MEMBERSHIP INTEREST PURCHASE AGREEMENT TRIARC COMPANIES, INC.,ARBY'S RESTAURANT GROUP, INC.,as Buyer, ALL THE MEMBERS OF RTM ACQUISITION COMPANY, L.L.C. as Sellers and RUSSELL V. UMPHENOUR, JR. DENNIS E. COOPER, and J. RUSSELL WELCH as the RTM Representatives

 

 

                                                                     EXHIBIT 2.3

                                                                     -----------

 

 

================================================================================

 

 

 

 

                      MEMBERSHIP INTEREST PURCHASE AGREEMENT

 

                                  by and among

 

                             TRIARC COMPANIES, INC.,

 

                         ARBY'S RESTAURANT GROUP, INC.,

                                    as Buyer,

 

                               ALL THE MEMBERS OF

                         RTM ACQUISITION COMPANY, L.L.C.

                                   as Sellers

 

                                       and

 

                            RUSSELL V. UMPHENOUR, JR.

 

                                DENNIS E. COOPER,

 

                                       and

 

                                J. RUSSELL WELCH

 

                           as the RTM Representatives

 

 

 

                               ___________________

 

                            Dated as of May 27, 2005

 

                               ___________________

 

 

 

 

 

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ARTICLE I SALE AND PURCHASE OF MEMBERSHIP INTERESTS......................................................2

     SECTION 1.01         SALE AND PURCHASE OF MEMBERSHIP INTERESTS.......................................2

     SECTION 1.02         CLOSING.........................................................................2

     SECTION 1.03         PAYMENT OF AGGREGATE PURCHASE PRICE.............................................3

     SECTION 1.04         REQUIRED WITHHOLDING............................................................3

 

ARTICLE II REPRESENTATIONS AND WARRANTIES OF THE SELLERS AS TO RTMAC.....................................3

     SECTION 2.01         ORGANIZATION AND QUALIFICATION OF RTMAC.........................................3

     SECTION 2.02         AUTHORIZATION OF RTMAC; ENFORCEABILITY..........................................4

     SECTION 2.03         MEMBERSHIP INTERESTS............................................................4

     SECTION 2.04         SUBSIDIARIES....................................................................4

     SECTION 2.05         GOVERNMENTAL AUTHORIZATIONS.....................................................4

     SECTION 2.06         NON CONTRAVENTION...............................................................5

     SECTION 2.07         RESTATED COMBINED RTM FINANCIAL STATEMENTS; INTERNAL CONTROLS; INDEBTEDNESS.....5

     SECTION 2.08         ABSENCE OF CERTAIN CHANGES OR EVENTS............................................6

     SECTION 2.09         ABSENCE OF UNDISCLOSED LIABILITIES..............................................7

     SECTION 2.10         COMPLIANCE WITH LAWS; PERMITS...................................................7

     SECTION 2.11         LEGAL ACTIONS...................................................................7

     SECTION 2.12         CONTRACTS.......................................................................8

     SECTION 2.13         TAX MATTERS....................................................................10

     SECTION 2.14         EMPLOYEE BENEFITS..............................................................11

     SECTION 2.15         LABOR MATTERS..................................................................14

     SECTION 2.16         ENVIRONMENTAL MATTERS..........................................................14

     SECTION 2.17         INTELLECTUAL PROPERTY..........................................................15

     SECTION 2.18         REAL PROPERTY..................................................................16

     SECTION 2.19         PERSONAL PROPERTY..............................................................16

     SECTION 2.20         SUFFICIENCY OF ASSETS..........................................................16

     SECTION 2.21         INSURANCE......................................................................17

     SECTION 2.22         INVENTORY......................................................................17

     SECTION 2.23         ACCOUNTS RECEIVABLE............................................................17

     SECTION 2.24         SUPPLIERS......................................................................17

     SECTION 2.25         RTMAC RESTAURANTS..............................................................17

     SECTION 2.26         TRANSACTIONS WITH AFFILIATES...................................................18

     SECTION 2.27         BROKERS AND FINDERS............................................................18

     SECTION 2.28         INVESTMENT COMPANY.............................................................19

 

ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE SELLERS...............................................19

      SECTION 3.01         TITLE TO THE MEMBERSHIP INTERESTS..............................................19

     SECTION 3.02         ORGANIZATION AND AUTHORITY OF SUCH SELLER; ENFORCEABILITY......................19

     SECTION 3.03         GOVERNMENTAL AUTHORIZATIONS....................................................19

     SECTION 3.04         NON-CONTRAVENTION..............................................................20

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ARTICLE IV REPRESENTATIONS AND WARRANTIES OF TRIARC AND ARG.............................................20

     SECTION 4.01         ORGANIZATION AND QUALIFICATION OF TRIARC AND ARG...............................20

     SECTION 4.02         AUTHORIZATION OF TRIARC AND ARG; ENFORCEABILITY................................21

     SECTION 4.03         GOVERNMENTAL AUTHORIZATIONS....................................................21

     SECTION 4.04         NON-CONTRAVENTION..............................................................21

     SECTION 4.05         BROKERS AND FINDERS............................................................22

     SECTION 4.06         PURCHASE FOR INVESTMENT........................................................22

 

ARTICLE V INTERIM OPERATIONS COVENANTS..................................................................23

     SECTION 5.01         CONDUCT OF BUSINESS OF RTMAC...................................................23

     SECTION 5.02         CONTROL OF BUSINESS PENDING CLOSING............................................26

 

ARTICLE VI ADDITIONAL COVENANTS.........................................................................26

     SECTION 6.01         ACCESS TO INFORMATION; CONFIDENTIALITY.........................................26

     SECTION 6.02         COMMERCIALLY REASONABLE EFFORTS................................................26

     SECTION 6.03         NOTICES OF CERTAIN EVENTS......................................................27

     SECTION 6.04         CONSENTS; FILINGS..............................................................27

     SECTION 6.05         ACTIONS WITH RESPECT TO DEBT FINANCING AND DEBT REFINANCINGS...................28

     SECTION 6.06         NO SOLICITATION................................................................29

     SECTION 6.07         DEFENSE OF LITIGATION..........................................................29

     SECTION 6.08         EMPLOYEES AND EMPLOYEE BENEFITS, ETC...........................................30

     SECTION 6.09         DIRECTORS' AND OFFICERS' INDEMNIFICATION AND INSURANCE.........................31

     SECTION 6.10         PUBLIC ANNOUNCEMENTS...........................................................32

     SECTION 6.11         SARBANES-OXLEY COMPLIANCE......................................................32

     SECTION 6.12          CHARITABLE COMMITMENTS.........................................................32

 

ARTICLE VII TAX MATTERS.................................................................................33

     SECTION 7.01         TAX INDEMNIFICATION............................................................33

     SECTION 7.02         TAX INDEMNIFICATION PROCEDURES.................................................34

     SECTION 7.03         RTM TAX AUDITS AND CONTESTS; COOPERATION.......................................35

     SECTION 7.04         PREPARATION OF TAX RETURNS AND PAYMENT OF TAXES................................37

     SECTION 7.05         STRADDLE PERIODS...............................................................38

     SECTION 7.06         REFUNDS........................................................................39

     SECTION 7.07         CONVEYANCE TAXES...............................................................39

     SECTION 7.08         TERMINATION OF TAX SHARING AGREEMENTS..........................................39

     SECTION 7.09         SECTION 754 ELECTION...........................................................39

     SECTION 7.10         TAX TREATMENT..................................................................39

     SECTION 7.11          RTMAC ASSET RANGE..............................................................40

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ARTICLE VIII CONDITIONS TO CLOSING......................................................................40

     SECTION 8.01         CONDITIONS TO EACH PARTY'S OBLIGATIONS TO EFFECT THE PURCHASE..................40

     SECTION 8.02         CONDITIONS TO OBLIGATIONS OF TRIARC AND ARG TO EFFECT THE PURCHASE.............41

     SECTION 8.03         CONDITIONS TO OBLIGATIONS OF THE SELLERS TO EFFECT THE PURCHASE................42

     SECTION 8.04         FRUSTRATION OF CLOSING CONDITIONS..............................................43

 

ARTICLE IX TERMINATION, AMENDMENT AND WAIVER............................................................43

     SECTION 9.01         GROUNDS FOR TERMINATION........................................................43

     SECTION 9.02         EFFECT OF TERMINATION..........................................................44

     SECTION 9.03         AMENDMENT......................................................................44

     SECTION 9.04         EXTENSION; WAIVER..............................................................44

 

ARTICLE X SURVIVAL; INDEMNIFICATION.....................................................................45

      SECTION 10.01        SURVIVAL.......................................................................45

     SECTION 10.02        OBLIGATION OF ARG TO INDEMNIFY.................................................45

     SECTION 10.03        MATTERS PERTAINING TO INDEMNIFICATION BY ARG...................................46

     SECTION 10.04        OBLIGATION OF THE SELLERS TO INDEMNIFY.........................................47

     SECTION 10.05        MATTERS PERTAINING TO INDEMNIFICATION BY THE SELLERS...........................49

     SECTION 10.06        PROCEDURE FOR INDEMNIFICATION..................................................51

     SECTION 10.07        SOLE AND EXCLUSIVE REMEDY......................................................53

     SECTION 10.08         MISCELLANEOUS..................................................................53

 

ARTICLE XI MISCELLANEOUS................................................................................53

     SECTION 11.01        DEFINITIONS....................................................................53

     SECTION 11.02        INTERPRETATION.................................................................65

     SECTION 11.03        FEES, COSTS AND EXPENSES.......................................................65

     SECTION 11.04        NOTICES........................................................................66

     SECTION 11.05        GOVERNING LAW..................................................................68

     SECTION 11.06        JURISDICTION...................................................................68

     SECTION 11.07        WAIVER OF JURY TRIAL...........................................................68

     SECTION 11.08        EXHIBITS AND DISCLOSURE LETTERS................................................68

     SECTION 11.09        NO THIRD-PARTY BENEFICIARIES...................................................68

     SECTION 11.10        SEVERABILITY...................................................................69

     SECTION 11.11        RULES OF CONSTRUCTION..........................................................69

     SECTION 11.12        ASSIGNMENT.....................................................................69

     SECTION 11.13        REMEDIES.......................................................................69

     SECTION 11.14        SPECIFIC PERFORMANCE...........................................................69

     SECTION 11.15        COUNTERPARTS...................................................................69

     SECTION 11.16        ENTIRE AGREEMENT...............................................................70

     SECTION 11.17        RTM REPRESENTATIVES............................................................70

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SCHEDULES

 

Schedule I        Sellers; Membership Interests; Aggregate Purchase Price

 

ANNEXES

 

Annex A           Form of Escrow Agreement

 

 

 

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                     MEMBERSHIP INTEREST PURCHASE AGREEMENT

 

         MEMBERSHIP INTEREST PURCHASE AGREEMENT, dated as of May 27, 2005 (this

"AGREEMENT"), by and among Triarc Companies, Inc., a Delaware corporation

("TRIARC"); Arby's Restaurant Group, Inc., a Delaware corporation and an

indirect wholly owned subsidiary of Triarc ("ARG"); each of the persons listed

on SCHEDULE I hereto (collectively, the "SELLERS," and each, a "SELLER"); and

Russell V. Umphenour, Jr., Dennis E. Cooper and J. Russell Welch, as the RTM

Representatives (as defined below), for the purchase and sale of all of the

membership interests in RTM Acquisition Company, L.L.C., a Georgia limited

liability company ("RTMAC").

 

         WHEREAS, the Sellers are the beneficial and record owners of all of the

membership interests in RTMAC (the "MEMBERSHIP INTERESTS");

 

          WHEREAS, the Sellers wish to sell to ARG, and ARG wishes to purchase

from the Sellers, all of the Membership Interests upon the terms and subject to

the conditions of this Agreement (the "PURCHASE");

 

         WHEREAS, Triarc, Arby's Acquisition Co., a Georgia corporation and a

direct wholly owned subsidiary of Triarc ("MERGER SUB CORP."), Arby's

Restaurant, LLC, a Delaware limited liability company and a direct wholly owned

subsidiary of Triarc ("MERGER SUB LLC"), RTM Restaurant Group, Inc., a Georgia

corporation ("RTMRG") and Russell V. Umphenour, Jr., Dennis E. Cooper and J.

Russell Welch, as the RTM Representatives, have entered into an Agreement and

Plan of Merger, dated as of the date hereof (the "RTMRG MERGER AGREEMENT"),

which provides, among other things, for the merger of Merger Sub Corp. with and

into RTMRG, with RTMRG surviving the merger and becoming a direct wholly owned

subsidiary of Triarc (the "FIRST MERGER"), followed immediately thereafter by

the merger of RTMRG with and into Merger Sub LLC, with Merger Sub LLC surviving

the merger (the "SECOND MERGER" and, together with the First Merger, the

"MERGERS") and immediately after the Second Effective Time (as defined in the

RTMRG Merger Agreement), Triarc will contribute all of the outstanding

membership interests in the surviving entity in the Second Merger directly or

indirectly to Triarc Restaurant Holdings, LLC, which will directly or indirectly

contribute all of the outstanding membership interests in the surviving entity

in the Second Merger to ARG (such contributions, the "TRIARC CONTRIBUTIONS");

 

         WHEREAS, certain principal shareholders of RTMRG (the "RTMRG PRINCIPAL

SHAREHOLDERS"), who collectively beneficially own approximately 87.1% of the

outstanding shares of RTMRG Common Stock have entered into a Transaction Support

Agreement for the benefit of Triarc (the "TRANSACTION SUPPORT AGREEMENT"),

pursuant to which the RTMRG Principal Shareholders have agreed, INTER ALIA, on

the terms and subject to the conditions set forth in the Transaction Support

Agreement, (a) to seek to obtain the waiver from each shareholder of RTMRG of

dissenters rights in respect of the First Merger and (b) to the indemnification

obligations of the RTMRG Principal Shareholders set forth in RTMRG Merger

Agreement and the restrictive covenants set forth therein;

 

 

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         WHEREAS, Triarc, ARG, RTMMC Acquisition, LLC, a Delaware limited

liability company and a direct wholly owned subsidiary of Triarc ("RTMMC

ACQUISITION SUB"), RTM Management Company, L.L.C., a Georgia limited liability

company ("RTMMC"), each of the members of RTMMC, and Russell V. Umphenour, Jr.,

Dennis E. Cooper and J. Russell Welch, as the RTM Representatives, have entered

into an Asset Purchase Agreement, dated as of the date hereof (the "RTMMC

PURCHASE AGREEMENT"), pursuant to which, INTER ALIA, simultaneously with the

Closing, RTMMC Acquisition Sub will acquire from RTMMC, on the terms and subject

to the conditions set forth therein, the Purchased Assets (as defined therein)

and the Assumed Liabilities (as defined therein) (the "RTMMC PURCHASE" and,

together with the Mergers and the Purchase, the "RTM TRANSACTIONS") for an

amount in cash equal to the cash portion of the Aggregate Purchase Price (as

defined therein) (as used herein, the "RTMMC AGGREGATE PURCHASE PRICE"); and

 

         WHEREAS, simultaneously with, and as a condition to the obligation of

the parties hereto to effect, the Purchase, Triarc, ARG, each of the RTMRG

Principal Shareholders, each of the Sellers as of immediately prior to the

Closing, RTMMC, each of the members of RTMMC as of immediately prior to the

Closing, the RTM Representatives and the Escrow Agent (as defined below) will

enter into an Escrow Agreement in the form attached hereto as ANNEX A with such

changes as may be requested by the Escrow Agent (the "ESCROW AGREEMENT").

 

         NOW THEREFORE, in consideration of the foregoing and the mutual

covenants and agreements herein contained, and intending to be legally bound

hereby, the parties hereto hereby agree as follows:

 

                                    ARTICLE I

 

                    SALE AND PURCHASE OF MEMBERSHIP INTERESTS

 

         Section 1.01    SALE AND PURCHASE OF MEMBERSHIP INTERESTS. At the

Closing provided for in Section 1.02, upon the terms and subject to the

conditions of this Agreement and in reliance upon the representations,

warranties and agreements contained herein, the Sellers shall sell to Triarc,

and Triarc shall purchase from the Sellers, all of the Membership Interests for

an aggregate purchase price (the "AGGREGATE PURCHASE PRICE") to be paid in

accordance with Section 1.03 equal to $10.00. Immediately after such purchase,

Triarc shall contribute, or cause to be contributed, such Membership Interests

to ARG.

 

         Section 1.02    CLOSING. Subject to the satisfaction or waiver of all of

the conditions to closing contained in Article VIII, the closing of the Purchase

(the "CLOSING") shall take place (a) at the offices of Paul, Weiss, Rifkind,

Wharton & Garrison LLP, 1285 Avenue of the Americas, New York, New York, at

10:00 a.m. on the third Business Day after the day on which the last of those

conditions (other than any conditions, including the consummation of the Mergers

and the RTMMC Purchase, that by their nature are to be satisfied at the Closing)

is satisfied or waived in accordance with this Agreement or (b) at such other

place and time or on such other date as Triarc and the

 

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RTM Representatives may agree in writing. The date on which the Closing occurs

is referred to as the "CLOSING DATE."

 

         Section 1.03     PAYMENT OF AGGREGATE PURCHASE PRICE. At the Closing,

ARG shall, and Triarc shall cause ARG to, pay to each of the Sellers the

Aggregate Purchase Price pro rata in accordance with their Membership Interests

as set forth on SCHEDULE I (less any withholding of Taxes as provided in Section

1.07) by wire transfer of immediately available funds to an account designated

by such Seller in writing to Triarc not less than five Business Days prior to

the Closing, subject to Section 1.04.

 

         Section 1.04     REQUIRED WITHHOLDING. ARG shall be entitled to deduct

and withhold from the cash portion of the Aggregate Purchase Price such amounts

as it may be required to deduct and withhold from such payment under any

applicable Laws, and shall deduct and withhold from the portion of the Aggregate

Purchase Price payable to a Seller an amount equal to the amounts specified

under Section 1445 of the Code (assuming for these purposes the application of

Section 1445 of the Code to the Mergers and the Purchase) if such Seller does

not duly execute and deliver on or prior to the Closing Date a certificate

stating that such Seller is not a "foreign person" within the meaning of Section

1445 of the Code, which certificate shall set forth all information required by,

and otherwise be executed in accordance with, Treasury Regulation ss.

1.1445-2(b)(2). If ARG so deducts or withholds any such amounts, such amounts

shall be treated for, all purposes as having been paid to the Person in respect

of whom ARG made such deduction and withholding.

 

 

                                   ARTICLE II

 

            REPRESENTATIONS AND WARRANTIES OF THE SELLERS AS TO RTMAC

 

         Except as otherwise set forth in the disclosure letter delivered on or

prior to the date of this Agreement by the Sellers to Triarc (the "RTMAC

DISCLOSURE LETTER"), which RTMAC Disclosure Letter is arranged in Sections

corresponding to the Sections of this Agreement, the Sellers, jointly and

severally, represent and warrant to Triarc and ARG that:

 

         Section 2.01    ORGANIZATION AND QUALIFICATION OF RTMAC. RTMAC is a

limited liability company duly organized, validly existing and in good standing

under the laws of the State of Georgia, and has the limited liability company

power and authority to own or lease its assets and to carry on its business

substantially as it is being conducted on the date hereof. RTMAC is duly

qualified and licensed to do business and is in good standing in each

jurisdiction where the ownership or operation of its property and assets or the

conduct of its business requires such qualification, except where the failure to

be so qualified or in good standing has not had and could not reasonably be

expected to have, individually or in the aggregate, an RTMAC Material Adverse

Effect. RTMAC has made available to Triarc correct and complete copies of the

articles of organization and operating agreement of RTMAC (as amended to the

date hereof).

 

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         Section 2.02    AUTHORIZATION OF RTMAC; ENFORCEABILITY. RTMAC has all

requisite limited liability company power and authority, and has taken all

limited liability company action necessary in order to execute, deliver and

perform its obligations under each of the Ancillary Agreements to which it is a

party and to consummate the transactions contemplated by each such Ancillary

Agreement. Each of the Ancillary Agreements to which it is a party have been

duly executed and delivered by RTMAC and constitute the legal, valid and binding

obligation of RTMAC, enforceable in accordance with their respective terms,

subject to bankruptcy, insolvency, fraudulent transfer, reorganization,

moratorium and similar Laws of general applicability relating to or affecting

creditors' rights, and to general equity principles.

 

         Section 2.03    MEMBERSHIP INTERESTS. The Sellers are the only members

of RTMAC and own the respective percentages of the Membership Interests set

forth on SCHEDULE I hereto. No other membership or other ownership interest of

RTMAC is authorized or outstanding. All of the Membership Interests have been

duly authorized and validly issued, are fully paid and nonassessable. There are

no options, warrants, calls, conversion rights, stock appreciation rights,

redemption rights, repurchase rights or other rights, agreements, arrangements

or commitments to which RTMAC is a party (A) relating to the issued or unissued

membership interests or other securities of RTMAC or (B) obligating RTMAC to

issue or sell any of its membership interests or other securities. Except as set

forth in Section 2.03 of the RTMAC Disclosure Letter, there are no voting

trusts, proxies or other agreements or understandings with respect to the voting

of the membership interests of RTMAC. RTMAC does not have outstanding any bonds,

debentures, notes or other obligations the holders of which have the right to

vote (or convertible into or exercisable for securities having the right to

vote) with the members of RTMAC on any matter.

 

         Section 2.04    SUBSIDIARIES. RTMAC does not directly or indirectly own

any Subsidiary. Section 2.04 of the RTMAC Disclosure Letter sets forth all

interests (the "INVESTMENTS") of RTMAC, listing the name of such Person, the

type of entity, jurisdiction of organization and the number and class, amount

and/or series of debt or equity interests of such Persons held by RTMAC and each

other holder of any equity or other ownership interest in such Person. RTMAC has

good and valid title, free and clear of any Liens, to the Investments.

 

         Section 2.05    GOVERNMENTAL AUTHORIZATIONS. The execution, delivery and

performance by RTMAC of each of the Ancillary Agreements to which it is a party

do not, and the consummation by RTMAC of the transactions contemplated thereby

will not, require any consent, approval or other authorization of, or filing

with or notification to, any Governmental Entity, other than:

 

         (a)     the filing of the First Certificate of Merger with the Secretary

of State of the State of Georgia and the Second Certificate of Merger with the

Secretaries of State of the States of Delaware and Georgia;

 

         (b)     the filing with the SEC of any forms, reports, schedules,

statements and other documents that may be required under the Securities Act and

the Exchange Act

 

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in connection with this Agreement and the Registration Rights Agreement and the

transactions contemplated hereby and thereby; and

 

         (c)     the pre-merger notification required under the HSR Act.

 

         Section 2.06    NON CONTRAVENTION. Except with respect to Contracts to

be satisfied in full or terminated in connection with the Debt Refinancings, the

execution, delivery and performance by RTMAC of each of the Ancillary Agreements

to which it is a party do not, and the consummation by RTMAC of the transactions

contemplated thereby will not (a) contravene, conflict with, or result in any

violation or breach of, the articles of organization or the operating agreement

of RTMAC, (b) contravene or conflict with, or result in any violation or breach

of, in any material respect, any Laws, Orders or Permits applicable to RTMAC or

by which any assets of RTMAC are bound, assuming that all consents, approvals,

authorizations, filings and notifications described in Section 2.05, Section

3.03 and Section 4.03 have been obtained or made, (c) result in any violation or

breach of, or constitute a default (with or without notice or lapse of time or

both) under, (x) any RTMAC Material Contract or (y) any other Contract to which

RTMAC is a party or by which any assets of RTMAC are bound, other than in the

case of this clause (y) any such violation, breach or default that would not

reasonably be expected to be, individually or in the aggregate, material to

RTMAC, (d) require any consent, approval or other authorization of, or filing

with or notification to, any Person under (x) any RTMAC Material Contract or (y)

any other Contract to which RTMAC is a party or by which any assets of RTMAC are

bound, other than in the case of this clause (y) any such consent, approval,

authorization, filing or notification that, if not obtained or made, would not

reasonably be expected to be, individually or in the aggregate, material to

RTMAC, (e) give rise to any termination, cancellation, amendment, modification

or acceleration of any rights or obligations under (x) any RTMAC Material

Contract or (y) any other Contract to which RTMAC is a party or by which any

assets of RTMAC are bound, other than in the case of this clause (y) any such

termination, cancellation, amendment, modification or acceleration that would

not reasonably be expected to be, individually or in the aggregate, material to

RTMAC, or (f) cause the creation or imposition of any Liens (other than

Permitted Liens) on any material assets of RTMAC.

 

         Section 2.07    RESTATED COMBINED RTM FINANCIAL STATEMENTS; INTERNAL

CONTROLS; INDEBTEDNESS.

 

         (a)     Section 2.07(a) of the RTMAC Disclosure Letter sets forth the

following combined financial statements of the RTM Parties and their

Subsidiaries (collectively, the "RESTATED COMBINED RTM FINANCIAL STATEMENTS"):

(i) the restated audited combined balance sheets as of May 30, 2004 and May 25,

2003 and statements of income, net capital deficiency and cash flows for the

fiscal years ended May 30, 2004, May 25, 2003 and May 26, 2002, for the RTM

Parties and their Subsidiaries (such statements, together with the footnotes

related thereto, being the "RESTATED COMBINED RTM AUDITED FINANCIAL STATEMENTS")

and (ii) the restated unaudited combined balance sheets as of March 6, 2005 and

May 30, 2004 and statements of income and retained earnings for the 40 weeks

ended March 6, 2005 and February 29, 2004, for the RTM Parties and their

Subsidiaries (such statements being the "RESTATED COMBINED RTM

 

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UNAUDITED FINANCIAL STATEMENTS"). The Restated Combined RTM Financial Statements

(x) were prepared in accordance with GAAP applied on a consistent basis (except

as may be indicated in the notes to the Restated Combined RTM Financial

Statements and except for the absence of footnotes in the case of the Restated

Combined RTM Unaudited Financial Statements); and (y) fairly present, in all

material respects, the combined financial position of the RTM Parties and their

Subsidiaries as of the dates thereof and their combined results of operations

and cash flows for the periods then ended (subject, in the case of the Restated

Combined RTM Unaudited Financial Statements, to normal year-end adjustments).

 

         (b)     RTMAC maintains accurate books and records reflecting its assets

and liabilities and maintains proper and adequate internal accounting controls

which provide assurance that (i) transactions are executed with management's

authorization; (ii) transactions are recorded as necessary to permit preparation

of the financial statements of RTMAC and to maintain accountability for the

assets of RTMAC; (iii) access to the assets of RTMAC is permitted only in

accordance with management's authorization; (iv) the reporting of the assets of

RTMAC is compared with existing assets at regular intervals; and (v) accounts,

notes and other receivables and inventory are recorded accurately, and proper

and adequate procedures are implemented to effect the collection thereof on a

current and timely basis. RTMAC has heretofore made available to Triarc a true,

complete and correct copy of any disclosure (or, if unwritten, a summary

thereof) by any Representative of RTMAC to RTMAC's independent auditors relating

to (x) any significant deficiencies in the design or operation of internal

controls which could adversely affect the ability of RTMAC to record, process,

summarize and report financial data and any material weaknesses in internal

controls and (y) any fraud, whether or not material, that involves management or

other employees who have a significant role in the internal control over

financial reporting of RTMAC.

 

         (c)     Section 2.07(c) of the RTMAC Disclosure Letter sets forth a true

and correct list of all Indebtedness of RTMAC (which Section may be updated by

the Sellers prior to the Closing Date to reflect (x) any additions or deletions

thereto after the date hereof in compliance with Section 5.01 and (y) payments

of principal and interest and accrual of interest on such Indebtedness during

the period from the date hereof through the Closing Date). The aggregate amount

of prepayment penalties, premiums, make wholes, breakage and other costs and

expenses payable to the lenders as such of all such Indebtedness solely on

account of the repayment of such Indebtedness in the Debt Refinancings will not

exceed $20 million. Section 2.07(c) of the RTMAC Disclosure Letter specifically

identifies all Indebtedness of RTMAC or included in the Winners Indebtedness

Amount that constitutes RTM Non-Prepayable Debt. All Indebtedness of the RTM

Parties and their Subsidiaries and the Mrs. Winners Obligors, other than the RTM

Non-Prepayable Debt, is permitted by its terms to be prepaid, or the holder

thereof has consented in writing (which consent is in full force and effect) to

being prepaid, in connection with the Debt Refinancings.

 

         Section 2.08    ABSENCE OF CERTAIN CHANGES OR EVENTS. Except to the

extent relating to the transactions contemplated by this Agreement, since May

30, 2004 (i) RTMAC has in all material respects conducted its business in the

ordinary course of

 

<PAGE>

                                       7

 

 

business consistent with past practice and (ii) there has not occurred any

event, and there does not exist any condition or set of circumstances, that has

had or could reasonably be expected to have, individually or in the aggregate,

an RTM Material Adverse Effect.

 

         Section 2.09    ABSENCE OF UNDISCLOSED LIABILITIES. RTMAC does not have

any material Liabilities, except for (i) Liabilities set forth in the Restated

Combined RTM Financial Statements, (ii) Liabilities which have arisen after May

30, 2004 in the ordinary course of business consistent with past practice or in

compliance with Section 5.01, (iii) Liabilities set forth in Section 2.09 of the

RTMAC Disclosure Letter and (iv) Liabilities that are (A) the subject of any

other representation or warranty contained in this Article II and are

specifically disclosed pursuant to such representation or warranty or are not

required to be disclosed because such other representation or warranty is

limited or qualified with respect to dollar amount, Knowledge of the Sellers or

materiality or (B) taken into account in the determination of the RTM Estimated

Net Liabilities or RTM Closing Net Liabilities.

 

         Section 2.10          COMPLIANCE WITH LAWS; PERMITS.

 

         (a)     Since December 31, 2001, except for matters specifically

addressed by Section 2.15 (last sentence only), Section 2.16 or Section 2.25(b),

(i) RTMAC has conducted its business in compliance in all material respects with

applicable Law; and (ii) RTMAC has not received any notice or other

communication (whether oral or written) from any Governmental Entity or any

other Person regarding any actual, alleged, possible, or potential failure to

comply in any material respect with any applicable Laws.

 

         (b)     RTMAC holds all material Permits issued or provided by

Governmental Entities under all Laws, which are necessary for it to own its

assets or operate its business as currently conducted (the "RTMAC PERMITS").

There have been no material misstatements or omissions in connection with any

RTMAC Permit that, individually or in the aggregate, would be reasonably likely

to result in the revocation, nonrenewal, suspension or adverse modification of

such RTMAC Permit except for such revocations, non-renewals, suspensions or

adverse modifications that have not been and would not reasonably be expected to

be, individually or in the aggregate, material to RTMAC. There is not pending,

nor to the Knowledge of the Sellers, threatened, against RTMAC, any application,

action, petition, objection or other pleading, or any proceeding, with any

Governmental Entity which questions or contests the validity of, or any rights

of the holder under, or nonrenewal or suspension of any RTMAC Permit.

 

         Section 2.11    LEGAL ACTIONS. Section 2.11 of the RTMAC Disclosure

Letter sets forth a true and complete list of all Legal Actions pending or, to

the Knowledge of the Sellers, threatened against (a) RTMAC or (b) any director,

officer or employee of RTMAC or other Person for whom RTMAC may be liable, other

than in the case of clause (a) or (b) any such Legal Actions commenced or, to

the Knowledge of the Sellers, threatened after the date of this Agreement and

prior to the Closing Date that have not resulted in and would not reasonably be

expected to result in, individually or in the aggregate, (x) Losses to RTMAC in

excess of $1 million or (y) RTMAC being bound

 

<PAGE>

                                       8

 

 

by any material restriction (other than customary confidentiality restrictions).

RTMAC is not subject to or bound by any outstanding Order that is material to

RTMAC.

 

         Section 2.12       CONTRACTS.

 

         (a)     Section 2.12(a) of the RTMAC Disclosure Letter lists the

following Contracts to which RTMAC is a party and which are outstanding (which

Section may be updated by the Sellers prior to the Closing Date to reflect any

additions or deletions thereto after the date hereof in compliance with Section

5.01) (collectively, the "RTMAC MATERIAL CONTRACTS"):

 

                (i)      any Contract expressly requiring capital expenditures

involving consideration in excess of $50,000 in any twelve month period;

 

                (ii)     any Contract which restricts or limits, in any material

respect, the ability of RTMAC to freely engage in any aspect of the quick

service restaurant business whether as franchisor or owner/operator, or to

employ any individuals (other than any confidentiality agreement entered into in

connection with a potential acquisition containing any such restriction or

limitation to employ any individuals);

 

                (iii)    any collective bargaining agreement;

 

                (iv)     any Contract which involved payments from RTMAC of more

than $250,000 to any Person supplying food or paper products or distribution

services to any of the RTM Parties or any of their Subsidiaries during the

twelve-month period ended May 30, 2004;

 

                (v)      any Contract which involved payments from RTMAC of more

than $100,000 to any Person supplying advertising services or marketing services

or materials to any of the RTM Parties or any of their Subsidiaries during the

twelve-month period ended May 30, 2004;

 

                (vi)     any Contract which involved payments to RTMAC of more

than $100,000 from any Person supplying beverage products to any of the RTM

Parties or any of their Subsidiaries during the twelve-month period ended May

30, 2004;

 

                (vii)    any Contract relating to the employment of any employee,

and any Contract pursuant to which RTMAC is or may become obligated to make any

severance, termination, bonus or relocation payment or any other payment (other

than payments in respect of salary) in excess of $125,000, to any current or

former employee, officer or director;

 

                (viii)   any Contract which provides for indemnification by RTMAC

of (A) any officer, director or employee of any of the RTM Parties or any of

their Subsidiaries or (B) any agent of the RTM Parties or any of their

Subsidiaries or any other Person that, in the case of this clause (B), has

resulted in or would reasonably be expected to result in, individually or in the

aggregate, material Liabilities to RTMAC;

 

<PAGE>

                                       9

 

 

                (ix)     any Contract relating to any Indebtedness, guarantying

the performance of any Person or guarantying any Indebtedness;

 

                (x)      any Contract involving a purchase price of $50,000 or

more under which the closing of the transactions contemplated thereby has not

occurred or under which there remains outstanding obligations and which relates

to the acquisition by RTMAC of any operating business or the capital stock or

other equity securities of any other Person, or the sale by RTMAC of any

operating business or the capital stock or other equity securities of any former

Subsidiary of RTMAC;

 

                (xi)     any partnership or joint venture agreement or other

Contract involving a sharing of profits, losses, costs or Liabilities with any

other Person;

 

                (xii)    any Contract under which RTMAC uses or occupies or has

the right to use or occupy any real property (collectively, the "RTMAC REAL

PROPERTY LEASES") (and Section 2.12(a)(xii) of the RTMAC Disclosure Letter sets

forth a true and complete summary of the following terms of each such RTMAC Real

Property Lease: (1) the lessee; (2) the unit number; (3) the monthly rental

rate; (4) the monthly operating expenses payable to the landlord; (5) the

monthly rental taxes; (6) the commencement date and the termination date; (7)

any assignment or change in control provisions; and (8) any guaranty by a Person

other than an RTM Party or their Subsidiaries);

 

                (xiii)   any Contract under which RTMAC grants to any Person or

Persons the right of use or occupancy to any portion of any parcel of any RTMAC

Real Property (collectively, the "RTMAC LEASES") (and Section 2.12(a)(xiii) of

the RTMAC Disclosure Letter sets forth a true and complete summary of the

following terms of each such RTMAC Lease: (1) the sublessee; (2) the unit

number; (3) the monthly rental rate; (4) the monthly operating expenses payable

to the landlord; (5) the monthly rental taxes; (6) the commencement date and the

termination date; and (7) any guaranty by an RTM Party or any of their

Subsidiaries);

 

                (xiv)    any Contract under which the closing of the transactions

contemplated thereby has not occurred relating to the acquisition or sale by

RTMAC of one or more parcels of real property, the aggregate purchase price of

which exceeds $50,000;

 

                (xv)     any Contract under which the closing of the transactions

contemplated thereby has not occurred relating to the construction by RTMAC of

one or more new Restaurants, the estimated costs under which exceed $50,000 in

the aggregate;

 

                (xvi)    any Contract entered into out of the ordinary course

of business, including any Contract entered into in connection with any

settlement of any claim, action, suit, demand, proceeding, investigation or

dispute, involving payments by RTMAC in excess of $50,000 or any unfulfilled or

pending non-payment obligations of RTMAC; and

 

<PAGE>

                                       10

 

 

                (xvii)   any Contract or pledge pursuant to which RTMAC or any

of its Subsidiaries has committed or undertaken to make any charitable

contribution with an unfulfilled amount in excess of $50,000 individually or

$250,000 in the aggregate.

 

        (b)      Each RTMAC Material Contract is valid, binding, in full force

and effect and enforceable in accordance with its terms against RTMAC and, to

the Knowledge of the Sellers, against any other party thereto. RTMAC and, to the

Knowledge of the Sellers, each other party thereto, is not in material breach or

material default under any RTMAC Material Contract and to the Knowledge of the

Sellers, no event has occurred or condition or set of circumstances exists

which, with or without notice or lapse of time or both, would constitute a

material breach or material default, or permit termination, modification or

acceleration, under any RTMAC Material Contract by any party thereto.

 

         Section 2.13    TAX MATTERS.

 

         (a)     All income Tax Returns and all other material Tax Returns

required to be filed by or with respect to RTMAC have been properly prepared and

timely filed (including all applicable extensions), and all such Tax Returns

(including information provided therewith or with respect thereto) are true,

complete and correct in all material respects.

 

         (b)     RTMAC has fully and timely paid all material Taxes owed by RTMAC

(whether or not shown on any Tax Return), and has made adequate provision for

any such Taxes that are not yet due and payable, for all taxable periods, or

portions thereof, ending on or before the date hereof.

 

         (c)     There are no outstanding agreements extending or waiving the

statutory period of limitations applicable to any claim for, or the period for

the collection or assessment or reassessment of, Taxes due from RTMAC for any

taxable period and no written request for any such waiver or extension is

currently pending.

 

         (d)     No audit or other proceeding by any Governmental Entity is

pending, no Governmental Entity has given written notice of any intention to

commence an audit or other proceeding, or assert any deficiency or claim for

additional Taxes against RTMAC, and no claim in writing has been made by any

Governmental Entity in a jurisdiction where RTMAC does not file Tax Returns with

respect to a particular Tax that it is or may be subject to taxation by that

jurisdiction with respect to such Tax, and all deficiencies for Taxes asserted

or assessed in writing against RTMAC have been fully and timely paid, settled or

properly reflected in the Restated Combined RTM Financial Statements.

 

         (e)     Since the formation of RTMAC, no jurisdiction in which RTMAC

files, or has filed, Tax Returns treats, or has treated, RTMAC as an entity

other than a partnership, or as being subject, or having been subject, to

entity-level Tax, for federal, state, local and foreign income or franchise Tax

purposes.

 

<PAGE>

                                       11

 

 

         (f)     RTMAC has never made an election to be excluded from the

provisions of Subchapter K of the Code, is (or ever has been) subject to the

taxable mortgage pool rules under Section 7701(i) of the Code, or is (or ever

has been) classified as an association taxable as a corporation or a publicly

traded partnership taxable as a corporation under Section 7704 of the Code.

Section 2.13(f) of the RTMAC Disclosure Letter sets forth a description of each

election, and revocation of such election, if any, made by RTMAC under Section

754 of the Code (and any comparable provision of state, local or foreign Tax

Law).

 

         (g)     There are no Liens for Taxes upon the assets or properties of

RTMAC, except for statutory Liens for current Taxes not yet due.

 

         (h)     RTMAC is not a party to any Tax Sharing Agreement.

 

         (i)     RTMAC has withheld (or will withhold) from its employees,

independent contractors, creditors, members and third parties and timely paid to

the appropriate Governmental Entity proper and accurate amounts in all material

respects for all periods ending on or before the Closing Date in compliance with

all Tax withholding and remitting provisions of applicable Laws and have each

complied in all material respects with all Tax information reporting provisions

of all applicable Laws.

 

         (j)     RTMAC has not agreed, and is not required to make, any

adjustment under Section 481(a) of the Code, and no Governmental Entity has

proposed in writing any such adjustment or change in accounting method.

 

         (k)     RTMAC has not executed or entered into a closing agreement

pursuant to Section 7121 of the Code or any similar provision of state, local or

foreign Law, and RTMAC is not subject to any private letter ruling of the IRS or

comparable ruling of any other Governmental Entity.

 

         (l)     No property owned by RTMAC: (i) is property required to be

treated as being owned by another Person pursuant to the provisions of Section

168(f)(8) of the Internal Revenue Code of 1954, as amended and in effect

immediately prior to the enactment of the Tax Reform Act of 1986, (ii)

constitutes "tax-exempt use property" within the meaning of Section 168(h)(1) of

the Code or (iii) is "tax-exempt bond financed property" within the meaning of

Section 168(g)(5) of the Code.

 

         (m)     The adjusted tax basis of each note, receivable or other

obligation among any of RTMAC, its direct or indirect members and its Affiliates

equals the principal amount of such note, receivable or obligation (including

any accrued but unpaid interest).

 

         Section 2.14    EMPLOYEE BENEFITS.

 

         (a)     Except for severance agreements under which the remaining

aggregate payments to the applicable former employee are less than $125,000,

RTMAC does not maintain or contribute to or have any obligation to maintain or

contribute to, or have any direct or indirect Liability with respect to any

plan, program, arrangement or

 

<PAGE>

                                       12

 

 

agreement that is a pension, profit-sharing, savings, retirement, employment,

consulting, severance pay, termination, executive compensation, incentive

compensation, deferred compensation, bonus, stock purchase, stock option,

phantom stock or other equity-based compensation, change-in-control, retention,

salary continuation, vacation, sick leave, disability, death benefit, group

insurance, hospitalization, medical, dental, life (including all individual life

insurance policies as to which RTMAC is the owner, the beneficiary, or both),

Code Section 125 "cafeteria" or "flexible" benefit, employee loan, educational

assistance, fringe benefit plan, whether written or oral, including, without

limitation, any (i) "employee benefit plan" within the meaning of Section 3(3)

of ERISA or (ii) other employee benefit plans, agreements, programs, policies,

arrangements or payroll practices, whether or not subject to ERISA (including

any funding mechanism therefor now in effect or required in the future as a

result of the transaction contemplated by this Agreement or otherwise) under

which any current or former employee, director, officer, leased employee or

agent (or their beneficiaries) of RTMAC has any present or future right to

benefits (each such plan, program, arrangement or agreement set forth in such

Section being individually, an "RTMAC EMPLOYEE PLAN," and collectively the

"RTMAC EMPLOYEE PLANS"). All references to "RTMAC" in this Section 2.14 shall

refer to RTMAC and any employer that would be considered a single employer with

RTMAC under Sections 414(b), (c), (m) or (o) of the Code.

 

         (b)     RTMAC does not maintain, contribute to or have any Liability

with respect to, and has not within the preceding six years maintained,

contributed to or had any Liability with respect to, any RTMAC Employee Plan

that is, or has been, (i) subject to Title IV of ERISA or Section 412 of the

Code, (ii) maintained by more than one employer within the meaning of Section

413(c) of the Code, (iii) subject to Sections 4063 or 4064 of ERISA, (iv) a

"multiemployer plan," within the meaning of Section 4001(a)(3) of ERISA, (v) a

"multiple employer welfare arrangement" as defined in Section 3(40) of ERISA,

(vi) maintained outside the jurisdiction of the United States, or (vii) an

"employee pension benefit plan" within the meaning of Section 3(2) of ERISA and

that is not intended to be qualified under Section 401(a) of the Code.

 

         (c)     (i)      Each RTMAC Employee Plan has been established and

administered in all material respects in accordance with its terms and in

compliance with the applicable provisions of ERISA, the Code and all other

applicable Laws; (ii) with respect to each RTMAC Employee Plan, all reports,

returns, notices and other documentation that are required to have been filed

with or furnished to the IRS, the DOL or any other Governmental Entity, or to

the participants or beneficiaries of such RTMAC Employee Plan have been filed or

furnished on a timely basis; (iii) each RTMAC Employee Plan that is intended to

be qualified within the meaning of Section 401(a) of the Code is so qualified

and has received a favorable determination letter from the IRS to the effect

that the RTMAC Employee Plan satisfies the requirements of Section 401(a) of the

Code and that its related trust is exempt from taxation under Section 501(a) of

the Code and, to the Knowledge of the Sellers, there are no facts or

circumstances that could reasonably be expected to cause the loss of such

qualification or the imposition of any material Liability, penalty or Tax under

ERISA, the Code or any other applicable Laws; (iv) other than routine claims for

benefits, no Liens or Legal Actions to or by any Person or Governmental Entity

have been filed against any RTMAC Employee Plan or RTMAC

 

<PAGE>

                                       13

 

 

with respect to any RTMAC Employee Plan or, to the Knowledge of the Sellers,

against any other Person and, to the Knowledge the Sellers, no such Liens or

Legal Actions are contemplated or threatened with respect to any RTMAC Employee

Plan; (v) no individual who has performed services for RTMAC has been improperly

excluded from participation in any RTMAC Employee Plan; and (vi) there are no

audits or proceedings initiated pursuant to the Employee Plans Compliance

Resolution System or similar proceedings pending with the IRS or the DOL with

respect to any RTMAC Employee Plan.

 

         (d)     Neither RTMAC nor, to the Knowledge of the Sellers, any other

"party in interest" or "disqualified person" with respect to any RTMAC Employee

Plan has engaged in a non-exempt "prohibited transaction" within the meaning of

Section 406 of ERISA or Section 4975 of the Code involving such RTMAC Employee

Plan. To the Knowledge of the Sellers, no fiduciary has any Liability for breach

of fiduciary duty or any other failure to act or comply with the requirements of

ERISA, the Code or any other applicable Laws in connection with the

administration or investment of the assets of any RTMAC Employee Plan.

 

         (e)     All Liabilities or expenses of RTMAC in respect of any RTMAC

Employee Plan (including workers compensation) which have not been paid, have

been properly accrued on the Restated Combined RTM Unaudited Financial

Statements in compliance with GAAP. All contributions (including all employer

contributions and employee salary reduction contributions) or premium payments

required to have been made under the terms of any RTMAC Employee Plan, or in

accordance with applicable Law, as of the date hereof have been timely made or

reflected on the Restated Combined RTM Unaudited Financial Statements in

accordance with GAAP.

 

         (f)     Neither RTMAC nor any organization to which RTMAC is a successor

or parent corporation, within the meaning of Section 4069(b) of ERISA, has

engaged in any transaction described in Sections 4069 or 4212(c) of ERISA.

 

         (g)     RTMAC has no obligation to provide or make available

post-employment welfare benefits or welfare benefit coverage for any employee or

former employee, except as may be required under COBRA, and at the sole expense

of the employee or former employee.

 

         (h)     Neither the execution and delivery of this Agreement nor the

consummation of the transactions contemplated hereby will (either alone or in

combination with another event) (i) result in any payment becoming due, or

increase the amount of any compensation due, to any current or former employee

of RTMAC; (ii) increase any benefits otherwise payable under any RTMAC Employee

Plan; (iii) result in the acceleration of the time of payment or vesting of any

such compensation or benefits; or (iv) result in the payment of any amount that

could, individually or in combination with any other such payment, constitute an

"excess parachute payment," as defined in Section 280G(b)(1) of the Code.

 

<PAGE>

                                       14

 

 

         (i)     RTMAC has no plan, Contract or commitment, whether legally

binding or not, to create any additional employee benefit or compensation plans,

policies or arrangements or, except as may be required by Law, to modify any

RTMAC Employee Plan.

 

         (j)     There are no reserves, assets, surpluses or prepaid premiums

with respect to any "welfare plan" (as defined in Section 3(1) of ERISA) that

are disclosed in Section 2.14(a) of the RTMAC Disclosure Letter.

 

         (k)     RTMAC has not incurred any Liability or obligation under WARN

or any similar state or local Law within the last six months which remains

unsatisfied.

 

         (l)     RTMAC has no direct or indirect material Liability with respect

to any misclassification of any Person as an independent contractor rather than

as an employee, or with respect to any employee leased from another employer.

 

         (m)     The Sellers have made available to Triarc with respect to each

RTMAC Employee Plan (other than severance agreements under which the aggregate

remaining payments to the applicable former employee are less than $125,000), a

true, correct and complete copy (or, to the extent no such copy exists, an

accurate description) thereof and, to the extent applicable: (i) the most recent

documents constituting the RTMAC Employee Plan and all amendments thereto, (ii)

any related trust agreement or other funding instrument; (iii) the most recent

IRS determination letter; (iv) the most recent summary plan description and

summary of material modifications; (v) the three most recent (A) Forms 5500 and

attached schedules, and (B) audited financial statements; (vi) for the last

three years, all correspondence with the IRS, the DOL and any other Governmental

Entity regarding the operation or the administration of any RTMAC Employee Plan;

and (vii) any other documents in respect of an RTMAC Employee Plan reasonably

requested by Triarc.

 

         Section 2.15    LABOR MATTERS. RTMAC is not the subject of, nor, to

the Knowledge of the Sellers, is there threatened, any material claim asserting

that RTMAC has committed an unfair labor practice with respect to RTMAC

Employees located in the United States, nor is there pending or, to the

Knowledge of the Sellers, threatened, nor has there been since December 31,

2001, any organized effort or demand for recognition by any labor organization

or any labor dispute or slow-down that is material to the operations of RTMAC.

There is not pending, nor, to the Knowledge of the Sellers, is there threatened

any material labor strike, walk-out, work stoppage or lockout with respect to

RTMAC Employees. RTMAC is, and since December 31, 2001 has been, in compliance

in all material respects with all applicable foreign, federal, state and local

Laws respecting employment, employment of minors, employment practices, terms

and conditions of employment, withholding and wages and hours. RTMAC does not

have any employees who spend more than 25% of their work week for matters

related to any RTM Related Entity.

 

         Section 2.16    ENVIRONMENTAL MATTERS. (i) RTMAC is not, and since

December 31, 2001 has not been, in violation in any material respect of any

applicable

 

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                                       15

 

 

Environmental Law; (ii) since December 31, 2001, RTMAC has not received any

written notice, demand, claim or request for information from any Governmental

Entity alleging the violation in any material respect of or any material

Liability under any applicable Environmental Law; (iii) RTMAC is not the subject

of any Order arising under any Environmental Law; and (iv) to the Knowledge of

the Sellers, there are no events, conditions or circumstances reasonably likely

to result in any material Liability to RTMAC under Environmental Laws.

 

         Section 2.17    INTELLECTUAL PROPERTY.

 

         (a)     RTMAC owns, is licensed under, or otherwise possesses legally

enforceable rights to use all patents, trade secrets, inventions, trademarks,

trade names, service marks, trade dress rights, Internet domain names,

copyrights, and any applications and registrations therefor, technology,

know-how, computer software programs or applications, and tangible or intangible

proprietary information or materials that are used in and material to the

business of RTMAC as currently conducted; PROVIDED, that no representation or

warranty is being made under this Agreement with respect to the compliance by

ARG or its applicable Subsidiary with any Contracts pursuant to which ARG or its

applicable Subsidiary licenses the RTMAC Third-Party Intellectual Property

Rights to RTMAC or the sufficiency of any such Contract to grant valid rights to

such RTMAC Third-Party Intellectual Property Rights. Section 2.17(a) of the

RTMAC Disclosure Letter sets forth all material United States patents, patent

applications, trademark, service mark and copyright applications and

registrations, and Internet domain name registrations owned by RTMAC.

 

         (b)     RTMAC is not, nor will it be as a result of the execution

and delivery by the Sellers of this Agreement or the performance by the Sellers

of their obligations hereunder, in violation in any material respect of any

material licenses, sublicenses or other agreements as to which RTMAC is a party

and pursuant to which RTMAC is authorized to use any third-party patents,

inventions, trademarks, trade names, service marks, trade dress rights, Internet

domain names, copyrights, trade secrets or other intellectual property rights

(collectively, "RTMAC THIRD-PARTY INTELLECTUAL PROPERTY RIGHTS").

 

         (c)     No claims with respect to (i) the right of RTMAC to use or to

sell, license or make available to any Person any of RTMAC's products or

services, or any of the patents, patent applications, registered and material

unregistered trademarks, trade names, service marks, registered copyrights, and

any applications therefor or trade secrets owned by RTMAC (collectively, the

"RTMAC INTELLECTUAL PROPERTY RIGHTS"); or (ii) RTMAC Third-Party Intellectual

Property Rights are, to the Knowledge of the Sellers, currently pending or

threatened by any Person against RTMAC, that if adversely determined could be

material to RTMAC; PROVIDED, that no representation or warranty is being made

with respect to claims made against ARG or any of its Subsidiaries of which the

Sellers do not have Knowledge.

 

         (d)     RTMAC has taken all necessary actions to maintain and protect

the RTMAC Intellectual Property Rights.

 

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                                       16

 

 

         Section 2.18    REAL PROPERTY. Section 2.18 of the RTMAC Disclosure

Letter sets forth a true, correct and complete schedule of all real property

owned by, or leased, subleased or licensed to, RTMAC (which Section may be

updated by the Sellers prior to the Closing Date to reflect any additions or

deletions thereto after the date hereof in compliance with Section 5.01)

(collectively, the "RTMAC REAL PROPERTY"). With respect to each such parcel of

RTMAC Real Property:

 

         (a)     RTMAC has good and marketable title to the RTMAC Real Property

owned by it and a valid leasehold interest in the RTMAC Real Property leased to

it, as the case may be, free and clear of any Liens, except for Permitted Liens;

 

         (b)     except for RTMAC Leases, there are no leases, subleases,

licenses, concessions, or other agreements entered into by RTMAC granting to any

Person or Persons the right of use or occupancy to any portion of the parcel of

any of such RTMAC Real Property;

 

         (c)     [intentionally omitted];

 

         (d)     all of the real property used by RTMAC in the conduct of its

business is included in the RTMAC Real Property, and is sufficient to operate

the Arby's quick service restaurant business as currently conducted;

 

         (e)     except for the RTMAC Restaurants (which are addressed in

Section 2.25), RTMAC has not received notice and, to the Knowledge of the

Sellers, there are no pending, threatened or contemplated condemnation

proceeding or proceedings affecting any of the RTMAC Real Property or any part

thereof or of any sale or other disposition of the RTMAC Real Property or any

part thereof in lieu of condemnation, in each case that, individually or in the

aggregate, is, or is reasonably likely to be, material to RTMAC; and

 

         (f)     no portion of any material RTMAC Real Property has suffered

any material damage by fire or other casualty which is uninsured or has not

heretofore been completely repaired and restored in full.

 

         Section 2.19    PERSONAL PROPERTY. RTMAC has good and marketable title

to, or a valid and enforceable leasehold interest in, all material tangible

personal property or assets owned, used or held for use by it. RTMAC's ownership

of or leasehold interest in any such personal property or assets is not subject

to any Liens, except for Permitted Liens. Except for normal wear and tear, and

except to the extent addressed in Section 2.25(a), the machinery, equipment,

fixtures and improvements of RTMAC necessary for and material to the continued

conduct of its business are in good operating condition and in a state of

reasonable maintenance and repair.

 

         Section 2.20    SUFFICIENCY OF ASSETS. The RTM Parties and their

Subsidiaries taken as a whole have, and upon completion of the RTM Transactions,

ARG shall have, directly or indirectly, ownership of or rights in all of the

assets necessary to

 

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                                       17

 

 

conduct the Arby's restaurant business of the RTM Parties and their Subsidiaries

in all material respects as currently conducted.

 

         Section 2.21    INSURANCE. RTMAC maintains (or has maintained on its

behalf), and has maintained (or has maintained on its behalf) without

interruption, policies or binders of insurance covering risks and events and in

amounts adequate for its business and operations and customary in the industry

in which it operates. There are no material claims by RTMAC pending under any of

such policies or bonds in excess of $100,000 as to which coverage has been

questioned, denied or disputed by the underwriters of such policies or bonds or

in respect of which such underwriters have reserved their rights.

 

         Section 2.22    INVENTORY. The Inventory of RTMAC consists of items

which are in all material respects of a quality and quantity usable and salable

in the ordinary course of business consistent with past practice.

 

         Section 2.23    ACCOUNTS RECEIVABLE. All Accounts Receivable of

RTMAC that are reflected on the Restated Combined RTM Financial Statements or on

the accounting records of RTMAC as of the Closing Date represent or will

represent valid obligations arising from sales actually made or services

actually performed by RTMAC in the ordinary course of business. There is no

contest, claim, defense or right of setoff, other than returns in the ordinary

course of business of RTMAC, under any Contract with any account debtor of a

material Account Receivable relating to a material portion or validity of such

Account Receivable, other than any of the foregoing asserted after the date

hereof and where the result, individually or in the aggregate, is not and would

not reasonably be expected to be material to RTMAC.

 

         Section 2.24    SUPPLIERS. No supplier or distributor that is

identified with an asterisk on Section 2.12(a) of the RTMAC Disclosure Letter

has reduced or otherwise discontinued or adversely modified the terms on which

such products or services are supplied, or threatened to reduce or discontinue

or adversely modify the terms in connection with supplying such items to RTMAC,

in a manner that is or would be material to RTMAC.

 

         Section 2.25    RTMAC RESTAURANTS.

 

         (a)     Section 2.25(a) of the RTMAC Disclosure Letter sets forth a

true and complete list of the Restaurants owned or operated by RTMAC (which

Section may be updated by the Sellers prior to the Closing Date to reflect any

additions or deletions thereto after the date hereof in compliance with Section

5.01) (the "RTMAC RESTAURANTS"). The stores, equipment, machinery, fixtures and

improvements owned by RTMAC or otherwise used by RTMAC in connection with the

operation of the RTMAC Restaurants are (as to physical plant and structure)

structurally sound, in good operating condition and repair, except for ordinary

wear and tear, and are adequate for the uses to which they are being put.

 

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                                       18

 

 

         (b)     To the Knowledge of the Sellers, RTMAC has not received

written notice that any of the buildings and structures or any appurtenances

thereto or equipment therein or the operation or maintenance thereof related to

the RTMAC Restaurants violates in any material respect any restrictive

covenants, any insurance requirements or any applicable federal, state or local

Law, ordinance or zoning regulation. To the Knowledge of the Sellers, none of

the property nor any buildings, structures or improvements thereon related to

the RTMAC Restaurants violate in any material respect any building, fire,

environmental or other Laws.

 

         (c)     No Governmental Entity has issued or threatened, in writing,

to issue any written notice or order that materially affects the use of the

property of an RTMAC Restaurant as presently utilized and RTMAC has not received

written notice from any other third party of any adverse claim that would

materially adversely affect the current operations of the RTMAC Restaurants.

There are no condemnation or eminent domain proceedings pending or, to the

Knowledge of the Sellers, threatened, against the property where any such RTMAC

Restaurant is located, and RTMAC has not received written notice of the intent

of any Governmental Entity to take or use the property or any part thereof.

 

         Section 2.26    TRANSACTIONS WITH AFFILIATES. Except for existing

employment agreements with RTMAC or existing RTMAC Employee Plans, RTMAC is not

a party to any Contract with any Affiliate of RTMAC (other than any other RTM

Party or any of their Subsidiaries or any of their Subsidiaries, except in the

case of RTMMC to the extent that such Contract is an Excluded Asset (as defined

in the RTMMC Purchase Agreement), any director, officer, member or employee of

RTMAC or, to the Knowledge of the Sellers, any Affiliates or Immediate Family

Members of any director, officer, member or employee of RTMAC. Section 2.26 of

the RTMAC Disclosure Letter also sets forth a true and complete list of all

outstanding loans or extensions of credit (other than travel advances made in

the ordinary course of business to directors, officers or employees) that RTMAC

has made directly or indirectly to any director, officer, member or employee of

RTMAC or any of their respective Affiliates or Immediate Family Members,

providing with respect to each such loan or extension of credit the outstanding

principal amount, the interest rate and final maturity date. Each Contract and

loan or extension of credit set forth or required to be set forth in Section

2.26 of the RTMAC Disclosure Letter is hereinafter referred to as a "RTMAC

RELATED PARTY ARRANGEMENT".

 

         Section 2.27    BROKERS AND FINDERS. No broker, finder or investment

banker other than TM Capital is entitled to any brokerage, finder's or other fee

or commission in connection with the RTM Transactions or the other transactions

contemplated by this Agreement or the Ancillary Agreements based upon

arrangements made by or on behalf of RTMAC or any of the Sellers. RTMAC has made

available to Triarc a correct and complete copy of all agreements between RTMAC

and TM Capital under which TM Capital would be entitled to any payment relating

to the RTM Transactions or such other transactions, which agreements shall not

be amended or otherwise modified after the date hereof without the prior written

consent of Triarc.

 

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                                       19

 

 

         Section 2.28    INVESTMENT COMPANY. RTMAC is not and is not controlled

by or affiliated with an "investment company" within the meaning of the

Investment Company Act of 1940, as amended.

 

 

                                  ARTICLE III

 

                  REPRESENTATIONS AND WARRANTIES OF THE SELLERS

 

         Except as otherwise set forth in the RTMAC Disclosure Letter, which

RTMAC Disclosure Letter is arranged in Sections corresponding to the Sections of

this Agreement, each Seller, severally and not jointly, represents and warrants

to Triarc and ARG that:

 

         Section 3.01    TITLE TO THE MEMBERSHIP INTERESTS. Such Seller owns

beneficially and of record, free and clear of any Lien, and has full power and

authority to convey free and clear of any Lien, the percentage of the Membership

Interests set forth opposite such Seller's name on SCHEDULE I hereto, and, upon

payment for such Membership Interests at the Closing as provided in Section

1.03, such Seller will convey to ARG good and valid title thereto, free and

clear of any Lien.

 

         Section 3.02    ORGANIZATION AND AUTHORITY OF SUCH SELLER;

ENFORCEABILITY. Such Seller has all requisite power and authority, and has taken

all action necessary in order to execute, deliver and perform its obligations

under this Agreement and each of the Ancillary Agreements to which it is a party

and to consummate the transactions contemplated by this Agreement and each such

Ancillary Agreement. This Agreement and each of the Ancillary Agreements to

which such Seller is a party have been duly executed and delivered by such

Seller and constitute the legal, valid and binding obligation of such Seller,

enforceable in accordance with their respective terms, subject to bankruptcy,

insolvency, fraudulent transfer, reorganization, moratorium and similar Laws of

general applicability relating to or affecting creditors' rights, and to general

equity principles.

 

         Section 3.03    GOVERNMENTAL AUTHORIZATIONS. The execution, delivery and

performance by such Seller of this Agreement and each of the Ancillary

Agreements to which it is a party do not, and the consummation by such Seller of

the transactions contemplated hereby and thereby will not, require any consent,

approval or other authorization of, or filing with or notification to, any

Governmental Entity, other than:

 

         (a)     the filing of the First Certificate of Merger with the Secretary

of State of the State of Georgia and the Second Certificate of Merger with the

Secretaries of State of the States of Delaware and Georgia;

 

         (b)     the filing with the SEC of any forms, reports, schedules,

statements and other documents that may be required under the Securities Act and

the Exchange Act in connection with this Agreement and the Registration Rights

Agreement and the transactions contemplated hereby and thereby; and

 

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                                       20

 

 

         (c)     the pre-merger notification required under the HSR Act.

 

          Section 3.04    NON-CONTRAVENTION. Except with respect to Contracts to

be satisfied in full or terminated in connection with the Debt Refinancings, the

execution, delivery and performance by such Seller of this Agreement and each of

the Ancillary Agreements to which it is a party do not, and the consummation by

such Seller of the transactions contemplated hereby and thereby will not (a)

contravene, conflict with, or result in any violation or breach of, the articles

of organization or operating agreement of RTMAC, (b) contravene or conflict

with, or result in any violation or breach of, in any material respect, any

Laws, Orders or Permits applicable to RTMAC or such Seller or by which any

assets of any of RTMAC or such Seller are bound, assuming that all consents,

approvals, authorizations, filings and notifications described in Section 2.05,

Section 3.03 and Section 4.03 have been obtained or made, (c) result in any

violation or breach of, or constitute a default (with or without notice or lapse

of time or both) under, (x) any RTMAC Material Contract or (y) any other

Contract to which RTMAC or such Seller is a party or by which any assets of

RTMAC or such Seller are bound, other than in the case of this clause (y) any

such violation, breach or default that would not reasonably be expected to be,

individually or in the aggregate, material to RTMAC or such Seller, (d) require

any consent, approval or other authorization of, or filing with or notification

to, any Person under (x) any RTMAC Material Contract or (y) any other Contract

to which RTMAC or such Seller is a party or by which any assets of RTMAC or such

Seller are bound, other than in the case of this clause (y) any such consent,

approval, authorization, filing or notification that, if not obtained or made,

would not reasonably be expected to be, individually or in the aggregate,

material to RTMAC or such Seller, (e) give rise to any termination,

cancellation, amendment, modification or acceleration of any rights or

obligations under (x) any RTMAC Material Contract or (y) any other Contract to

which RTMAC or such Seller is a party or by which any assets of RTMAC or such

Seller are bound, other than in the case of this clause (y) any such

termination, cancellation, amendment, modification or acceleration that would

not reasonably be expected to be, individually or in the aggregate, material to

RTMAC or such Seller, or (f) cause the creation or imposition of any Liens

(other than Permitted Liens) on any material assets of RTMAC or such Seller.

 

 

                                    ARTICLE IV

 

                REPRESENTATIONS AND WARRANTIES OF TRIARC AND ARG

 

         Triarc and ARG jointly and severally represent and warrant to the

Sellers as follows:

 

         Section 4.01    ORGANIZATION AND QUALIFICATION OF TRIARC AND ARG. Each

of Triarc and ARG is a corporation duly organized, validly existing and in good

standing under the laws of its jurisdiction of incorporation, and has the

corporate power and authority to own or lease its assets and to carry on its

business substantially as it is being conducted on the date hereof. Each of

Triarc and ARG is duly qualified and licensed to do business and is in good

standing in each jurisdiction where the ownership or operation

 

<PAGE>

                                       21

 

 

of its property and assets or the conduct of its business requires such

qualification, except where the failure to be so qualified or in good standing

has not had and would not reasonably be expected to have, individually or in the

aggregate, a Triarc Material Adverse Effect. Triarc has made available to the

RTM Representatives correct and complete copies of the certificate of

incorporation and bylaws of Triarc and ARG (as amended to the date hereof).

 

         Section 4.02    AUTHORIZATION OF TRIARC AND ARG; ENFORCEABILITY. Each of

Triarc and ARG has all requisite corporate power and authority, and has taken

all corporate action necessary in order to execute, deliver and perform its

obligations under this Agreement and each of the Ancillary Agreements to which

it is a party and to consummate the transactions contemplated by this Agreement

and each such Ancillary Agreement. This Agreement and each of the Ancillary

Agreements to which it is a party have been duly executed and delivered by each

of Triarc and ARG and constitute the legal, valid and binding obligation of each

of Triarc and ARG, enforceable in accordance with their respective terms,

subject to bankruptcy, insolvency, fraudulent transfer, reorganization,

moratorium and similar Laws of general applicability relating to or affecting

creditors' rights, and to general equity principles.

 

         Section 4.03    GOVERNMENTAL AUTHORIZATIONS. The execution, delivery and

performance by each of Triarc and ARG of this Agreement and each of the

Ancillary Agreements to which it is a party do not, and the consummation by each

of Triarc and ARG of the transactions contemplated hereby and thereby will not,

require any consent, approval or other authorization of, or filing with or

notification to, any Governmental Entity, other than:

 

         (a)     the filing of the First Certificate of Merger with the Secretary

of State of the State of Georgia and the Second Certificate of Merger with the

Secretaries of State of the States of Delaware and Georgia;

 

         (b)     the filing with the SEC of any forms, reports, schedules,

statements and other documents that may be required under the Securities Act and

the Exchange Act in connection with this Agreement and the Registration Rights

Agreement and the transactions contemplated hereby and thereby; and

 

         (c)     the pre-merger notification required under the HSR Act.

 

         Section 4.04    NON-CONTRAVENTION. Except with respect to Contracts to

be satisfied in full or terminated in connection with the Debt Refinancings and

except as set forth in Section 4.05 of the Triarc Disclosure Letter, the

execution, delivery and performance by each of Triarc and ARG of this Agreement

and each of the Ancillary Agreements to which it is a party do not, and the

consummation by each of Triarc and ARG of the transactions contemplated hereby

and thereby will not (a) contravene, conflict with, or result in any violation

or breach of, the certificate of incorporation or by-laws (or comparable

organizational instruments) of any of Triarc and ARG, (b) contravene or conflict

with, or result in any violation or breach of, in any material respect, any

Laws, Orders or Permits applicable to Triarc or any of its Subsidiaries or by

 

<PAGE>

                                       22

 

 

which any assets of Triarc and its Subsidiaries are bound, assuming that all

consents, approvals, authorizations, filings and notifications described in

Section 2.05, Section 3.03 and Section 4.03 have been obtained or made, (c)

result in any violation or breach of, or constitute a default (with or without

notice or lapse of time or both) under, (x) any Contract filed with the Triarc

SEC Reports or (y) any other Contract to which Triarc or any of its Subsidiaries

is a party or by which any assets of Triarc or any of its Subsidiaries is bound,

other than in the case of this clause (y) any such violation, breach or default

that would not reasonably be expected to have, individually or in the aggregate,

a Triarc Material Adverse Effect, (d) require any consent, approval or other

authorization of, or filing with or notification to, any Person under, (x) any

Contract filed with the Triarc SEC Reports or (y) any other Contract to which

Triarc or any of its Subsidiaries is a party or by which any assets of Triarc or

any of its Subsidiaries is bound, other than in the case of this clause (y) any

such consent, approval, authorization, filing or notification that, if not

obtained or made, would not reasonably be expected to have, individually or in

the aggregate, a Triarc Material Adverse Effect, (e) give rise to any

termination, cancellation, amendment, modification or acceleration of any rights

or obligations under, (x) any Contract filed with the Triarc SEC Reports or (y)

any other Contract to which Triarc or any of its Subsidiaries is a party or by

which any assets of Triarc or any of its Subsidiaries is bound, other than in

the case of this clause (y) any such termination, cancellation, amendment,

modification or acceleration that would not reasonably be expected to have,

individually or in the aggregate, a Triarc Material Adverse Effect, or (f) cause

the creation or imposition of any Liens (other than Permitted Liens) on any

material assets of any of Triarc or any of its Subsidiaries.

 

         Section 4.05    BROKERS AND FINDERS. No broker, finder or investment

banker other than as set forth on Section 3.29 of the Triarc Disclosure Letter

is entitled to any brokerage, finder's or other fee or commission in connection

with the RTM Transactions or the other transactions contemplated by this

Agreement or the Ancillary Agreements based upon arrangements made by or on

behalf of Triarc or any of its Subsidiaries. Triarc has made available to the

RTM Representatives a correct and complete copy of all agreements between Triarc

and those Persons set forth on Section 3.29 of the Triarc Disclosure Letter

under which such Persons would be entitled to any payment relating to the RTM

Transactions or such other transactions, which agreements shall not have been

amended or otherwise modified after the date hereof without the prior written

consent of the RTM Representatives.

 

         Section 4.06    PURCHASE FOR INVESTMENT. ARG is purchasing the

Membership Interests for its own account for investment and not for resale or

distribution in any transaction that would be in violation of the securities

laws of the United States of America or any state thereof.

 

 

 

<PAGE>

                                       23

 

 

                                   ARTICLE V

 

                          INTERIM OPERATIONS COVENANTS

 

         Section 5.01    CONDUCT OF BUSINESS OF RTMAC. During the period from

the date hereof until the Closing, except as required by Law or a Governmental

Entity or as otherwise contemplated by this Agreement or the Ancillary

Agreements or taken in connection with complying with the terms of this

Agreement or the Ancillary Agreements, the Sellers shall cause RTMAC to (x)

conduct its operations only in the ordinary course of business consistent with

past practice and with no less diligence and effort than would be applied in the

absence of this Agreement and (y) use its commercially reasonable efforts to

maintain and preserve intact its business organization, to retain the services

of its current officers and key employees, and to preserve the good will of its

customers, suppliers and other Persons with whom it has business relationships.

Without limiting the generality of the foregoing, and except as otherwise

contemplated by this Agreement or the Ancillary Agreements or as set forth in

Section 5.01 of the RTMAC Disclosure Letter, (i) the Sellers shall not permit

RTMAC to, without the prior written consent of Triarc (not to be unreasonably

withheld, conditioned or delayed), and (ii) with respect to Section 5.01(p), the

Sellers shall cause RTMAC to take the actions set forth in Section 5.01(p):

 

         (a)     ORGANIZATION DOCUMENTS. Amend its articles of organization

or operating agreement;

 

         (b)     DIVIDENDS. Make, declare or pay any dividend or distribution on

its membership interests or similar equity interests, other than (i)

distributions to members in an amount equal to their aggregate liability for

income Taxes based on the operations of RTMAC, as reasonably determined by

RTMAC, (ii) cash dividends or distributions in an amount that the RTM

Representatives have demonstrated to the reasonable satisfaction of Triarc

(based upon reasonably detailed information provided by the RTM Representatives

to Triarc), after taking into account any distributions described in clause (i)

that have been made or are expected to be made prior to the Closing, would not

reasonably be expected to result in the Net Liabilities of the RTM Parties and

their Subsidiaries being more than the RTM Benchmark as of the Closing Date and

(iii) dividends or distributions of proceeds from Excluded Asset Dispositions;

 

         (c)     EQUITY INTERESTS. (i) Adjust, split, combine or reclassify its

membership interests or similar equity interests, (ii) redeem, purchase or

otherwise acquire, directly or indirectly, any membership interests or similar

equity interests or any securities convertible or exchangeable into or

exercisable for any membership interests or similar equity interests, (iii)

grant any Person any right or option to acquire any of its membership interests

or similar equity interests, (iv) issue, deliver or sell any additional

membership interests or similar equity interests or any securities convertible

or exchangeable into or exercisable for any membership interests or similar

equity interests or such securities or (v) enter into any Contract,

understanding or arrangement with respect to the sale, voting, registration or

repurchase of its membership interests or similar equity interests;

 

<PAGE>

                                       24

 

 

         (d)     COMPENSATION AND BENEFITS. (i) Increase the compensation or

benefits payable or to become payable to any of its directors, officers or

employees, (ii) pay any compensation or benefits not required by any existing

plan or arrangement (including the granting of stock options, stock appreciation

rights, shares of restricted stock or performance units) to its directors,

officers or employees, (iii) grant any severance or termination pay to any of

its directors, officers or employees (except pursuant to existing agreements,

plans or policies), (iv) enter into any new employment or severance agreement

with any of its directors, officers or employees or (v) establish, adopt, enter

into, amend or take any action to accelerate rights under any RTMAC Employee

Plans, except in each case (A) for increases in salary, wages and benefits of

officers or employees consistent with past practice, or (B) in conjunction with

new hires, promotions or other changes in job status consistent with past

practice;

 

         (e)     ACQUISITIONS. Acquire, by merger, consolidation, acquisition of

equity interests or assets, or otherwise, any business or any corporation,

partnership, limited liability company, joint venture or other business

organization or division thereof;

 

         (f)     DISPOSITIONS. Sell, close, lease, license, transfer, pledge,

encumber, grant or dispose of any of its properties or assets, including RTMAC

Restaurants, other than (i) the sale of Inventory or (ii) the disposition of

used or excess equipment or machinery, in each case in the ordinary course of

business consistent with past practice;

 

         (g)     CONTRACTS. (i) Enter into any Contract that, had it been entered

into on or prior to the date hereof, would have constituted an RTMAC Material

Contract, other than in the ordinary course of business consistent with past

practice or (ii) terminate, cancel or request any material change in any RTMAC

Material Contract or any Contract entered into pursuant to clause (i) above,

other than in the ordinary course of business consistent with past practice;

 

         (h)     INDEBTEDNESS; GUARANTEES. (i) Incur, assume or prepay any

Indebtedness, other than (x) in the ordinary course of business consistent with

past practice under existing lines of credit to be used for working capital

purposes or with Triarc's consent to acquire, remodel, furnish or build new

Restaurants or to remodel RTMAC Restaurants or (y) any Indebtedness incurred

either on terms reasonably acceptable to Triarc the proceeds of which will be

used solely to make scheduled amortization payments of principal or scheduled

payments of interest on Indebtedness existing as of the date hereof or as set

forth in Section 5.01(h) of the RTMAC Disclosure Letter, or (ii) assume,

guarantee, endorse or otherwise become liable or responsible for the obligations

of any other Person, other than (x) guarantees in favor of the RTM Parties or

any of their wholly owned Subsidiaries in the ordinary course of business or (y)

endorsement of negotiable instruments in the ordinary course of business

consistent with past practice;

 

         (i)     LOANS. (i) Make any loans, advances or capital contributions to,

or investments in, any other Person, other than in the ordinary course of

business consistent

 

<PAGE>

                                        25

 

 

with past practice, or (ii) make any loans to its directors or officers, other

than travel and similar advances in the ordinary course of business consistent

with past practice;

 

         (j)     CAPITAL EXPENDITURES. Fail to make any capital expenditure,

including maintenance capital expenditures and capital expenditures for

remodeling of Restaurants, in accordance with the ordinary course of business

consistent with past practice;

 

         (k)     ACCOUNTING. Change its accounting policies or procedures, other

than as required by GAAP;

 

         (l)     LEGAL ACTIONS. Subject to Section 5.01(p), waive, release,

assign, settle or compromise any Legal Actions required to be disclosed pursuant

to Section 2.11, other than any such waiver, release, assignment, settlement or

compromise entered into in the ordinary course of business consistent with past

practice that (i) does not involve payment by RTMAC of more than $100,000 in any

one instance or multiple instances involving the same or related conduct, facts,

circumstances or events and (ii) does not require RTMAC to be bound by any

material restriction (other than customary confidentiality restrictions);

 

         (m)     INTELLECTUAL PROPERTY. Take any action or omit to take any

action that causes any material RTMAC Intellectual Property Rights to become

invalidated, abandoned or dedicated to the public domain;

 

         (n)     RTMAC REAL PROPERTY. (i) Enter into any RTMAC Real Property

Lease or acquire any real property, except in connection with acquisitions of

RTMAC Restaurants described in Section 5.01(e) of the RTMAC Disclosure Letter,

(ii) enter into any lease, sublease, license, concession or other Contract

granting to any Person or Persons the right to use or occupancy to any portion

of the parcel of any RTMAC Real Property, (iii) enter into any Contract relating

to the sale of any RTMAC Real Property, other than dispositions of RTMAC

Restaurants described in Section 5.01(f) of the RTMAC Disclosure Letter or (iv)

terminate, cancel or request any material change in any of the foregoing in

clauses (i), (ii) and (iii) above, other than in the case of this clause (iv) in

the ordinary course of business consistent with past practice; or

 

         (o)     RELATED ACTIONS. Authorize, commit or agree to do any of the

foregoing; and

 

         (p)     TAXES. (i) Prepare, in the ordinary course of business and

consistent with past practice (except as otherwise required by a change in

applicable law or a good faith resolution of a contest), and timely file all

material Tax Returns required to be filed by it on or before the Closing Date

("RTM POST-SIGNING RETURNS"); (ii) consult with Triarc with respect to all RTM

Post-Signing Returns other than income Tax Returns and deliver drafts of such

RTM Post-Signing Returns to Triarc no later than ten Business Days prior to the

date (including extensions) on which such RTM Post-Signing Returns are required

to be filed; (iii) fully and timely pay all Taxes due and payable in respect of

such RTM Post-Signing Returns that are so filed; (iv) properly reserve (and

reflect such

 

<PAGE>

                                       26

 

 

reserve in its books and records and financial statements), in accordance with

past practice and in the ordinary course of business, for all Taxes payable by

it for which no RTM Post-Signing Return is due prior to the Closing Date; and

(v) promptly notify Triarc of any suit, claim, action, investigation, proceeding

or audit with respect to income Taxes or any other material Tax (collectively,

"TAX