutions and of
resolutions or actions of any other body authorizing the execution of the Loan
Documents to which each is a party.

 

(iii)                               An incumbency
certificate, executed by the Secretary or Assistant Secretary of the Borrower
and each Initial Guarantor, which shall identify by name and title and bear the
signatures of the Authorized Officers and any other officers of the Borrower
and each Initial Guarantor authorized to sign the Loan Documents to which each
is a party, upon which certificate the Agent and the Lenders shall be entitled
to rely until informed of any change in writing by the Borrower or the Initial
Guarantor, as applicable.

 

(iv)                              A certificate, signed by
the principal financial officer of the Borrower, stating that on the initial
Credit Extension Date no Default or Unmatured Default has occurred and is
continuing.

 

(v)                                 If the initial Credit
Extension will be the issuance of a Facility LC, a properly completed Facility
LC Application.

 

(vi)                              A written opinion of the
Borrower’s counsel, addressed to the Lenders in substantially the form of Exhibit
4.1 (vi), subject to such changes as are approved by the Agent.

 

(vii)                           Any Notes requested by a
Lender pursuant to Section 2.13 payable to the order of each such requesting
Lender.

 

(viii)                        Written money transfer
instructions, in substantially the form of Exhibit 4.1 (viii), addressed to the
Agent and signed by an Authorized Officer, together with such other related
money transfer authorizations as the Agent may have reasonably requested.

 

(ix)                                One or more Guaranty
Agreements entered into by, collectively, each of the Initial Guarantors.

 

(x)                                   A Compliance
Certificate signed on behalf of Borrower.

 

30

 

(xi)                                Borrower shall have
paid or caused to be paid (a) to Agent the amount of the Annual Administrative
Agent’s Fee required pursuant to the Fee Letter, (b) to Arranger the
Arrangement Fee in the amount required by the Fee Letter, (c) to Agent for the
ratable benefit of the Lenders according to the Pro Rata Share of each Lender
on the date of Closing, a fee (“Upfront Fee”) in the total amount of $175,000,
and (d) to Agent the fee of legal counsel to Agent in the amount as heretofore
agreed among Borrower, Agent and such counsel.

 

(xii)                             A financial plan for the
Borrower for each of the three consecutive fiscal years of Borrower ending on
December 31, 2005.

 

(xiii)                          The Agent shall have
determined that (i) since October 16, 2002, there is an absence of any material
adverse change or disruption in primary or secondary loan syndication markets,
financial markets or in capital markets generally (whether resulting from
events prior to or after the date of the commitment) that would likely impair
syndication of the Loans hereunder and (ii) the Borrower and each Initial
Guarantor have fully cooperated with the Agent’s syndication efforts including,
without limitation, by providing the Agent with information regarding the
Borrower’s and each Initial Guarantor’s operations and prospects and such other
information as the Agent deems necessary to successfully syndicate the Loans
hereunder.

 

(xiv)                         Agent shall have determined
that all Indebtedness of Borrower under that certain Credit Agreement dated as
of March 17, 2000 among Borrower, PNC Bank, National Association as
Administrative Agent, Bank One, Indiana, NA as syndication agent and the other
Lenders party thereto, as amended (the “Prior Credit Agreement”), shall have
been paid in full and the Prior Credit Agreement terminated and, without limitation,
Borrower, Agent and PNC shall have made arrangements satisfactory to Agent for
each of the Transferred Letters of Credit to become Facility LCs under this
Agreement.

 

(xv)                            Such other documents as any
Lender or its counsel may have reasonably requested.

 

4.2                                 Each Credit Extension.  The Lenders shall not be required to make
any Credit Extension unless on the applicable Credit Extension Date:

 

(i)                                     There exists no
Default or Unmatured Default.

 

(ii)                                  The representations
and warranties contained in Article 5 are true and correct as of such Credit
Extension Date except to the extent any such representation or warranty is
stated to relate solely to an earlier date, in which case such representation
or warranty shall have been true and correct on and as of such earlier date.

 

(iii)                               All legal matters
incident to the making of such Credit Extension shall be satisfactory to the
Lenders and their counsel.

 

Each Borrowing Notice or request for issuance of a Facility LC with
respect to each such Credit Extension shall constitute a representation and
warranty by the Borrower that the

 

31

 

conditions contained in Sections 4.2(i) and (ii) have been
satisfied.  Any Lender may require a
duly completed Compliance Certificate as a condition to making a Credit
Extension.

 

ARTICLE 5.

 

REPRESENTATIONS
AND WARRANTIES

 

The Borrower represents and warrants to the Lenders that:

 

5.1                                 Existence and Standing.  Each of the Borrower and its Subsidiaries is
a corporation, partnership (in the case of Subsidiaries only) or limited
liability company duly and properly incorporated or organized, as the case may
be, validly existing and (to the extent such concept applies to such entity) in
good standing under the laws of its jurisdiction of incorporation or
organization and has all requisite authority to conduct its business in each
jurisdiction in which its business is conducted.

 

5.2                                 Authorization and Validity.  The Borrower and each of the Initial
Guarantors has the power and authority and legal right to execute and deliver
the Loan Documents to which each is a party and to perform its obligations
thereunder.  The execution and delivery
by the Borrower and each of the Initial Guarantors of the Loan Documents to
which each is a party and the performance of their respective obligations
thereunder have been duly authorized by proper corporate proceedings, and the
Loan Documents to which the Borrower and each of the Initial Guarantors is a
party constitute legal, valid and binding obligations of the Borrower and each
of the Initial Guarantors enforceable against the Borrower and each of the
Initial Guarantors in accordance with their terms, except as enforceability may
be limited by bankruptcy, insolvency or similar laws affecting the enforcement
of creditors’ rights generally.

 

5.3                                 No Conflict; Government Consent.  Neither the execution and delivery by the
Borrower or any Initial Guarantor of the Loan Documents to which it is a party,
nor the consummation of the transactions therein contemplated, nor compliance
with the provisions thereof will violate (i) any law, rule, regulation, order,
writ, judgment, injunction, decree or award binding on the Borrower or any of
its Subsidiaries or (ii) the Borrower’s or any of its Subsidiary’s articles or
certificate of incorporation, partnership agreement, certificate of
partnership, articles or certificate of organization, by-laws, or operating or
other management agreement, as the case may be, or (iii) the provisions of any
indenture, instrument or agreement to which the Borrower or any of its
Subsidiaries is a party or is subject, or by which it, or its Property, is
bound, or conflict with or constitute a default thereunder, or result in, or
require, the creation or imposition of any Lien in, of or on the Property of
the Borrower or a Subsidiary pursuant to the terms of any such indenture,
instrument or agreement.  No order,
consent, adjudication, approval, license, authorization, or validation of, or
filing, recording or registration with, or exemption by, or other action in
respect of any governmental or public body or authority, or any subdivision
thereof, which has not been obtained by the Borrower or any of its
Subsidiaries, is required to be obtained by the Borrower or any of its
Subsidiaries in connection with the execution and delivery of the Loan
Documents, the borrowings under this Agreement, the payment and performance by
the Borrower of the Obligations or the legality, validity, binding effect or
enforceability of any of the Loan Documents.

 

5.4                                 Financial Statements.  The September 29, 2002 consolidated
financial statements of the Borrower and its Subsidiaries heretofore delivered
to the Lenders were prepared in accordance with generally accepted accounting
principles in effect on the date such statements

 

32

 

were prepared and fairly present the consolidated financial condition
and operations of the Borrower and its Subsidiaries at such date and the
consolidated results of their operations for the period then ended.

 

5.5                                 Material Adverse Change.  Since September 29, 2002 there has been no
change in the business, Property, prospects, condition (financial or otherwise)
or results of operations of the Borrower and its Subsidiaries which could
reasonably be expected to have a Material Adverse Effect.

 

5.6                                 Taxes.  The Borrower and its Subsidiaries have filed
all United States federal tax returns and all other tax returns which are
required to be filed and have paid all taxes due pursuant to said returns or
pursuant to any assessment received by the Borrower or any of its Subsidiaries,
except such taxes, if any, as are being contested in good faith and as to which
adequate reserves have been provided in accordance with GAAP and as to which no
Lien exists.  The United States income
tax returns of the Borrower and its Subsidiaries have been audited by the
Internal Revenue Service through the fiscal year ended in 1998.  No tax liens have been filed and no claims
are being asserted with respect to any such taxes.  The charges, accruals and reserves on the books of the Borrower
and its Subsidiaries in respect of any taxes or other governmental charges are
adequate.

 

5.7                                 Litigation and Contingent
Obligations.  There is no
litigation, arbitration, governmental investigation, proceeding or inquiry
pending or, to the knowledge of any of their officers, threatened against or
affecting the Borrower or any of its Subsidiaries which could reasonably be
expected to have a Material Adverse Effect or which seeks to prevent, enjoin or
delay the making of any Credit Extensions. 
Other than any liability incident to any litigation, arbitration or
proceeding which could not reasonably be expected to have a Material Adverse
Effect, the Borrower has no material contingent obligations not provided for or
disclosed in the financial statements referred to in Section 5.4.

 

5.8                                 Subsidiaries.  Schedule 1 contains an accurate list of
all Subsidiaries of the Borrower as of the date of this Agreement, setting
forth their respective jurisdictions of organization and the percentage of
their respective capital stock or other ownership interests owned by the
Borrower or other Subsidiaries.  All of
the issued and outstanding shares of capital stock or other ownership interests
of such Subsidiaries have been (to the extent such concepts are relevant with
respect to such ownership interests) duly authorized and issued and are fully
paid and non-assessable.

 

5.9                                 ERISA.  The Unfunded Liabilities of all Single
Employer Plans do not in the aggregate exceed $-0-.  Each Plan complies in all material respects with all applicable
requirements of law and regulations, no Reportable Event has occurred with
respect to any Plan, neither the Borrower nor any other member of the Controlled
Group has withdrawn from any Plan or initiated steps to do so, and no steps
have been taken to reorganize or terminate any Plan.

 

5.10                           Accuracy of Information.  No information, exhibit or report furnished
by the Borrower or any of its Subsidiaries to the Agent or to any Lender in
connection with the negotiation of, or compliance with, the Loan Documents
contained any material misstatement of fact or omitted to state a material fact
or any fact necessary to make the statements contained therein not misleading.

 

33

 

5.11                           Regulation
U.  Margin stock (as defined in
Regulation U) constitutes less than 25% of the value of those assets of the
Borrower and its Subsidiaries which are subject to any limitation on sale,
pledge, or other restriction hereunder.

 

5.12                           Material
Agreements.  Neither the
Borrower nor any Subsidiary is a party to any agreement or instrument or
subject to any charter or other corporate restriction which could reasonably be
expected to have a Material Adverse Effect. 
Neither the Borrower nor any Subsidiary is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in (i) any agreement to which it is a party, which default
could reasonably be expected to have a Material Adverse Effect or (ii) any
agreement or instrument evidencing or governing Indebtedness.

 

5.13                           Compliance
With Laws.  The Borrower and its
Subsidiaries have complied with all applicable statutes, rules, regulations,
orders and restrictions of any domestic or foreign government or any
instrumentality or agency thereof having jurisdiction over the conduct of their
respective businesses or the ownership of their respective Property except for
any failure to comply with any of the foregoing which could not reasonably be
expected to have a Material Adverse Effect.

 

5.14                           Ownership
of Properties.  The
Borrower and its Subsidiaries have good title, free of all Liens other than
those permitted by Section 6.15, to all of the Property and assets reflected in
the Borrower’s most recent consolidated financial statements provided to the
Agent as owned by the Borrower and its Subsidiaries.

 

5.15                           Plan Assets; Prohibited Transactions.  The Borrower is not an entity deemed to hold
“plan assets” within the meaning of 29 C.F.R. § 2510.3-101 of an employee
benefit plan (as defined in Section 3(3) of ERISA) which is subject to Title I
of ERISA or any plan (within the meaning of Section 4975 of the Code), and
neither the execution of this Agreement nor the making of Credit Extensions
hereunder gives rise to a prohibited transaction within the meaning of Section
406 of ERISA or Section 4975 of the Code.

 

5.16                           Environmental
Matters.  In the ordinary course of
its business, the officers of the Borrower consider the effect of Environmental
Laws on the business of the Borrower and its Subsidiaries, in the course of
which they identify and evaluate potential risks and liabilities accruing to
the Borrower due to Environmental Laws. 
On the basis of this consideration, the Borrower has concluded that
Environmental Laws cannot reasonably be expected to have a Material Adverse
Effect.  Neither the Borrower nor any
Subsidiary has received any notice to the effect that its operations are not in
material compliance with any of the requirements of applicable Environmental
Laws or are the subject of any federal or state investigation evaluating
whether any remedial action is needed to respond to a release of any toxic or
hazardous waste or substance into the environment, which non-compliance or
remedial action could reasonably be expected to have a Material Adverse Effect.

 

5.17                           Investment
Company Act.  Neither the
Borrower nor any Subsidiary is an “investment company” or a company
“controlled” by an “investment company”, within the meaning of the Investment
Company Act of 1940, as amended.

 

5.18                           Public Utility Holding Company Act.  Neither the Borrower nor any Subsidiary is a
“holding company” or a “subsidiary company” of a “holding company”, or an
“affiliate” of a “holding company” or of a “subsidiary company” of a “holding
company”, within the meaning of the Public Utility Holding Company Act of 1935,
as amended.

 

34

 

5.19                           Subordinated Indebtedness.  The Obligations constitute senior
indebtedness which is entitled to the benefits of the subordination provisions
of all outstanding Subordinated Indebtedness.

 

5.20                           Post-Retirement
Benefits.  The present value of the
expected cost of post-retirement medical and insurance benefits payable by the
Borrower and its Subsidiaries to its employees and former employees, as
estimated by the Borrower in accordance with procedures and assumptions deemed
reasonable by the Required Lenders, does not exceed $-0-.

 

5.21                           Insurance.  The certificate signed by the President or principal
financial officer of the Borrower, that attests to the existence and adequacy
of, and summarizes, the property and casualty insurance program carried by the
Borrower with respect to itself and its Subsidiaries and that has been
furnished by the Borrower to the Agent and the Lenders, is complete and
accurate.  This summary includes the
insurer’s or insurers’ name(s), policy number(s), expiration date(s), amount(s)
of coverage, type(s) of coverage, exclusion(s), and deductibles.  This summary also includes similar
information, and describes any reserves, relating to any self-insurance program
that is in effect.

 

5.22                           Solvency.

 

(i)                                     Immediately after
the consummation of the transactions to occur on the date hereof and
immediately following the making of each Loan, if any, made on the date hereof
and after giving effect to the application of the proceeds of such Loans, (a)
the fair value of the assets of the Borrower and its Subsidiaries on a
consolidated basis, at a fair valuation, will exceed the debts and liabilities,
subordinated, contingent or otherwise, of the Borrower and its Subsidiaries on
a consolidated basis; (b) the present fair saleable value of the Property of
the Borrower and its Subsidiaries on a consolidated basis will be greater than the
amount that will be required to pay the probable liability of the Borrower and
its Subsidiaries on a consolidated basis on their debts and other liabilities,
subordinated, contingent or otherwise, as such debts and other liabilities
become absolute and matured; (c) the Borrower and its Subsidiaries on a
consolidated basis will be able to pay their debts and liabilities,
subordinated, contingent or otherwise, as such debts and liabilities become
absolute and matured; and (d) the Borrower and its Subsidiaries on a
consolidated basis will not have unreasonably small capital with which to
conduct the businesses in which they are engaged as such businesses are now
conducted and are proposed to be conducted after the date hereof.

 

(ii)                                  The Borrower does not
intend to, or to permit any of its Subsidiaries to, and does not believe that
it or any of its Subsidiaries will, incur debts beyond its ability to pay such
debts as they mature, taking into account the timing of and amounts of cash to
be received by it or any such Subsidiary and the timing of the amounts of cash
to be payable on or in respect of its Indebtedness or the Indebtedness of any
such Subsidiary.

 

35

 

ARTICLE 6.

 

COVENANTS

 

During the term of this Agreement, unless the Required Lenders shall
otherwise consent in writing:

 

6.1                                 Financial Reporting.  The Borrower will maintain, for itself and
each Subsidiary, a system of accounting established and administered in
accordance with GAAP, and furnish to the Lenders:

 

(i)                                     Within 90 days
after the close of each of its fiscal years, an unqualified (except for
qualifications relating to changes in accounting principles or practices
reflecting changes in generally accepted accounting principles and required or
approved by the Borrower’s independent certified public accountants) audit
report certified by independent certified public accountants acceptable to the
Lenders, prepared in accordance with GAAP on a consolidated basis for itself
and its Subsidiaries, including balance sheets as of the end of such period,
related profit and loss and reconciliation of surplus statements, and a
statement of cash flows, accompanied by (a) any management letter prepared by
said accountants, and (b) a certificate of said accountants that, in the course
of their examination necessary for their certification of the foregoing, they
have obtained no knowledge of any Default or Unmatured Default, or if, in the
opinion of such accountants, any Default or Unmatured Default shall exist, stating
the nature and status thereof, and acknowledging that the audit report is
intended for the use of Lenders as well as the Borrowers.

 

(ii)                                  Within 45 days after
the close of the first three quarterly periods of each of its fiscal years, for
itself and its Subsidiaries, consolidated unaudited balance sheets as at the
close of each such period and consolidated profit and loss and reconciliation
of surplus statements and a statement of cash flows for the period from the
beginning of such fiscal year to the end of such quarter, all certified by its
principal financial officer.

 

(iii)                               As soon as available,
but in any event within 45 days after the beginning of each fiscal year of the
Borrower, a copy of the plan and forecast (including a projected consolidated balance
sheet, income statement and funds flow statement) of the Borrower for such
fiscal year.

 

(iv)                              Together with the
financial statements required under Sections 6.1(i) and (ii), a Compliance
Certificate in substantially the form of Exhibit 6.1 (“Compliance Certificate”)
signed by its principal financial officer showing the calculations necessary to
determine compliance with this Agreement and stating that no Default or
Unmatured Default exists, or if any Default or Unmatured Default exists,
stating the nature and status thereof.

 

(v)                                 Within 270 days after
the close of each fiscal year, a statement of the Unfunded Liabilities of each
Single Employer Plan, certified as correct by an actuary enrolled under ERISA.

 

36

 

(vi)                              As soon as possible and
in any event within 10 days after the Borrower knows that any Reportable Event
has occurred with respect to any Plan, a statement, signed by the principal
financial officer of the Borrower, describing said Reportable Event and the
action which the Borrower proposes to take with respect thereto.

 

(vii)                           As soon as possible and in
any event within 10 days after receipt by the Borrower, a copy of (a) any
notice or claim to the effect that the Borrower or any of its Subsidiaries is
or may be liable to any Person as a result of the release by the Borrower, any
of its Subsidiaries, or any other Person of any toxic or hazardous waste or
substance into the environment, and (b) any notice alleging any violation of
any federal, state or local environmental, health or safety law or regulation
by the Borrower or any of its Subsidiaries, which, in either case, could
reasonably be expected to have a Material Adverse Effect.

 

(viii)                        Promptly upon the furnishing
thereof to the shareholders of the Borrower, copies of all financial
statements, reports and proxy statements so furnished.

 

(ix)                                Promptly upon the
filing thereof, copies of all registration statements and annual, quarterly,
monthly or other regular reports which the Borrower or any of its Subsidiaries
files with the Securities and Exchange Commission.

 

(x)                                   Such other
information (including non-financial information) as the Agent or any Lender
may from time to time reasonably request.

 

6.2                                 Use
of Proceeds.  The Borrower will,
and will cause each Subsidiary to, use the proceeds of the Credit Extensions to
repay in full all Indebtedness owing at the time of Closing under the Prior
Credit Agreement, for working capital and for general corporate purposes.  The Borrower will not, nor will it permit
any Subsidiary to, use any of the proceeds of the Advances to purchase or carry
any “margin stock” (as defined in Regulation U).

 

6.3                                 Notice of Default.  The Borrower will, and will cause each Subsidiary to, give prompt
notice in writing to the Lenders of the occurrence of any Default or Unmatured
Default and of any other development, financial or otherwise, which could
reasonably be expected to have a Material Adverse Effect.

 

6.4                                 Conduct of Business.  The Borrower will, and will cause each Subsidiary
to, carry on and conduct its business in substantially the same manner and in
substantially the same fields of enterprise as it is presently conducted and do
all things necessary to remain duly incorporated or organized, validly existing
and (to the extent such concept applies to such entity) in good standing as a
domestic corporation, partnership or limited liability company in its
jurisdiction of incorporation or organization, as the case may be, and maintain
all requisite authority to conduct its business in each jurisdiction in which
its business is conducted.

 

6.5                                 Taxes.  The Borrower will, and will cause each
Subsidiary to, timely file complete and correct United States federal and
applicable foreign, state and local tax returns required by law and pay when
due all taxes, assessments and governmental charges and levies upon it or its
income, profits or Property, except those which are being contested in good
faith by appropriate proceedings and with respect to which adequate reserves
have been set aside in accordance with GAAP. 
At any time that the Borrower or any of its Subsidiaries is organized as
a limited

 

37

 

liability company, each such limited liability company will qualify for
partnership tax treatment under United States federal tax law.

 

6.6                                 Insurance. 
The Borrower will, and will cause each Subsidiary to, maintain with
financially sound and reputable insurance companies insurance on all their
Property in such amounts and covering such risks as is consistent with sound
business practice, and the Borrower will furnish to any Lender upon request
full information as to the insurance carried.

 

6.7                                 Compliance with Laws.  The Borrower will, and will cause each
Subsidiary to, comply with all laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which it may be subject including,
without limitation, all Environmental Laws.

 

6.8                                 Maintenance of Properties.  The Borrower will, and will cause each
Subsidiary to, do all things necessary to maintain, preserve, protect and keep
its Property in good repair, working order and condition, and make all
necessary and proper repairs, renewals and replacements so that its business
carried on in connection therewith may be properly conducted at all times.

 

6.9                                 Inspection.  The Borrower will, and will cause each
Subsidiary to, permit the Agent and the Lenders, by their respective
representatives and agents, to inspect any of the Property, books and financial
records of the Borrower and each Subsidiary, to examine and make copies of the
books of accounts and other financial records of the Borrower and each
Subsidiary, and to discuss the affairs, finances and accounts of the Borrower
and each Subsidiary with, and to be advised as to the same by, their respective
officers at such reasonable times and intervals as the Agent or any Lender may
designate.

 

6.10                           Dividends.  The Borrower will not, nor will it permit
any Subsidiary to, declare or pay any dividends or make any distributions on
its capital stock (other than dividends payable in its own capital stock) or
redeem, repurchase or otherwise acquire or retire any of its capital stock at
any time outstanding, except that [i] any Subsidiary may declare and pay
dividends or make distributions to the Borrower or to a Wholly-Owned
Subsidiary, and (ii) the Borrower may declare and pay dividends on its capital
stock and repurchase shares of its capital stock provided that no Default or
Unmatured Default shall exist before or after giving effect to such dividends
or such repurchase or be created as a result thereof.

 

6.11                           Indebtedness.  The Borrower will not, nor will it permit
any Subsidiary to, create, incur or suffer to exist any Indebtedness, except:

 

(i)                                     The Loans and the
Reimbursement Obligations.

 

(ii)                                  Indebtedness existing
on the date hereof and described in Schedule 2 (including any extensions or
renewals thereof, provided there is no increase in the amount thereof or
other significant change in the terms thereof unless otherwise specified in Schedule
2.

 

(iii)                               Indebtedness constituted
by Rate Management Obligations related to the Loans.

 

(iv)                              Financial Contracts
intended to protect against material fluctuations in the cost of energy and
milk and other commodities used in the ordinary course of Borrower’s business
involving an Indebtedness not exceeding $15,000,000 in the aggregate
outstanding at any one time.

 

38

 

(v)                                 Capitalized Lease
Obligations and obligations under Operating Leases.

 

(vi)                              Indebtedness under the
Jeffersontown IRB, provided that the principal amount is not subsequently
increased; such Jeffersontown IRB shall continue to be permitted Indebtedness
hereunder if Capital Delivery, Ltd. should subsequently sell its rights
thereunder to a Person which is not an Affiliate of the Borrower.

 

(vii)                           Indebtedness secured by
purchase money security interest liens not exceeding $15,000,000 outstanding in
the aggregate at any one time.

 

(viii)                        Indebtedness of a Subsidiary to
Borrower or another Subsidiary, or of Borrower to a Subsidiary, if and to the
extent permitted under Section 6.14.

 

(ix)                                Indebtedness of Foreign
Subsidiaries, provided that the aggregate amount of such Indebtedness under
this clause (viii) plus Investments in Foreign Subsidiaries described in
Section 6.14(vi) does not exceed $25,000,000 at any time outstanding.

 

(x)                                   Contingent
Obligations constituted by (a) the endorsement of instruments for deposit or
collection in the ordinary course of business, (b) obligations of the Guarantors
under the Guaranty Agreements and the RSC Guaranty Agreement, (c) other
Guaranties, to the extent of not greater than $10,000,000 in the aggregate at
any one time outstanding, and (d) contingent reimbursement obligations
(including any Guaranty thereof) with respect to any portion of the RSC Letter
of Credit that has not been drawn against and to the extent of not more than
$18,000,000 at any time outstanding.

 

6.12                           Merger,
etc.  The Borrower will not, nor
will it permit any Loan Party to, merge or consolidate with or into any other
Person, or liquidate or dissolve, except that a Loan Party may merge into
another Loan Party.

 

6.13                           Sale
of Assets.  The Borrower will
not, nor will it permit any Subsidiary to, lease, sell or otherwise dispose of
its Property to any other Person, except:

 

(i)                                     Sales of inventory
in the ordinary course of business.

 

(ii)                                  Any sale, transfer or
lease of assets in the ordinary course of business which are no longer
necessary or required in the conduct of Borrower’s or such Subsidiary’s
business.

 

(iii)                               Any sale, transfer or
lease of assets by any Loan Party to another Loan Party.

 

(iv)                              Any sale, transfer or
lease of assets in the ordinary course of business which are replaced by
substitute assets acquired or leased.

 

(v)                                 Any sale of any store
and related assets to a franchisee provided that each of the following
conditions is satisfied:

 

(1) the gross sales price (before deduction
for expenses) in connection with the sale any store shall not exceed
$5,000,000;

 

39

 

(2) the gross sales price (before deduction
for expenses) in connection with all sales by the Loan Parties under this
clause (v) of this Section shall not exceed $25,000,000 during the term of this
Agreement (including after giving effect to any extension of the Facility
Expiration Date) after giving effect to such sale;

 

(3) the Borrower shall be in pro-forma
compliance with its financial covenants and the other terms of this Agreement
after giving effect to such sale; and

 

(4) the Borrower shall notify the Agent and
the Lenders of such sale within ten Business Days following the date of such
sale, such notice to state the amount of the gross sales price (before
deduction for expenses) of such sale and demonstrate compliance with clauses
(1) through (3) above.

 

6.14                           Investments and Acquisitions.  The Borrower will not, nor will it permit
any Subsidiary to, make or suffer to exist any Investments (including without
limitation, loans and advances to, and other Investments in, Subsidiaries), or
commitments therefor, or to create any Subsidiary or to become or remain a
partner in any partnership or joint venture, or to make any Acquisition of any
Person, except:

 

(i)                                     Cash Equivalent
Investments, except that the limitation on the maturity of Cash Equivalent
Investments by RSC shall be five (5) years rather than one (1) year.

 

(ii)                                  Existing Investments
in Subsidiaries and other Investments in existence on the date hereof and
described in Schedule 1.

 

(iii)                               Trade credit extended on
usual and customary terms in the ordinary course of business.

 

(iv)                              Advances to employees to
meet expenses incurred by such employees in the ordinary course of business.

 

(v)                                 Loans, advances and
investments in other Loan Parties.

 

(vi)                              Investments in any Foreign
Subsidiaries provided that the aggregate amount of such Investments plus
Indebtedness of Foreign Subsidiaries described in Section 6.11(viii) does not
exceed $25,000,000 outstanding in the aggregate at any one time exclusive of
any Investment in any Foreign Subsidiary existing on the date of Closing and
listed on Schedule1.

 

(vii)                           Investments in Excluded
Domestic Subsidiaries not to exceed $1,000,000 in the aggregate outstanding at
any one time exclusive of any Investment in an Excluded Domestic Subsidiary
existing on the date of Closing and listed on Schedule 1.

 

(viii)                        Investments in franchisees and
other Investments of the Borrower of a type other than as described in
subsections (i) through (vii) and (ix) of this Section 6.14 in an amount not to
exceed $30,000,000 in the aggregate at any one time outstanding.

 

(ix)                                Any Acquisition by a
Loan Party (each a “Permitted Acquisition”) that conforms with each of the
following requirements:

 

40

 

(1)                                  the Person that is
acquired shall execute a Guaranty Agreement on or promptly following the date
of such Permitted Acquisition (except that a Foreign Subsidiary shall not be
required to execute a Guaranty Agreement but any acquisition of any Excluded
Subsidiary shall be subject to the limitations on Investments in such Excluded
Subsidiaries described in this Section), and if the Borrower is a party to such
Acquisition, the Borrower shall be the survivor thereof;

 

(2)                                  the board of
directors or other equivalent governing body of such Person shall have approved
such Permitted Acquisition and, if the Loan Parties shall use any portion of
the Loans to fund such Permitted Acquisition, the Loan Parties also shall have
delivered to the Lenders written evidence of the approval of the board of
directors (or equivalent body) of such Person for such Permitted Acquisition;

 

(3)                                  the business
acquired, or the business conducted by the Person whose ownership interests are
being acquired, as applicable, shall be substantially the same as one or more
line or lines of business conducted by the Loan Parties and shall comply with
Section 6.4 [Conduct of or Business];

 

(4)                                  no Unmatured Default
or Default shall exist immediately prior to and after giving effect to such
Permitted Acquisition;

 

(5)                                  the Borrower shall
demonstrate that it shall be in compliance with the covenants contained in
Section 6.17 after giving effect to such Permitted Acquisition (including in
such computation Indebtedness or other liabilities assumed or incurred in connection
with such Permitted Acquisition but excluding income earned or expenses
incurred by the Person, business or assets to be acquired prior to the date of
such Permitted Acquisition) by delivering at least five (5) Business Days prior
to such Permitted Acquisition a certificate (“Acquisition Compliance
Certificate”) in the form of Exhibit 6.14 evidencing such
compliance;

 

(6)                                  the Loan Parties
shall deliver to the Agent at least five (5) Business Days before such
Permitted Acquisition copies of any agreements entered into or proposed to be
entered into by such Loan Parties in connection with such Permitted Acquisition
and shall deliver to the Agent such other information about such Person or its
assets as any Lender may reasonably require.

 

6.15                           Liens.  The Borrower will not, nor will it permit
any Subsidiary to, create, incur, or suffer to exist any Lien in, of or on the
Property of the Borrower or any of its Subsidiaries, except:

 

(i)                                     Liens for taxes,
assessments or governmental charges or levies on its Property if the same shall
not at the time be delinquent or thereafter can be paid without penalty, or are
being contested in good faith and by appropriate proceedings and for which
adequate reserves in accordance with GAAP shall have been set aside on its books.

 

(ii)                                  Liens imposed by law,
such as carriers’, warehousemen’s and mechanics’ liens and other similar liens
arising in the ordinary course of business which secure payment of obligations
not more than 60 days past due or which are being 

 

41

 

contested in good faith by appropriate proceedings and for which
adequate reserves shall have been set aside on its books.

 

(iii)                               Liens arising out of
pledges or deposits under worker’s compensation laws, unemployment insurance,
old age pensions, or other social security or retirement benefits, or similar
legislation.

 

(iv)                              Utility easements,
building restrictions and such other encumbrances or charges against real
property as are of a nature generally existing with respect to properties of a
similar character and which do not in any material way affect the marketability
of the same or interfere with the use thereof in the business of the Borrower
or its Subsidiaries.

 

(v)                                 Liens existing on the
date hereof and described in Schedule 2, if any.

 

(vi)                              Liens in favor of the
Agent, for the benefit of the Lenders.

 

(vii)                           Liens constituted by
purchase money security interests securing Indebtedness permitted under Section
6.11 that is incurred to finance the purchase price of the property encumbered
by the Lien.

 

6.16                           Affiliates.  The Borrower will not, and will not permit
any Subsidiary to, enter into any transaction (including, without limitation,
the purchase or sale of any Property or service) with, or make any payment or transfer
to, any Affiliate except in the ordinary course of business and pursuant to the
reasonable requirements of the Borrower’s or such Subsidiary’s business and
upon fair and reasonable terms no less favorable to the Borrower or such
Subsidiary than the Borrower or such Subsidiary would obtain in a comparable
arms-length transaction.

 

6.17                           Financial
Covenants.

 

6.17.1                  Leverage Ratio.  The Borrower will not permit the ratio (the
“Leverage Ratio”) determined as of the end of each of its fiscal quarters, of
(i) Consolidated Indebtedness of the Loan Parties (exclusive of (a)
Consolidated Indebtedness under the Jeffersontown IRB for so long as Capital
Delivery, Ltd., is a wholly-owned Subsidiary of Borrower, and (b) Indebtedness
under Operating Leases) at the time of determination, to (ii) Consolidated
EBITDA for the then most-recently ended four fiscal quarters, to be greater
than 2.0 to 1.0.

 

6.17.2                  Interest Coverage Ratio.  The Borrower will not permit the ratio,
determined as of the end of each of its fiscal quarters for the then
most-recently ended four fiscal quarters, of (i) Consolidated EBITDA, plus
Consolidated Rentals expense, plus pre-opening expenses relating to
restaurants, minus Capital Expenditures, to (ii) Consolidated Interest Expense,
plus Consolidated Rentals expense plus pre-opening expenses relating to
restaurants, to be less than 2.0 to 1.0.

 

6.17.3                  Minimum Net Worth.  The Borrower will at all times maintain
Consolidated Net Worth of not less than an amount (the “Required Consolidated
Net Worth”) equal to the remainder of (i) the sum of (a) 90% of Consolidated
Net Worth as of 12/30/01, which is stipulated to be $176,000,000 (the “Base
Amount”), plus (b) 50% of Consolidated Net Income earned in each fiscal
quarter beginning with the quarter ending March 31, 2002 (without deduction for
losses), minus (ii) the aggregate

 

42

 

consideration paid by Borrower during the period after December 30,
2001 to repurchase common stock of Borrower.

 

6.18                           Subsidiaries,
Partnerships and Joint Ventures.

 

Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to own or create directly or indirectly any Subsidiaries other
than (i) any Subsidiary that has joined this Agreement as Guarantor on the date
of Closing; and (ii) any Subsidiary formed after the date of Closing that joins
this Agreement as a Guarantor pursuant to a Guaranty Agreement duly executed
and delivered by it, (iii) any Foreign Subsidiary, provided that the total
amount of the Investment in Foreign Subsidiaries which do not join this
Agreement as Guarantors may not exceed the amounts permitted under Section
6.14, and (iv) any Excluded Domestic Subsidiary, provided that the total amount
of the Investment in Excluded Domestic Subsidiaries which do not join this
Agreement as Guarantors may not exceed the amounts permitted under Section
6.14.  Except as described on Schedule
1, each of the Loan Parties shall not become or agree to become
a (1) general or limited partner in any general or limited partnership, except
that the Loan Parties may be general or limited partners in other Loan Parties,
(2) member or manager of, or hold a limited liability company interest in, a
limited liability company, except that the Loan Parties may be members or
managers of, or hold limited liability company interests in (a) other Loan
Parties, and (b) Persons other than Loan Parties provided such Loan Party owns
more than 50% of the ownership interests in such Person having voting power, or
(3) joint venturer or hold a joint venture interest in any joint venture.

 

ARTICLE 7.

 

DEFAULTS

 

The occurrence of any one or more of the following events shall
constitute a Default:

 

7.1                                 Any
representation or warranty made or deemed made by or on behalf of the Borrower
or any of its Subsidiaries to the Lenders or the Agent under or in connection
with this Agreement, any Credit Extension, or any certificate or information
delivered in connection with this Agreement or any other Loan Document shall be
materially false on the date as of which made.

 

7.2                                 Nonpayment
of principal of any Loan when due, nonpayment of any Reimbursement Obligation
within one Business Day after the same becomes due, or nonpayment of interest
upon any Loan or of any commitment fee, LC Fee or other obligations under any
of the Loan Documents within five days after the same becomes due.

 

7.3                                 The
breach by the Borrower of any of the terms or provisions of Article 6, Section
6.2, 6.10, 6.11, 6.12, 6.13, 6.14, 6.15, 6.16, 6.17 and 6.18.

 

7.4                                 The
breach by the Borrower (other than a breach which constitutes a Default under
another Section of this Article 7) of any of the terms or provisions of this
Agreement which is not remedied within five days after written notice from the
Agent or any Lender.

 

7.5                                 Failure
of the Borrower or any of its Subsidiaries or any Guarantor to pay when due any
Material Indebtedness; or the default by the Borrower or any of its
Subsidiaries or any Guarantor in the performance (beyond the applicable grace
period with respect thereto, if any) of any term, provision or condition
contained in any Material Indebtedness Agreement, or any other

 

43

 

event shall occur or condition exist, the effect of which default,
event or condition is to cause, or to permit the holder(s) of such Material
Indebtedness or the lender(s) under any Material Indebtedness Agreement to
cause, such Material Indebtedness to become due prior to its stated maturity or
any commitment to lend under any Material Indebtedness Agreement to be
terminated prior to its stated expiration date; or any Material Indebtedness of
the Borrower or any of its Subsidiaries or any Guarantor shall be declared to
be due and payable or required to be prepaid or repurchased (other than by a regularly
scheduled payment) prior to the stated maturity thereof; or the Borrower or any
of its Subsidiaries or any Guarantor shall not pay, or admit in writing its
inability to pay, its debts generally as they become due.

 

7.6                                 The
Borrower or any of its Subsidiaries or any Guarantor shall (i) have an order
for relief entered with respect to it under the Federal bankruptcy laws as now
or hereafter in effect, (ii) make an assignment for the benefit of creditors,
(iii) apply for, seek, consent to, or acquiesce in, the appointment of a
receiver, custodian, trustee, examiner, liquidator or similar official for it
or any Substantial Portion of its Property, (iv) institute any proceeding
seeking an order for relief under the Federal bankruptcy laws as now or hereafter
in effect or seeking to adjudicate it a bankrupt or insolvent, or seeking
dissolution, winding up, liquidation, reorganization, arrangement, adjustment
or composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors or fail to file an answer or
other pleading denying the material allegations of any such proceeding filed
against it, (v) take any corporate or partnership action to authorize or effect
any of the foregoing actions set forth in this Section 7.6 or (vi) fail to
contest in good faith any appointment or proceeding described in Section
7.7.Without the application, approval or consent of the Borrower or any of its
Subsidiaries, or any Guarantor, a receiver, trustee, examiner, liquidator or
similar official shall be appointed for the Borrower or any of its Subsidiaries
or any Guarantor or any Substantial Portion of its Property, or a proceeding
described in Section 7.6(iv) shall be instituted against the Borrower or any of
its Subsidiaries or any Guarantor and such appointment continues undischarged
or such proceeding continues undismissed or unstayed for a period of 30
consecutive days.  Any court, government
or governmental agency shall condemn, seize or otherwise appropriate, or take
custody or control of, all or any portion of the Property of the Borrower and
its Subsidiaries or any Guarantor which, when taken together with all other
Property of the Borrower and its Subsidiaries or any Guarantor so condemned,
seized, appropriated, or taken custody or control of, during the twelve-month
period ending with the month in which any such action occurs, constitutes a
Substantial Portion

 

7.7                                 The
Borrower or any of its Subsidiaries shall fail within 30 days to pay, bond or
otherwise discharge one or more (i) judgments or orders for the payment of
money in excess of $5,000,000 (or the equivalent thereof in currencies other
than U.S. Dollars) in the aggregate, or (ii) nonmonetary judgments or orders
which, individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect, which judgment(s), in any such case, is/are not stayed
on appeal or otherwise being appropriately contested in good faith.  The Unfunded Liabilities of all Single
Employer Plans shall exceed in the aggregate $1,000,000 or any Reportable Event
shall occur in connection with any Plan.

 

7.8                                 Nonpayment
by the Borrower or any Subsidiary of any Rate Management Obligation when due or
the breach by the Borrower or any Subsidiary of any term, provision or condition
contained in any Rate Management Transaction or any transaction of the type
described in the definition of “Rate Management Transactions,” whether or not
any Lender or Affiliate of a Lender is a party thereto.

 

44

 

7.9                                 Any
Change in Control shall occur.

 

7.10                           The
Borrower or any of its Subsidiaries shall (i) be the subject of any proceeding
or investigation pertaining to the release by the Borrower, any of its
Subsidiaries or any other Person of any toxic or hazardous waste or substance
into the environment, or (ii) violate any Environmental Law, which, in the case
of an event described in clause (i) or clause (ii), could reasonably be
expected to have a Material Adverse Effect.The occurrence of any “default”, as
defined in any Loan Document (other than this Agreement) or the breach of any
of the terms or provisions of any Loan Document (other than this Agreement),
which default or breach continues beyond any period of grace therein provided.  Any Guaranty shall fail to remain in full
force or effect or any action shall be taken to discontinue or to assert the
invalidity or unenforceability of any Guaranty, or any Guarantor shall fail to
comply with any of the terms or provisions of any Guaranty to which it is a
party, or any Guarantor shall deny that it has any further liability under any
Guaranty to which it is a party, or shall give notice to such effect.

 

ARTICLE 8.

 

ACCELERATION,
WAIVERS, AMENDMENTS AND REMEDIES

 

8.1                                 Acceleration; Facility LC Collateral
Account.

 

(i)                                     If any Default
described in Section 7.6 or 7.7 occurs with respect to the Borrower or any
Guarantor, the obligations of the Lenders to make Loans hereunder and the
obligation and power of the LC Issuer to issue Facility LCs shall automatically
terminate and the Obligations shall immediately become due and payable without
any election or action on the part of the Agent, the LC Issuer or any Lender
and the Borrower will be and become thereby unconditionally obligated, without
any further notice, act or demand, to pay to the Agent an amount in immediately
available funds, which funds shall be held in the Facility LC Collateral
Account, equal to the difference of (x) the amount of LC Obligations at such
time, less (v) the amount on deposit in the Facility LC Collateral Account at
such time which is free and clear of all right and claims of third parties and
has not been applied against the Obligations (such difference, the “Collateral
Shortfall Amount”).  If any other
Default occurs, the Required Lenders (or the Agent with the consent of the
Required Lenders) may (a) terminate or suspend the obligations of the Lenders
to make Loans hereunder and the obligation and power of the LC Issuer to issue
Facility LCs, or declare the Obligations to be due and payable, or both,
whereupon the Obligations shall become immediately due and payable, without
presentment, demand, protest or notice of any kind, all of which the Borrower
hereby expressly waives, and (b) upon notice to the Borrower and in addition to
the continuing right to demand payment of all amounts payable under this
Agreement, make demand on the Borrower to pay, and the Borrower will, forthwith
upon such demand and without any further notice or act, pay to the Agent the
Collateral Shortfall Amount, which funds shall be deposited in the Facility LC
Collateral Account.

 

(ii)                                  If at any time while
any Default is continuing, the Agent determines that the Collateral Shortfall
Amount at such time is greater than zero, the Agent may make demand on the
Borrower to pay, and the Borrower will, forthwith upon such demand and without
any further notice or act, pay to the Agent the Collateral

 

45

 

Shortfall Amount, which funds shall be deposited in the Facility LC
Collateral Account.

 

(iii)                               The Agent may at any
time or from time to time after funds are deposited in the Facility LC
Collateral Account, apply such funds to the payment of the Obligations and any
other amounts as shall from time to time have become due and payable by the
Borrower to the Lenders or the LC Issuer under the Loan Documents.

 

(iv)                              At any time while any
Default is continuing, neither the Borrower nor any Person claiming on behalf
of or through the Borrower shall have any right to withdraw any of the funds
held in the Facility LC Collateral Account. 
After all of the Obligations have been indefeasibly paid in full and the
Aggregate Commitment has been terminated, any funds remaining in the Facility
LC Collateral Account shall be returned by the Agent to the Borrower or paid to
whomever may be legally entitled thereto at such time.

 

(v)                                 If, within 30 days
after acceleration of the maturity of the Obligations or termination of the
obligations of the Lenders to make Loans and the obligation and power of the LC
Issuer to issue Facility LCs hereunder as a result of any Default (other than
any Default as described in Section 7.6 or 7.7 with respect to the Borrower or
any Guarantor) and before any judgment or decree for the payment of the
Obligations due shall have been obtained or entered, the Required Lenders (in
their sole discretion) shall so direct, the Agent shall, by notice to the
Borrower, rescind and annul such acceleration and/or termination.

 

8.2                                 Amendments.  Subject to the provisions of this Section
8.2, the Required Lenders (or the Agent with the consent in writing of the
Required Lenders) and the Borrower may enter into agreements supplemental
hereto for the purpose of adding or modifying any provisions to the Loan
Documents or changing in any manner the rights of the Lenders or the Borrower
hereunder or waiving any Default hereunder; provided, however, that no such
supplemental agreement shall, without the consent of all of the Lenders:

 

(i)                                     Extend the final
maturity of any Loan, or extend the expiry date of any Facility LC to a date
after the Facility Termination Date or postpone any regularly scheduled payment
of principal of any Loan or forgive all or any portion of the principal amount
thereof or any Reimbursement Obligation related thereto, or reduce the rate or
extend the time of payment of interest or fees thereon or Reimbursement
Obligations related thereto.

 

(ii)                                  Reduce the percentage
specified in the definition of Required Lenders.

 

(iii)                               Extend the Facility
Termination Date; or reduce the amount or extend the payment date for, the
mandatory payments required under Section 2.2; or increase (except pursuant to
Section 2.23) the amount of the Aggregate Commitment or the Commitment of any
Lender hereunder or the commitment to issue Facility LCs; or permit the
Borrower to assign its rights under this Agreement.

 

(iv)                              Amend this Section 8.2.

 

(v)                                 Release any Guarantor.

 

46

 

No amendment of any provision of this Agreement relating to the Agent
shall be effective without the written consent of the Agent, and no amendment
of any provision relating to the LC Issuer shall be effective without the
written consent of the LC Issuer.  The
Agent may (i) waive payment of the fee required under Section 12.3.3 and (ii)
implement any Flex-Pricing Provisions contained in the fee letter described in
Section 10.13 or any commitment letter delivered in connection with the
transaction which is the subject of this Agreement without obtaining the
consent of any other party to this Agreement so long as, in the case of any
implementation of any Flex-Pricing Provisions, the Agent’s actions would not
require consent of all of the Lenders pursuant to the foregoing provisions of
this Section.

 

8.3                                 Preservation of Rights.  No delay or omission of the Lenders, the LC
Issuer or the Agent to exercise any right under the Loan Documents shall impair
such right or be construed to be a waiver of any Default or an acquiescence
therein, and the making of a Credit Extension notwithstanding the existence of
a Default or the inability of the Borrower to satisfy the conditions precedent
to such Credit Extension shall not constitute any waiver or acquiescence.  Any single or partial exercise of any such right
shall not preclude other or further exercise thereof or the exercise of any
other right, and no waiver, amendment or other variation of the terms,
conditions or provisions of the Loan Documents whatsoever shall be valid unless
in writing signed by the Lenders required pursuant to Section 8.2, and then
only to the extent in such writing specifically set forth.  All remedies contained in the Loan Documents
or by law afforded shall be cumulative and all shall be available to the Agent,
the LC Issuer and the Lenders until the Obligations have been paid in full.

 

ARTICLE 9.

 

GENERAL
PROVISIONS

 

9.1                                 Survival of Representations.  All representations and warranties of the
Borrower contained in this Agreement shall survive the making of the Credit
Extensions herein contemplated.

 

9.2                                 Governmental Regulation.  Anything contained in this Agreement to the
contrary notwithstanding, neither the LC Issuer nor any Lender shall be
obligated to extend credit to the Borrower in violation of any limitation or
prohibition provided by any applicable statute or regulation.

 

9.3                                 Headings.  Section headings in the Loan Documents are
for convenience of reference only, and shall not govern the interpretation of
any of the provisions of the Loan Documents.

 

9.4                                 Entire Agreement.  The Loan Documents embody the entire agreement and understanding
among the Borrower, the Agent, the LC Issuer and the Lenders and supersede all
prior agreements and understandings among the Borrower, the Agent, the LC
Issuer and the Lenders relating to the subject matter thereof other than those contained
in the fee letter described in Section 10.13 and any Flex-Pricing Provisions
contained in any commitment letter entered into in connection with the
transaction which is the subject of this Agreement, all of which shall survive
and remain in full force and effect during the term of this Agreement.

 

9.5                                 Several Obligations; Benefits of
this Agreement.  The respective
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other (except to the extent to which the
Agent is authorized to act as such). 
The failure of any

 

47

 

Lender to perform any of its obligations hereunder shall not relieve
any other Lender from any of its obligations hereunder.  This Agreement shall not be construed so as
to confer any right or benefit upon any Person other than the parties to this
Agreement and their respective successors and assigns, provided, however, that the
parties hereto expressly agree that the Arranger shall enjoy the benefits of
the provisions of Sections 9.6, 9.10 and 10.11 to the extent specifically set
forth therein and shall have the right to enforce such provisions on its own
behalf and in its own name to the same extent as if it were a party to this
Agreement.

 

9.6                                 Expenses; Indemnification.

 

(i)                                     The Borrower shall
reimburse the Agent and the Arranger for any costs, internal charges and
out-of-pocket expenses (including reasonable attorneys’ fees and time charges
of attorneys for the Agent, which attorneys may be employees of the Agent)
reasonably incurred or paid by the Agent or the Arranger in connection with the
preparation, negotiation, execution, delivery, syndication, distribution
(including, without limitation, via the internet), review, amendment,
modification, and administration of the Loan Documents.  The Borrower also agrees to reimburse the
Agent, the Arranger, the LC Issuer and the Lenders for any costs, internal
charges and out-of-pocket expenses (including reasonable attorneys’ fees and time
charges of attorneys for the Agent, the Arranger, the LC Issuer and the
Lenders, which attorneys may be employees of the Agent, the Arranger, the LC
Issuer or the Lenders) reasonably incurred or paid by the Agent, the Arranger,
the LC Issuer or any Lender in connection with the collection and enforcement
of the Loan Documents.

 

(ii)                                  The Borrower hereby
further agrees to indemnify the Agent, the Arranger, the LC Issuer and each
Lender, their respective affiliates, and each of their directors, officers and
employees against all losses, claims, damages, penalties, judgments,
liabilities and expenses (including, without limitation, all reasonable
expenses of litigation or preparation therefor whether or not the Agent, the
Arranger, the LC Issuer or any Lender or any affiliate is a party thereto)
which any of them may reasonably incur or pay arising out of or relating to
this Agreement, the other Loan Documents, the transactions contemplated hereby
or the direct or indirect application or proposed application of the proceeds
of any Credit Extension hereunder except to the extent that they are determined
in a final non-appealable judgment by a court of competent jurisdiction to have
resulted from the gross negligence or willful misconduct of the party seeking indemnification.   The obligations of the Borrower under this
Section 9.6 shall survive the termination of this Agreement.

 

9.7                                 Numbers of Documents.  All statements, notices, closing documents,
and requests hereunder shall be furnished to the Agent with sufficient
counterparts so that the Agent may furnish one to each of the Lenders.

 

9.8                                 Accounting.  Except as provided to the contrary herein,
all accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with GAAP.

 

9.9                                 Severability of Provisions.  Any provision in any Loan Document that is
held to be inoperative, unenforceable, or invalid in any jurisdiction shall, as
to that jurisdiction, be

 

48

 

inoperative, unenforceable, or invalid without affecting the remaining
provisions in that jurisdiction or the operation, enforceability, or validity
of that provision in any other jurisdiction, and to this end the provisions of
all Loan Documents are declared to be severable.

 

9.10                           Nonliability of Lenders.  The relationship between the Borrower on the
one hand and the Lenders, the LC Issuer and the Agent on the other hand shall
be solely that of borrower and lender. 
Neither the Agent, the Arranger, the LC Issuer nor any Lender shall have
any fiduciary responsibilities to the Borrower.  Neither the Agent, the Arranger, the LC Issuer nor any Lender
undertakes any responsibility to the Borrower to review or inform the Borrower
of any matter in connection with any phase of the Borrower’s business or
operations.  The Borrower agrees that
neither the Agent, the Arranger, the LC Issuer nor any Lender shall have
liability to the Borrower (whether sounding in tort, contract or otherwise) for
losses suffered by the Borrower in connection with, arising out of, or in any
way related to, the transactions contemplated and the relationship established
by the Loan Documents, or any act, omission or event occurring in connection
therewith, unless it is determined in a final non-appealable judgment by a
court of competent jurisdiction that such losses resulted from the gross
negligence or willful misconduct of the party from which recovery is
sought.  Neither the Agent, the
Arranger, the LC Issuer nor any Lender shall have any liability with respect
to, and the Borrower hereby waives, releases and agrees not to sue for, any
special, indirect, consequential or punitive damages suffered by the Borrower
in connection with, arising out of, or in any way related to the Loan Documents
or the transactions contemplated thereby.

 

9.11                           Confidentiality.  Each Lender agrees to hold any confidential
information which it may receive from the Borrower pursuant to this Agreement
in confidence, except for disclosure (i) to its Affiliates and to other Lenders
and their respective Affiliates, (ii) to legal counsel, accountants, and other
professional advisors to such Lender or to a Transferee, (iii) to regulatory
officials, (iv) to any Person as requested pursuant to or as required by law,
regulation, or legal process, (v) to any Person in connection with any legal
proceeding to which such Lender is a party, (vi) to such Lender’s direct or
indirect contractual counterparties in swap agreements or to legal counsel,
accountants and other professional advisors to such counterparties, (vii)
permitted by Section 12.4 and (viii) to rating agencies if requested or
required by such agencies in connection with a rating relating to the Advances
hereunder.

 

9.12                           Nonreliance.  Each Lender hereby represents that it is not
relying on or looking to any margin stock (as defined in Regulation U of the
Board of Governors of the Federal Reserve System) for the repayment of the
Credit Extensions provided for herein.

 

9.13                           Course
of Dealing.  No course of
dealing in respect of, nor any omission or delay in the exercise of, any right,
power, remedy or privilege by any Lender or Agent shall operate as a waiver
thereof, nor shall any right, power, remedy or privilege of Agent or any Lender
be exclusive of any other right, power, remedy or privilege referred to herein
or in any related document, or now or hereafter available at law, in equity, in
bankruptcy, by statute or otherwise.

 

9.14                           Time
of Essence.  Time shall be of
the essence in the performance of all the Obligations under the Loan Documents.

 

9.15                           Acceptance of Partial Performance
not a Waiver.  Without limitation of
any other provision contained in the Loan Documents concerning construction and
enforceability of waivers, any acceptance by Agent or Lenders of any payments
of principal, interest, late charges or any other sums due under the Notes or
other Loan Documents, or of tender of performance by

 

49

 

Borrower of non-monetary obligations of Borrower under the Loan Documents,
shall not constitute a waiver by Agent or Lenders of any breach by Borrower of
the provisions of the Loan Document in respect of which such payment was made
or performance was tendered unless such waiver is made expressly in writing.

 

9.16                           Construction
of Provisions.  Each covenant by
Borrower contained in this Agreement and the other Loan Documents shall be
construed without reference to any other such covenant, and any determination
of whether Borrower is in compliance with any such covenant shall be made
without reference to whether Borrower is in compliance with any other such
covenant.

 

ARTICLE 10.

 

THE AGENT

 

10.1                           Appointment;
Nature of Relationship. 
Bank One, Kentucky, NA is hereby appointed by each of the Lenders as its
contractual representative (herein referred to as the “Agent”) hereunder and
under each other Loan Document, and each of the Lenders irrevocably authorizes
the Agent to act as the contractual representative of such Lender with the
rights and duties expressly set forth herein and in the other Loan
Documents.  The Agent agrees to act as
such contractual representative upon the express conditions contained in this
Article 10.  Notwithstanding the use of
the defined term “Agent,” it is expressly understood and agreed that the Agent
shall not have any fiduciary responsibilities to any Lender by reason of this
Agreement or any other Loan Document and that the Agent is merely acting as the
contractual representative of the Lenders with only those duties as are
expressly set forth in this Agreement and the other Loan Documents.  In its capacity as the Lenders’ contractual
representative, the Agent (i) does not hereby assume any fiduciary duties to
any of the Lenders, (ii) is a “representative” of the Lenders within the
meaning of the term “secured party” as defined in the Kentucky Uniform
Commercial Code and (iii) is acting as an independent contractor, the rights
and duties of which are limited to those expressly set forth in this Agreement
and the other Loan Documents.  Each of
the Lenders hereby agrees to assert no claim against the Agent on any agency
theory or any other theory of liability for breach of fiduciary duty, all of
which claims each Lender hereby waives.

 

10.2                           Powers.  The Agent shall have and may exercise such
powers under the Loan Documents as are specifically delegated to the Agent by
the terms of each thereof, together with such powers as are reasonably
incidental thereto.  The Agent shall
have no implied duties to the Lenders, or any obligation to the Lenders to take
any action thereunder except any action specifically provided by the Loan
Documents to be taken by the Agent.

 

10.3                           General
Immunity.  Neither the Agent nor
any of its directors, officers, agents or employees shall be liable to the
Borrower, the Lenders or any Lender for any action taken or omitted to be taken
by it or them hereunder or under any other Loan Document or in connection
herewith or therewith except to the extent such action or inaction is
determined in a final non-appealable judgment by a court of competent
jurisdiction to have arisen from the gross negligence or willful misconduct of
such Person.

 

10.4                           No Responsibility for Loans,
Recitals, etc. Neither the Agent nor any of its directors, officers, agents
or employees shall be responsible for or have any duty to ascertain, inquire
into, or verify (a) any statement, warranty or representation made in
connection with any

 

50

 

Loan Document or any borrowing hereunder; (b) the performance or
observance of any of the covenants or agreements of any obligor under any Loan
Document, including, without limitation, any agreement by an obligor to furnish
information directly to each Lender; (c) the satisfaction of any condition
specified in Article 4, except receipt of items required to be delivered solely
to the Agent; (d) the existence or possible existence of any Default or
Unmatured Default; (e) the validity, enforceability, effectiveness, sufficiency
or genuineness of any Loan Document or any other instrument or writing
furnished in connection therewith; (f) the value, sufficiency, creation,
perfection or priority of any Lien in any collateral security; or (g) the
financial condition of the Borrower or any guarantor of any of the Obligations
or of any of the Borrower’s or any such guarantor’s respective
Subsidiaries.  The Agent shall have no
duty to disclose to the Lenders information that is not required to be
furnished by the Borrower to the Agent at such time, but is voluntarily
furnished by the Borrower to the Agent (either in its capacity as Agent or in
its individual capacity).

 

10.5                           Action
on Instructions of Lenders. 
The Agent shall in all cases be fully protected in acting, or in
refraining from acting, hereunder and under any other Loan Document in accordance
with written instructions signed by the Required Lenders, and such instructions
and any action taken or failure to act pursuant thereto shall be binding on all
of the Lenders.  The Lenders hereby
acknowledge that the Agent shall be under no duty to take any discretionary
action permitted to be taken by it pursuant to the provisions of this Agreement
or any other Loan Document unless it shall be requested in writing to do so by
the Required Lenders.  The Agent shall
be fully justified in failing or refusing to take any action hereunder and
under any other Loan Document unless it shall first be indemnified to its
satisfaction by the Lenders pro rata against any and all liability, cost and
expense that it may incur by reason of taking or continuing to take any such
action.

 

10.6                           Employment
of Agents and Counsel. 
The Agent may execute any of its duties as Agent hereunder and under any
other Loan Document by or through employees, agents, and attorneys-in-fact and
shall not be answerable to the Lenders, except as to money or securities
received by it or its authorized agents, for the default or misconduct of any
such agents or attorneys-in-fact selected by it with reasonable care.  The Agent shall be entitled to advice of
counsel concerning the contractual arrangement between the Agent and the
Lenders and all matters pertaining to the Agent’s duties hereunder and under
any other Loan Document.

 

10.7                           Reliance
on Documents; Counsel. 
The Agent shall be entitled to rely upon any Note, notice, consent,
certificate, affidavit, letter, telegram, statement, paper or document believed
by it to be genuine and correct and to have been signed or sent by the proper
person or persons, and, in respect to legal matters, upon the opinion of
counsel selected by the Agent, which counsel may be employees of the Agent.

 

10.8                           Agent’s Reimbursement and
Indemnification.  The Lenders
agree to reimburse and indemnify the Agent ratably in proportion to their
respective Commitments (or, if the Commitments have been terminated, in proportion
to their Commitments immediately prior to such termination) (i) for any amounts
not reimbursed by the Borrower for which the Agent is entitled to reimbursement
by the Borrower under the Loan Documents, (ii) for any other expenses incurred
by the Agent on behalf of the Lenders, in connection with the preparation,
execution, delivery, administration and enforcement of the Loan Documents
(including, without limitation, for any expenses incurred by the Agent in
connection with any dispute between the Agent and any Lender or between two or
more of the Lenders) and (iii) for any liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or

 

51

 

disbursements of any kind and nature whatsoever which may be imposed
on, incurred by or asserted against the Agent in any way relating to or arising
out of the Loan Documents or any other document delivered in connection
therewith or the transactions contemplated thereby (including, without
limitation, for any such amounts incurred by or asserted against the Agent in
connection with any dispute between the Agent and any Lender or between two or
more of the Lenders), or the enforcement of any of the terms of the Loan
Documents or of any such other documents, provided that (i) no Lender shall be
liable for any of the foregoing to the extent any of the foregoing is found in
a final non-appealable judgment by a court of competent jurisdiction to have
resulted from the gross negligence or willful misconduct of the Agent and (ii)
any indemnification required pursuant to Section 3.5(vii) shall,
notwithstanding the provisions of this Section 10.8, be paid by the relevant
Lender in accordance with the provisions thereof.  The obligations of the Lenders under this Section 10.8 shall
survive payment of the Obligations and termination of this Agreement.

 

10.9                           Notice
of Default.  The Agent
shall not be deemed to have knowledge or notice of the occurrence of any
Default or Unmatured Default hereunder unless the Agent has received written
notice from a Lender or the Borrower referring to this Agreement describing
such Default or Unmatured Default and stating that such notice is a “notice of
default”.  In the event that the Agent
receives such a notice, the Agent shall give prompt notice thereof to the
Lenders.

 

10.10                     Rights
as a Lender.  In the event the
Agent is a Lender, the Agent shall have the same rights and powers hereunder
and under any other Loan Document with respect to its Commitment and its Loans
as any Lender and may exercise the same as though it were not the Agent, and
the term “Lender” or “Lenders” shall, at any time when the Agent is a Lender,
unless the context otherwise indicates, include the Agent in its individual
capacity.  The Agent and its Affiliates
may accept deposits from, lend money to, and generally engage in any kind of
trust, debt, equity or other transaction, in addition to those contemplated by
this Agreement or any other Loan Document, with the Borrower or any of its Subsidiaries
in which the Borrower or such Subsidiary is not restricted hereby from engaging
with any other Person.  The Agent, in
its individual capacity, is not obligated to remain a Lender.

 

10.11                     Lender
Credit Decision.  Each
Lender acknowledges that it has, independently and without reliance upon the
Agent, the Arranger or any other Lender and based on the financial statements
prepared by the Borrower and such other documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into
this Agreement and the other Loan Documents. 
Each Lender also acknowledges that it will, independently and without
reliance upon the Agent, the Arranger or any other Lender and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under this Agreement and
the other Loan Documents.

 

10.12                     Successor
Agent.  The Agent may
resign at any time by giving written notice thereof to the Lenders and the
Borrower, such resignation to be effective upon the appointment of a successor
Agent or, if no successor Agent has been appointed, forty-five days after the
retiring Agent gives notice of its intention to resign.  The Agent may be removed at any time with or
without cause by written notice received by the Agent from the Required
Lenders, such removal to be effective on the date specified by the Required
Lenders.  Upon any such resignation or
removal, the Required Lenders shall have the right to appoint, on behalf of the
Borrower and the Lenders, a successor Agent. 
If no successor Agent shall have been so appointed by the Required
Lenders within thirty days after the resigning Agent’s giving notice of its
intention to resign, then the resigning Agent may appoint, on behalf of the
Borrower and the

 

52

 

Lenders, a successor Agent. 
Notwithstanding the previous sentence, the Agent may at any time without
the consent of the Borrower or any Lender, appoint any of its Affiliates which
is a commercial bank as a successor Agent hereunder.  If the Agent has resigned or been removed and no successor Agent
has been appointed, the Lenders may perform all the duties of the Agent
hereunder and the Borrower shall make all payments in respect of the
Obligations to the applicable Lender and for all other purposes shall deal
directly with the Lenders.  No successor
Agent shall be deemed to be appointed hereunder until such successor Agent has
accepted the appointment.  Any such
successor Agent shall be a commercial bank having capital and retained earnings
of at least $100,000,000.  Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the resigning or removed Agent.  Upon the effectiveness of the resignation or
removal of the Agent, the resigning or removed Agent shall be discharged from
its duties and obligations hereunder and under the Loan Documents.  After the effectiveness of the resignation
or removal of an Agent, the provisions of this Article 10 shall continue in
effect for the benefit of such Agent in respect of any actions taken or omitted
to be taken by it while it was acting as the Agent hereunder and under the
other Loan Documents.  In the event that
there is a successor to the Agent by merger, or the Agent assigns its duties
and obligations to an Affiliate pursuant to this Section 10.12, then the term
“Prime Rate” as used in this Agreement shall mean the prime rate, base rate or
other analogous rate of the new Agent.

 

10.13                     Agent
and Arranger Fees.  The Borrower
agrees to pay to the Agent and the Arranger, for their respective accounts, the
“Annual Administrative Agent’s Fee” and the “Arrangement Fee,” respectively, in
the amounts and at the times as set forth in that certain letter agreement
dated October 16, 2002 (the “Fee Letter”), the provisions of which are
incorporated by reference herein, or in the case of the Annual Administrative
Agent’s Fee, as otherwise agreed from time to time by Borrower and Agent.

 

10.14                     Delegation
to Affiliates.  The Borrower and
the Lenders agree that the Agent may delegate any of its duties under this
Agreement to any of its Affiliates.  Any
such Affiliate (and such Affiliate’s directors, officers, agents and employees)
which performs duties in connection with this Agreement shall be entitled to
the same benefits of the indemnification, waiver and other protective
provisions to which the Agent is entitled under Articles 9 and 10.

 

ARTICLE 11.

 

SETOFF;
RATABLE PAYMENTS

 

11.1                           Setoff.  In addition to, and without limitation of,
any rights of the Lenders under applicable law, if the Borrower becomes
insolvent, however evidenced, or any Default occurs, any and all deposits
(including all account balances, whether provisional or final and whether or
not collected or available) and any other Indebtedness at any time held or
owing by any Lender or any Affiliate of any Lender to or for the credit or account
of the Borrower may be offset and applied toward the payment of the Obligations
owing to such Lender, whether or not the Obligations, or any part thereof,
shall then be due.

 

11.2                           Ratable
Payments.  If any Lender,
whether by setoff or otherwise, has payment made to it upon its Outstanding
Credit Exposure (other than payments received pursuant to Section 3.1, 3.2, 3.4
or 3.5) in a greater proportion than that received by any other Lender, such
Lender agrees, promptly upon demand, to purchase a portion of the Aggregate
Outstanding Credit Exposure held by the other Lenders so that after such
purchase each Lender will hold its

 

53

 

Pro Rata Share of the Aggregate Outstanding Credit Exposure.  If any Lender, whether in connection with
setoff or amounts which might be subject to setoff or otherwise, receives
collateral or other protection for its Obligations or such amounts which may be
subject to setoff, such Lender agrees, promptly upon demand, to take such action
necessary such that all Lenders share in the benefits of such collateral
ratably in proportion to their respective Pro Rata Shares of the Aggregate
Outstanding Credit Exposure.  In case
any such payment is disturbed by legal process, or otherwise, appropriate
further adjustments shall be made.

 

ARTICLE 12.

 

BENEFIT OF
AGREEMENT; ASSIGNMENTS; PARTICIPATIONS

 

12.1                           Successors and Assigns.  The terms and provisions of the Loan
Documents shall be binding upon and inure to the benefit of the Borrower and the
Lenders and their respective successors and assigns permitted hereby, except
that (i) the Borrower shall not have the right to assign its rights or
obligations under the Loan Documents without the prior written consent of each
Lender, (ii) any assignment by any Lender must be made in compliance with
Section 12.3, and (iii) any transfer by Participation must be made in
compliance with Section 12.2.  Any
attempted assignment or transfer by any party not made in compliance with this
Section 12.1 shall be null and void, unless such attempted assignment or
transfer is treated as a participation in accordance with Section 12.3.2.  The parties to this Agreement acknowledge
that clause (ii) of this Section 12.1 relates only to absolute assignments and
this Section 12.1 does not prohibit assignments creating security interests,
including, without limitation, (x) any pledge or assignment by any Lender of
all or any portion of its rights under this Agreement and any Note to a Federal
Reserve Bank or (y) in the case of a Lender which is a Fund, any pledge or
assignment of all or any portion of its rights under this Agreement and any
Note to its trustee in support of its obligations to its trustee; provided,
however, that no such pledge or assignment creating a security
interest shall release the transferor Lender from its obligations hereunder
unless and until the parties thereto have complied with the provisions of
Section 12.3.  The Agent may treat the
Person which made any Loan or which holds any Note as the owner thereof for all
purposes hereof unless and until such Person complies with Section 12.3; provided,
however, that the Agent may in its discretion (but shall not be
required to) follow instructions from the Person which made any Loan or which
holds any Note to direct payments relating to such Loan or Note to another
Person.  Any assignee of the rights to
any Loan or any Note agrees by acceptance of such assignment to be bound by all
the terms and provisions of the Loan Documents.  Any request, authority or consent of any Person, who at the time
of making such request or giving such authority or consent is the owner of the
rights to any Loan (whether or not a Note has been issued in evidence thereof),
shall be conclusive and binding on any subsequent holder or assignee of the
rights to such Loan.

 

12.2                           Participations.

 

12.2.1                  Permitted Participants; Effect.  Any Lender may at any time sell to one or
more banks or other entities (“Participants”) participating interests in any
Outstanding Credit Exposure of such Lender, any Note held by such Lender, any
Commitment of such Lender or any other interest of such Lender under the Loan
Documents.  In the event of any such
sale by a Lender of participating interests to a Participant, such Lender’s
obligations under the Loan Documents shall remain unchanged, such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations, such Lender shall remain the owner of its Outstanding Credit
Exposure and the holder of

 

54

 

any Note issued to it in evidence thereof for all purposes under the
Loan Documents, all amounts payable by the Borrower under this Agreement shall
be determined as if such Lender had not sold such participating interests, and
the Borrower and the Agent shall continue to deal solely and directly with such
Lender in connection with such Lender’s rights and obligations under the Loan
Documents.

 

12.2.2                  Voting Rights.  Each Lender shall retain the sole right to
approve, without the consent of any Participant, any amendment, modification or
waiver of any provision of the Loan Documents other than any amendment,
modification or waiver with respect to any Credit Extension or Commitment in
which such Participant has an interest which would require consent of all of
the Lenders pursuant to the terms of Section 8.2 or of any other Loan Document.

 

12.2.3                  Benefit of Certain Provisions.  The Borrower agrees that each Participant
shall be deemed to have the right of setoff provided in Section 11.1 in respect
of its participating interest in amounts owing under the Loan Documents to the
same extent as if the amount of its participating interest were owing directly
to it as a Lender under the Loan Documents, provided that each Lender shall retain the
right of setoff provided in Section 11.1 with respect to the amount of
participating interests sold to each Participant.  The Lenders agree to share with each Participant, and each
Participant, by exercising the right of setoff provided in Section 11.1, agrees
to share with each Lender, any amount received pursuant to the exercise of its
right of setoff, such amounts to be shared in accordance with Section 11.2 as
if each Participant were a Lender.  The
Borrower further agrees that each Participant shall be entitled to the benefits
of Sections 3.1, 3.2, 3.4 and 3.5 to the same extent as if it were a Lender and
had acquired its interest by assignment pursuant to Section 12.3, provided
that (i) a Participant shall not be entitled to receive any greater payment
under Section 3.1, 3.2 or 3.5 than the Lender who sold the participating
interest to such Participant would have received had it retained such interest
for its own account, unless the sale of such interest to such Participant is
made with the prior written consent of the Borrower, and (ii) any Participant
not incorporated under the laws of the United States of America or any State
thereof agrees to comply with the provisions of Section 3.5 to the same extent
as if it were a Lender.

 

12.3                           Assignments.

 

12.3.1                  Permitted Assignments.  Any Lender may at any time assign to one or
more banks or other entities (“Purchasers”) all or any part of its rights and
obligations under the Loan Documents. 
Such assignment (the “Assignment and Assumption Agreement”) shall be
substantially in the form of Exhibit 12.3 or in such other form
as may be agreed to by the parties thereto. 
Each such assignment with respect to a Purchaser which is not a Lender
or an Affiliate of a Lender or an Approved Fund shall either be in an amount
equal to the entire applicable Commitment and Loans of the assigning Lender
or  (unless each of the Borrower, the
Agent and the LC Issuer otherwise consents) be in an aggregate amount not less
than $5,000,000 in the case of any assignment of a Revolving Commitment and
$1,000,000 in the case of any assignment of a Term Loan or Term Loan
Commitment.  The amount of the
assignment shall be based on the Commitment or outstanding Loans (if the
Commitment has been terminated) subject to the assignment, determined as of the
date of such assignment or as of the “Trade Date,” if the “Trade Date” is
specified in the assignment.

 

55

 

12.3.2                  Consents.  The consent of the Borrower shall be
required prior to an assignment becoming effective unless the Purchaser is a
Lender, an Affiliate of a Lender or an Approved Fund, provided that the consent
of the Borrower shall not be required if a Default has occurred and is
continuing.  The consent of the Agent
shall be required prior to an assignment becoming effective unless the
Purchaser is a Lender with a Revolving Commitment (in the case of an assignment
of a Revolving Commitment) or is a Lender, an Affiliate of a Lender or an
Approved Fund (in the case of an assignment of any other Commitment or
Loans).  The consent of the Issuing Bank
shall be required prior to an assignment of a Revolving Commitment becoming
effective unless the Purchaser is a Lender with a Revolving Commitment.  Any consent required under this Section
12.3.2 shall not be unreasonably withheld or delayed.

 

12.3.3                  Effect; Effective Date.  Upon (i) delivery to the Agent of an
assignment, together with any consents required by Sections 12.3.1 and 12.3.2,
and (ii) payment of a $3,500 fee to the Agent for processing such assignment
(unless such fee is waived by the Agent), such assignment shall become
effective on the effective date specified in such assignment.  The assignment shall contain a
representation by the Purchaser to the effect that none of the consideration
used to make the purchase of the Commitment and Outstanding Credit Exposure
under the applicable assignment agreement constitutes “plan assets” as defined
under ERISA and that the rights and interests of the Purchaser in and under the
Loan Documents will not be “plan assets” under ERISA.  On and after the effective date of such assignment, such
Purchaser shall for all purposes be a Lender party to this Agreement and any
other Loan Document executed by or on behalf of the Lenders and shall have all
the rights and obligations of a Lender under the Loan Documents, to the same
extent as if it were an original party thereto, and the transferor Lender shall
be released with respect to the Commitment and Outstanding Credit Exposure
assigned to such Purchaser without any further consent or action by the
Borrower, the Lenders or the Agent.  In
the case of an assignment covering all of the assigning Lender’s rights and
obligations under this Agreement, such Lender shall cease to be a Lender
hereunder but shall continue to be entitled to the benefits of, and subject to,
those provisions of this Agreement and the other Loan Documents which survive
payment of the Obligations and termination of the applicable agreement.  Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
Section 12.3 shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
Section 12.2.  Upon the consummation of
any assignment to a Purchaser pursuant to this Section 12.3.3, the transferor
Lender, the Agent and the Borrower shall, if the transferor Lender or the
Purchaser desires that its Loans be evidenced by Notes, make appropriate
arrangements so that new Notes or, as appropriate, replacement Notes are issued
to such transferor Lender and new Notes or, as appropriate, replacement Notes,
are issued to such Purchaser, in each case in principal amounts reflecting
their respective Commitments, as adjusted pursuant to such assignment.

 

12.3.4                  Register.  The Agent, acting solely for this purpose as
an agent of the Borrower, shall maintain at one of its offices in Louisville,
Kentucky or Chicago, Illinois a copy of each Assignment and Assumption
delivered to it and a register for the recordation of the names and addresses
of the Lenders, and the Commitments of, and principal amounts of the Loans
owing to, each Lender pursuant to the terms hereof from time to time (the
“Register”).  The entries in the Register
shall be conclusive, and the Borrower, the Agent and the Lenders may treat each
Person whose name is recorded in

 

56

 

the Register pursuant to the terms hereof as a Lender hereunder for all
purposes of this Agreement, notwithstanding notice to the contrary.  The Register shall be available for
inspection by the Borrower and any Lender, at any reasonable time and from time
to time upon reasonable prior notice.

 

12.4                           Dissemination of Information.  The Borrower authorizes each Lender to
disclose to any Participant or Purchaser or any other Person acquiring an
interest in the Loan Documents by operation of law (each a “Transferee”) and
any prospective Transferee any and all information in such Lender’s possession
concerning the creditworthiness of the Borrower and its Subsidiaries, including
without limitation any information contained in any Reports; provided
that each Transferee and prospective Transferee agrees to be bound by Section
9.11 of this Agreement.

 

12.5                           Tax
Treatment.  If any interest in
any Loan Document is transferred to any Transferee which is not incorporated
under the laws of the United States or any State thereof, the transferor Lender
shall cause such Transferee, concurrently with the effectiveness of such
transfer, to comply with the provisions of Section 3.5(iv).

 

ARTICLE 13.

 

NOTICES

 

13.1                           Notices.  Except as otherwise permitted by Section
2.14 with respect to borrowing notices, all notices, requests and other
communications to any party hereunder shall be in writing (including electronic
transmission, facsimile transmission or similar writing) and shall be given to
such party: (x) in the case of the Borrower or the Agent, at its address or
facsimile number set forth on the signature pages hereof, (y) in the case of
any Lender, at its address or facsimile number set forth below its signature
hereto or (z) in the case of any party, at such other address or facsimile
number as such party may hereafter specify for the purpose by notice to the Agent
and the Borrower in accordance with the provisions of this Section 13.1.  Each such notice, request or other
communication shall be effective (i) if given by facsimile transmission, when
transmitted to the facsimile number specified in this Section and confirmation
of receipt is received, (ii) if given by mail, 72 hours after such
communication is deposited in the mails with first class postage prepaid,
addressed as aforesaid, or (iii) if given by any other means, when delivered
(or, in the case of electronic transmission, received) at the address specified
in this Section; provided that notices to the Agent under Article 2 shall not
be effective until received.

 

13.2                           Change
of Address.  The Borrower, the
Agent and any Lender may each change the address for service of notice upon it
by a notice in writing to the other parties hereto.

 

ARTICLE 14.

 

COUNTERPARTS
AND FACSIMILES

 

This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one agreement, and any of the parties
hereto may execute this Agreement by signing any such counterpart.  This Agreement shall be effective when it
has been executed by the Borrower, the Agent, the LC Issuer and the Lenders and
each party has notified the Agent by facsimile transmission or telephone that
it has taken such action.  A facsimile
signature by any party to a Loan Document shall be effective to legally bind
such party to the same extent as the manual signature of such party.

 

57

 

ARTICLE 15.

 

CHOICE OF LAW;
CONSENT TO JURISDICTION;

WAIVER OF JURY TRIAL

 

15.1                           CHOICE OF
LAW.  THE LOAN
DOCUMENTS (OTHER THAN THOSE CONTAINING A CONTRARY EXPRESS CHOICE OF LAW
PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS AND WITHOUT
REGARD TO THE CONFLICT OF LAWS PROVISIONS OF THE COMMONWEALTH OF KENTUCKY, BUT
GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.

 

15.2                           CONSENT TO JURISDICTION.  THE BORROWER HEREBY IRREVOCABLY SUBMITS TO
THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR KENTUCKY STATE
COURT SITTING IN LOUISVILLE, KENTUCKY IN ANY ACTION OR PROCEEDING ARISING OUT
OF OR RELATING TO ANY LOAN DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES
THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR
HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT
IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM.  NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE
AGENT, THE LC ISSUER OR ANY LENDER TO BRING PROCEEDINGS AGAINST THE BORROWER IN
THE COURTS OF ANY OTHER JURISDICTION. 
ANY JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE AGENT, THE LC ISSUER
OR ANY LENDER OR ANY AFFILIATE OF THE AGENT, THE LC ISSUER OR ANY LENDER
INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF,
RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT SHALL BE BROUGHT ONLY IN A
COURT IN LOUISVILLE, KENTUCKY.

 

15.3                           WAIVER OF
JURY TRIAL.  THE
BORROWER, THE AGENT, THE LC ISSUER AND EACH LENDER HEREBY WAIVE TRIAL BY JURY
IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER
(WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF,
RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT OR THE RELATIONSHIP ESTABLISHED
THEREUNDER.

 

58

 

IN WITNESS WHEREOF, the Borrower, the Lenders, the LC Issuer and the
Agent have executed this Agreement as of the date first above written.

 

	
   

  	
   

  	
  PAPA JOHN’S
  INTERNATIONAL, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ J. David Flanery

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President of Finance

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  2002 Papa John’s Blvd.

  
	
   

  	
   

  	
   

  	
  Louisville, Kentucky 40299

  
	
   

  	
   

  	
  Attention: David Flanery

  
	
   

  	
   

  	
   

  	
  Telephone:

  	
  (502) 261.4753

  
	
   

  	
   

  	
   

  	
  FAX:

  	
  (502) 261.4190

  
	
   

  	
   

  	
   

  
	
  Commitments

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  $35,000,000.00

  	
   

  	
  BANK ONE, KENTUCKY,
  NA,

  
	
   

  	
   

  	
  Individually as a Lender and as LC Issuer and Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Thelma B. Ferguson

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  First Vice President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  416 W. Jefferson Street

  
	
   

  	
   

  	
   

  	
  Louisville, Kentucky  40202

  
	
   

  	
   

  	
  Attention: Thelma B. Ferguson

  
	
   

  	
   

  	
   

  	
  Telephone:

  	
  (502) 566.2821

  
	
   

  	
   

  	
   

  	
  FAX:

  	
  (502) 566.8339

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  $35,000,000.00

  	
   

  	
  PNC BANK, NATIONAL
  ASSOCIATION, as a Lender

  
	
   

  	
   

  	
  By:

  	
  /s/ Jeffrey L. Stein

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Corporate Banking

  
	
   

  	
   

  	
   

  	
  201 East Fifth Street, 3rd Floor

  
	
   

  	
   

  	
   

  	
  Cincinnati, Ohio  45202

  
	
   

  	
   

  	
  Attention:  Jeffrey L. Stein

  
	
   

  	
   

  	
   

  	
  Telephone:

  	
  (513) 651.8692

  
	
   

  	
   

  	
   

  	
  FAX:

  	
  (513) 651.8951

  
												

 

59

 

	
  $25,000,000.00

  	
   

  	
  BANK OF AMERICA,
  as a Lender

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Bryan Hulker

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  414 Union Street, 4th Floor

  
	
   

  	
   

  	
   

  	
  Nashville, Tennessee  37239

  
	
   

  	
   

  	
  Attention:  Bryan Hulker

  
	
   

  	
   

  	
   

  	
  Telephone:

  	
  (615) 749.3001

  
	
   

  	
   

  	
   

  	
  FAX:

  	
  (615) 749.4762

  
	
   

  	
   

  	
   

  
	
  $25,000,000.00

  	
   

  	
  FIFTH THIRD BANK,
  as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Edward B. Martin

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Fifth Third Center

  
	
   

  	
   

  	
   

  	
  401 South 4th Avenue

  
	
   

  	
   

  	
   

  	
  Louisville, Kentucky 
  40202-3411

  
	
   

  	
   

  	
  Attention:  Ed Martin

  
	
   

  	
   

  	
   

  	
  Telephone:

  	
  (502) 562.5536

  
	
   

  	
   

  	
   

  	
  FAX:

  	
  (502) 562.5540

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  $25,000,000.00

  	
   

  	
  NATIONAL CITY BANK
  OF KENTUCKY, as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Kevin L. Anderson

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  101 South Fifth Street - 37th Floor

  
	
   

  	
   

  	
   

  	
  Louisville, Kentucky  40202

  
	
   

  	
   

  	
  Attention:  Kevin L. Anderson

  
	
   

  	
   

  	
   

  	
  Telephone:

  	
  (502) 581.7894

  
	
   

  	
   

  	
   

  	
  FAX:

  	
  (502) 581.4424

  
											

 

60

 

	
  $20,000,000.00

  	
   

  	
  U.S. BANK
  NATIONAL
  ASSOCIATION, as a Lender

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Toby B. Rau

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  One Financial Square

  
	
   

  	
   

  	
   

  	
  Louisville, Kentucky  40202

  
	
   

  	
   

  	
  Attention:  Toby Rau

  
	
   

  	
   

  	
   

  	
  Telephone:

  	
  (502) 562.6648

  
	
   

  	
   

  	
   

  	
  FAX:

  	
  (502) 562.6460

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  $10,000,000.00

  	
   

  	
  HUNTINGTON NATIONAL
  BANK, as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Randall K. Stephens

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Marcia J. Carmean

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  201 N. Illinois Street, Suite 1800

  
	
   

  	
   

  	
   

  	
  Indianapolis, Indiana  46204

  
	
   

  	
   

  	
  Attention:  Randall K.
  Stephens

  
	
   

  	
   

  	
   

  	
  Telephone:

  	
  (317) 237.2553

  
	
   

  	
   

  	
   

  	
  FAX:

  	
  (317) 237.2505

  
							

 

61

 

PRICING SCHEDULE

 

	
  APPLICABLE MARGIN

  	
   

  	
  LEVEL I
  STATUS

  	
   

  	
  LEVEL II
  STATUS

  	
   

  	
  LEVEL III
  STATUS

  	
   

  
	
  Eurodollar Rate

  	
   

  	
  0.625

  	
  %

  	
  0.750

  	
  %

  	
  1.00

  	
  %

  
	
  Floating Rate

  	
   

  	
  0.00

  	
  %

  	
  0.00

  	
  %

  	
  0.00

  	
  %

  

 

	
  APPLICABLE FEE RATE

  	
   

  	
  LEVEL I
  STATUS

  	
   

  	
  LEVEL II
  STATUS

  	
   

  	
  LEVEL III
  STATUS

  	
   

  
	
  Facility Fee

  	
   

  	
  0.15

  	
  %

  	
  0.15

  	
  %

  	
  0.20

  	
  %

  
	
  Letters of Credit

  	
   

  	
  0.625

  	
  %

  	
  0.750

  	
  %

  	
  1.00

  	
  %

  

 

For the purposes of this Schedule, the following terms have the
following meanings, subject to the final paragraph of this Schedule:

 

“Financials” means the annual or quarterly financial statements of the
Borrower delivered pursuant to Section 6.1(i) or (ii).

 

“Level I Status” exists at any date if, as of the last day of the
fiscal quarter of the Borrower referred to in the most recent Financials, the
Leverage Ratio is less than 1.00 to 1.00.

 

“Level II Status” exists at any date if, as of the last day of the
fiscal quarter of the Borrower referred to in the most recent Financials, (i)
the Borrower has not qualified for Level I Status and (ii) the Leverage Ratio
is less than 1.50 to 1.00.

 

“Level III Status” exists at any date if the Borrower has not qualified
for Level I Status or Level II Status.

 

“Status” means either Level I Status, Level II Status or Level III
Status.

 

During the period from the date of the Agreement until the same date
six calendar months thereafter, the Applicable Margin and Applicable Fee Rate
shall be determined according to Level II Status, regardless of the actual
Status of Borrower calculated as set forth above, unless the actual Status of
Borrower is Level III Status, in which case the Applicable Margin and
Applicable Fee Rate shall be determined according to Level III Status.  Thereafter, the Applicable Margin and
Applicable Fee Rate shall be determined in accordance with the foregoing table
based on the Borrower’s Status as reflected in the then most recent
Financials.  Adjustments, if any, to the
Applicable Margin or Applicable Fee Rate shall be effective five Business Days
after the Agent has received the applicable Financials.  If the Borrower fails to deliver the
Financials to the Agent at the time required pursuant to Section 6.1, then the
Applicable Margin and Applicable Fee Rate shall be the highest Applicable
Margin and Applicable Fee Rate set forth in the foregoing table until five
Business Days after such Financials are so delivered.

 

62

 

EXHIBIT 2.8

Form of Borrowing Notice

to

Credit Agreement

 

BORROWING NOTICE

 

This Borrowing Notice is being delivered to Bank One, Kentucky, NA, as
Agent, pursuant to Section 2.8 of that certain Credit Agreement (the “Credit
Agreement”) dated as of January 27, 2003, among [i] PAPA JOHN’S INTERNATIONAL, INC.,
a Delaware corporation (referred to hereinafter as “Borrower”), [ii] the
financial institution(s) listed on the signature pages thereof, and their
respective successors and assigns (each individually a “Lender” and
collectively “Lenders”) and [iii] BANK ONE, KENTUCKY, NA, a national banking
association (in its individual capacity, “BOK”), for itself as a Lender
and as Agent.  Borrower hereby requests
the Lenders to make an Advance to the Borrower in the amount of
$                
on the Borrowing Date of               
       , 200  .  The Advance requested hereunder shall be in
the form of a:

 

                            Floating Rate
Advance [check if applicable]

 

                            Eurodollar
Advance    [check if applicable]

 

To the extent that Borrower has requested a Eurodollar Advance, the
initial Interest Period shall be
                  
month(s) [select a one, two, three, six or twelve month period] commencing on
the Borrowing Date, which date is a Business Day.  (Capitalized terms used herein without definition shall have the
meanings assigned to those terms in the Credit Agreement.)

 

The proceeds of the Advance requested pursuant to this Borrowing Notice
shall be deposited in Borrower’s account maintained with the Agent.

 

The undersigned officer on behalf of Borrower certifies that to the
best of [his/her] knowledge:

 

The amount of the Advance requested pursuant to this Borrowing Notice
will not cause the Aggregate Outstanding Credit Exposure (after giving effect
to any immediate application of the proceeds thereof) to exceed the Aggregate
Commitment in effect as of the date hereof;

 

The representations and warranties contained in the Credit Agreement, as
originally stated or as updated in writing from time to time by the Borrower,
are true and correct in all material respects on and as of the date hereof to
the same extent as though made on and as of the date hereof;

 

No event has occurred and is continuing under the Credit Agreement, or
will result from the disbursement of the Advance requested pursuant to this
Borrowing Notice, which would constitute a Default or an Unmatured Default;

 

Borrower has performed all of its obligations in all material respects
and has satisfied all conditions which the Credit Agreement and the other Loan
Documents provide shall be performed or satisfied on or before the Borrowing
Date for the Advance requested pursuant to this Borrowing Notice;

 

63

 

To the knowledge of Borrower, no order, judgment or decree of any
court, arbitrator or governmental authority purports to enjoin or restrain any
Lender from making its Pro Rata Share of the Advance requested pursuant to this
Borrowing Notice; and

 

To the knowledge of Borrower, no injunction or other restraining order
has been issued and no hearing to cause an injunction or other restraining
order to be issued is pending or noticed with respect to any action, suit or
proceeding seeking to enjoin or otherwise prevent the consummation of the
Credit Agreement or the making of Advances thereunder or the issuing or
extension of the respective stated expiration dates of Letters of Credit
thereunder.

 

 

	
  Dated:

  	
                      ,
  200  

  	
  PAPA JOHN’S
  INTERNATIONAL, INC.,
a Delaware corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  

 

64

 

EXHIBIT 2.9

Form of Conversion/Continuation Notice

to

Credit Agreement

 

FORM OF CONVERSION/CONTINUATION
NOTICE

 

This Conversion/Continuation Notice is being delivered to Bank One,
Kentucky, NA, as Agent, pursuant to Section 2.9 of that certain Credit
Agreement (the “Credit Agreement”) dated as of January 27, 2003, among
[i] PAPA
JOHN’S INTERNATIONAL, INC., a Delaware corporation (referred to
hereinafter as “Borrower”), [ii] the financial institution(s) listed on
the signature pages thereof, and their respective successors and assigns (each
individually a “Lender” and collectively “Lenders”) and [iii] BANK ONE,
KENTUCKY, NA, a national banking association (in its individual
capacity, “BOK”), for itself as a Lender and as Agent.  Borrower hereby requests the Lenders to:

 

                          [check if
applicable] convert
$                   
principal amount [must be $5,000,000 or more in increments of $1,000,000] of
Floating Rate Loans into a Eurodollar Loan for an Interest Period of
                 
month(s) [select a one, two, three, six or twelve month period] on
               
      , 200  ;

 

                          [check if applicable]
convert
$                   
principal amount [must be $1,000,000 or more in increments of $1,000,000] of
Eurodollar Loans into a Floating Rate Loan on                
      , 200  ;

 

                          [check if
applicable] continue
$                   
principal amount of Eurodollar Loans as a Eurodollar Loan for an Interest
Period of
                
month(s) [select a one, two, three, six or twelve month period] on               
      , 200  ;

 

The undersigned officer of Borrower certifies that to the best of
[his/her] knowledge, no Default or Unmatured Default has occurred and is
continuing under the Credit Agreement.

 

Capitalized terms used herein without definition shall have the
meanings assigned to those terms in the Credit Agreement.

 

 

	
  Dated:

  	
                      ,
  200  

  	
  PAPA JOHN’S
  INTERNATIONAL, INC.,
a Delaware corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  

 

65

 

EXHIBIT 2.13

NOTE

 

[Date]

 

PAPA
JOHN’S INTERNATIONAL, INC., a Delaware corporation
(the “Borrower”), promises to pay to the order of
                                                               
(the “Lender”) the aggregate unpaid principal amount of all Loans made by the
Lender to the Borrower pursuant to Article 2 of the Agreement (as hereinafter
defined), in immediately available funds at the main office of Bank One,
Kentucky, NA in Louisville, Kentucky, as Agent, together with interest on the
unpaid principal amount hereof at the rates and on the dates set forth in the
Agreement.  The Borrower shall pay the
principal of and accrued and unpaid interest on the Loans in full on the
Facility Termination Date.

 

The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Loan and the date and amount of each principal
payment hereunder.

 

This Note is one of the Notes issued pursuant to, and is entitled to
the benefits of, the Credit Agreement dated as of January 27, 2003 (which, as
it may be amended or modified and in effect from time to time, is herein called
the “Agreement”), among the Borrower, the Lenders party thereto, including the
Lender, the LC Issuer and Bank One, Kentucky, NA, as Agent, to which Agreement
reference is hereby made for a statement of the terms and conditions governing
this Note, including the terms and conditions under which this Note may be
prepaid or its maturity date accelerated. 
This Note is guaranteed pursuant to the Guaranty Agreement, all as more
specifically described in the Agreement, and reference is made thereto for a
statement of the terms and provisions thereof. 
Capitalized terms used herein and not otherwise defined herein are used
with the meanings attributed to them in the Agreement.

 

 

	
   

  	
  PAPA JOHN’S
  INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Print Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					

 

66

 

SCHEDULE
OF LOANS AND PAYMENTS OF PRINCIPAL

TO

NOTE
OF                   ,

DATED           ,
200  

 

	
  Date

  	
   

  	
  Principal

  Amount of

  Loan

  	
   

  	
  Maturity

  of Interest

  Period

  	
   

  	
  Principal

  Amount

  Paid

  	
   

  	
  Unpaid

  Balance

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

67

 

SCHEDULE 1

 

SUBSIDIARIES
AND OTHER INVESTMENTS

(See Sections 5.8, 6.14 and 6.18)

 

Schedule 1

 

Papa John’s
International, Inc.

Subsidiaries (§5.8)

 

	
  Name

  	
   

  	
  Jurisdiction

  of

  Organization

  	
   

  	
  Authorized

  Capital

  Stock

  	
   

  	
  Issued and

  Outstanding Shares

  	
   

  	
  Owner
  (100% unless

  noted otherwise)

  	
   

  
	
  Papa John’s USA, Inc.

  	
   

  	
  Kentucky

  	
   

  	
  1,000

  	
   

  	
  100

  	
   

  	
  Papa John’s International, Inc.

  	
   

  
	
  Papa John’s Support Services, Inc.

  	
   

  	
  Kentucky

  	
   

  	
  1,000

  	
   

  	
  1,000

  	
   

  	
  Papa John’s International, Inc.

  	
   

  
	
  Capital Delivery, Ltd.

  	
   

  	
  Kentucky

  	
   

  	
  1,000

  	
   

  	
  100

  	
   

  	
  Papa John’s International, Inc.

  	
   

  
	
  Risk Services Corp.

  	
   

  	
  Kentucky

  	
   

  	
  1,000

  	
   

  	
  100

  	
   

  	
  Papa John’s International, Inc.

  	
   

  
	
  PJ Food Service, Inc.

  	
   

  	
  Kentucky

  	
   

  	
  1,000

  	
   

  	
  236.5

  	
   

  	
  Papa John’s International, Inc.

  	
   

  
	
  PJFS of Mississippi, Inc.

  	
   

  	
  Mississippi

  	
   

  	
  1,000

  	
   

  	
  100

  	
   

  	
  Papa John’s International, Inc.

  	
   

  
	
  Papa John’s (U.K.), Ltd.

  	
   

  	
  U.K.

  	
   

  	
  10,000,000

  	
   

  	
  10,000,000

  	
   

  	
  Papa John’s International, Inc.

  	
   

  
	
  Perfect Pizza Holdings, Ltd.

  	
   

  	
  U.K.

  	
   

  	
  3,545,364

  	
   

  	
  3,545,364

  	
   

  	
  Papa John’s (UK, Ltd.)

  	
   

  
	
  Perfect Pizza Limited

  	
   

  	
  U.K.

  	
   

  	
  100

  	
   

  	
  14

  	
   

  	
  Perfect Pizza Holdings, Ltd.

  	
   

  
	
  Gino’s Dial-A-Pizza, Limited

  	
   

  	
  U.K.

  	
   

  	
  1,000

  	
   

  	
  2

  	
   

  	
  Perfect Pizza Limited

  	
   

  
	
  PJ Food Service Canada, Inc./

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Services Alimentaires PJ Canada, Inc.

  	
   

  	
  Ontario, Canada

  	
   

  	
  Unlimited

  	
   

  	
  100

  	
   

  	
  Papa John’s International, Inc.

  	
   

  
	
  RSC Insurance Services, Ltd.

  	
   

  	
  Bermuda

  	
   

  	
  120,000

  	
   

  	
  120,000

  	
   

  	
  Papa John’s International, Inc.

  	
   

  
	
  Colonel’s Limited, LLC

  	
   

  	
  Virginia

  	
   

  	
  —

  	
   

  	
  100 units

  	
   

  	
  Papa John’s USA, Inc. -70 units (70%)

  	
   

  
	
  Papa John’s Puerto Rico, Inc.

  	
   

  	
  Puerto Rico

  	
   

  	
  1,000

  	
   

  	
  100

  	
   

  	
  Papa John’s International, Inc.

  	
   

  
	
  South OBT Corp

  	
   

  	
  Florida

  	
   

  	
  1,000

  	
   

  	
  100

  	
   

  	
  Papa John’s USA, Inc.

  	
   

  

 

Rev. 1/03

 

68

 

Schedule
1

 

Existing
Investments in Excluded Subsidiaries (§6.14; 6.18)

 

	
  Name

  	
   

  	
  Percent

  Ownership

  	
   

  	
  Investment

  	
   

  	
  Debt

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Papa John’s (U.K.) Ltd.

  	
   

  	
  100

  	
  %

  	
  $

  	
  16,533,504

  	
   

  	
  $

  	
  15,106,704

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  South OBT

  	
   

  	
  100

  	
  %

  	
  0

  	
   

  	
  0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cap-John, L.L.C.

  	
   

  	
  50

  	
  %

  	
  595,000

  	
   

  	
  0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  PJIU

  	
   

  	
  50

  	
  %

  	
  39,653

  	
   

  	
  0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Downtown Housing Assistance Fund

  	
   

  	
  9

  	
  %

  	
  204,727

  	
   

  	
  0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  RSC Insurance Services, Ltd.

  	
   

  	
  100

  	
  %

  	
  120,000

  	
   

  	
  0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Colonel’s Ltd, LLC

  	
   

  	
  70

  	
  %

  	
  3,195,326

  	
   

  	
  0

  	
   

  
										

 

	
   

  	
   

  	
  Gross Amount

  	
   

  	
   

  	
   

  
	
  Loans to Papa John’s Franchisees as of December 29, 2002

  	
   

  	
  $

  	
  18,533,876

  	
   

  	
  0

  	
   

  
							

 

69

 

SCHEDULE 2

EXISTING INDEBTEDNESS AND LIENS

(See Sections 6.11 and 6.15)

 

1.                                       Interest
rate collar.  The Borrower is party
to a no-fee interest rate collar (“Collar”) with a notional amount of
$100,000,000, a 30-day LIBOR rate range of 6.36% (floor) to 9.50% (ceiling) and
an expiration date of March, 2003.  The
purpose of the Collar is to provide a hedge against the effects of rising
interest rates.  Borrower will make
payments under the terms of the Collar when the 30-day LIBOR rate is below the
floor to raise the effective rate to 6.36%, and will receive payments when the
30-day LIBOR rate is above the ceiling, to lower the effectiveness rate to
9.50%, thus assuring that the Borrower’s effective 30-day LIBOR rate is always
within the above-stated range.  When the
30-day LIBOR rate is within the range, no payments are made or received under
the Collar.  Amounts payable or
receivable under the Collar will be accounted for as an adjustment to interest
expense.

 

2.                                       Economic
development loan.  In March, 1994,
PJFS of Mississippi, Inc. (“PJFS”) entered into an agreement for a $2.0
million economic development loan from the State of Mississippi in connection
with the opening of a commissary in Jackson, Mississippi.  The loan was funded by a bond issuance under
the Mississippi Small Enterprise Development Finance Act.  PJFS received the loan proceeds in February,
1995.  Interest accrues on disbursed
proceeds at a rate of 5.3%.  PJFS is
required to make semi-annual principal and interest payments to retire the loan
by March 1, 2004.  The current principal
balance of the loan is $485,000.

 

3.                                       Interest
rate swap agreement.  During 2001,
Borrower entered into a interest rate swap agreement that provides for a fixed
rate of 5.31%, as compared to LIBOR, on $100.0 million of floating rate debt
from March 2003 to March 2004, reducing to a notional value of $80.0 million
from March 2004 to March 2005, and reducing to a notional value or $60.0
million in March 2005 with an expiration of March 2006.

 

4.                                       As
of December 29, 2002, and subject to Section 4.1 of the Agreement requiring
extinguishment of Indebtedness under the Prior Loan Agreement as a condition to
Closing, the outstanding balance under the Prior Loan Agreement was
$139,600,000.

 

70

 

EXHIBIT 2.23

 

Form of Lender Joinder

 

This Lender Joinder (the “Agreement”) is dated as of the
Commitment Increase Effective Date set forth below and is entered into by [Insert name
of New Commitment Provider] (the “New Commitment Provider”)
for the benefit of the Agent and Lenders under the Credit Agreement described
below (as amended, the “Credit Agreement”).  Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement, receipt of a copy of which is
hereby acknowledged by the New Commitment Provider.  The Terms and Conditions set forth in Annex 1 attached
hereto are hereby agreed to and incorporated herein by reference and made a
part of this Agreement as if set forth herein in full.

 

For valuable consideration, the receipt of which is hereby
acknowledged, the New Commitment Provider hereby irrevocably purchases, subject
to and in accordance with the Terms and Conditions and the Credit Agreement, as
of the Effective Date inserted by the Agent as contemplated below, the interest
in and to all of the rights and obligations of a Lender under the Credit
Agreement and any other documents or instruments delivered pursuant thereto
that represents the amount and percentage interest identified below of all of
the outstanding rights and obligations under the respective facilities
identified below (including without limitation any letters of credit,
guaranties and swingline loans included in such facilities and, to the extent
permitted to be assigned under applicable law, all claims (including without
limitation contract claims, tort claims, malpractice claims, statutory claims
and all other claims at law or in equity), suits, causes of action and any
other right against any Person whether known or unknown arising under or in
connection with the Credit Agreement, any other documents or instruments
delivered pursuant thereto or the loan transactions governed thereby) (the “Acquired
Interest”).  Such purchase is
without recourse to the Agent and any other Lender and, except as expressly
provided in this Agreement, without representation or warranty by the Agent and
any other Lender.

 

New Commitment
Provider:                           [and
is an Affiliate/Approved Fund of [identify Lender](1)

 

Borrower(s):    Papa John’s International, Inc., a
Delaware corporation

 

Agent:             Bank
One, Kentucky, NA, as the agent under the Credit Agreement.

 

Credit
Agreement:     The $175,000,000 (as increased pursuant
to Section 2.23 thereof) Credit Agreement dated as of January 27, 2003 among
Papa John’s International, Inc., the Lenders party thereto, and Bank One,
Kentucky, NA, as Agent.

 

(1)  Select as applicable.

 

71

 

Assigned Interest:

 

	
  Facility Assigned

  	
   

  	
  Aggregate
  Amount of

  Commitment/Loans for

  all Lenders*

  	
   

  	
  Amount of

  Commitment/Loans

  Assigned*

  	
   

  	
  Percentage
  Assigned of

  Commitment/Loans(2)

  	
   

  
	
   

  	
  (3)

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  

 

6.                                       Trade
Date:                                              (4)

 

Commitment Increase Effective
Date:                        ,
20    [TO BE INSERTED BY AGENT AND WHICH SHALL BE THE
EFFECTIVE DATE OF RECORDATION OF TRANSFER BY THE AGENT.]

 

The terms set forth in this Agreement are hereby agreed to:

 

	
   

  	
   

  	
  NEW COMMITMENT PROVIDER

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [INSERT NAME OF NEW COMMITMENT PROVIDER]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
  Consented to and  Accepted:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  BANK ONE, KENTUCKY,
  NA, as Agent

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
							

 

* Amount to be adjusted to take into account any payments or
prepayments made between the Trade Date and the Effective Date.

 

(2)  Set forth, to at
least 9 decimals, as a percentage of the Commitment/Loans of all Lenders
thereunder.

 

(3)  Fill in the appropriate
terminology for the types of facilities under the Credit Agreement that are
being assigned under this Assignment (e.g. “Revolving Credit Commitment,” “Term
Loan Commitment,”, etc.)

 

(4)  Insert if
satisfaction of minimum amounts is to be determined as of the Trade Date.

 

	
  [NAME OF RELEVANT PARTY]

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  
	
  Title:

  

 

72

 

ANNEX 1

TERMS AND CONDITIONS FOR

LENDER JOINDER

 

Certain Undertakings of New Commitment
Provider.  The
New Commitment Provider (a) represents and warrants that (i) it has full power
and authority, and has taken all action necessary, to execute and deliver this
Agreement and to consummate the transactions contemplated hereby and to become
a Lender under the Credit Agreement, (ii) from and after the Effective Date, it
shall be bound by the provisions of the Credit Agreement as a Lender thereunder
and, to the extent of the Acquired Interest, shall have the obligations of a
Lender thereunder, (iii) its payment instructions and notice instructions are
as set forth in Schedule 1 to this Agreement, (iv) none
of the funds, monies, assets or other consideration being used to make the
purchase and assumption hereunder are “plan assets” as defined under ERISA and
that its rights, benefits and interests in and under the Loan Documents will
not be “plan assets” under ERISA, (v) it has received a copy of the Credit
Agreement, together with copies of financial statements and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Agreement and to purchase the Assigned
Interest, on the basis of which it has made such analysis and decision
independently and without reliance on the Agent or any other Lender, and (vi)
attached as Schedule 1 to this Agreement is any documentation required
to be delivered by the New Commitment Provider with respect to its tax status
pursuant to the terms of the Credit Agreement, duly completed and executed by
the New Commitment Provider and (b) agrees that it will (i) independently and
without reliance on the Agent, the Assignor or any other Lender, and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
the Loan Documents, and (ii) perform in accordance with their terms all of
the obligations which by the terms of the Loan Documents are required to be
performed by it as a Lender, and (iii) indemnify and hold the Agent harmless
against all losses, costs and expenses (including, without limitation,
reasonable attorneys’ fees) and liabilities incurred by the Agent in connection
with or arising in any manner from the New Commitment Provider’s
non-performance of the obligations under this Agreement, and (iv) neither the
Agent nor any of its officers, directors, employees, agents or attorneys shall
be responsible for (1) any statements, warranties or representations made in or
in connection with the Credit Agreement or any other Loan Document, (2) the
execution, legality, validity, enforceability, genuineness, sufficiency,
perfection, priority, collectibility, or value of the Loan Documents or any
collateral thereunder, (3) the financial condition of the Borrower, any of its
Subsidiaries or Affiliates or any other Person obligated in respect of any Loan
Document, (4) the performance or observance by the Borrower, any of its
Subsidiaries or Affiliates or any other Person of any of their respective
obligations under any Loan Document, (5) inspecting any of the property, books
or records of the Borrower, or any Guarantor, or (6) any mistake, error of
judgment, or action taken or omitted to be taken in connection with the Loans
or the Loan Documents.

 

Payments.  The New Commitment Provider shall remit to
the Agent, on the Effective Date, the New Commitment Provider’s Pro Rata Share
of Loans outstanding on the Effective Date. 
From and after the Effective Date, the Agent shall make all payments in
respect of the Acquired Interest (including payments of principal, interest,
fees and other amounts) to the New Commitment Provider for amounts which have
accrued from and after the Effective Date.

 

General Provisions.
This Agreement shall be binding upon, and inure to the benefit of, the parties
hereto and their respective successors and assigns.  This Agreement may 

 

73

 

be executed in any number of counterparts, which together shall
constitute one instrument.  Delivery of
an executed counterpart of a signature page of this Agreement by telecopy shall
be effective to the same extent as delivery of a manually executed counterpart
of this Agreement.  This Agreement shall
be governed by, and construed in accordance with, the law of the Commonwealth
of Kentucky.

 

<
the balance of this page intentionally has been left blank >

 

74

 

Schedule
1
ADMINISTRATIVE QUESTIONNAIRE

 

(Schedule to be supplied by Closing Unit or
Trading Documentation Unit)

 

(For Forms for Primary Syndication call
Peterine Svoboda at 312-732-8844)

(For Forms after Primary Syndication call Jim Bartz at 312-732-1242)

 

75

 

Schedule
1

US AND NON-US TAX INFORMATION REPORTING REQUIREMENTS

 

(Schedule to be supplied by Closing Unit or
Trading Documentation Unit)

 

(For Forms for Primary Syndication call
Peterine Svoboda at 312-732-8844)

(For Forms after Primary Syndication call Jim Bartz at 312-732-1242)

 

76

 

EXHIBIT 4.1 (vi)

FORM OF OPINION

 

January
    , 2003

 

The Agent, the LC Issuer and the Lenders who are parties to the

Credit Agreement described below.

 

Gentlemen/Ladies:

 

We are counsel for Papa John’s International, Inc., a Delaware
corporation (the “Borrower”), and have represented the Borrower in connection
with its execution and delivery of a Credit Agreement dated as of January 15,
2003 (the “Agreement”) among the Borrower, the Lenders named therein, and Bank
One, Kentucky, NA, as Agent and as LC Issuer, and providing for Credit
Extensions in an aggregate principal amount on the date of Closing not
exceeding $175,000,000 at any one time outstanding.  All capitalized terms used in this opinion and not otherwise
defined herein shall have the meanings attributed to them in the Agreement.

 

We have examined the Borrower’s and the Initial Guarantors’ articles of
incorporation and bylaws and the other organizational records of each, the
Agreement, Guaranty Agreement, RSC Guaranty Agreement and the other Loan
Documents executed and delivered at the Closing, and such other matters of fact
and law which we deem necessary in order to render this opinion.  Based upon the foregoing, it is our opinion
that:

 

l.                                          Each
of the Borrower and its Subsidiaries is a corporation, partnership or limited
liability company duly and properly incorporated or organized, as the case may
be, validly existing and (to the extent such concept applies to such entity) in
good standing under the laws of its jurisdiction of incorporation or
organization and has all requisite authority to conduct its business in each
jurisdiction in which its business is conducted.

 

2.                                       The
execution and delivery by the Borrower, RSC and the Initial Guarantors
(collectively, the “Obligors”) of the Loan Documents to which each is a party
and the performance by the Obligors of their respective obligations thereunder
have been duly authorized by proper corporate proceedings on the part of the
Obligors and will not:

 

(a)                                  require
any consent of the Obligors’ shareholders (other than any such consent as has
already been given and remains in full force and effect);

 

(b)                                 violate
(i) any law, rule, regulation, order, writ, judgment, injunction, decree or
award binding on the Borrower or any of its Subsidiaries or (ii) the Borrower’s
or any Subsidiary’s articles or certificate of incorporation, partnership
agreement, certificate of partnership, articles or certificate of organization,
by-laws, or operating or other management agreement, as the case may be, or
(iii) the provisions of any indenture, instrument or agreement to which the
Borrower or any of its Subsidiaries is a party or is subject, or by which it,
or its Property, is bound, or conflict with or constitute a default thereunder;
or

 

77

 

(c) result in, or require, the creation or imposition of any Lien in,
of or on the Property of the Borrower or a Subsidiary pursuant to the terms of
any indenture, instrument or agreement binding upon the Borrower or any of its
Subsidiaries.

 

3.                                       The
Loan Documents to which each Obligor is a party have been duly executed and
delivered by the applicable Obligors and constitute legal, valid and binding
obligations of the Obligors enforceable against the Obligors in accordance with
their terms except to the extent the enforcement thereof may be limited by
bankruptcy, insolvency or similar laws affecting the enforcement of creditors’
rights generally and subject also to the availability of equitable remedies if
equitable remedies are sought.

 

4.                                       There
is no litigation, arbitration, governmental investigation, proceeding or
inquiry pending or, to the best of our knowledge after due inquiry, threatened
against the Borrower or any of its Subsidiaries which, if adversely determined,
could reasonably be expected to have a Material Adverse Effect.

 

5.                                       No
order, consent, adjudication, approval, license, authorization, or validation
of, or filing, recording or registration with, or exemption by, or other action
in respect of any governmental or public body or authority, or any subdivision
thereof, which has not been obtained by the Borrower or any of its
Subsidiaries, is required to be obtained by the Borrower or any of its Subsidiaries
in connection with the execution and delivery of the Loan Documents, the
borrowings under the Agreement, the payment and performance by the Obligors of
the Obligations, or the legality, validity, binding effect or enforceability of
any of the Loan Documents.

 

This opinion may be relied upon by the Agent, the LC Issuer, the
Lenders and their participants, assignees and other transferees.

 

Very truly
yours,

 

78

 

EXHIBIT 4.1 (viii)

LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION

 

To Bank One, Kentucky, NA,

as Agent (the “Agent”) under the Credit Agreement

Described Below.

 

	
  Re:

  	
  Credit Agreement, dated January 27, 2003 (as the same may be amended
  or modified, the “Credit Agreement”), among Papa John’s International, Inc.,
  a Delaware corporation (the “Borrower”), the Lenders named therein and the
  Agent.  Capitalized terms used herein
  and not otherwise defined herein shall have the meanings assigned thereto in
  the Credit Agreement.

  

 

The Agent is specifically authorized and directed to act upon the
following standing money transfer instructions with respect to the proceeds of
Advances or other extensions of credit from time to time until receipt by the
Agent of a specific written revocation of such instructions by the Borrower, provided,
however, that the Agent may otherwise transfer funds as hereafter
directed in writing by the Borrower in accordance with Section 13.1 of the
Credit Agreement or based on any telephonic notice made in accordance with
Section 2.14 of the Credit Agreement.

 

Facility Identification Number(s)

 

Customer/Account Name

 

Transfer Funds To

 

 

For Account No.

 

Reference/Attention To

 

	
  Authorized Officer (Customer Representative)

  	
   

  	
  Date

  	
  , 200

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (Please Print)

  	
   

  	
  Signature

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Bank Officer Name

  	
   

  	
  Date

  	
  , 200

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (Please Print)

  	
   

  	
  Signature

  	
   

  

 

(Deliver
Completed Form to Credit Support Staff For Immediate Processing)

 

79

 

EXHIBIT 6.1

COMPLIANCE CERTIFICATE

 

To:                              The Lenders parties to the

Credit Agreement Described Below

 

This Compliance Certificate is furnished pursuant to that certain
Credit Agreement dated as of January 27, 2003 (as amended, modified, renewed or
extended from time to time, the “Agreement”) among Papa John’s International,
Inc. (the “Borrower”), the Lenders party thereto and Bank One, Kentucky, NA, as
Agent for the Lenders and as LC Issuer. 
Unless otherwise defined herein, capitalized terms used in this
Compliance Certificate have the meanings ascribed thereto in the Agreement.

 

THE UNDERSIGNED HEREBY CERTIFIES THAT:

 

1.  I am the duly elected
                       of
the Borrower;

 

2.  I have reviewed the terms of
the Agreement and I have made, or have caused to be made under my supervision,
a detailed review of the transactions and conditions of the Borrower and its
Subsidiaries during the accounting period covered by the attached financial
statements;

 

3.  The examinations described
in paragraph 2 did not disclose, and I have no knowledge of, the existence of
any condition or event which constitutes a Default or Unmatured Default during
or at the end of the accounting period covered by the attached financial
statements or as of the date of this Certificate, except as set forth below;
and

 

4.  Schedule I attached
hereto sets forth [i] financial data and computations evidencing the Borrower’s
compliance with certain covenants of the Agreement, all of which data and
computations are true, complete and correct, and [ii] the determination of the
interest rates to be paid for Advances, the LC Fee rates and the commitment fee
rates commencing on the fifth Business Day following the delivery hereof.

 

Described below are the exceptions, if any, to paragraph 3 by listing,
in detail, the nature of the condition or event, the period during which it has
existed and the action which the Borrower has taken, is taking, or proposes to
take with respect to each such condition or event:

 

 

80

 

The foregoing certifications, together with the computations set forth
in Schedule I and the financial statements delivered with this
Certificate in support hereof, are made and delivered this
        day of
                    ,
200  .

 

 

	
   

  	
  PAPA JOHN’S
  INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  (signature)

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  (type or print)

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  

 

81

 

SCHEDULE
I TO COMPLIANCE CERTIFICATE

 

Compliance as of
            ,
200  .

(the “Calculation Date”) with

provisions of Article 6 of 

the Agreement

 

(1)                                  Leverage Ratio (Section 6.17.1).  The ratio of
(i) Consolidated Indebtedness of the Loan Parties (exclusive of Consolidated
Indebtedness under the Jeffersontown IRB for so long as Capital Delivery, Ltd.
is a wholly-owned Subsidiary of Borrower) as of the Calculation Date to (ii)
Consolidated EBITDA for the four fiscal quarters ending on the Calculation
Date, is     to 1.0, which is not more than the permitted
ratio of 2.0 to 1.0 as of the Calculation Date.

 

(A)                              Consolidated
Indebtedness of the Loan Parties (exclusive of Consolidated Indebtedness under
the Jeffersontown IRB in the amount of
$               and
the RSC/Borrower Letter of Credit in the amount of $            )
as of the Calculation Date is
$            .

 

(B)                                Consolidated
EBITDA for the four fiscal quarters ending on the Calculation Date is computed
as follows:

 

	
  (i)                                     Consolidated Net Income

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  depreciation

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (iii)                               amortization

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (iv)                              other
  non-cash charges to net income

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (v)                                 Consolidated
  Interest Expense

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (vi)                              income
  tax expense

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (vii)                           sum
  of items (i) through (vi)

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (viii)                        non-cash
  credits to Consolidated Net Income

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (ix)                                Consolidated
  EBITDA equals item (vii) minus item (viii)

  	
   

  	
  $

  	
   

  	
   

  

 

(C)                                The
ratio of Consolidated Indebtedness as of the Calculation Date to Consolidated
EBITDA for the four fiscal quarters ending on the Calculation Date equals item
(A) divided by item (B) (ix), or
                   .

 

Status
of Applicable Margin and Applicable Fee Rate based upon Leverage Ratio: Level
            

 

(2)                                  Interest Coverage Ratio (Section 6.17.2). 
The ratio as of the Calculation Date for the four fiscal quarters then
ended of (A) Consolidated EBITDA plus Consolidated Rentals expense plus
pre-opening expenses relating to restaurants minus Capital Expenditures to (B)
Consolidated Interest Expense plus Consolidated Rentals expense plus
pre-opening expenses relating to 

 

82

 

restaurants is
      to 1.0, which is not less than the minimum ratio
of 2.0 to 1.0 determined in accordance with the following grid:

 

	
  (A)                              (i)                                     Consolidated
  EBITDA (from item (1) (B) (ix) above)

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  Consolidated
  Rentals expense

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (iii)                               pre-opening expenses
  relating to restaurants

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (iv)                              sum of items (i), (ii)
  and (iii)

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (v)                                 Capital Expenditures

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (vi)                              item (iv) minus item
  (v)

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (B)                                (i)                                     Consolidated
  Interest Expense

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  Consolidated
  Rentals expense

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (iii)                               pre-opening expense
  relating to restaurants

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (iv)                              sum of items (i), (ii)
  and (iii)

  	
   

  	
  $

  	
   

  	
   

  

 

(C)                                The
Interest Coverage Ratio as of the Calculation Date for the four fiscal quarters
then ended equals item (2) (A) (vi) divided by item (B) (iv), or
        to 1.0

 

(3)                                  Minimum Net Worth (Section 6.17.3).  The
Consolidated Net Worth of the Borrower is
$            as of
the Calculation Date, which amount is not less than the Required Consolidated
Net Worth.

 

Required Consolidated Net Worth as of the Calculation Date is computed
as follows:

 

	
  (i)                                     Base Amount

  	
   

  	
  $

  	
  176,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  Consolidated Net
  Income for each fiscal quarter in which Consolidated Net Income was earned
  during the period from January 1, 2002 through the Calculation Date.

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (iii)                               50% of item (ii)

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (iv)                              sum of items (i) and
  (iii)

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (v)                                 aggregate
  consideration paid by the Borrower during the period from January 1, 2002
  through the Calculation Date in connection with the purchase by the Borrower
  of its capital stock

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (vi)                              Required Consolidated
  Net Worth equals item (iv) minus item (v)

  	
   

  	
  $

  	
   

  	
   

  

 

(4)                                  Other Financial Covenants

 

(A)                              Financial
Contracts re: commodities in ordinary course (§6.11):

 

83

 

	
  (i)                                     actual amount as
  of Calculation Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  limitation:  $15,000,000

  	
   

  	
   

  	
   

  	
   

  

 

(B)                                Indebtedness secured by
purchase money security interests (§6.11):

 

	
  (i)                                     actual amount as
  of Calculation Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  limitation:  $15,000,000.00

  	
   

  	
   

  	
   

  	
   

  

 

(C)                                Indebtedness of Foreign
Subsidiaries (§6.11):

 

	
  (i)                                     actual amount as
  of Calculation Date (including Investments in Foreign Subsidiaries of
  $                     
  see §6.14):

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  limitation:
  $25,000,000.00

  	
   

  	
   

  	
   

  	
   

  

 

(D)                               Contingent
Obligations (other than Reimbursement Obligations, endorsements for deposit or
collection in ordinary course, under Guaranty Agreements, or the RSC/Borrower
Letter of Credit to the extent of $18,000,000) (§6.11):

 

	
  (i)                                     actual amount as
  of Calculation Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  limitation:  $10,000,000.00

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (iii)                               actual amount of
  RSC/Borrower Letter of Credit as of Calculation Date

  	
   

  	
  $

  	
   

  	
   

  

 

(E)                                 Gross
sales price of assets since date of Closing (§6.13):

 

	
  (i)                                     actual amount as
  of Calculation Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  limitation:  $25,000,000.00

  	
   

  	
   

  	
   

  	
   

  

 

(F)                                 Investments
in Excluded Domestic Subsidiaries since date of Closing (§6.14):

 

	
  (i)                                     actual amount as
  of Calculation Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  limitation:  $1,000,000.00

  	
   

  	
   

  	
   

  	
   

  

 

(G)                                Investments
in franchisees and other Investments of Borrower (§6.14)

 

	
  (i)                                     actual amount as
  of Calculation Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  limitation:
  $30,000,000.00

  	
   

  	
   

  	
   

  	
   

  

 

84

 

EXHIBIT 6.14

 

FORM OF ACQUISITION COMPLIANCE CERTIFICATE

 

            ,
200  

 

Bank One, Kentucky, NA

416 West Jefferson Street

Louisville, Kentucky 40202

Attn: 
              Ms.
Thelma B. Ferguson,

First Vice President

 

Ladies and Gentlemen:

 

I refer to the Credit Agreement dated as of January 15, 2003, by and
among PAPA JOHN’S INTERNATIONAL, INC. (the “Borrower”), the Lenders and
Guarantors party thereto, and Bank One, Kentucky, NA as Agent (the “Agent”)
for the Lenders (as further amended, supplemented or modified from time to
time, the “Credit Agreement”). 
Unless otherwise defined herein, terms defined in the Credit Agreement
are used herein with the same meanings.

 

I,                      ,
[President/Chief
Executive Officer/principal financial officer] of the Borrower, do
hereby certify on behalf of the borrower as of the date hereof, as follows:

 

(1)                                  Description
of Proposed Permitted Acquisition.  The Borrower desires that
                              
[List Loan Party(s) that will be making the Acquisition] (the “Acquiring
Loan Party”) [acquire substantially all of the assets/acquire all of the
ownership interests/merge with]
                        [Insert
name of entity whose assets are being acquired, the entity whose ownership
interests are being acquired, or the entity to be merged with (the “Seller”)]
(the “Acquisition”).

 

The consideration for the Acquisition is approximately
             .

 

The proposed date of Acquisition (the “Acquisition Date”)
is                       (must
be at least five (5) Business Days after the date of delivery of this
Certificate).

 

The Seller is engaged in
                         [describe
business being acquired] (must be substantially the same as one or more lines
of business conducted by the Loan Parties and shall comply with Section 6.4 of
the Credit Agreement).

 

The business is located in
                        list
location].

 

The board of directors or other equivalent governing body of the Seller
has approved the Acquisition.  If any
portion of the Loans is being used to fund the Acquisition, written evidence of
such approval of the board of directors or other equivalent governing body of
the Seller is also being delivered herewith.

 

85

 

(2)                                  Joinder
of Guarantors.  If required pursuant
to Section 6.14(viii)(1), we are simultaneously delivering to the
Administrative Agent or will deliver to the Administrative Agent on or prior to
the Acquisition Date, a Guaranty Agreement, a copy of the organizational
documents of the Seller, and such other documents concerning the Seller as
Agent reasonably may request.

 

(3)                                  Compliance
with Covenants.  The Borrower is in
compliance with the covenants contained in Sections 6.10 through 6.18 of the
Credit Agreement after giving effect to such Acquisition (including in such
computation Indebtedness or other liabilities assumed or incurred in connection
with such Acquisition but excluding income earned or expenses incurred by the
Person, business or assets to be acquired prior to the date of such
Acquisition) and such compliance is demonstrated on Schedule A hereto.

 

(4)                                  Acquisition
Agreements.  Copies of any
agreements entered into or proposed to be entered into by the Borrower or its
Subsidiaries in connection with the Acquisition are attached hereto as Schedule
B.

 

(5)                                  Event
of Default or Potential Default. 
The last Compliance Certificate delivered prior to this date was dated           
for the fiscal quarter ending
                     ,
200   .  Such certificate
certified that no Default or Unmatured Default existed on the date of such
Compliance Certificate.  No Default or
Unmatured Default exists as of the subsequent quarter ended
              ,
200     (if applicable) or as of the date hereof or will
exist on the Acquisition Date after giving effect to the Acquisition and any
Loans to be made in connection therewith.

 

IN WITNESS WHEREOF, the undersigned has executed this Certificate this
         day
of           ,
200  .

 

	
   

  	
  PAPA JOHN’S INTERNATIONAL, INC. 
  

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

Attachments

 

	
  Schedule A:

  	
   

  	
  Demonstration of compliance with Credit Agreement (Compliance should
  be demonstrated in the form set forth in the Compliance Certificate.)

  
	
   

  	
   

  	
   

  
	
  Schedule B:

  	
   

  	
  Acquisition
  Agreements

  

 

86

 

EXHIBIT
12.3

 

ASSIGNMENT AND ASSUMPTION AGREEMENT

 

This Assignment and Assumption (the “Assignment and Assumption”)
is dated as of the Effective Date set forth below and is entered into by and
between [Insert
name of Assignor] (the “Assignor”) and [Insert name of Assignee]
(the “Assignee”).  Capitalized
terms used but not defined herein shall have the meanings given to them in the
Credit Agreement identified below (as amended, the “Credit Agreement”),
receipt of a copy of which is hereby acknowledged by the Assignee.  The Terms and Conditions set forth in Annex
1 attached hereto are hereby agreed to and incorporated herein by reference and
made a part of this Assignment and Assumption as if set forth herein in full.

 

For an agreed consideration, the Assignor hereby irrevocably sells and
assigns to the Assignee, and the Assignee hereby irrevocably purchases and
assumes from the Assignor, subject to and in accordance with the Terms and
Conditions and the Credit Agreement, as of the Effective Date inserted by the
Agent as contemplated below, the interest in and to all of the Assignor’s
rights and obligations in its capacity as a Lender under the Credit Agreement
and any other documents or instruments delivered pursuant thereto that
represents the amount and percentage interest identified below of all of the
Assignor’s outstanding rights and obligations under the respective facilities
identified below (including without limitation any letters of credit,
guaranties and swingline loans included in such facilities and, to the extent
permitted to be assigned under applicable law, all claims (including without
limitation contract claims, tort claims, malpractice claims, statutory claims
and all other claims at law or in equity), suits, causes of action and any
other right of the Assignor against any Person whether known or unknown arising
under or in connection with the Credit Agreement, any other documents or
instruments delivered pursuant thereto or the loan transactions governed
thereby) (the “Assigned Interest”). 
Such sale and assignment is without recourse to the Assignor and, except
as expressly provided in this Assignment and Assumption, without representation
or warranty by the Assignor.

 

1.                                       Assignor

 

2.                                       Assignee:                                                                                                                               [and
is an Affiliate/Approved

Fund of [identify Lender](1)

 

3.                                       Borrower(s):                              Papa
John’s International, Inc., a Delaware corporation

 

4.                                       Agent:                                                           Bank
One, Kentucky, NA, as the agent under the Credit Agreement.

 

5.                                       Credit
Agreement: The (original) $175,000,000 Credit Agreement dated as of January 15,
2003 among Papa John’s International, Inc., the Lenders party thereto, and Bank
One, Kentucky, NA, as Agent.

 

(1)  Select as
applicable.

 

87

 

6.                                       Assigned
Interest:

 

	
  Facility Assigned

  	
   

  	
  Aggregate
  Amount of

  Commitment/Loans for

  all Lenders*

  	
   

  	
  Amount of

  Commitment/Loans

  Assigned*

  	
   

  	
  Percentage
  Assigned of

  Commitment/Loans(2)

  	
   

  
	
   

  	
  (3)

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  

 

7.                                       Trade
Date:                                                                                                    (4)

 

Effective Date:                                        ,
20    [TO BE INSERTED BY AGENT AND WHICH SHALL BE THE
EFFECTIVE DATE OF RECORDATION OF TRANSFER BY THE AGENT.]

 

The terms set forth in this Assignment and Assumption are hereby agreed
to:

 

	
   

  	
   

  	
  ASSIGNOR

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [NAME OF ASSIGNOR]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ASSIGNEE

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [NAME OF ASSIGNEE]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
  [Consented to and](5)  Accepted:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  BANK ONE, KENTUCKY,
  NA, as Agent

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
							

 

[Consented to:](6)

 

*Amount to be adjusted by the counterparties to take into account any
payments or prepayments made between the Trade Date and the Effective Date.

 

88

 

(2)  Set forth, to at
least 9 decimals, as a percentage of the Commitment/Loans of all Lenders
thereunder.

(3)  Fill in the appropriate
terminology for the types of facilities under the Credit Agreement that are
being assigned under this Assignment (e.g. “Revolving Credit Commitment,” “Term
Loan Commitment,”, etc.)

(4)  Insert if
satisfaction of minimum amounts is to be determined as of the Trade Date.

(5)  To be added only
if the consent of the Agent is required by the terms of the Credit Agreement.

(6)  To be added only
if the consent of the Borrower and/or other parties (e.g. Swingline Lender, L/C
Issuer) is required by the terms of the Credit Agreement.

 

 

	
  [NAME OF RELEVANT PARTY]

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
					

 

89

 

 

ANNEX
1

TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

 

1.                                       Representations
and Warranties.

 

Assignor.  The Assignor represents and warrants that
(i) it is the legal and beneficial owner of the Assigned Interest, (ii) the
Assigned Interest is free and clear of any lien, encumbrance or other adverse
claim and (iii) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby.  Neither the Assignor nor any of its officers, directors,
employees, agents or attorneys shall be responsible for (i) any statements,
warranties or representations made in or in connection with the Credit
Agreement or any other Loan Document, (ii) the execution, legality, validity,
enforceability, genuineness, sufficiency, perfection, priority, collectibility,
or value of the Loan Documents or any collateral thereunder, (iii) the
financial condition of the Borrower, any of its Subsidiaries or Affiliates or
any other Person obligated in respect of any Loan Document, (iv) the performance
or observance by the Borrower, any of its Subsidiaries or Affiliates or any
other Person of any of their respective obligations under any Loan Document,
(v) inspecting any of the property, books or records of the Borrower, or any
guarantor, or (vi) any mistake, error of judgment, or action taken or omitted
to be taken in connection with the Loans or the Loan Documents.

 

Assignee.  The Assignee (a) represents and warrants
that (i) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby and to become a Lender under the Credit
Agreement, (ii) from and after the Effective Date, it shall be bound by the
provisions of the Credit Agreement as a Lender thereunder and, to the extent of
the Assigned Interest, shall have the obligations of a Lender thereunder, (iii)
agrees that its payment instructions and notice instructions are as set forth
in Schedule 1 to this Assignment and Assumption, (iv) confirms that none of the
funds, monies, assets or other consideration being used to make the purchase
and assumption hereunder are “plan assets” as defined under ERISA and that its
rights, benefits and interests in and under the Loan Documents will not be
“plan assets” under ERISA, (v) agrees to indemnify and hold the Assignor
harmless against all losses, costs and expenses (including, without limitation,
reasonable attorneys’ fees) and liabilities incurred by the Assignor in
connection with or arising in any manner from the Assignee’s non-performance of
the obligations assumed under this Assignment and Assumption, (vi) it has
received a copy of the Credit Agreement, together with copies of financial
statements and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Assumption and to purchase the Assigned Interest on the basis of
which it has made such analysis and decision independently and without reliance
on the Agent or any other Lender, and (vii) attached as Schedule 1 to this
Assignment and Assumption is any documentation required to be delivered by the
Assignee with respect to its tax status pursuant to the terms of the Credit
Agreement, duly completed and executed by the Assignee and (b) agrees that (i)
it will, independently and without reliance on the Agent, the Assignor or any
other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Documents, and (ii) it will perform in
accordance with their terms all of the obligations which by the terms of the
Loan Documents are required to be performed by it as a Lender.

 

90

 

Payments.  The Assignee shall pay the Assignor, on the
Effective Date, the amount agreed to by the Assignor and the Assignee.  From and after the Effective Date, the Agent
shall make all payments in respect of the Assigned Interest (including payments
of principal, interest, fees and other amounts) to the Assignor for amounts
which have accrued to but excluding the Effective Date and to the Assignee for
amounts which have accrued from and after the Effective Date.

 

General Provisions.
This Assignment and Assumption shall be binding upon, and inure to the benefit
of, the parties hereto and their respective successors and assigns.  This Assignment and Assumption may be
executed in any number of counterparts, which together shall constitute one
instrument.  Delivery of an executed
counterpart of a signature page of this Assignment and Assumption by telecopy
shall be effective as delivery of a manually executed counterpart of this Assignment
and Assumption.  This Assignment and
Assumption shall be governed by, and construed in accordance with, the law of
the Commonwealth of Kentucky.

 

91

 

Schedule 1

ADMINISTRATIVE QUESTIONNAIRE

 

(Schedule to be supplied by Closing Unit or
Trading Documentation Unit)

 

(For Forms for Primary Syndication call
Peterine Svoboda at 312-732-8844)

(For Forms after Primary Syndication call Jim Bartz at 312-732-1242)

 

92

 

Schedule 1

US AND NON-US TAX INFORMATION
REPORTING REQUIREMENTS

 

(Schedule to be supplied by Closing Unit or
Trading Documentation Unit)

 

(For Forms for Primary Syndication call
Peterine Svoboda at 312-732-8844)

(For Forms after Primary Syndication call Jim Bartz at 312-732-1242)

 

93

 

Transferred
Letters of Credit Schedule

 

	
  Issuer

  	
   

  	
  LC#

  	
   

  	
  Account

  Party

  	
   

  	
  Beneficiary

  	
   

  	
  Outstanding

  Amount

  	
   

  	
  Expiration

  	
   

  
	
  1. 
  PNC

  	
   

  	
  S233541KTY

  	
   

  	
  Borrower

  	
   

  	
  RSC

  	
   

  	
  $

  	
  7,000,000.00

  	
   

  	
  9/30/03

  	
   

  
	
  2. 
  PNC

  	
   

  	
  S233542KTY

  	
   

  	
  Borrower

  	
   

  	
  United States Fidelity and Guaranty Company

  	
   

  	
  $

  	
  2,500,000.00

  	
   

  	
  9/30/03

  	
   

  
	
  3. 
  PNC

  	
   

  	
  S234173KTY

  	
   

  	
  RSC

  	
   

  	
  Discover Reinsurance Company

  	
   

  	
  $

  	
  7,000,000.00

  	
   

  	
  9/30/03

  	
   

  

 

94

 

NOTE

 

January 27, 2003

 

PAPA
JOHN’S INTERNATIONAL, INC., a Delaware corporation
(the “Borrower”), promises to pay to the order of BANK ONE, KENTUCKY, NA (the
“Lender”) the aggregate unpaid principal amount of all Loans made by the Lender
to the Borrower pursuant to Article 2 of the Agreement (as hereinafter
defined), in immediately available funds at the main office of Bank One,
Kentucky, NA in Louisville, Kentucky, as Agent, together with interest on the
unpaid principal amount hereof at the rates and on the dates set forth in the
Agreement.  The Borrower shall pay the
principal of and accrued and unpaid interest on the Loans in full on the
Facility Termination Date.

 

The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Loan and the date and amount of each principal
payment hereunder.

 

This Note is one of the Notes issued pursuant to, and is entitled to
the benefits of, the Credit Agreement dated as of January 27, 2003 (which, as
it may be amended or modified and in effect from time to time, is herein called
the “Agreement”), among the Borrower, the Lenders party thereto, including the
Lender, the LC Issuer and Bank One, Kentucky, NA, as Agent, to which Agreement
reference is hereby made for a statement of the terms and conditions governing
this Note, including the terms and conditions under which this Note may be
prepaid or its maturity date accelerated. 
This Note is guaranteed pursuant to the Guaranty Agreement, all as more
specifically described in the Agreement, and reference is made thereto for a
statement of the terms and provisions thereof. 
Capitalized terms used herein and not otherwise defined herein are used
with the meanings attributed to them in the Agreement.

 

 

	
   

  	
  PAPA JOHN’S
  INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ J. David Flanery

  
	
   

  	
  Print Name:

  	
  J. David Flanery

  
	
   

  	
  Title:

  	
  Senior Vice President of Finance

  
					

 

 

 

NOTE

 

January 27, 2003

 

PAPA
JOHN’S INTERNATIONAL, INC., a Delaware corporation
(the “Borrower”), promises to pay to the order of PNC BANK, NATIONAL ASSOCIATION
(the “Lender”) the aggregate unpaid principal amount of all Loans made by the
Lender to the Borrower pursuant to Article 2 of the Agreement (as hereinafter
defined), in immediately available funds at the main office of Bank One,
Kentucky, NA in Louisville, Kentucky, as Agent, together with interest on the
unpaid principal amount hereof at the rates and on the dates set forth in the
Agreement.  The Borrower shall pay the
principal of and accrued and unpaid interest on the Loans in full on the
Facility Termination Date.

 

The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Loan and the date and amount of each principal
payment hereunder.

 

This Note is one of the Notes issued pursuant to, and is entitled to
the benefits of, the Credit Agreement dated as of January 27, 2003 (which, as
it may be amended or modified and in effect from time to time, is herein called
the “Agreement”), among the Borrower, the Lenders party thereto, including the
Lender, the LC Issuer and Bank One, Kentucky, NA, as Agent, to which Agreement
reference is hereby made for a statement of the terms and conditions governing
this Note, including the terms and conditions under which this Note may be
prepaid or its maturity date accelerated. 
This Note is guaranteed pursuant to the Guaranty Agreement, all as more
specifically described in the Agreement, and reference is made thereto for a
statement of the terms and provisions thereof. 
Capitalized terms used herein and not otherwise defined herein are used
with the meanings attributed to them in the Agreement.

 

 

	
   

  	
  PAPA JOHN’S
  INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ J. David Flanery

  
	
   

  	
  Print Name:

  	
  J. David Flanery

  
	
   

  	
  Title:

  	
  Senior Vice President of Finance

  
					

 

 

 

NOTE

 

January 27, 2003

 

PAPA
JOHN’S INTERNATIONAL, INC., a Delaware corporation
(the “Borrower”), promises to pay to the order of BANK OF AMERICA (the
“Lender”) the aggregate unpaid principal amount of all Loans made by the Lender
to the Borrower pursuant to Article 2 of the Agreement (as hereinafter
defined), in immediately available funds at the main office of Bank One,
Kentucky, NA in Louisville, Kentucky, as Agent, together with interest on the
unpaid principal amount hereof at the rates and on the dates set forth in the
Agreement.  The Borrower shall pay the
principal of and accrued and unpaid interest on the Loans in full on the Facility
Termination Date.

 

The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Loan and the date and amount of each principal
payment hereunder.

 

This Note is one of the Notes issued pursuant to, and is entitled to
the benefits of, the Credit Agreement dated as of January 27, 2003 (which, as
it may be amended or modified and in effect from time to time, is herein called
the “Agreement”), among the Borrower, the Lenders party thereto, including the
Lender, the LC Issuer and Bank One, Kentucky, NA, as Agent, to which Agreement
reference is hereby made for a statement of the terms and conditions governing
this Note, including the terms and conditions under which this Note may be prepaid
or its maturity date accelerated.  This
Note is guaranteed pursuant to the Guaranty Agreement, all as more specifically
described in the Agreement, and reference is made thereto for a statement of
the terms and provisions thereof. 
Capitalized terms used herein and not otherwise defined herein are used
with the meanings attributed to them in the Agreement.

 

 

	
   

  	
  PAPA JOHN’S
  INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ J. David Flanery

  
	
   

  	
  Print Name:

  	
  J. David Flanery

  
	
   

  	
  Title:

  	
  Senior Vice President of Finance

  
					

 

 

 

NOTE

 

January 27, 2003

 

PAPA
JOHN’S INTERNATIONAL, INC., a Delaware corporation
(the “Borrower”), promises to pay to the order of FIFTH THIRD BANK (the
“Lender”) the aggregate unpaid principal amount of all Loans made by the Lender
to the Borrower pursuant to Article 2 of the Agreement (as hereinafter
defined), in immediately available funds at the main office of Bank One,
Kentucky, NA in Louisville, Kentucky, as Agent, together with interest on the
unpaid principal amount hereof at the rates and on the dates set forth in the
Agreement.  The Borrower shall pay the
principal of and accrued and unpaid interest on the Loans in full on the
Facility Termination Date.

 

The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Loan and the date and amount of each principal
payment hereunder.

 

This Note is one of the Notes issued pursuant to, and is entitled to
the benefits of, the Credit Agreement dated as of January 27, 2003 (which, as
it may be amended or modified and in effect from time to time, is herein called
the “Agreement”), among the Borrower, the Lenders party thereto, including the
Lender, the LC Issuer and Bank One, Kentucky, NA, as Agent, to which Agreement
reference is hereby made for a statement of the terms and conditions governing
this Note, including the terms and conditions under which this Note may be
prepaid or its maturity date accelerated. 
This Note is guaranteed pursuant to the Guaranty Agreement, all as more
specifically described in the Agreement, and reference is made thereto for a
statement of the terms and provisions thereof. 
Capitalized terms used herein and not otherwise defined herein are used
with the meanings attributed to them in the Agreement.

 

 

	
   

  	
  PAPA JOHN’S
  INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ J. David Flanery

  
	
   

  	
  Print Name:

  	
  J. David Flanery

  
	
   

  	
  Title:

  	
  Senior Vice President of Finance

  
					

 

 

 

NOTE

 

January 27, 2003

 

PAPA
JOHN’S INTERNATIONAL, INC., a Delaware corporation
(the “Borrower”), promises to pay to the order of NATIONAL CITY BANK OF KENTUCKY
(the “Lender”) the aggregate unpaid principal amount of all Loans made by the
Lender to the Borrower pursuant to Article 2 of the Agreement (as hereinafter
defined), in immediately available funds at the main office of Bank One,
Kentucky, NA in Louisville, Kentucky, as Agent, together with interest on the
unpaid principal amount hereof at the rates and on the dates set forth in the
Agreement.  The Borrower shall pay the principal
of and accrued and unpaid interest on the Loans in full on the Facility
Termination Date.

 

The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Loan and the date and amount of each principal
payment hereunder.

 

This Note is one of the Notes issued pursuant to, and is entitled to
the benefits of, the Credit Agreement dated as of January 27, 2003 (which, as
it may be amended or modified and in effect from time to time, is herein called
the “Agreement”), among the Borrower, the Lenders party thereto, including the
Lender, the LC Issuer and Bank One, Kentucky, NA, as Agent, to which Agreement
reference is hereby made for a statement of the terms and conditions governing
this Note, including the terms and conditions under which this Note may be
prepaid or its maturity date accelerated. 
This Note is guaranteed pursuant to the Guaranty Agreement, all as more
specifically described in the Agreement, and reference is made thereto for a
statement of the terms and provisions thereof. 
Capitalized terms used herein and not otherwise defined herein are used
with the meanings attributed to them in the Agreement.

 

 

	
   

  	
  PAPA JOHN’S
  INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ J. David Flanery

  
	
   

  	
  Print Name:

  	
  J. David Flanery

  
	
   

  	
  Title:

  	
  Senior Vice President of Finance

  
					

 

 

 

NOTE

 

January 27, 2003

 

PAPA
JOHN’S INTERNATIONAL, INC., a Delaware corporation
(the “Borrower”), promises to pay to the order of U.S. BANK NATIONAL ASSOCIATION
(the “Lender”) the aggregate unpaid principal amount of all Loans made by the
Lender to the Borrower pursuant to Article 2 of the Agreement (as hereinafter
defined), in immediately available funds at the main office of Bank One, Kentucky,
NA in Louisville, Kentucky, as Agent, together with interest on the unpaid
principal amount hereof at the rates and on the dates set forth in the
Agreement.  The Borrower shall pay the
principal of and accrued and unpaid interest on the Loans in full on the
Facility Termination Date.

 

The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Loan and the date and amount of each principal
payment hereunder.

 

This Note is one of the Notes issued pursuant to, and is entitled to
the benefits of, the Credit Agreement dated as of January 27, 2003 (which, as
it may be amended or modified and in effect from time to time, is herein called
the “Agreement”), among the Borrower, the Lenders party thereto, including the
Lender, the LC Issuer and Bank One, Kentucky, NA, as Agent, to which Agreement
reference is hereby made for a statement of the terms and conditions governing
this Note, including the terms and conditions under which this Note may be
prepaid or its maturity date accelerated. 
This Note is guaranteed pursuant to the Guaranty Agreement, all as more
specifically described in the Agreement, and reference is made thereto for a
statement of the terms and provisions thereof. 
Capitalized terms used herein and not otherwise defined herein are used
with the meanings attributed to them in the Agreement.

 

 

	
   

  	
  PAPA JOHN’S
  INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ J. David Flanery

  
	
   

  	
  Print Name:

  	
  J. David Flanery

  
	
   

  	
  Title:

  	
  Senior Vice President of Finance

  
					

 

 

 

NOTE

 

January 27, 2003

 

PAPA
JOHN’S INTERNATIONAL, INC., a Delaware corporation
(the “Borrower”), promises to pay to the order of HUNTINGTON NATIONAL BANK (the
“Lender”) the aggregate unpaid principal amount of all Loans made by the Lender
to the Borrower pursuant to Article 2 of the Agreement (as hereinafter
defined), in immediately available funds at the main office of Bank One,
Kentucky, NA in Louisville, Kentucky, as Agent, together with interest on the
unpaid principal amount hereof at the rates and on the dates set forth in the
Agreement.  The Borrower shall pay the
principal of and accrued and unpaid interest on the Loans in full on the
Facility Termination Date.

 

The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Loan and the date and amount of each principal
payment hereunder.

 

This Note is one of the Notes issued pursuant to, and is entitled to
the benefits of, the Credit Agreement dated as of January 27, 2003 (which, as
it may be amended or modified and in effect from time to time, is herein called
the “Agreement”), among the Borrower, the Lenders party thereto, including the
Lender, the LC Issuer and Bank One, Kentucky, NA, as Agent, to which Agreement
reference is hereby made for a statement of the terms and conditions governing
this Note, including the terms and conditions under which this Note may be
prepaid or its maturity date accelerated. 
This Note is guaranteed pursuant to the Guaranty Agreement, all as more
specifically described in the Agreement, and reference is made thereto for a
statement of the terms and provisions thereof. 
Capitalized terms used herein and not otherwise defined herein are used
with the meanings attributed to them in the Agreement.

 

 

	
   

  	
  PAPA JOHN’S
  INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ J. David Flanery

  
	
   

  	
  Print Name:

  	
  J. David Flanery

  
	
   

  	
  Title:

  	
  Senior Vice President of Finance

  
					

 

 

 

SUBSIDIARY GUARANTY

 

THIS SUBSIDIARY GUARANTY (this “Guaranty”) is made as of January 27, 2003
by PAPA
JOHN’S USA, INC., PAPA JOHN’S SUPPORT SERVICES, INC., CAPITAL DELIVERY, LTD.,
RISK SERVICES CORP. and PJ FOOD SERVICE, INC., each a Kentucky
corporation, and PJFS of Mississippi, Inc., a Mississippi corporation
(collectively, the “Subsidiary Guarantors”) in favor of the Agent, for the
benefit of the Lenders, under the Credit Agreement referred to below;

 

WITNESSETH:

 

WHEREAS, PAPA JOHN’S INTERNATIONAL, INC., a Delaware
corporation (the “Principal”) and Bank One, Kentucky, NA, a national banking
association having its principal office in Louisville, Kentucky, as Agent (the
“Agent”), and certain other Lenders from time to time party thereto have
entered into a certain Credit Agreement dated as of even date herewith (as same
may be amended or modified from time to time, the “Credit Agreement”),
providing, subject to the terms and conditions thereof, for extensions of
credit to be made by the Lenders to the Principal;

 

WHEREAS, it is a condition precedent to the Agent and
the Lenders executing the Credit Agreement that each of the Subsidiary
Guarantors execute and deliver this Guaranty whereby each of the Subsidiary
Guarantors shall guarantee the payment when due, subject to Section 9 hereof,
of all Guaranteed Obligations, as defined below; and

 

WHEREAS, in consideration of the financial and other
support that the Principal has provided, and such financial and other support
as the Principal may in the future provide, to the Subsidiary Guarantors, and
in order to induce the Lenders and the Agent to enter into the Credit
Agreement, and the Lenders and their Affiliates to enter into one or more Rate
Management Transactions with the Principal, and because each Subsidiary
Guarantor has determined that executing this Guaranty is in its interest and to
its financial benefit, each of the Subsidiary Guarantors is willing to
guarantee the Obligations of the Principal under the Credit Agreement, any
Note, any Rate Management Transaction, and the other Loan Documents;

 

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

 

SECTION 
l.1.  Selected Terms Used
Herein. 

 

“Guaranteed Obligations” is defined in Section 3 below.

 

SECTION 
1.2.  Terms in Credit
Agreement.  Other capitalized terms
used herein but not defined herein shall have the meaning set forth in the
Credit Agreement.

 

 

SECTION 
2.1.  Representations and
Warranties.  Each of the Subsidiary
Guarantors represents and warrants (which representations and warranties shall
be deemed to have been renewed upon each Borrowing Date under the Credit
Agreement) that:

 

(a)                                  It is a corporation, partnership or
limited liability company duly and properly incorporated or organized, as the
case may be, validly existing and (to the extent such concept applies to such
entity) in good standing under the laws of its jurisdiction of incorporation or
organization and has all requisite
authority to conduct its business in each jurisdiction in which its business is
conducted.

 

(b)                                 It has the power and authority and legal
right to execute and deliver this Guaranty and to perform its obligations
hereunder.  The execution and delivery
by it of this Guaranty and the performance of its obligations hereunder have
been duly authorized by proper corporate proceedings, and this Guaranty
constitutes a legal, valid and binding obligation of such Subsidiary Guarantor
enforceable against it in accordance with its terms, except as enforceability
may be limited by bankruptcy, insolvency or similar laws affecting the
enforcement of creditors’ rights generally.

 

(c)                                  Neither
the execution and delivery by it of this Guaranty, nor the consummation of the
transactions herein contemplated, nor compliance with the provisions hereof
will violate (i) any law, rule, regulation, order, writ, judgment, injunction,
decree or award binding on it or any of its subsidiaries or (ii) its articles
or certificate of incorporation, partnership agreement, certificate of
partnership, articles or certificate of organization, by-laws, or operating or
other management agreement, as the case may be, or (iii) the provisions of any
indenture, instrument or agreement to which it or any of its subsidiaries is a
party or is subject, or by which it, or its Property, is bound, or conflict
with or constitute a default thereunder, or result in, or require, the creation
or imposition of any Lien in, of or on the Property of such Subsidiary
Guarantor or a subsidiary thereof pursuant to the terms of any such indenture,
instrument or agreement.  No order,
consent, adjudication, approval, license, authorization, or validation of, or
filing, recording or registration with, or exemption by, or other action in
respect of any governmental or public body or authority, or any subdivision
thereof, which has not been obtained by it or any of its subsidiaries, is
required to be obtained by it or any of its subsidiaries in connection with the
execution and delivery of this Guaranty or the performance by it of its
obligations hereunder or the legality, validity, binding effect or
enforceability of this Guaranty.

 

SECTION 
2.2.  Covenants.  Each of the Subsidiary Guarantors covenants
that, so long as any Lender has any Commitment outstanding under the Credit
Agreement, any Rate Management Transaction remains in effect or any of the
Guaranteed Obligations shall remain unpaid, that it will, and, if necessary,
will enable the Principal to, fully comply with those covenants and agreements
set forth in the Credit Agreement.

 

SECTION 
3.  The Guaranty.  Subject to Section 9 hereof, each of the
Subsidiary Guarantors hereby absolutely and unconditionally guarantees, as
primary obligor and not as surety, the full and punctual payment (whether at
stated maturity, upon acceleration or early termination or otherwise, and at
all times thereafter) and performance of the Obligations and the Rate
Management Obligations, including without limitation any such Obligations or
Rate Management Obligations 

 

2

 

incurred or accrued during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, whether or not allowed or allowable
in such proceeding (collectively, subject to the provisions of Section 9
hereof, being referred to collectively as the “Guaranteed Obligations”).  Upon failure by the Principal to pay
punctually any such amount, each of the Subsidiary Guarantors agrees that it
shall forthwith on demand pay to the Agent for the benefit of the Lenders and,
if applicable, their Affiliates, the amount not so paid at the place and in the
manner specified in the Credit Agreement, any Note, any Rate Management
Transaction or the relevant Loan Document, as the case may be. This Guaranty is
a guaranty of payment and not of collection. 
Each of the Subsidiary Guarantors waives any right to require the Lender
to sue the Principal, any other Guarantor, or any other Person obligated for
all or any part of the Guaranteed Obligations, or otherwise to enforce its
payment against any collateral securing all or any part of the Guaranteed
Obligations.

 

SECTION 
4.  Guaranty Unconditional.  Subject to Section 9 hereof, the obligations
of each of the Subsidiary Guarantors hereunder shall be unconditional and
absolute and, without limiting the generality of the foregoing, shall not be
released, discharged or otherwise affected by:

 

(i)                                     any extensions, renewals, settlements,
compromises, waivers or releases in respect of any of the Guaranteed
Obligations, by operation of law or otherwise, or any obligation of any other
Guarantor of any of the Guaranteed Obligations, or any default, failure or
delay, willful or otherwise, in the payment or performance of the Guaranteed
Obligations;

 

(ii)                                  any modification or amendment of or supplement to
the Credit Agreement, any Note, any Rate Management Transaction or any other
Loan Document;

 

(iii)                                any releases, nonperfection or invalidity of any
direct or indirect security for any obligation of the Principal under the
Credit Agreement, any Note, any Rate Management Transaction, any other Loan
Document, or any obligations of any other Guarantor of any of the Guaranteed
Obligations, or any action or failure to act by the Agent, any Lender or any
Affiliate of any Lender with respect to any collateral securing all or any part
of the Guaranteed Obligations;

 

(iv)                              any change in the corporate existence, structure
or ownership of the Principal or any other Guarantor of any of the Guaranteed
Obligations, or any insolvency, bankruptcy, reorganization or other similar
proceeding affecting the Principal, or any other Guarantor of the Guaranteed
Obligations, or its assets or any resulting release or discharge of any
Obligation of the Principal, or any other Guarantor of any of the Guaranteed
Obligations;

 

(v)                                 the existence of any claim, setoff or other
rights which the Subsidiary Guarantors may have at any time against the
Principal, any other Guarantor of any of the Guaranteed Obligations, the Agent,
any Lender or any other Person, whether in connection herewith or any unrelated
transactions;

 

(vi)                              any invalidity or unenforceability relating to or
against the Principal, or any other Guarantor of any of the Guaranteed
Obligations, for any reason related to the Credit Agreement, any Rate
Management Transaction, any other Loan Document, or any provision 

 

3

 

of applicable law or regulation purporting to
prohibit the payment by the Principal, or any other Guarantor of the Guaranteed
Obligations, of the principal of or interest on any Note or any other amount
payable by the Principal under the Credit Agreement, any Note, any Rate
Management Transaction or any other Loan Document; or

 

(vii)                           any other act or omission to act or delay of any
kind by the Principal, any other Guarantor of the Guaranteed Obligations, the
Agent, any Lender or any other Person or any other circumstance whatsoever
which might, but for the provisions of this paragraph, constitute a legal or
equitable discharge of any Subsidiary Guarantor’s obligations hereunder.

 

SECTION 
5.  Discharge Only Upon
Payment In Full: Reinstatement In Certain Circumstances.  Each of the Subsidiary Guarantor’s
obligations hereunder shall remain in full force and effect until all
Guaranteed Obligations shall have been indefeasibly paid in full, the
Commitments under the Credit Agreement shall have terminated or expired and all
Rate Management Transactions have terminated or expired.  If at any time any payment of the principal
of or interest on any Note or any other amount payable by the Principal or any
other party under the Credit Agreement, any Rate Management Transaction or any
other Loan Document is rescinded or must be otherwise restored or returned upon
the insolvency, bankruptcy or reorganization of the Principal or otherwise,
each of the Subsidiary Guarantor’s obligations hereunder with respect to such
payment shall be reinstated as though such payment had been due but not made at
such time.

 

SECTION 
6.  Waivers.  Each of the Subsidiary Guarantors
irrevocably waives acceptance hereof, presentment, demand, protest and, to the
fullest extent permitted by law, any notice not provided for herein, as well as
any requirement that at any time any action be taken by any Person against the
Principal, any other guarantor of any of the Guaranteed Obligations, or any
other Person.

 

SECTION 
7.  Subrogation.  Each of the Subsidiary Guarantors hereby
agrees not to assert any right, claim or cause of action, including, without
limitation, a claim for subrogation, reimbursement, indemnification or
otherwise, against the Principal arising out of or by reason of this Guaranty
or the obligations hereunder, including, without limitation, the payment or
securing or purchasing of any of the Guaranteed Obligations by any of the
Subsidiary Guarantors unless and until the Guaranteed Obligations are
indefeasibly paid in full, any commitment to lend under the Credit Agreement
and any other Loan Documents is terminated and all Rate Management Transactions
have terminated or expired.

 

SECTION 
8.  Stay of Acceleration.  If acceleration of the time for payment of
any of the Guaranteed Obligations is stayed upon the insolvency, bankruptcy or
reorganization of the Principal, all such amounts otherwise subject to
acceleration under the terms of the Credit Agreement, any Note, any Rate
Management Transaction or any other Loan Document shall nonetheless be payable
by each of the Subsidiary Guarantors hereunder forthwith on demand by the Agent
made at the request of the Required Lenders.

 

SECTION 
9.  Limitation on Obligations.  (a) The provisions of this Guaranty are
severable, and in any action or proceeding involving any state corporate law,
or any state, federal or foreign 

 

4

 

bankruptcy, insolvency, reorganization or other law affecting the
rights of creditors generally, if the obligations of any Subsidiary Guarantor
under this Guaranty would otherwise be held or determined to be avoidable, invalid
or unenforceable on account of the amount of such Subsidiary Guarantor’s
liability under this Guaranty, then, notwithstanding any other provision of
this Guaranty to the contrary, the amount of such liability shall, without any
further action by the Subsidiary Guarantors, the Agent or any Lender, be
automatically limited and reduced to the highest amount that is valid and
enforceable as determined in such action or proceeding (such highest amount
determined hereunder being the relevant Subsidiary Guarantor’s “Maximum
Liability”). This Section 9(a) with respect to the Maximum Liability of the
Subsidiary Guarantors is intended solely to preserve the rights of the Agent
hereunder to the maximum extent not subject to avoidance under applicable law,
and neither the Subsidiary Guarantor nor any other person or entity shall have
any right or claim under this Section 9(a) with respect to the Maximum
Liability, except to the extent necessary so that the obligations of the
Subsidiary Guarantor hereunder shall not be rendered voidable under applicable
law.

 

(b)                                 Each of the Subsidiary Guarantors agrees that the
Guaranteed Obligations may at any time and from time to time exceed the Maximum
Liability of each Subsidiary Guarantor, and may exceed the aggregate Maximum
Liability of all other Subsidiary Guarantors, without impairing this Guaranty
or affecting the rights and remedies of the Agent hereunder. Nothing in this
Section 9(b) shall be construed to increase any Subsidiary Guarantor’s
obligations hereunder beyond its Maximum Liability.

 

(c)                                  In the event any Subsidiary Guarantor (a “Paying
Subsidiary Guarantor”) shall make any payment or payments under this Guaranty
or shall suffer any loss as a result of any realization upon any collateral
granted by it to secure its obligations under this Guaranty, each other
Subsidiary Guarantor (each a “Non-Paying Subsidiary Guarantor”) shall
contribute to such Paying Subsidiary Guarantor an amount equal to such
Non-Paying Subsidiary Guarantor’s “Pro Rata Share” of such payment or payments
made, or losses suffered, by such Paying Subsidiary Guarantor.  For the purposes hereof, each Non-Paying
Subsidiary Guarantor’s “Pro Rata Share” with respect to any such payment or
loss by a Paying Subsidiary Guarantor shall be determined as of the date on
which such payment or loss was made by reference to the ratio of (i) such
Non-Paying Subsidiary Guarantor’s Maximum Liability as of such date (without
giving effect to any right to receive, or obligation to make, any contribution
hereunder) or, if such Non-Paying Subsidiary Guarantor’s Maximum Liability has
not been determined, the aggregate amount of all monies received by such
Non-Paying Subsidiary Guarantor from the Principal after the date hereof
(whether by loan, capital infusion or by other means) to (ii) the aggregate
Maximum Liability of all Subsidiary Guarantors hereunder (including such Paying
Subsidiary Guarantor) as of such date (without giving effect to any right to
receive, or obligation to make, any contribution hereunder), or to the extent
that a Maximum Liability has not been determined for any Subsidiary Guarantors,
the aggregate amount of all monies received by such Subsidiary Guarantors from
the Principal after the date hereof (whether by loan, capital infusion or by
other means).  Nothing in this Section 9
(c) shall affect any Subsidiary Guarantor’s several liability for the entire
amount of the Guaranteed Obligations (up to such Subsidiary Guarantor’s Maximum
Liability).  Each of the Subsidiary
Guarantors covenants and agrees that its right to receive any contribution
under this Guaranty from a Non-Paying Subsidiary Guarantor shall be subordinate
and junior in right of payment to all the Guaranteed Obligations.  The provisions of this Section 9(c) are for
the benefit of both the Agent and the Subsidiary 

 

5

 

Guarantors and may be enforced by any one, or
more, or all of them in accordance with the terms hereof.

 

(d)                                 For purposes of KRS 371.065 [i] the maximum
aggregate liability of each Subsidiary Guarantor under this Guaranty shall not
exceed $225,000,000, plus interest and fees constituting part of the
Obligations, and fees, charges and costs of collecting the Obligations,
including reasonable attorneys’ fees, and [ii] this Guaranty shall terminate on
January 15, 2008, except that such termination shall not affect the liability
of any Subsidiary Guaranty with respect to [a] Guaranteed Obligations created
or incurred prior to such date, or [b] extensions or renewals of, interest accruing
on, or fees, costs or expenses, including reasonable attorneys’ fees, incurred
with respect to, such guaranteed Obligations on or after such date.

 

SECTION  10.  Application of Payments.  All payments received by the Agent hereunder
shall be applied by the Agent to payment of the Guaranteed Obligations in the
following order unless a court of competent jurisdiction shall otherwise
direct:

 

(a)                                  FIRST, to payment of
all costs and expenses of the Agent incurred in connection with the collection
and enforcement of the Guaranteed Obligations or of any security interest
granted to the Agent in connection with any collateral securing the Guaranteed
Obligations;

 

(b)                                 SECOND, to payment of
that portion of the Guaranteed Obligations constituting accrued and unpaid
interest and fees, pro rata among the Lenders and their Affiliates in
accordance with the amount of such accrued and unpaid interest and fees owing
to each of them;

 

(c)                                  THIRD, to payment of
the principal of the Guaranteed Obligations and the net early termination
payments and any other Rate Management Obligations then due and unpaid from the
Principal to any of the Lenders or their Affiliates, pro rata among the Lenders
and their Affiliates in accordance with the amount of such principal and such
net early termination payments and other Rate Management Obligations then due
and unpaid owing to each of them; and

 

(d)                                 FOURTH, to payment of
any Guaranteed Obligations (other than those listed above) pro rata among those
parties to whom such Guaranteed Obligations are due in accordance with the
amounts owing to each of them.

 

SECTION 
11.  Notices.  All notices, requests and other
communications to any party hereunder shall be sufficiently given or made if
given or made in accordance with the provisions of Article 13 of the Credit
Agreement, except addressed to the Subsidiary Guarantor in care of the
Principal in the case of notices to any Subsidiary Guarantor.

 

SECTION 
12.  No Waivers.  No failure or delay by the Agent or any
Lenders in exercising any right, power or privilege hereunder shall operate as
a waiver thereof nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege.  The rights and remedies
provided in this Guaranty, the Credit Agreement, 

 

6

 

any Note, any Rate Management Transaction and
the other Loan Documents shall be cumulative and not exclusive of any rights or
remedies provided by law.

 

SECTION  13.  No Duty to Advise.  Each of the Subsidiary Guarantors assumes
all responsibility for being and keeping itself informed of the Principal’s
financial condition and assets, and of all other circumstances bearing upon the
risk of nonpayment of the Guaranteed Obligations and the nature, scope and
extent of the risks that each of the Subsidiary Guarantors assumes and incurs
under this Guaranty, and agrees that neither the Agent nor any Lender has any
duty to advise any of the Subsidiary Guarantors of information known to it
regarding those circumstances or risks.

 

SECTION 
14.  Successors and Assigns.  This Guaranty is for the benefit of the
Agent and the Lenders and their respective successors and permitted assigns and
in the event of an assignment of any amounts payable under the Credit
Agreement, any Note, any Rate Management Transaction, or the other Loan
Documents, the rights hereunder, to the extent applicable to the indebtedness
so assigned, shall be transferred with such indebtedness. This Guaranty shall
be binding upon each of the Subsidiary Guarantors and their respective
successors and permitted assigns.

 

SECTION 
15.  Changes in Writing.  Neither this Guaranty nor any provision
hereof may be changed, waived, discharged or terminated orally, but only in writing
signed by each of the Subsidiary Guarantors charged with the modification and
the Agent with the consent of the Required Lenders.

 

SECTION  16.  Costs of Enforcement.  Each of the Subsidiary Guarantors agrees to
pay all costs and expenses including, without limitation, all court costs and
reasonable attorneys’ fees and expenses paid or incurred by the Agent or any
Lender or any Affiliate of any Lender in endeavoring to collect all or any part
of the Guaranteed Obligations from, or in prosecuting any action against, the
Principal, the Subsidiary Guarantors or any other Guarantor of all or any part
of the Guaranteed Obligations.

 

SECTION 
17.  GOVERNING LAW; SUBMISSION
TO JURISDICTION; WAIVER OF JURY TRIAL. 
THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAW OF THE COMMONWEALTH OF KENTUCKY. 
EACH OF THE SUBSIDIARY GUARANTORS HEREBY SUBMITS TO THE NONEXCLUSIVE
JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF
KENTUCKY AND OF ANY KENTUCKY STATE COURT SITTING IN LOUISVILLE, KENTUCKY AND
FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS
GUARANTY (INCLUDING, WITHOUT LIMITATION, ANY OF THE OTHER LOAN DOCUMENTS)  OR THE TRANSACTIONS CONTEMPLATED HEREBY.  EACH OF THE SUBSIDIARY GUARANTORS IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH ANY OF THEM
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING
BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH
A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.  EACH OF THE SUBSIDIARY GUARANTORS, AND THE AGENT AND THE LENDERS
ACCEPTING THIS GUARANTY, 

 

7

 

HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT
TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
GUARANTY OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

SECTION 
18.  Taxes. etc.  All payments required to be made by any of
the Subsidiary Guarantors hereunder shall be made without setoff or
counterclaim and free and clear of and without deduction or withholding for or
on account of, any present or future taxes, levies, imposts, duties or other
charges of whatsoever nature imposed by any government or any political or
taxing authority thereof (but excluding Excluded Taxes), provided, however,
that if any of the Subsidiary Guarantors is required by law to make such
deduction or withholding, such Subsidiary Guarantor shall forthwith  (i) pay to the Agent or any Lender, as applicable,
such additional amount as results in the net amount received by the Agent or
any Lender, as applicable, equaling the full amount which would have been
received by the Agent or any Lender, as applicable, had no such deduction or
withholding been made, (ii) pay the full amount deducted to the relevant
authority in accordance with applicable law, and (iii) furnish to the Agent or
any Lender, as applicable, certified copies of official receipts evidencing
payment of such withholding taxes within 30 days after such payment is made.

 

SECTION 19. 
Setoff.  Without limiting
the rights of the Agent or the Lenders under applicable law, if all or any part
of the Guaranteed Obligations is then due, whether pursuant to the occurrence
of a Default or otherwise, then each Subsidiary Guarantor authorizes the Agent
and the Lenders to apply any sums standing to the credit of the Subsidiary
Guarantor with the Agent or any Lender or any Lending Installation of the Agent
or any Lender toward the payment of the Guaranteed Obligations.

 

8

 

 

IN WITNESS WHEREOF, each of the Subsidiary
Guarantors has caused this Guaranty to be duly executed, under seal, by its
authorized officer as of the day and year first above written.

 

	
   

  	
  PAPA
  JOHN’S USA, INC., a
  Kentucky

  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. David
  Flanery

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Senior Vice
  President of Finance

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PAPA
  JOHN’S SUPPORT SERVICES,

  INC., a Kentucky
  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. David
  Flanery

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CAPITAL
  DELIVERY, LTD.,
  a Kentucky

  corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. David
  Flanery

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  RISK
  SERVICES CORP.,
  a Kentucky

  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. David
  Flanery

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Treasurer

  
				

 

9

 

	
   

  	
  PJ
  FOOD SERVICE, INC.,
  a Kentucky

  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. David
  Flanery

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PJFS
  OF MISSISSIPPI, INC., a Mississippi

  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. David
  Flanery

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Treasurer

  
				

 

10

 

GUARANTY

(RSC Guaranty Agreement)

 

 

THIS GUARANTY (this “Guaranty”) is made as of January 27, 2003
by PAPA
JOHN’S INTERNATIONAL, INC., a Delaware corporation (“Papa John’s”), PAPA JOHN’S
USA,
INC., PAPA JOHN’S SUPPORT SERVICES, INC., CAPITAL DELIVERY, LTD., RISK SERVICES
CORP. and PJ FOOD SERVICE, INC., each a Kentucky
corporation, and PJFS of Mississippi, Inc., a Mississippi corporation
(collectively, the “Guarantors”) in favor of the Agent, for the benefit of the
Lenders, under the Credit Agreement referred to below;

 

WITNESSETH:

 

WHEREAS, Papa John’s and Bank One, Kentucky, NA, a
national banking association having its principal office in Louisville,
Kentucky, as Agent (the “Agent”), and certain other Lenders from time to time
party thereto have entered into a certain Credit Agreement dated as of even
date herewith (as same may be amended or modified from time to time, the
“Credit Agreement”); and

 

WHEREAS, the Credit Agreement provides, subject to the
terms and conditions thereof, for extensions of credit to be made by the Lenders
to Papa John’s, and for the issuance upon the request and for the account of RSC
INSURANCE SERVICES LTD., a Bermuda corporation (the “Principal”), of
the RSC Facility LC; and

 

WHEREAS, it is a condition precedent to the issuance of
the RSC Facility LC that each of the Guarantors execute and deliver this
Guaranty whereby each of the Guarantors shall guarantee the payment when due,
subject to Section 9 hereof, of all Guaranteed Obligations, as defined below;
and

 

WHEREAS, in consideration of the financial and other
support that the Principal has provided, and such financial and other support
as the Principal may in the future provide, to the Guarantors, and in order to
induce the Lenders and the Agent to cause the RSC Facility LC to be issued, and
because each Guarantor has determined that executing this Guaranty is in its
interest and to its financial benefit, each of the Guarantors is willing to
guarantee the Reimbursement Obligations of the Principal in connection with the
RSC Facility LC;

 

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

 

SECTION 
l.1.  Selected Terms Used
Herein. 

 

“Guaranteed Obligations” is defined in Section 3 below.

 

SECTION 
1.2.  Terms in Credit
Agreement.  Other capitalized terms
used herein but not defined herein shall have the meaning set forth in the
Credit Agreement.

 

 

SECTION 
2.1.  Representations and
Warranties.  Each of the Guarantors
represents and warrants (which representations and warranties shall be deemed
to have been renewed upon each issuance of the RSC Facility LC) that:

 

(a)                                  It is a corporation, partnership or
limited liability company duly and properly incorporated or organized, as the
case may be, validly existing and (to the extent such concept applies to such
entity) in good standing under the laws of its jurisdiction of incorporation or
organization and has all requisite
authority to conduct its business in each jurisdiction in which its business is
conducted.

 

(b)                                 It has the power and authority and legal
right to execute and deliver this Guaranty and to perform its obligations
hereunder.  The execution and delivery
by it of this Guaranty and the performance of its obligations hereunder have
been duly authorized by proper corporate proceedings, and this Guaranty
constitutes a legal, valid and binding obligation of such Guarantor enforceable
against it in accordance with its terms, except as enforceability may be limited
by bankruptcy, insolvency or similar laws affecting the enforcement of
creditors’ rights generally.

 

(c)                                  Neither
the execution and delivery by it of this Guaranty, nor the consummation of the
transactions herein contemplated, nor compliance with the provisions hereof
will violate (i) any law, rule, regulation, order, writ, judgment, injunction,
decree or award binding on it or any of its subsidiaries or (ii) its articles
or certificate of incorporation, partnership agreement, certificate of
partnership, articles or certificate of organization, by-laws, or operating or
other management agreement, as the case may be, or (iii) the provisions of any
indenture, instrument or agreement to which it or any of its subsidiaries is a
party or is subject, or by which it, or its Property, is bound, or conflict
with or constitute a default thereunder, or result in, or require, the creation
or imposition of any Lien in, of or on the Property of such Guarantor or a
subsidiary thereof pursuant to the terms of any such indenture, instrument or
agreement.  No order, consent,
adjudication, approval, license, authorization, or validation of, or filing,
recording or registration with, or exemption by, or other action in respect of
any governmental or public body or authority, or any subdivision thereof, which
has not been obtained by it or any of its subsidiaries, is required to be
obtained by it or any of its subsidiaries in connection with the execution and
delivery of this Guaranty or the performance by it of its obligations hereunder
or the legality, validity, binding effect or enforceability of this Guaranty.

 

SECTION 
2.2.  Covenants.  Each of the Guarantors covenants that, so
long as the RSC Facility LC is outstanding or any Reimbursement Obligations
related thereto shall remain unpaid, that it will, and, if necessary, will
enable Papa John’s to, fully comply with those covenants and agreements set
forth in the Credit Agreement.

 

SECTION 
3.  The Guaranty.  Subject to Section 9 hereof, each of the
Guarantors hereby absolutely and unconditionally guarantees, as primary obligor
and not as surety, the full and punctual payment (whether at stated maturity,
upon acceleration or early termination or otherwise, and at all times
thereafter) and performance of the Reimbursement Obligations and other
Obligations of RSC, including without limitation any such Reimbursement
Obligations and other 

 

2

 

Obligations incurred or accrued during the pendency of any bankruptcy,
insolvency, receivership or other similar proceeding, whether or not allowed or
allowable in such proceeding (collectively, subject to the provisions of
Section 9 hereof, being referred to collectively as the “Guaranteed
Obligations”).  Upon failure by the
Principal to pay punctually any such amount, each of the Guarantors agrees that
it shall forthwith on demand pay to the Agent for the benefit of the Lenders
and, if applicable, their Affiliates, the amount not so paid at the place and
in the manner specified in the Credit Agreement or the relevant Loan Document,
as the case may be. This Guaranty is a guaranty of payment and not of
collection.  Each of the Guarantors
waives any right to require the Lender to sue the Principal, any other
Guarantor, or any other Person obligated for all or any part of the Guaranteed
Obligations, or otherwise to enforce its payment against any collateral
securing all or any part of the Guaranteed Obligations.

 

SECTION 
4.  Guaranty Unconditional.  Subject to Section 9 hereof, the obligations
of each of the Guarantors hereunder shall be unconditional and absolute and,
without limiting the generality of the foregoing, shall not be released,
discharged or otherwise affected by:

 

(i)                                     any extensions, renewals, settlements,
compromises, waivers or releases in respect of any of the Guaranteed
Obligations, by operation of law or otherwise, or any obligation of any other
guarantor of any of the Guaranteed Obligations, or any default, failure or
delay, willful or otherwise, in the payment or performance of the Guaranteed
Obligations;

 

(ii)                                  any modification or amendment of or supplement to
the Credit Agreement or any other Loan Document;

 

(iii)                                any releases, nonperfection or invalidity of any
direct or indirect security for any obligation of the Principal under the
Credit Agreement, any Note, any other Loan Document, or any obligations of any
other guarantor of any of the Guaranteed Obligations, or any action or failure
to act by the Agent, any Lender or any Affiliate of any Lender with respect to
any collateral securing all or any part of the Guaranteed Obligations;

 

(iv)                              any change in the corporate existence, structure
or ownership of the Principal or any other guarantor of any of the Guaranteed
Obligations, or any insolvency, bankruptcy, reorganization or other similar
proceeding affecting the Principal, or any other guarantor of the Guaranteed
Obligations, or its assets or any resulting release or discharge of any
obligation of the Principal, or any other guarantor of any of the Guaranteed
Obligations;

 

(v)                                 the existence of any claim, setoff or other
rights which the Subsidiary Guarantors may have at any time against the
Principal, any other guarantor of any of the Guaranteed Obligations, the Agent,
any Lender or any other Person, whether in connection herewith or any unrelated
transactions;

 

(vi)                              any invalidity or unenforceability relating to or
against the Principal, or any other guarantor of any of the Guaranteed
Obligations, for any reason related to the Credit Agreement, any other Loan
Document, or any provision of applicable law or regulation purporting to
prohibit the payment by the Principal, or any other guarantor of the 

 

3

 

Guaranteed Obligations, of any amount payable
by the Principal under the Credit Agreement or any other Loan Document; or

 

(vii)                           any other act or omission to act or delay of any
kind by the Principal, any other guarantor of the Guaranteed Obligations, the
Agent, any Lender or any other Person or any other circumstance whatsoever which
might, but for the provisions of this paragraph, constitute a legal or
equitable discharge of any Guarantor’s obligations hereunder.

 

SECTION 
5.  Discharge Only Upon
Payment In Full: Reinstatement In Certain Circumstances.  Each of the Guarantor’s obligations
hereunder shall remain in full force and effect until all Guaranteed
Obligations shall have been indefeasibly paid in full and the Commitments under
the Credit Agreement shall have terminated or expired.  If at any time any payment of any amount of
the Guaranteed Obligations is rescinded or must be otherwise restored or
returned upon the insolvency, bankruptcy or reorganization of the Principal or
otherwise, each of the Guarantor’s obligations hereunder with respect to such
payment shall be reinstated as though such payment had been due but not made at
such time.

 

SECTION 
6.  Waivers.  Each of the Guarantors irrevocably waives
acceptance hereof, presentment, demand, protest and, to the fullest extent
permitted by law, any notice not provided for herein, as well as any
requirement that at any time any action be taken by any Person against the
Principal, any other guarantor of any of the Guaranteed Obligations, or any
other Person.

 

SECTION 
7.  Subrogation.  Each of the Guarantors hereby agrees not to
assert any right, claim or cause of action, including, without limitation, a
claim for subrogation, reimbursement, indemnification or otherwise, against the
Principal arising out of or by reason of this Guaranty or the obligations
hereunder, including, without limitation, the payment or securing or purchasing
of any of the Guaranteed Obligations by any of the Guarantors unless and until
the Guaranteed Obligations are indefeasibly paid in full and any commitment to
lend under the Credit Agreement and any other Loan Documents is terminated.

 

SECTION 
8.  Stay of Acceleration.  If acceleration of the time for payment of
any of the Guaranteed Obligations is stayed upon the insolvency, bankruptcy or
reorganization of the Principal, all such amounts otherwise subject to
acceleration under the terms of the Credit Agreement shall nonetheless be
payable by each of the Guarantors hereunder forthwith on demand by the Agent
made at the request of the Required Lenders.

 

SECTION 
9.  Limitation on Obligations.  (a) The provisions of this Guaranty are
severable, and in any action or proceeding involving any state corporate law,
or any state, federal or foreign bankruptcy, insolvency, reorganization or
other law affecting the rights of creditors generally, if the obligations of
any Guarantor under this Guaranty would otherwise be held or determined to be
avoidable, invalid or unenforceable on account of the amount of such
Guarantor’s liability under this Guaranty, then, notwithstanding any other
provision of this Guaranty to the contrary, the amount of such liability shall,
without any further action by the Guarantors, the Agent or any Lender, be
automatically limited and reduced to the highest amount that is valid and
enforceable as determined in such action or proceeding (such highest amount
determined hereunder being the relevant Guarantor’s “Maximum Liability”). This
Section 9(a) with respect to the Maximum

 

4

 

Liability of the Guarantors is intended
solely to preserve the rights of the Agent hereunder to the maximum extent not
subject to avoidance under applicable law, and neither the Guarantor nor any
other person or entity shall have any right or claim under this Section 9(a)
with respect to the Maximum Liability, except to the extent necessary so that
the obligations of the Guarantor hereunder shall not be rendered voidable under
applicable law.

 

(b)                                 Each of the Guarantors agrees that the Guaranteed
Obligations may at any time and from time to time exceed the Maximum Liability
of each Guarantor, and may exceed the aggregate Maximum Liability of all other
Guarantors, without impairing this Guaranty or affecting the rights and
remedies of the Agent hereunder. Nothing in this Section 9(b) shall be
construed to increase any Guarantor’s obligations hereunder beyond its Maximum
Liability.

 

(c)                                  In the event any Guarantor (a “Paying Guarantor”)
shall make any payment or payments under this Guaranty or shall suffer any loss
as a result of any realization upon any collateral granted by it to secure its
obligations under this Guaranty, each other Guarantor (each a “Non-Paying
Guarantor”) shall contribute to such Paying Guarantor an amount equal to such
Non-Paying Guarantor’s “Pro Rata Share” of such payment or payments made, or
losses suffered, by such Paying Guarantor. 
For the purposes hereof, each Non-Paying Guarantor’s “Pro Rata Share”
with respect to any such payment or loss by a Paying Guarantor shall be
determined as of the date on which such payment or loss was made by reference to
the ratio of (i) such Non-Paying Guarantor’s Maximum Liability as of such date
(without giving effect to any right to receive, or obligation to make, any
contribution hereunder) or, if such Non-Paying Guarantor’s Maximum Liability
has not been determined, the aggregate amount of all monies received by such
Non-Paying Guarantor from the Principal after the date hereof (whether by loan,
capital infusion or by other means) to (ii) the aggregate Maximum Liability of
all Guarantors hereunder (including such Paying Guarantor) as of such date
(without giving effect to any right to receive, or obligation to make, any
contribution hereunder), or to the extent that a Maximum Liability has not been
determined for any Guarantors, the aggregate amount of all monies received by
such Guarantors from the Principal after the date hereof (whether by loan,
capital infusion or by other means). 
Nothing in this Section 9 (c) shall affect any Guarantor’s several
liability for the entire amount of the Guaranteed Obligations (up to such
Guarantor’s Maximum Liability).  Each of
the Guarantors covenants and agrees that its right to receive any contribution
under this Guaranty from a Non-Paying Guarantor shall be subordinate and junior
in right of payment to all the Guaranteed Obligations.  The provisions of this Section 9(c) are for
the benefit of both the Agent and the Guarantors and may be enforced by any
one, or more, or all of them in accordance with the terms hereof.

 

(d)                                 For purposes of KRS 371.065 [i] the maximum
aggregate liability of each Guarantor under this Guaranty shall not exceed
$25,000,000, plus interest and fees constituting part of the Obligations, and
fees, charges and costs of collecting the Obligations, including reasonable
attorneys’ fees, and [ii] this Guaranty shall terminate on January 15, 2008,
except that such termination shall not affect the liability of any Guaranty
with respect to [a] Guaranteed Obligations created or incurred prior to such
date, or [b] extensions or renewals of, interest accruing on, or fees, costs or
expenses, including reasonable attorneys’ fees, incurred with respect to, such
guaranteed Obligations on or after such date.

 

5

 

SECTION  10.  Application of Payments.  All payments received by the Agent hereunder
shall be applied by the Agent to payment of the Guaranteed Obligations in the
following order unless a court of competent jurisdiction shall otherwise
direct:

 

(a)                                  FIRST, to payment of
all costs and expenses of the Agent incurred in connection with the collection
and enforcement of the Guaranteed Obligations or of any security interest
granted to the Agent in connection with any collateral securing the Guaranteed
Obligations;

 

(b)                                 SECOND, to payment of
that portion of the Guaranteed Obligations constituting accrued and unpaid
interest and fees, pro rata among the Lenders and their Affiliates in
accordance with the amount of such accrued and unpaid interest and fees owing
to each of them;

 

(c)                                  THIRD, to payment of
the principal of the Guaranteed Obligations pro rata among the Lenders and
their Affiliates in accordance with the amount of such principal then due and
unpaid owing to each of them; and

 

(d)                                 FOURTH, to payment of
any Guaranteed Obligations (other than those listed above) pro rata among those
parties to whom such Guaranteed Obligations are due in accordance with the
amounts owing to each of them.

 

SECTION 
11.  Notices.  All notices, requests and other
communications to any party hereunder shall be sufficiently given or made if given
or made in accordance with the provisions of Article 13 of the Credit
Agreement, except addressed to the Principal and each Guarantor in care of Papa
John’s.

 

SECTION 
12.  No Waivers.  No failure or delay by the Agent or any
Lenders in exercising any right, power or privilege hereunder shall operate as
a waiver thereof nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege.  The rights and remedies
provided in this Guaranty, the Credit Agreement, any Note, any Rate Management
Transaction and the other Loan Documents shall be cumulative and not exclusive
of any rights or remedies provided by law.

 

SECTION  13.  No Duty to Advise.  Each of the Guarantors assumes all
responsibility for being and keeping itself informed of the Principal’s
financial condition and assets, and of all other circumstances bearing upon the
risk of nonpayment of the Guaranteed Obligations and the nature, scope and
extent of the risks that each of the Guarantors assumes and incurs under this
Guaranty, and agrees that neither the Agent nor any Lender has any duty to
advise any of the Guarantors of information known to it regarding those
circumstances or risks.

 

SECTION 
14.  Successors and Assigns.  This Guaranty is for the benefit of the
Agent and the Lenders and their respective successors and permitted assigns and
in the event of an assignment of any amounts payable under the Credit
Agreement, any Note, any Rate Management Transaction, or the other Loan
Documents, the rights hereunder, to the extent applicable to the indebtedness
so 

 

6

 

assigned, shall be transferred with such
indebtedness. This Guaranty shall be binding upon each of the Guarantors and
their respective successors and permitted assigns.

 

SECTION 
15.  Changes in Writing.  Neither this Guaranty nor any provision
hereof may be changed, waived, discharged or terminated orally, but only in
writing signed by each of the Guarantors charged with the modification and the
Agent with the consent of the Required Lenders.

 

SECTION  16.  Costs of Enforcement.  Each of the Guarantors agrees to pay all
costs and expenses including, without limitation, all court costs and
reasonable attorneys’ fees and expenses paid or incurred by the Agent or any
Lender or any Affiliate of any Lender in endeavoring to collect all or any part
of the Guaranteed Obligations from, or in prosecuting any action against, the
Principal, the Guarantors or any other guarantor of all or any part of the
Guaranteed Obligations.

 

SECTION 
17.  GOVERNING LAW; SUBMISSION
TO JURISDICTION; WAIVER OF JURY TRIAL. 
THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAW OF THE COMMONWEALTH OF KENTUCKY. 
EACH OF THE GUARANTORS HEREBY SUBMITS TO THE NONEXCLUSIVE JURISDICTION
OF THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF KENTUCKY AND OF
ANY KENTUCKY STATE COURT SITTING IN LOUISVILLE, KENTUCKY AND FOR PURPOSES OF
ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS GUARANTY (INCLUDING,
WITHOUT LIMITATION, ANY OF THE OTHER LOAN DOCUMENTS)  OR THE TRANSACTIONS CONTEMPLATED HEREBY.  EACH OF THE GUARANTORS IRREVOCABLY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH ANY OF THEM MAY NOW
OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN
SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS
BEEN BROUGHT IN AN INCONVENIENT FORUM. 
EACH OF THE GUARANTORS, AND THE AGENT AND THE LENDERS ACCEPTING THIS
GUARANTY, HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE
TRANSACTIONS CONTEMPLATED HEREBY.

 

SECTION  18.  Taxes. etc.  All payments required to be made by any of the Guarantors
hereunder shall be made without setoff or counterclaim and free and clear of
and without deduction or withholding for or on account of, any present or
future taxes, levies, imposts, duties or other charges of whatsoever nature imposed
by any government or any political or taxing authority thereof (but excluding
Excluded Taxes), provided, however, that if any of the Guarantors is required
by law to make such deduction or withholding, such Guarantor shall forthwith
(i) pay to the Agent or any Lender, as applicable, such additional amount as
results in the net amount received by the Agent or any Lender, as applicable,
equaling the full amount which would have been received by the Agent or any
Lender, as applicable, had no such deduction or withholding been made, (ii) pay
the full amount deducted to the relevant authority in accordance with
applicable law, and (iii) furnish to the Agent or any Lender, as applicable,
certified copies of official receipts evidencing payment of such withholding
taxes within 30 days after such payment is made.

 

7

 

SECTION 19.  Setoff.  Without limiting the rights of the Agent or
the Lenders under applicable law, if all or any part of the Guaranteed
Obligations is then due, whether pursuant to the occurrence of a Default or
otherwise, then the Guarantor authorizes the Agent and the Lenders to apply any
sums standing to the credit of the Guarantor with the Agent or any Lender or
any Lending Installation of the Agent or any Lender toward the payment of the
Guaranteed Obligations.

 

8

 

IN WITNESS WHEREOF, each of the Guarantors
has caused this Guaranty to be duly executed, under seal, by its authorized
officer as of the day and year first above written.

 

	
   

  	
  PAPA
  JOHN’S INTERNATIONAL, INC., a

  Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. David
  Flanery

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Senior Vice
  President of Finance

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PAPA
  JOHN’S USA, INC., a
  Kentucky

  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. David
  Flanery

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Senior Vice
  President of Finance

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PAPA
  JOHN’S SUPPORT SERVICES,

  INC., a Kentucky
  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. David
  Flanery

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CAPITAL
  DELIVERY, LTD.,
  a Kentucky

  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. David
  Flanery

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  
				

 

9

 

	
   

  	
  RISK
  SERVICES CORP.,
  a Kentucky

  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. David
  Flanery

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PJ
  FOOD SERVICE, INC.,
  a Kentucky

  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. David
  Flanery

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PJFS
  OF MISSISSIPPI, INC., a Mississippi

  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. David
  Flanery

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Treasurer

  
				

 

10

 

EXHIBIT
6.1

COMPLIANCE CERTIFICATE

 

 

To:                              The Lenders parties to
the

Credit Agreement Described Below

 

This Compliance Certificate is furnished pursuant to that certain
Credit Agreement dated as of January 27, 2003 (as amended, modified, renewed or
extended from time to time, the “Agreement”) among Papa John’s International,
Inc. (the “Borrower”), the Lenders party thereto and Bank One, Kentucky, NA, as
Agent for the Lenders and as LC Issuer. 
Unless otherwise defined herein, capitalized terms used in this Compliance
Certificate have the meanings ascribed thereto in the Agreement.

 

THE UNDERSIGNED HEREBY CERTIFIES THAT:

 

1.  I am the duly elected Senior
Vice President of Finance of the Borrower;

 

2.  I have reviewed the terms of
the Agreement and I have made, or have caused to be made under my supervision,
a detailed review of the transactions and conditions of the Borrower and its
Subsidiaries during the accounting period covered by the attached financial
statements;

 

3.  The examinations described
in paragraph 2 did not disclose, and I have no knowledge of, the existence of
any condition or event which constitutes a Default or Unmatured Default during
or at the end of the accounting period covered by the attached financial
statements or as of the date of this Certificate, except as set forth below;
and

 

4.  Schedule I attached
hereto sets forth [i] financial data and computations evidencing the Borrower’s
compliance with certain covenants of the Agreement, all of which data and
computations are true, complete and correct, and [ii] the determination of the
interest rates to be paid for Advances, the LC Fee rates and the commitment fee
rates commencing on the fifth Business Day following the delivery hereof.

 

Described below are the exceptions, if any, to paragraph 3 by listing,
in detail, the nature of the condition or event, the period during which it has
existed and the action which the Borrower has taken, is taking, or proposes to
take with respect to each such condition or event:

 

None

 

 

 

 

 

1

 

The foregoing certifications, together with the computations set forth
in Schedule I and the financial statements delivered with this
Certificate in support hereof, are made and delivered this 27th day of January,
2003.

 

	
   

  	
  PAPA JOHN’S
  INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. David
  Flanery

  
	
   

  	
  (signature)

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  J. David Flanery

  
	
   

  	
  (type or print)

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Senior Vice President of Finance

  
					

 

2

 

SCHEDULE
I TO COMPLIANCE CERTIFICATE

 

Compliance as of September 29, 2002 (the “Calculation
Date”) with

provisions of Article 6 of 

the Agreement

 

(1)                                 Leverage Ratio
(Section 6.17.1).  The ratio of (i)
Consolidated Indebtedness of the Loan Parties (exclusive of Consolidated
Indebtedness under the Jeffersontown IRB for so long as Capital Delivery, Ltd.
is a wholly-owned Subsidiary of Borrower) as of the Calculation Date to (ii)
Consolidated EBITDA for the four fiscal quarters ending on the Calculation
Date, is 1.17 to 1.0, which is not more than the permitted ratio of 2.0 to 1.0
as of the Calculation Date.

 

(A)                              Consolidated
Indebtedness of the Loan Parties (exclusive of Consolidated Indebtedness under
the Jeffersontown IRB in the amount of $80,200,000 and the RSC/Borrower Letter
of Credit in the amount of $6,000,000) as of the Calculation Date is
$142,697,000.

 

(B)                                Consolidated
EBITDA for the four fiscal quarters ending on the Calculation Date is computed
as follows:

 

	
  (i)                                     Consolidated
  Net Income

  	
   

  	
  $

  	
  47,249,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  depreciation

  	
   

  	
   

  	
  31,638,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (iii)                               amortization

  	
   

  	
   

  	
  1,139,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (iv)                              other
  non-cash charges to net income

  	
   

  	
   

  	
  6,308,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (v)                                 Consolidated
  Interest Expense

  	
   

  	
   

  	
  7,573,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (vi)                              income
  tax expense

  	
   

  	
   

  	
  28,421,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (vii)                           sum
  of items (i) through (vi)

  	
   

  	
   

  	
  122,328,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (viii)                        non-cash
  credits to Consolidated Net income

  	
   

  	
   

  	
  0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ix)                                Consolidated
  EBITDA equals item (vii) minus item (viii)

  	
   

  	
  $

  	
  122,328,000

  	
   

  

 

(C)                                The
ratio of Consolidated Indebtedness as of the Calculation Date to Consolidated
EBITDA for the four fiscal quarters ending on the Calculation Date equals item
(A) divided by item (B) (ix), or 1.17.

 

Status
of Applicable Margin and Applicable Fee Rate based upon Leverage Ratio: Level
2

 

(2)                                 Interest Coverage
Ratio (Section 6.17.2).  The ratio
as of the Calculation Date for the four fiscal quarters then ended of (A)
Consolidated EBITDA plus Consolidated Rentals 

 

3

 

expense plus pre-opening expenses relating to
restaurants minus Capital Expenditures to (B) Consolidated Interest Expense
plus Consolidated Rentals expense plus pre-opening expenses relating to
restaurants is 4.9 to 1.0, which is not less than the minimum ratio of 2.0 to
1.0 determined in accordance with the following grid:

 

	
  (A)                              (i)                                     Consolidated
  EBITDA (from item (1) (B) (ix) above)

  	
   

  	
  $

  	
  122,328,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  Consolidated
  Rentals expense

  	
   

  	
  16,431,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (iii)                               pre-opening
  expenses relating to restaurants

  	
   

  	
  223,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (iv)                              sum
  of items (i), (ii) and (iii)

  	
   

  	
  138,982,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (v)                                 Capital
  Expenditures

  	
   

  	
  19,586,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (vi)                              item
  (iv) minus item (v)

  	
   

  	
  $

  	
  119,396,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (B)                                (i)                                     Consolidated
  Interest Expense

  	
   

  	
  7,573,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  Consolidated
  Rentals expense

  	
   

  	
  16,431,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (iii)                               pre-opening
  expense relating to restaurants

  	
   

  	
  223,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (iv)                              sum
  of items (i), (ii) and (iii)

  	
   

  	
  $

  	
  24,227,000

  	
   

  

 

(C)                                The
Interest Coverage Ratio as of the Calculation Date for the four fiscal quarters
then ended equals item (2) (A) (vi) divided by item (B) (iv), or 4.9 to 1.0

 

(3)                                 Minimum Net Worth
(Section 6.17.3).  The Consolidated Net
Worth of the Borrower is $136,212,000 as of the Calculation Date, which amount
is not less than the Required Consolidated Net Worth.

 

Required
Consolidated Net Worth as of the Calculation Date is computed as follows:

 

	
  (i)                                     Base
  Amount

  	
   

  	
  $

  	
  176,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  Consolidated
  Net Income for each fiscal quarter in which Consolidated Net Income was
  earned (as opposed to a net loss) during the period from January 1, 2002
  through the Calculation Date.

  	
   

  	
  $

  	
  35,721,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (iii)                               50%
  of item (ii)

  	
   

  	
  17,860,500

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (iv)                              sum
  of items (i) and (iii)

  	
   

  	
  $

  	
  193,860,500

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (v)                                 aggregate
  consideration paid by the Borrower during the period from January 1, 2002
  through the Calculation Date in connection with the purchase by the Borrower
  of its capital stock

  	
   

  	
  $

  	
  102,229,000

  	
   

  

 

4

 

	
  (vi)                              Required
  Consolidated Net Worth equals item (iv) minus item (v).

  	
   

  	
  $

  	
  91,631,500

  	
   

  

 

(4)                                 Other Financial
Covenants

 

(A)                              Financial
Contracts re: commodities in ordinary course (§6.11):

 

	
  (i)                                     actual
  amount as of Calculation Date:

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  limitation:  $15,000,000

  	
   

  	
   

  	
   

  

 

(B)                                Indebtedness
secured by purchase money security interests (§6.11):

 

	
  (i)                                     actual
  amount as of Calculation Date:

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  limitation:  $15,000,000.00

  	
   

  	
   

  	
   

  

 

(C)                                Indebtedness
of Foreign Subsidiaries (§6.11):

 

	
  (i)                                     actual
  amount as of Calculation Date (including Investments in Foreign Subsidiaries
  of $6,000,000 see §6.14):

  	
   

  	
  $

  	
  6,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  limitation:
  $25,000,000.00

  	
   

  	
   

  	
   

  

 

(D)                               Contingent
Obligations (other than Reimbursement Obligations, endorsements for deposit or
collection in ordinary course, under Guaranty Agreements, or the RSC/Borrower
Letter of Credit to the extent of $18,000,000) (§6.11):

 

	
  (i)                                     actual
  amount as of Calculation Date:

  	
   

  	
  $

  	
  3,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  limitation:  $10,000,000.00

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (iii)                               actual
  amount of RSC/Borrower Letter of Credit as of Calculation Date

  	
   

  	
  $

  	
  6,000,000

  	
   

  

 

(E)                                 Gross
sales price of assets since date of Closing (§6.13):

 

	
  (i)                                     actual
  amount as of Calculation Date:

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  limitation:  $25,000,000.00

  	
   

  	
   

  	
   

  

 

(F)                                 Investments
in Excluded Domestic Subsidiaries since date of Closing (§6.14):

 

	
  (i)                                     actual
  amount as of Calculation Date:

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  limitation:  $1,000,000.00

  	
   

  	
   

  	
   

  

 

(G)                                Investments
in franchisees and other Investments of Borrower (§6.14)

 

5

 

	
  (i)                                     actual
  amount as of Calculation Date:

  	
   

  	
  $

  	
  18,817,898

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (ii)                                  limitation:
  $30,000,000.00

  	
   

  	
   

  	
   

  

 

6Exhibit
10.2

 

AMENDMENT NO. 1 TO

STOCKHOLDER PROTECTION RIGHTS AGREEMENT

 

THIS AMENDMENT NO. 1 to the Stockholder Protection
Rights Agreement (“Rights Agreement”) dated as of February 14, 2000 by and
between Papa John’s International, Inc. (the “Company”) and National City Bank,
as Rights Agent, is made and entered into as of the 24th day of December, 2002.

 

RECITALS:

 

A.            The
Company and the Rights Agent entered into the Rights Agreement as of February
14, 2000.

 

B.            Section
5.4 of the Rights Agreement provides that the Company and the Rights Agent may
from time to time supplement or amend the Rights Agreement in any respect
without the approval of any holders of rights prior to the close of business on
the “Flip-In Date” (as defined in Section 1.1(k) of the Rights Agreement) and a
“Flip-In Date” has not occurred.

 

C.            The
Company and the Rights Agent desire to amend the Rights Agreement to modify the
definition of “Acquiring Person.”

 

AGREEMENT:

 

The parties hereby agree as follows:

 

1.             Amendment
of Section 1.1(a).  Section 1.1(a) of
the Rights Agreement is hereby amended to read in its entirety as follows:

 

(a)           “Acquiring
Person” shall mean any Person (as hereinafter defined) who is a Beneficial
Owner of 15% or more of the outstanding shares of Common Stock; provided,
however, that the term “Acquiring Person” shall not include (i) the Company,
(ii) any Subsidiary (as hereinafter defined) of the Company, (iii) any employee
benefit or compensation plan of the Company or any Subsidiary of the Company,
(iv) any entity holding Common Stock for or pursuant to the terms of any such
employee benefit or compensation plan, (v) an Exempt Person (as hereinafter
defined), (vi) any Person who shall become the Beneficial Owner of 15% or more
of the outstanding shares of Common Stock solely as a result of an acquisition
by the Company of shares of Common Stock, until such time hereafter or
thereafter as such Person shall become the Beneficial Owner (other than by
means of a stock dividend or stock split) of additional shares of Common Stock
representing 1% or more of the Common Stock then outstanding, (vii) any Person
who is the Beneficial Owner of 15% or more of the outstanding shares of Common
Stock but who acquired Beneficial Ownership of shares of Common Stock without
any plan or intention to seek or affect control of the Company, if such Person
promptly enters into an irrevocable commitment promptly to divest, and
thereafter promptly divests (without exercising or retaining any power,
including voting power, with respect to such shares), sufficient shares of
Common Stock (or securities convertible into, exchangeable into or exercisable
for Common Stock) so that such Person ceases to be the Beneficial Owner of 15%
or more of the outstanding shares of Common Stock or (viii) any Person who
Beneficially Owns shares of Common Stock consisting solely of one or more of
(A) shares of Common Stock Beneficially Owned pursuant to the grant or exercise
of an option granted to such Person by the Company in connection with an
agreement to merge with, or acquire, the Company entered into prior to a
Flip-In Date, (B) shares of Common Stock (or securities convertible into,
exchangeable into or exercisable for Common Stock), Beneficially Owned by such
Person or its Affiliates or Associates at the time of grant of such option or
(C) shares of Common Stock (or securities convertible into, exchangeable into
or exercisable for Common Stock) acquired by Affiliates or Associates of such
Person after the time of such grant which, in the aggregate, amount to less
than 1% of the outstanding shares of Common Stock.

 

 

2.             No
Other Changes.  Except as amended
pursuant to Section 1, all of the provisions of the Rights Agreement shall
remain unchanged and in full force and effect.

 

3.             Miscellaneous.  This Amendment shall be deemed to be a
contract made under the laws of the State of Delaware and for all purposes
shall be governed by and construed in accordance with the laws of such state
applicable to contracts to be made and performed entirely within such state.

 

IN WITNESS WHEREOF, the parties hereto have caused
this Amendment to be duly executed as of the date first written above.

 

 

	
  PAPA JOHN’S INTERNATIONAL, INC.

  	
  NATIONAL CITY BANK

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ J. David Flanery

  	
   

  	
  By:

  	
  /s/ Sherry L. Damore

  	
   

  
	
   

  	
  J. David Flanery

  	
   

  	
  Sherry L. Damore

  
	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
  Senior Vice President of Finance

  	
  Title:

  	
  Vice President

  
						

 

2

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