8-K
false 0001804745 0001804745 2021-09-29 2021-09-29

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): September 29, 2021

 

 

DRIVEN BRANDS HOLDINGS INC.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   001-39898   47-3595252

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(I.R.S. Employer

Identification No.)

440 South Church Street, Suite 700

Charlotte, North Carolina 28202

(Address of principal executive offices) (Zip Code)

(704) 377-8855

(Registrant’s telephone number, including area code)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions (see General Instruction A.2. below):

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading

Symbol

 

Name of each exchange

on which registered

Common Stock, $0.01 par value   DRVN   The Nasdaq Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 


Item 1.01 Entry into a Material Definitive Agreement

2021-1 Senior Notes

On September 29, 2021, Driven Brands Funding, LLC and Driven Brands Canada Funding Corporation (wholly-owned subsidiaries of Driven Brands Holdings Inc. (the “Company”)) (together, the “Co-Issuers”), issued $450 million Series 2021-1 Fixed Rate Senior Notes, Class A-2 (the “2021-1 Senior Notes”). The 2021-1 Senior Notes bear interest at a rate of 2.791%, have an anticipated repayment date of October 20, 2028 and a legal maturity date of October 20, 2051. The 2021-1 Senior Notes are secured by substantially all assets of the Co-Issuers and are guaranteed by the Securitization Entities (as defined in the Base Indenture). The 2021-1 Senior Notes were issued pursuant to the Base Indenture (as defined below) and a series supplement to the Base Indenture dated as of September 29, 2021 (the “Series 2021-1 Supplement”).

The foregoing description of the Series 2021-1 Supplement is qualified in its entirety by reference to the full text of the Series 2021-1 Supplement, which is incorporated herein by reference to Exhibit 4.1 to this Current Report on Form 8-K.

Amendment No. 8 to the Amended and Restated Base Indenture

On September 29, 2021, the Co-Issuers entered into the Amendment No. 8 (“Amendment No. 8 to Base Indenture”) to the Amended and Restated Base Indenture, dated as of April 24, 2018 (as amended by Amendment No. 1 to the Base Indenture, dated as of March 19, 2019, Amendment No. 2 to the Base Indenture, dated as of June 15, 2019, Amendment No. 3 to the Base Indenture, dated as of September 17, 2019, Amendment No. 4 to the Base Indenture, dated as of July 6, 2020, Amendment No. 5 to the Base Indenture, dated as of December 14, 2020, Amendment No. 6 to the Base Indenture, dated as of March 30, 2021, and Amendment No. 7 to the Base Indenture, dated as of March 30, 2021, is herein called the “Base Indenture”), among the Co-Issuers and Citibank, N.A., as trustee and securities intermediary.

Amendment No. 8 to Base Indenture amended the Base Indenture by (i) replacing the definitions of “Adjusted EBITDA” and “Run Rate Adjusted EBITDA” in their entirety with the definition of “Parent Adjusted EBITDA” and amending or replacing certain related definitions and related provisions to conform to the definition of “EBITDA” in the Credit Agreement, dated as of May 27, 2021, by and among Driven Holdings, LLC (“Parent”), as borrower, the lenders and issuing banks party thereto and JPMorgan Chase Bank, N.A., as administrative agent (the “Parent Credit Agreement”), (ii) amending the “Driven Brands Leverage Ratio” and related provisions to test at the level of Parent and its consolidated subsidiaries and to expressly provide that each Manager, in accordance with the applicable Managing Standard, may further amend the definition of “Driven Brands Leverage Ratio” with the consent of the Control Party, including, without limitation, in connection with any change of control, (iii) removing the ability of the Trustee to make distributions on Definitive Notes by check, so that all distributions on all Series of Notes will be made by wire transfer, and (iv) making other amendments consistent with and in furtherance of the foregoing, including to the definitions of “Driven Brands Entity,” “Non-Securitization Entities” and “Parent”.

The foregoing description of Amendment No. 8 to Base Indenture is qualified in its entirety by reference to the full text of Amendment No. 8 to Base Indenture, which is incorporated herein by reference to Exhibit 4.2 to this Current Report on Form 8-K.

Amendment No. 4 to the Amended and Restated Management Agreement

On September 29, 2021, Driven Brands Funding, LLC, Driven Funding Holdco, LLC, certain subsidiaries of Driven Brands Funding, LLC party thereto, Take 5 LLC, Take 5 Oil Change, LLC, Driven Brands, Inc., as manager, and Citibank, N.A., as trustee, entered into the Amendment No. 4 (“Amendment No. 4 to U.S. Management Agreement”) to the Amended and Restated Management Agreement, dated as of April 24, 2018 (as amended by the Amendment and Joinder to Management Agreement, dated as of October 4, 2019, the Amendment and Joinder to the Amended and Restated Management Agreement, dated as of July 6, 2020, and the Amendment No. 3 to the Amended and Restated Management Agreement, dated as of March 30, 2021, the “U.S. Management Agreement”), among Driven Brands Funding, LLC, Driven Funding Holdco, LLC, certain subsidiaries of Driven Brands Funding, LLC party thereto, Take 5 LLC, Take 5 Oil Change, LLC, certain Sub-managers party thereto, Driven Brands, Inc., as manager, and Citibank, N.A., as trustee.


Amendment No. 4 to U.S. Management Agreement amended the U.S. Management Agreement by (i) amending the Driven Brands Specified Non-Securitization Debt Cap to test adjusted debt for borrowed money of Parent and its consolidated subsidiaries, (ii) making other amendments consistent with and in furtherance of the amendments made in Amendment No. 8 to Base Indenture, and (iii) making certain other technical amendments.

The foregoing description of Amendment No. 4 to U.S. Management Agreement is qualified in its entirety by reference to the full text of Amendment No. 4 to U.S. Management Agreement, which is incorporated herein by reference to Exhibit 10.1 to this Current Report on Form 8-K.

Amendment No. 2 to the Canadian Management Agreement

On September 29, 2021, Driven Brands Canada Funding Corporation, Driven Canada Funding HoldCo Corporation, certain subsidiaries of Driven Brands Canada Funding Corporation party thereto, Driven Brands Canada Shared Services Inc., as manager, and Citibank, N.A., as trustee, entered into the Amendment No. 2 (“Amendment No. 2 to Canadian Management Agreement”) to the Canadian Management Agreement, dated as of July 6, 2020 (as amended by Amendment No. 1 to Canadian Management Agreement dated as of March 30, 2021, the “Canadian Management Agreement”), among Driven Brands Canada Funding Corporation, Driven Canada Funding HoldCo Corporation, certain subsidiaries of Driven Brands Canada Funding Corporation party thereto, Driven Brands Canada Shared Services Inc., as manager, and Citibank, N.A., as trustee.

Amendment No. 2 to Canadian Management Agreement amended the Canadian Management Agreement by including the changes described above regarding Amendment No. 4 to the U.S. Management Agreement to conform the Canadian Management Agreement to the U.S. Management Agreement, as amended by Amendment No. 4 to U.S. Management Agreement.

The foregoing description of Amendment No. 2 to Canadian Management Agreement is qualified in its entirety by reference to the full text of Amendment No. 2 to Canadian Management Agreement, which is incorporated herein by reference to Exhibit 10.2 to this Current Report on Form 8-K.

Item 2.03 Creation of a Direct Financial Obligations or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

The information contained under Item 1.01 above is hereby incorporated by reference into this Item 2.03.

Item 7.01 Regulation FD Disclosure

On September 29, 2021, the Company issued a press release describing certain of the matters in Item 1.01 of this Current Report on Form 8-K. A copy of the press release is furnished as Exhibit 99.1 to this report and incorporated by reference herein.

The information provided pursuant to this Item 7.01 is “furnished” and shall not be deemed to be “filed” with the SEC or incorporated by reference in any filing under the Securities Exchange Act of 1934, as amended, or the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in any such filings. The filing of this Item 7.01 of this Current Report on Form 8-K (including the exhibit hereto or any information included herein or therein) shall not be deemed an admission as to the materiality of any information herein that is required to be disclosed solely by reason of Regulation FD.


Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

 

Exhibit
No.
  

Description

4.1    Series 2021-1 Supplement, dated as of September 29, 2021, by and among Driven Brands Funding, LLC, as issuer, Driven Brands Canada Funding Corporation, as Canadian co-issuer, and Citibank, N.A., as trustee and Series 2021-1 securities intermediary.
4.2    Amendment No.8 to the Amended and Restated Base Indenture, dated as of September 29, 2021, among Driven Brands Funding, LLC, as issuer, Driven Brands Canada Funding Corporation, as Canadian co-issuer, and Citibank, N.A., as trustee.
10.1†    Amendment No. 4 to the Amended and Restated Management Agreement and Consent to Amendment No. 2 to Canadian Management Agreement, dated as of September 29, 2021, among Driven Brands Funding, LLC, Driven Funding Holdco, LLC, certain subsidiaries of Driven Brands Funding, LLC party thereto, Take 5 LLC, Take 5 Oil Change, LLC, Driven Brands, Inc., as manager, and Citibank, N.A., as trustee.
10.2†    Amendment No. 2 to Canadian Management Agreement, dated as of September 29, 2021, among Driven Brands Canada Funding Corporation, Driven Canada Funding HoldCo Corporation, certain subsidiaries of Driven Brands Canada Funding Corporation party thereto, Driven Brands Canada Shared Services Inc., as manager, and Citibank, N.A., as trustee.
99.1    Driven Brands Holdings Inc. Press Release dated September 29, 2021
104    Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document

 

Indicates management contract or compensatory plan.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: September 29, 2021

 

DRIVEN BRANDS HOLDINGS INC.
By:  

/s/ Scott O’Melia

Name:   Scott O’Melia
Title:  

Executive Vice President, General

Counsel and Secretary

EX-4.1

Exhibit 4.1

 

 

DRIVEN BRANDS FUNDING, LLC and

DRIVEN BRANDS CANADA FUNDING CORPORATION,

as Co-Issuers

and

CITIBANK, N.A.,

as Trustee and Series 2021-1 Securities Intermediary

SERIES 2021-1 SUPPLEMENT

Dated as of September 29, 2021

to

AMENDED AND RESTATED BASE INDENTURE

Dated as of April 24, 2018

(as amended through and including the Series 2021-1 Closing Date)

 

 

$450,000,000 Series 2021-1 2.791% Fixed Rate Senior Secured Notes, Class A-2

 


Table of Contents

 

     Page  

PRELIMINARY STATEMENT

     1  

DESIGNATION

     1  

ARTICLE I DEFINITIONS

     1  

ARTICLE II [Reserved]

     2  

ARTICLE III SERIES 2021-1 ALLOCATIONS; PAYMENTS

     2  

Section 3.1

  Allocations with Respect to the Series 2021-1 Class A-2 Notes      2  

Section 3.2

 

Application of Weekly Collections on Weekly Allocation Dates to the Series 2021-1 Class A-2 Notes; Quarterly Payment Date Applications

     2  

Section 3.3

  Certain Distributions from Series 2021-1 Class A-2 Distribution Account      3  

Section 3.4

  [Reserved]      4  

Section 3.5

  Series 2021-1 Class A-2 Interest      4  

Section 3.6

  Payment of Series 2021-1 Class A-2 Note Principal      5  

Section 3.7

  [Reserved]      9  

Section 3.8

  Series 2021-1 Class A-2 Distribution Account      9  

Section 3.9

  Trustee as Securities Intermediary      10  

Section 3.10

  Managers      11  

Section 3.11

  Replacement of Ineligible Accounts      11  

ARTICLE IV FORM OF SERIES 2021-1 CLASS A-2 NOTES

     12  

Section 4.1

  [Reserved]      12  

Section 4.2

  Issuance of Series 2021-1 Class A-2 Notes      12  

Section 4.3

  [Reserved]      13  

Section 4.4

       13  

Section 4.4

  Transfer Restrictions of Series 2021-1 Class A-2 Notes      13  

Section 4.5

  Note Owner Representations and Warranties      19  

Section 4.6

  Limitation on Liability      20  

ARTICLE V GENERAL

     21  

Section 5.1

  Information      21  

Section 5.2

  Exhibits      22  

Section 5.3

  Ratification of Base Indenture      22  

 

i


Section 5.4

  Requirements for Notices to the Rating Agencies      22  

Section 5.5

  Certain Notices to the Rating Agencies      22  

Section 5.6

  Prior Notice by Trustee to the Controlling Class Representative and Control Party      22  

Section 5.7

  Counterparts      23  

Section 5.8

  Electronic Signatures and Transmission      23  

Section 5.9

  Governing Law      23  

Section 5.10

  Amendments      23  

Section 5.11

  Termination of Series Supplement      23  

Section 5.12

  Entire Agreement      24  

 

ANNEXES   
Annex A    Series 2021-1 Supplemental Definitions List
EXHIBITS   
Exhibit A-1-1    Form of Rule 144A Global Series 2021-1 Class A-2 Note
Exhibit A-1-2    Form of Temporary Regulation S Global Series 2021-1 Class A-2 Note
Exhibit A-1-3    Form of Permanent Regulation S Global Series 2021-1 Class A-2 Note
Exhibit B-1    Form of Transferee Certificate – Series 2021-1 Class A-2 Notes, Rule 144A to Temporary Regulation S
Exhibit B-2    Form of Transferee Certificate – Series 2021-1 Class A-2 Notes, Rule 144A to Permanent Regulation S
Exhibit B-3    Form of Transferee Certificate – Series 2021-1 Class A-2 Notes, Regulation S to Rule 144A

 

ii


Exhibit 4.1

SERIES 2021-1 SUPPLEMENT, dated as of September 29, 2021 (this “Series 2021-1 Supplement” or this “Series Supplement”), by and among DRIVEN BRANDS FUNDING, LLC, a Delaware limited liability company (the “Issuer”), DRIVEN BRANDS CANADA FUNDING CORPORATION, a Canadian corporation (the “Canadian Co-Issuer” and, together with the Issuer, the “Co-Issuers”), and CITIBANK, N.A., a national banking association, as trustee (in such capacity, the “Trustee”) and as Series 2021-1 Securities Intermediary, to the Amended and Restated Base Indenture, dated as of April 24, 2018, by and between the Co-Issuers and Citibank, N.A., as Trustee and as Securities Intermediary (as amended by the Amendment No. 1 thereto, dated as of March 19, 2019, the Amendment No. 2 thereto, dated as of June 15, 2019, the Amendment No. 3 thereto, dated as of September 17, 2019, the Amendment No. 4 thereto, dated as of July 6, 2020, the Amendment No. 5 thereto, dated as December 14, 2020, the Amendment No. 6 thereto, dated as of March 30, 2021, the Amendment No. 7 thereto, dated as of March 30, 2021 and the Amendment No. 8 thereto, dated as of the date hereof, and as the same may be further amended, amended and restated, modified or supplemented from time to time, exclusive of Series Supplements, the “Base Indenture”).

PRELIMINARY STATEMENT

WHEREAS, Sections 2.2 and 13.1 of the Base Indenture provide, among other things, that the Co-Issuers and the Trustee may at any time and from time to time enter into a Series Supplement to the Base Indenture for the purpose of authorizing the issuance of one or more Series of Notes upon satisfaction of the conditions set forth therein; and

WHEREAS, all such conditions have been met for the issuance of the Series of Notes authorized hereunder.

NOW, THEREFORE, the parties hereto agree as follows:

DESIGNATION

There is hereby created a Series of Notes to be issued as one (1) Class of Notes pursuant to the Base Indenture and this Series Supplement, and such Series and Class of Notes shall be designated as the Series 2021-1 2.791% Fixed Rate Senior Secured Notes, Class A-2 (as referred to herein, the “Series 2021-1 Class A-2 Notes” or the “Series 2021-1 Notes”). For purposes of the Indenture, the Series 2021-1 Class A-2 Notes shall be deemed to be “Senior Notes”. The Series 2021-1 Class A-2 Notes shall be issued on the Series 2021-1 Closing Date.

ARTICLE I

DEFINITIONS

All capitalized terms used herein (including in the preamble and the recitals hereto) and not otherwise defined herein shall have the meanings assigned to such terms in the Series 2021-1 Supplemental Definitions List attached hereto as Annex A (the “Series 2021-1 Supplemental Definitions List”) as such Series 2021-1 Supplemental Definitions List may be amended, amended and restated, supplemented or otherwise modified from time to time in accordance with the terms hereof, which Series 2021-1 Supplemental Definitions List is made a part of this Series Supplement together with the Exhibits to this Series Supplement. All capitalized terms not otherwise defined therein shall have the meanings assigned thereto in the Base Indenture or the Base Indenture Definitions List attached to the Base Indenture as Annex A thereto, as such Base Indenture or Base Indenture Definitions List may be amended, amended and restated, supplemented or otherwise modified from time to time in accordance with the terms of the Base Indenture. Unless otherwise specified herein, all Article, Exhibit, Section or Subsection references herein shall refer to Articles, Exhibits, Sections or Subsections of the Base Indenture or this


Series Supplement (as indicated herein). Unless otherwise stated herein, as the context otherwise requires or if such term is otherwise defined in the Base Indenture, each capitalized term used or defined herein shall relate only to the Series 2021-1 Class A-2 Notes and not to any other Series of Notes issued by the Co-Issuers.

ARTICLE II

[RESERVED]

ARTICLE III

SERIES 2021-1 ALLOCATIONS; PAYMENTS

With respect to the Series 2021-1 Class A-2 Notes only, the following shall apply:

Section 3.1    Allocations with Respect to the Series 2021-1 Class A-2 Notes. On or after the Series 2021-1 Closing Date, the Co-Issuers shall arrange an amendment to the Interest Reserve Letter of Credit issued under the Series 2019-3 Class A-1 Note Purchase Agreement on the Series 2019-3 Closing Date increasing the stated amount thereunder. Such Interest Reserve Letter of Credit shall satisfy the Co-Issuers’ requirement to maintain (i) funds in the Senior Notes Interest Reserve Accounts, or (ii) a letter of credit, or a combination thereof, in an aggregate amount equal to the Senior Notes Interest Reserve Amount, as calculated after giving effect to the issuance of the Series 2021-1 Class A-2 Notes. Such amended Interest Reserve Letter of Credit shall replace any pre-existing deposits or Interest Reserve Letters of Credit in respect of required interest reserve amounts for the Series 2018-1 Notes, the Series 2019-1 Notes, the Series 2019-2 Notes, the Series 2019-3 Notes, the Series 2020-1 Notes and the Series 2020-2 Notes.

Section 3.2    Application of Weekly Collections on Weekly Allocation Dates to the Series 2021-1 Class A-2 Notes; Quarterly Payment Date Applications. On each Weekly Allocation Date, the Co-Issuers (or the Managers on their behalf) shall instruct the Trustee in writing to allocate from the Collection Accounts all amounts relating to the Series 2021-1 Class A-2 Notes pursuant to, and to the extent that funds are available therefor in accordance with the provisions of, the Priority of Payments, including the following:

(a)    Series 2021-1 Senior Notes Accrued Quarterly Interest Amounts. On each Weekly Allocation Date, the Co-Issuers (or the Managers on their behalf) shall instruct the Trustee in writing to allocate from the Collection Accounts the Series 2021-1 Quarterly Interest pursuant to, and to the extent that funds are available therefor in accordance with the provisions of, the Priority of Payments.

(b)    [Reserved].

(c)    [Reserved].

(d)    [Reserved].

(e)    Series 2021-1 Senior Notes Rapid Amortization Principal Amounts. If any Weekly Allocation Date occurs during a Rapid Amortization Period, the Co-Issuers (or the Managers on their behalf) shall instruct the Trustee in writing to allocate from the Collection Accounts for payment of principal on the Series 2021-1 Class A-2 Notes the amounts contemplated by the Priority of Payments for such principal.

 

2


(f)    Series 2021-1 Class A-2 Notes Scheduled Principal Payments Amounts. On each Weekly Allocation Date, only to the extent that the Series 2021-1 Non-Amortization Test is not satisfied and the previous Quarterly Payment Date is prior to the Series 2021-1 Anticipated Repayment Date, the Co-Issuers (or the Managers on their behalf) shall instruct the Trustee in writing to allocate from the Collection Accounts the Series 2021-1 Class A-2 Notes Scheduled Principal Payments Amounts pursuant to, and to the extent that funds are available therefor in accordance with the provisions of, the Priority of Payments; provided, that there will be no allocation from the Collection Accounts of Series 2021-1 Class A-2 Notes Scheduled Principal Payments Amounts for the Quarterly Payment Date occurring in October 2021. No Series 2021-1 Class A-2 Notes Scheduled Principal Payments Amounts will be made on the Quarterly Payment Date occurring in October 2021.

(g)    Series 2021-1 Class A-2 Notes Scheduled Principal Payment Deficiencies. On each Weekly Allocation Date, the Co-Issuers (or the Managers on their behalf) shall instruct the Trustee in writing to allocate from the Collection Accounts any portion of the Senior Notes Scheduled Principal Payments Deficiency Amounts attributable to the Series 2021-1 Class A-2 Notes pursuant to, and to the extent that funds are available therefor in accordance with the provisions of, the Priority of Payments.

(h)    [Reserved].

(i)    [Reserved].

(j)    [Reserved].

(k)    Series 2021-1 Senior Notes Accrued Quarterly Post-ARD Additional Interest Amount. On each Weekly Allocation Date, the Co-Issuers (or the Managers on their behalf) shall instruct the Trustee in writing to allocate from the Collection Accounts the Series 2021-1 Quarterly Post-ARD Additional Interest deemed to be the “Senior Notes Accrued Quarterly Post-ARD Additional Interest Amount” pursuant to, and to the extent that funds are available therefor in accordance with the provisions of, the Priority of Payments.

(l)    Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration. On each Weekly Allocation Date, the Co-Issuers (or the Managers on their behalf) shall instruct the Trustee in writing to allocate from the Collection Accounts the Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration deemed to be “unpaid premiums and make-whole prepayment consideration” pursuant to, and to the extent that funds are available therefor in accordance with the provisions of, the Priority of Payments.

(m)    Application Instructions. The Control Party is hereby authorized (but shall not be obligated) to deliver any instruction contemplated in this Section 3.2 that is not timely delivered by or on behalf of the Co-Issuers.

Section 3.3    Certain Distributions from Series 2021-1 Class A-2 Distribution Account. On each Quarterly Payment Date based solely upon the most recent Quarterly Noteholders’ Allocation Report or Quarterly Noteholders’ Report, the Trustee shall, in accordance with Section 6.1 of the Base Indenture, remit to the Series 2021-1 Class A-2 Noteholders from the Series 2021-1 Class A-2 Distribution Account, the amounts withdrawn from the Senior Notes Interest Payment Accounts and the Senior Notes Principal Payment Accounts, as applicable, pursuant to Section 5.12(a) or (h), as applicable, of the Base Indenture, and deposited in the Series 2021-1 Class A-2 Distribution Account for the payment of interest and, in each case with respect to the Series 2021-1 Senior Notes, to the extent applicable, principal on such Quarterly Payment Date.

 

3


Section 3.4    [Reserved].

Section 3.5    Series 2021-1 Class A-2 Interest.

(a)    Series 2021-1 Class A-2 Note Rate. From the Series 2021-1 Closing Date until the Series 2021-1 Outstanding Principal Amount has been paid in full, the Series 2021-1 Outstanding Principal Amount (after giving effect to all payments of principal made to Noteholders as of the first day of such Interest Accrual Period, or if such day is not a Quarterly Payment Date, as of the following Quarterly Payment Date, and also giving effect to repurchases and cancellations of Series 2021-1 Class A-2 Notes during such Interest Accrual Period) shall accrue interest at the Series 2021-1 Class A-2 Note Rate for such Interest Accrual Period. Such accrued interest shall be due and payable in arrears on each Quarterly Payment Date, from amounts that are made available for payment thereof (i) on any related Weekly Allocation Date in accordance with the Priority of Payments and (ii) on such Quarterly Payment Date in accordance with Section 5.12 of the Base Indenture; provided that in any event all accrued but unpaid interest shall be due and payable in full on the Series 2021-1 Legal Final Maturity Date, on any Series 2021-1 Prepayment Date with respect to a prepayment in full of the Series 2021-1 Class A-2 Notes or on any other day on which all of the Series 2021-1 Outstanding Principal Amount is required to be paid in full. To the extent any interest accruing at the Series 2021-1 Class A-2 Note Rate is not paid when due, such unpaid interest shall accrue interest at the Series 2021-1 Class A-2 Note Rate. All computations of interest at the Series 2021-1 Class A-2 Note Rate shall be made on a 30/360 Basis.

(b)    Series 2021-1 Quarterly Post-ARD Additional Interest.

(i)    Post-ARD Additional Interest. From and after the Series 2021-1 Anticipated Repayment Date, if the Series 2021-1 Final Payment has not been made, then additional interest (the “Series 2021-1 Quarterly Post-ARD Additional Interest”) shall accrue on the Series 2021-1 Outstanding Principal Amount at an annual interest rate (the “Series 2021-1 Quarterly Post-ARD Additional Interest Rate”) equal to the rate determined by the Servicer to be the greater of (I) 5.00% per annum and (II) a per annum rate equal to the amount, if any, by which the sum of the following exceeds the Series 2021-1 Class A-2 Note Rate: (A) the yield to maturity (adjusted to a quarterly bond-equivalent basis) on the Series 2021-1 Anticipated Repayment Date of the United States Treasury Security having a term closest to 10 years plus (B) 5.00%, plus (C) 1.57%. In addition, regular interest shall continue to accrue at the Series 2021-1 Class A-2 Note Rate from and after the Series 2021-1 Anticipated Repayment Date.

(ii)    Payment of Series 2021-1 Quarterly Post-ARD Additional Interest. Any Series 2021-1 Quarterly Post-ARD Additional Interest shall be due and payable on any applicable Quarterly Payment Date as and when amounts are made available for payment thereof (A) on any related Weekly Allocation Date in accordance with the Priority of Payments and (B) on such Quarterly Payment Date in accordance with Section 5.12 of the Base Indenture, in the amount so available. The failure to pay any Series 2021-1 Quarterly Post-ARD Additional Interest in excess of available amounts in accordance with the foregoing (including on the Series 2021-1 Legal Final Maturity Date) shall not be an Event of Default and interest shall not accrue on any unpaid portion thereof; provided that in any event all accrued but unpaid Series 2021-1 Quarterly Post-ARD Additional Interest shall be due and payable in full on the Series 2021-1 Legal Final Maturity Date, on any Series 2021-1 Prepayment Date with respect to a prepayment in full of the Series 2021-1 Class A-2 Notes or on any other day on which all of the Series 2021-1 Outstanding Principal Amount is required to be paid in full.

(c)    Series 2021-1 Class A-2 Initial Interest Accrual Period. The initial Interest Accrual Period for the Series 2021-1 Class A-2 Notes shall commence on the Series 2021-1 Closing Date and end on (but exclude) October 20, 2021.

 

4


Section 3.6    Payment of Series 2021-1 Class A-2 Note Principal.

(a)    Series 2021-1 Class A-2 Notes Principal Payment at Legal Maturity. The Series 2021-1 Outstanding Principal Amount shall be due and payable on the Series 2021-1 Legal Final Maturity Date. The Series 2021-1 Outstanding Principal Amount is not prepayable, in whole or in part, except as set forth in this Section 3.6.

(b)    Series 2021-1 Anticipated Repayment. The Series 2021-1 Final Payment is anticipated to occur on the Quarterly Payment Date occurring in October 2028 (such date, the “Series 2021-1 Anticipated Repayment Date”); provided that: (i) if the DSCR is greater than 2.00x as of the Quarterly Calculation Date immediately preceding the Series 2021-1 Anticipated Repayment Date and the Series 2021-1 Class A-2 Notes are repaid or refinanced in full on or before the date that is one (1) calendar year following the Series 2021-1 Anticipated Repayment Date, the Series 2021-1 Anticipated Repayment Date shall be deemed to be the date on which the Series 2021-1 Class A-2 Notes are repaid or refinanced for all purposes under this Series Supplement and the Base Indenture and (ii) if each of the Series 2021-1 Class A-2 Noteholders and Series 2021-1 Class A-2 Note Owners agree to (x) amend or extend the Series 2021-1 Anticipated Repayment Date, the Series 2021-1 Anticipated Repayment Date shall be deemed to be such amended or extended date for all purposes under this Series Supplement and the Base Indenture and/or (y) waive the occurrence of the failure of the Co-Issuers to make the Series 2021-1 Final Payment on or prior to the Series 2021-1 Anticipated Repayment Date (which waiver may be provided on, prior to or after the Series 2021-1 Anticipated Repayment Date), then, in each case, the Co-Issuers shall be deemed not to have failed to repay or refinance the Series 2021-1 Class A-2 Notes in full on or prior to the Series 2021-1 Anticipated Repayment Date for all purposes under this Series Supplement and the Base Indenture, any related Rapid Amortization Event in respect of the Series 2021-1 Class A-2 Notes shall be deemed not to have occurred under this Series Supplement and the Base Indenture and any related Rapid Amortization Period shall be deemed to have ended automatically as a result of the Rapid Amortization Event being deemed not to occur.

(c)    Payment of Series 2021-1 Class A-2 Notes Scheduled Principal Payments Amounts. Series 2021-1 Class A-2 Notes Scheduled Principal Payments Amounts shall be due and payable in accordance with the definition thereof on any applicable Quarterly Payment Date commencing with the Quarterly Payment Date occurring in January 2022, as and when amounts are made available for payment thereof (i) on any related Weekly Allocation Date in accordance with the Priority of Payments and (ii) on such Quarterly Payment Date in accordance with Section 5.12 of the Base Indenture, in the amount so available, and failure to pay any Series 2021-1 Class A-2 Notes Scheduled Principal Payments Amounts in excess of available amounts in accordance with the foregoing shall not be an Event of Default.

(d)    Series 2021-1 Class A-2 Notes Mandatory Payments of Principal.

(i)    [Reserved]

(ii)    [Reserved]

(iii)    During any Rapid Amortization Period, principal payments shall be due and payable on each Quarterly Payment Date on the Series 2021-1 Class A-2 Notes as and when amounts are made available for payment thereof (i) on any related Weekly Allocation Date in accordance with the Priority of Payments and (ii) on such Quarterly Payment Date in accordance with Section 5.12 of the Base Indenture, in the amount so available; provided, that any Rapid Amortization Event that begins following the occurrence of a Rapid Amortization Event described in Section 9.1(d) of the Base Indenture in respect of the Series 2021-1 Anticipated Repayment Date may cease to occur to the extent provided pursuant to, and in accordance with, Section 3.6(b).

 

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(e)    Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration Payments. In connection with any prepayment of any Series 2021-1 Class A-2 Notes funded with Asset Disposition Proceeds or the proceeds of Permitted Brand Dispositions pursuant to Section 3.6(j) or in connection with any optional prepayment of any Series 2021-1 Class A-2 Notes made pursuant to Section 3.6(f) (each, a “Series 2021-1 Prepayment”), the Co-Issuers shall pay, in the manner described herein, the Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration to the Series 2021-1 Class A-2 Noteholders with respect to the principal portion of the applicable Series 2021-1 Prepayment Amount; provided that no such Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration shall be payable in connection with (A) any prepayment made on or after the date that is thirty-six (36) months prior to the Series 2021-1 Anticipated Repayment Date (the “Prepayment Consideration End Date”); (B) any prepayment funded by Indemnification Amounts or Insurance/Condemnation Proceeds; (C) Series 2021-1 Class A-2 Notes Scheduled Principal Payments Amounts, Series 2021-1 Class A-2 Notes Optional Scheduled Principal Payments or Series 2021-1 Class A-2 Notes Scheduled Principal Payment Deficiency Amounts; (D) mandatory prepayments due to a Rapid Amortization Event; (E) any EU Change of Control; and (F) any cancellations of repurchased Series 2021-1 Class A-2 Notes.

(f)    Optional Prepayment of Series 2021-1 Class A-2 Notes. Subject to Section 3.6(e) and Section 3.6(g) of this Series Supplement, the Co-Issuers shall have the option to prepay the Series 2021-1 Class A-2 Notes in whole on any Business Day or in part on any Quarterly Payment Date or on any date a mandatory prepayment may be made and that is specified as the Series 2021-1 Prepayment Date in the applicable Prepayment Notices; provided that the Co-Issuers shall not make any optional prepayment in part of any Series 2021-1 Class A-2 Notes pursuant to this Section 3.6(f) in a principal amount for any single prepayment of less than $1,000,000 on any Quarterly Payment Date (except that any such prepayment may be in a principal amount less than such amount if (x) effected on the same day as any partial mandatory prepayment or repayment pursuant to this Series Supplement or (y) such prepayment is a Series 2021-1 Class A-2 Notes Optional Scheduled Principal Payment); provided, further, that no such optional prepayment may be made unless (i) the amount on deposit in the Senior Notes Principal Payment Accounts (including any amounts to be transferred from the Cash Trap Reserve Accounts pursuant to Section 5.12(h) of the Base Indenture) that is allocable to the Series 2021-1 Class A-2 Notes to be prepaid is sufficient to pay the principal amount of the Series 2021-1 Class A-2 Notes to be prepaid and any Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration (calculated in accordance with each Co-Issuer’s Allocable Share (and any Shortfall Payments in respect thereof shall be paid in accordance with the Allocation Agreement)) required pursuant to Section 3.6(e), in each case, payable on the relevant Series 2021-1 Prepayment Date; (ii) the amount on deposit in the Senior Notes Interest Payment Accounts that is allocable to the Series 2021-1 Outstanding Principal Amount to be prepaid is sufficient to pay the following amounts, calculated in accordance with each Co-Issuer’s Allocable Share (and any Shortfall Payments in respect thereof shall be paid in accordance with the Allocation Agreement), (A) the Series 2021-1 Quarterly Interest to but excluding the relevant Series 2021-1 Prepayment Date relating to the Series 2021-1 Outstanding Principal Amount to be prepaid (other than any Series 2021-1 Quarterly Post-ARD Additional Interest) and (B) only if such optional prepayment is a prepayment in whole, (x) the Series 2021-1 Quarterly Post-ARD Additional Interest and (y) all Securitization Operating Expenses, to the extent attributable to the Series 2021-1 Class A-2 Notes; and (iii) the Co-Issuers reimburse, in accordance with their Allocable Share (and any Shortfall Payments in respect thereof shall be paid in accordance with the Allocation Agreement), the Trustee, the Servicer and the Managers, as applicable, for any unreimbursed Advances and Manager Advances (in each case, with interest thereon at the Advance Interest Rate). The Co-Issuers may prepay a Series of Notes in full at any time regardless of the number of prior optional prepayments or any minimum payment requirement.

 

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If DBI, Canco or any Affiliate thereof intends to enter into any transaction pursuant to which, on account of a good faith, third-party acquisition negotiated on market terms, a change of control would occur which would be incompatible, pursuant to the reasonable advice of counsel to the EU/UK Retention Holders (an “EU Change of Control”), a written notice will be provided to each holder of any Series 2021-1 Class A-2 Notes that is an EU/UK Applicable Investor, with the option for its Series 2021-1 Class A-2 Notes to be repaid in full at par pursuant to the EU/UK Risk Retention Letter and Section 3.6(g), without, to the extent applicable, any Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration with respect to the relevant Notes, subject to the terms and conditions set forth in the EU/UK Risk Retention Letter.

(g)    Notices of Prepayments.

(i)    Except in the case of any Series 2021-1 Class A-2 Notes Optional Scheduled Principal Payment, the Co-Issuers shall give prior written notice (each, a “Prepayment Notice”) at least fifteen (15) Business Days but not more than twenty (20) Business Days prior to any Series 2021-1 Prepayment with respect to the Series 2021-1 Class A-2 Notes pursuant to Section 3.6(f) of this Series Supplement to each Series 2021-1 Class A-2 Noteholder affected by such Series 2021-1 Prepayment, each of the Rating Agencies, the Servicer, the Control Party and the Trustee; provided that at the request of the Co-Issuers, such notice to the affected Series 2021-1 Class A-2 Noteholders shall be given by the Trustee in the name and at the expense of the Co-Issuers; provided, further, that in the case of any transaction pursuant to which, on account of a good faith, third-party acquisition negotiated on market terms, such written notice shall be provided to each of the Holders of the Series 2021-1 Class A-2 Notes that is an EU/UK Applicable Investor in accordance with the EU/UK Risk Retention Letter and Section 3.6(f). In connection with any such Prepayment Notice, the Co-Issuers shall provide a written report to the Trustee directing the Trustee to distribute such prepayment in accordance with the applicable provisions of Section 3.6(k) of this Series Supplement. With respect to each such Series 2021-1 Prepayment, the related Prepayment Notice shall, in each case, specify (A) the Series 2021-1 Prepayment Date on which such prepayment shall be made, which in all cases shall be a Business Day, (B) the Series 2021-1 Prepayment Amount and (C) the Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration Calculation Date on which the applicable Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration, if any, to be paid in connection therewith shall be calculated. The Co-Issuers shall have the option, by written notice to the Trustee, the Control Party, the Rating Agencies and the affected Noteholders, to withdraw or amend the Series 2021-1 Prepayment Date set forth in any Prepayment Notice relating to an optional prepayment at any time up to the second (2nd) Business Day before the Series 2021-1 Prepayment Date set forth in such Prepayment Notice. Any such optional prepayment and Prepayment Notice may, in the Co-Issuers’ discretion, be subject to the satisfaction of one or more conditions precedent, including but not limited to the occurrence of a Change of Control. The Co-Issuers shall have the option to provide in any Prepayment Notice that the payment of the amounts set forth in Section 3.6(f) and the performance of the Co-Issuers’ obligations with respect to such optional prepayment may be performed by another Person. All Prepayment Notices shall be (i) transmitted by email to (A) each affected Series 2021-1 Class A-2 Noteholder to the extent such Series 2021-1 Class A-2 Noteholder has provided an email address to the Trustee and (B) to each of the Rating Agencies, the Servicer and the Trustee and (ii) sent by registered mail to each affected Series 2021-1 Class A-2 Noteholder. A Prepayment Notice may be revoked by the Co-Issuers if the Trustee receives written notice of such revocation no later than 10:00 a.m. (New York City time) two (2) Business Days prior to such Series 2021-1 Prepayment Date. The Co-Issuers shall give written notice of such revocation to the Servicer, and at the request of the Co-Issuers, the Trustee shall forward the notice of revocation to the Series 2021-1 Class A-2 Noteholders.

 

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(ii)    In the case of any Series 2021-1 Class A-2 Notes Optional Scheduled Principal Payment, on the applicable Weekly Allocation Date the Co-Issuers shall provide a written report to the Trustee directing the Trustee to distribute such prepayment in accordance with the applicable provisions of Section 3.6(k) of this Series Supplement, which report shall specify (A) the Series 2021-1 Prepayment Date on which such prepayment shall be made, which in all cases shall be the next applicable Quarterly Payment Date, and (B) the Series 2021-1 Prepayment Amount.

(h)    Series 2021-1 Prepayments. On each Series 2021-1 Prepayment Date with respect to any Series 2021-1 Prepayment, the Series 2021-1 Prepayment Amount and the Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration, if any, shall be due and payable. The Co-Issuers shall pay the Series 2021-1 Prepayment Amount together with the applicable Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration, if any, by, to the extent not already deposited therein pursuant to Section 3.6(f) of this Series Supplement, depositing such amounts in the applicable Series 2021-1 Class A-2 Distribution Account on or prior to the related Series 2021-1 Prepayment Date to be distributed in accordance with Section 3.6(k) of this Series Supplement.

(i)    Prepayment Consideration Not Payable. For the avoidance of doubt, there is no Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration payable as a result of (i) the application of Indemnification Amounts or Insurance/Condemnation Proceeds allocated to the Series 2021-1 Class A-2 Notes pursuant to clause (i) of the Priority of Payments, (ii) any Series 2021-1 Class A-2 Notes Scheduled Principal Payments Amounts, Series 2021-1 Class A-2 Notes Optional Scheduled Principal Payments or Series 2021-1 Class A-2 Notes Scheduled Principal Payment Deficiency Amounts, (iii) any prepayment on or after the Prepayment Consideration End Date, (iv) mandatory prepayments due to a Rapid Amortization Event (v) any EU Change of Control; and (vi) any cancellations of repurchased Series 2021-1 Class A-2 Notes.

(j)    Indemnification Amounts; Insurance/Condemnation Proceeds; Release Prices; Asset Disposition Proceeds. Any Indemnification Amounts, Insurance/Condemnation Proceeds, Release Prices or Asset Disposition Proceeds allocated to the Senior Notes Principal Payment Accounts in accordance with Section 5.11(i) of the Base Indenture shall be withdrawn from the Senior Notes Principal Payment Accounts in accordance with Section 5.12(h) of the Base Indenture and deposited in the Series 2021-1 Class A-2 Distribution Account and used to prepay the Series 2021-1 Class A-2 Notes, on the Quarterly Payment Date immediately succeeding such deposit. In connection with any prepayment made with Indemnification Amounts or Insurance/Condemnation Proceeds pursuant to this Section 3.6(j), the Co-Issuers shall not be obligated to pay any prepayment consideration. The Co-Issuers shall, however, be obligated to pay any applicable Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration required to be paid pursuant to Section 3.6(e) of this Series Supplement in connection with any prepayment funded with Asset Disposition Proceeds or the proceeds of Permitted Brand Dispositions, as applicable, pursuant to this Section 3.6(j); provided, for avoidance of doubt, that it shall not constitute an Event of Default if any such Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration is not paid because insufficient funds are available to pay such Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration, in accordance with the Priority of Payments.

(k)    Series 2021-1 Prepayment Distributions. On the Series 2021-1 Prepayment Date for each Series 2021-1 Prepayment to be made pursuant to this Section 3.6 in respect of the Series 2021-1 Class A-2 Notes, the Trustee shall, in accordance with Section 6.1 of the Base Indenture (except that, notwithstanding anything to the contrary therein, references to the distributions being made on a Quarterly Payment Date shall be deemed to be references to distributions made on such Series 2021-1

 

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Prepayment Date and references to the Record Date shall be deemed to be references to the Prepayment Record Date) and based solely upon the applicable written report provided to the Trustee pursuant to Section 3.6(g) of this Series Supplement, wire transfer to the Series 2021-1 Class A-2 Noteholders of record on the preceding Prepayment Record Date on a pro rata basis, based on their respective portion of the Series 2021-1 Outstanding Principal Amount, the amount deposited in the Series 2021-1 Class A-2 Distribution Account pursuant to this Section 3.6 (which may include amounts required by this Section 3.6 of this Series Supplement to be on deposit in other Indenture Trust Accounts prior to transfer to the Series 2021-1 Class A-2 Distribution Account as set forth in the applicable written report provided to the Trustee pursuant to this Section 3.6(k)), if any, in order to repay the applicable portion of the Series 2021-1 Outstanding Principal Amount and pay all accrued and unpaid interest thereon up to such Series 2021-1 Prepayment Date and any Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration due to Series 2021-1 Class A-2 Noteholders payable on such date.

(l)    Series 2021-1 Notices of Final Payment. The Co-Issuers shall notify the Trustee, the Servicer and each of the Rating Agencies on or before the Prepayment Record Date preceding the Series 2021-1 Prepayment Date that shall be the Series 2021-1 Final Payment Date; provided, however, that with respect to any Series 2021-1 Final Payment that is made in connection with any mandatory prepayment in full, the Co-Issuers shall not be obligated to provide any additional notice to the Trustee or the Rating Agencies of such Series 2021-1 Final Payment, and in the case of any optional prepayment in full, the Co-Issuers shall not be obligated to provide any additional notice to the Trustee or the Rating Agencies of such Series 2021-1 Final Payment beyond the notice required to be given in connection with such optional prepayment pursuant to Section 3.6(g) of this Series Supplement. The Trustee shall provide any written notice required under this Section 3.6(l) to each Person in whose name a Series 2021-1 Class A-2 Note is registered at the close of business on such Prepayment Record Date of the Series 2021-1 Prepayment Date that shall be the Series 2021-1 Final Payment Date. Such written notice to be sent to the Series 2021-1 Class A-2 Noteholders shall be made at the expense of the Co-Issuers and shall be mailed by the Trustee within five (5) Business Days of receipt of notice from the Co-Issuers indicating that the Series 2021-1 Final Payment shall be made and shall specify that such Series 2021-1 Final Payment shall be payable only upon presentation and surrender of the Series 2021-1 Class A-2 Notes and shall specify the place where the Series 2021-1 Class A-2 Notes may be presented and surrendered for such Series 2021-1 Final Payment.

Section 3.7    [Reserved].

Section 3.8    Series 2021-1 Class A-2 Distribution Account.

(a)    Establishment of Series 2021-1 Class A-2 Distribution Account. The Trustee has established and shall maintain in the name of the Trustee for the benefit of the Series 2021-1 Class A-2 Noteholders an account (the “Series 2021-1 Class A-2 Distribution Account”), bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Series 2021-1 Class A-2 Noteholders. The Series 2021-1 Class A-2 Distribution Account shall be an Eligible Account. Initially, the Series 2021-1 Class A-2 Distribution Account shall be established with the Trustee.

(b)    [Reserved].

(c)    Series 2021-1 Class A-2 Distribution Account Constitutes Additional Collateral for Series 2021-1 Class A-2 Notes. In order to secure and provide for the repayment and payment of the Obligations with respect to the Series 2021-1 Class A-2 Notes, the Co-Issuers hereby grant a security interest in and assign, pledge, grant, transfer and set over to the Trustee, for the benefit of the Series 2021-1 Class A-2 Noteholders, all of the Co-Issuers’ right, title and interest in and to the following (whether

 

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now or hereafter existing or acquired): (i) the Series 2021-1 Class A-2 Distribution Account, including any security entitlement with respect thereto; (ii) all funds and other property (including, without limitation, Financial Assets) on deposit therein from time to time; (iii) all certificates and instruments, if any, representing or evidencing any or all of the Series 2021-1 Class A-2 Distribution Account, or the funds on deposit therein from time to time; (iv) all interest, dividends, cash, instruments and other property from time to time received, receivable or otherwise distributed in respect of or in exchange for the Series 2021-1 Class A-2 Distribution Account or the funds on deposit therein from time to time; and (v) all proceeds of any and all of the foregoing, including, without limitation, cash (the items in the foregoing clauses (i) through (v) are referred to, collectively, as the “Series 2021-1 Class A-2 Distribution Account Collateral”).

(d)    Termination of Series 2021-1 Class A-2 Distribution Account. On or after the date on which all accrued and unpaid interest on and principal of all Outstanding Series 2021-1 Class A-2 Notes have been paid, the Trustee, acting in accordance with the written instructions of the Co-Issuers (or the Managers on their behalf), shall withdraw from the Series 2021-1 Class A-2 Distribution Account all amounts on deposit therein for distribution pursuant to the Priority of Payments.

Section 3.9    Trustee as Securities Intermediary.

(a)    The Trustee or other Person holding the Series 2021-1 Class A-2 Distribution Account shall be the “Series 2021-1 Securities Intermediary”. If the Series 2021-1 Securities Intermediary in respect of any Series 2021-1 Class A-2 Distribution Account is not the Trustee, the Co-Issuers shall obtain the express agreement of such other Person to the obligations of the Series 2021-1 Securities Intermediary set forth in this Section 3.9.

(b)    The Series 2021-1 Securities Intermediary agrees that:

(i)    The Series 2021-1 Class A-2 Distribution Account is an account to which Financial Assets shall or may be credited;

(ii)    The Series 2021-1 Class A-2 Distribution Account is a “securities account” within the meaning of Section 8-501 of the New York UCC and the Series 2021-1 Securities Intermediary qualifies as a “securities intermediary” under Section 8-102(a) of the New York UCC;

(iii)    All securities or other property (other than cash) underlying any Financial Assets credited to any Series 2021-1 Class A-2 Distribution Account shall be registered in the name of a Series 2021-1 Securities Intermediary, as applicable, indorsed to such Series 2021-1 Securities Intermediary or in blank or credited to another securities account maintained in the name of such Series 2021-1 Securities Intermediary, and in no case shall any Financial Asset credited to any Series 2021-1 Class A-2 Distribution Account be registered in the name of the Co-Issuers, payable to the order of the Co-Issuers or specially indorsed to the Co-Issuers;

(iv)    All property delivered to the Series 2021-1 Securities Intermediary pursuant to this Series Supplement shall be promptly credited to the Series 2021-1 Class A-2 Distribution Account;

(v)    Each item of property (whether investment property, security, instrument or cash) credited to any Series 2021-1 Class A-2 Distribution Account shall be treated as a Financial Asset;

 

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(vi)    If at any time the Series 2021-1 Securities Intermediary shall receive any entitlement order from the Trustee (including those directing transfer or redemption of any Financial Asset) relating to the Series 2021-1 Class A-2 Distribution Account, the Series 2021-1 Securities Intermediary shall comply with such entitlement order without further consent by the Co-Issuers, any other Securitization Entity or any other Person;

(vii)    The Series 2021-1 Class A-2 Distribution Account shall be governed by the laws of the State of New York, regardless of any provision of any other agreement. For purposes of all applicable UCCs, the State of New York shall be deemed to the applicable Series 2021-1 Securities Intermediary’s jurisdiction and the Series 2021-1 Class A-2 Distribution Account (as well as the “security entitlements” (as defined in Section 8-102(a)(17) of the New York UCC) related thereto) shall be governed by the laws of the State of New York;

(viii)    No Series 2021-1 Securities Intermediary has entered into, and until termination of this Series Supplement shall not enter into, any agreement with any other Person relating to the Series 2021-1 Class A-2 Distribution Account and/or any Financial Assets credited thereto pursuant to which it has agreed to comply with “entitlement orders” (as defined in Section 8-102(a)(8) of the New York UCC) of such other Person, and such Series 2021-1 Securities Intermediary has not entered into, and until the termination of this Series Supplement shall not enter into, any agreement with the Co-Issuers purporting to limit or condition the obligation of the Series 2021-1 Securities Intermediary to comply with entitlement orders as set forth in Section 3.9(b)(vi) of this Series Supplement; and

(ix)    Except for the claims and interest of the Trustee, the Secured Parties and the Securitization Entities in the Series 2021-1 Class A-2 Distribution Account, neither any Series 2021-1 Securities Intermediary nor, in the case of the Trustee, any Trust Officer knows of any claim to, or interest in, any Series 2021-1 Class A-2 Distribution Account or any Financial Asset credited thereto. If any Series 2021-1 Securities Intermediary or, in the case of the Trustee, a Trust Officer has actual knowledge of the assertion by any other person of any Lien, encumbrance or adverse claim (including any writ, garnishment, judgment, warrant of attachment, execution or similar process) against any Series 2021-1 Class A-2 Distribution Account or any Financial Asset carried therein, the Series 2021-1 Securities Intermediary shall promptly notify the Trustee, the Managers, the Servicer and the Co-Issuers thereof.

(c)    At any time after the occurrence and during the continuation of an Event of Default, the Trustee shall possess all right, title and interest in all funds on deposit from time to time in the Series 2021-1 Class A-2 Distribution Account and in all proceeds thereof, and shall (acting at the direction of the Control Party (at the direction of the Controlling Class Representative)) be the only Person authorized to originate entitlement orders in respect of the Series 2021-1 Class A-2 Distribution Account; provided, however, that at all other times the Co-Issuers shall be authorized to instruct the Trustee to originate entitlement orders in respect of the Series 2021-1 Class A-2 Distribution Account.

Section 3.10    Managers. Pursuant to each Management Agreement, the Managers have agreed to provide certain reports, notices, instructions and other services on behalf of the respective Co-Issuer. The Series 2021-1 Class A-2 Noteholders by their acceptance of the Series 2021-1 Class A-2 Notes consent to the provision of such reports and notices to the Trustee by the Managers in lieu of the Co-Issuers. Any such reports and notices that are required to be delivered to the Series 2021-1 Class A-2 Noteholders hereunder shall be made available on the Trustee’s website in the manner set forth in Section 4.4 of the Base Indenture.

Section 3.11    Replacement of Ineligible Accounts. If, at any time, the Series 2021-1 Class A-2 Distribution Account shall cease to be an Eligible Account (each, a “Series 2021-1 Ineligible

 

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Account”), the Co-Issuers shall (i) within five (5) Business Days of obtaining knowledge thereof, notify the Control Party thereof and (ii) within sixty (60) days of obtaining knowledge thereof, (A) establish, or cause to be established, a new account that is an Eligible Account in substitution for such Series 2021-1 Ineligible Account, (B) following the establishment of such new Eligible Account, transfer or, with respect to the Trustee Accounts maintained at the Trustee, instruct the Trustee in writing to transfer all cash and investments from such Series 2021-1 Ineligible Account into such new Eligible Account and (C) pledge, or cause to be pledged, such new Eligible Account to the Trustee for the benefit of the Secured Parties and, if such new Eligible Account is not established with the Trustee, cause such new Eligible Account to be subject to an Account Control Agreement in form and substance reasonably acceptable to the Control Party and the Trustee.

ARTICLE IV

FORM OF SERIES 2021-1 CLASS A-2 NOTES

Section 4.1    [Reserved].

Section 4.2    Issuance of Series 2021-1 Class A-2 Notes.

(a)    The Series 2021-1 Class A-2 Notes in the aggregate may be offered and sold in the Series 2021-1 Initial Principal Amount on the Series 2021-1 Closing Date by the Co-Issuers pursuant to the Series 2021-1 Class A-2 Note Purchase Agreement. The Series 2021-1 Class A-2 Notes shall be resold initially only to (A) a Co-Issuer or its Affiliates, (B) in the United States, to Persons who are not Competitors who are QIBs in reliance on Rule 144A or (C) outside the United States, to Persons who are not Competitors who are not U.S. persons (as defined in Regulation S) (a “U.S. Person”) in offshore transactions in reliance on Regulation S. The Series 2021-1 Class A-2 Notes may thereafter be transferred in reliance on Rule 144A and/or Regulation S and in accordance with the procedure described herein.

The Series 2021-1 Class A-2 Notes shall be Book-Entry Notes and DTC shall be the Depository for the Series 2021-1 Class A-2 Notes. The Applicable Procedures shall be applicable to transfers of beneficial interests in the Series 2021-1 Class A-2 Notes. The Series 2021-1 Class A-2 Notes shall be issued in minimum denominations of $25,000 and in any whole number denomination in excess thereof.

(b)    Global Notes.

(i)    Rule 144A Global Notes. The Series 2021-1 Class A-2 Notes offered and sold in their initial distribution in reliance upon Rule 144A shall be issued in the form of one or more global notes in fully registered form, without coupons, substantially in the form set forth in Exhibit A-1-1 hereto, registered in the name of Cede & Co. (“Cede”), as nominee of DTC, and deposited with the Trustee, as custodian for DTC (collectively, for purposes of this Section 4.2 and Section 4.4, the “Rule 144A Global Notes”). The aggregate initial principal amount of the Rule 144A Global Notes may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for DTC, in connection with a corresponding decrease or increase in the aggregate initial principal amount of the corresponding class of Temporary Regulation S Global Notes or Permanent Regulation S Global Notes, as hereinafter provided.

(ii)    Temporary Regulation S Global Notes and Permanent Regulation S Global Notes. Any Series 2021-1 Class A-2 Notes offered and sold on the Series 2021-1 Closing Date in reliance upon Regulation S shall be issued in the form of one or more global notes in fully registered form, without coupons, substantially in the form set forth in Exhibit A-1-2 hereto,

 

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registered in the name of Cede, as nominee of DTC, and deposited with the Trustee, as custodian for DTC, for credit to the respective accounts at DTC of the designated agents holding on behalf of Euroclear or Clearstream. Until such time as the Restricted Period shall have terminated with respect to any Series 2021-1 Class A-2 Note, such Series 2021-1 Class A-2 Notes shall be referred to herein collectively, for purposes of this Section 4.2 and Section 4.4, as the “Temporary Regulation S Global Notes.” After such time as the Restricted Period shall have terminated, the Temporary Regulation S Global Notes shall be exchangeable, in whole or in part, for interests in one or more permanent global notes in registered form without interest coupons, substantially in the form set forth in Exhibit A-1-3 hereto, as hereinafter provided (collectively, for purposes of this Section 4.2 and Section 4.4, the “Permanent Regulation S Global Notes”). The aggregate principal amount of the Temporary Regulation S Global Notes or the Permanent Regulation S Global Notes may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for DTC, in connection with a corresponding decrease or increase of aggregate principal amount of the corresponding Rule 144A Global Notes, as hereinafter provided.

(c)    Definitive Notes. The Series 2021-1 Global Notes shall be exchangeable in their entirety for one or more definitive notes in registered form, without interest coupons (collectively, for purposes of this Section 4.2 and Section 4.4 of this Series Supplement, the “Definitive Notes”) pursuant to Section 2.13 of the Base Indenture and this Section 4.2(c) in accordance with their terms and, upon complete exchange thereof, such Series 2021-1 Global Notes shall be surrendered for cancellation at the applicable Corporate Trust Office.

Section 4.3    [Reserved].

Section 4.4    Transfer Restrictions of Series 2021-1 Class A-2 Notes.

(a)    A Series 2021-1 Global Note may not be transferred, in whole or in part, to any Person other than DTC or a nominee thereof, or to a successor Depository or to a nominee of a successor Depository, and no such transfer to any such other Person may be registered; provided, however, that this Section 4.4(a) shall not prohibit any transfer of a Series 2021-1 Class A-2 Note that is issued in exchange for a Series 2021-1 Global Note in accordance with Section 2.8 of the Base Indenture and shall not prohibit any transfer of a beneficial interest in a Series 2021-1 Global Note effected in accordance with the other provisions of this Section 4.4.

(b)    The transfer by a Series 2021-1 Class A-2 Note Owner holding a beneficial interest in a Class A-2 Note in the form of a Rule 144A Global Note to a Person who wishes to take delivery thereof in the form of a beneficial interest in the Rule 144A Global Note shall be made upon the deemed representation of the transferee that it is purchasing for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a QIB and not a Competitor, and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Co-Issuers as such transferee has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon its foregoing representations in order to claim the exemption from registration provided by Rule 144A.

(c)    If a Series 2021-1 Class A-2 Note Owner holding a beneficial interest in a Class A-2 Note in the form of a Rule 144A Global Note wishes at any time to exchange its interest in such Rule 144A Global Note for an interest in the Temporary Regulation S Global Note, or to transfer such interest to a Person who wishes to take delivery thereof in the form of a beneficial interest in the Temporary Regulation S Global Note, such exchange or transfer may be effected, subject to the Applicable

 

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Procedures, only in accordance with the provisions of this Section 4.4(c). Upon receipt by the Registrar, at the applicable Corporate Trust Office, of (i) written instructions given in accordance with the Applicable Procedures from a Clearing Agency Participant directing the Registrar to credit or cause to be credited to a specified Clearing Agency Participant’s account a beneficial interest in the Temporary Regulation S Global Note, in a principal amount equal to that of the beneficial interest in such Rule 144A Global Note to be so exchanged or transferred, (ii) a written order given in accordance with the Applicable Procedures containing information regarding the account of the Clearing Agency Participant (and the Euroclear or Clearstream account, as the case may be) to be credited with, and the account of the Clearing Agency Participant to be debited for, such beneficial interest and (iii) a certificate in substantially the form set forth in Exhibit B-1 hereto given by the Series 2021-1 Class A-2 Note Owner holding such beneficial interest in such Rule 144A Global Note, the Registrar shall instruct the Trustee, as custodian of DTC, to reduce the principal amount of the Rule 144A Global Note, and to increase the principal amount of the Temporary Regulation S Global Note, by the principal amount of the beneficial interest in such Rule 144A Global Note to be so exchanged or transferred, and to credit or cause to be credited to the account of the Person specified in such instructions (which shall be the Clearing Agency Participant for Euroclear or Clearstream or both, as the case may be) a beneficial interest in the Temporary Regulation S Global Note having a principal amount equal to the amount by which the principal amount of such Rule 144A Global Note was reduced upon such exchange or transfer.

(d)    If a Series 2021-1 Class A-2 Note Owner holding a beneficial interest in a Rule 144A Global Note wishes at any time to exchange its interest in such Rule 144A Global Note for an interest in the Permanent Regulation S Global Note, or to transfer such interest to a Person who wishes to take delivery thereof in the form of a beneficial interest in the Permanent Regulation S Global Note, such exchange or transfer may be effected, subject to the Applicable Procedures, only in accordance with the provisions of this Section 4.4(d). Upon receipt by the Registrar, at the applicable Corporate Trust Office, of (i) written instructions given in accordance with the Applicable Procedures from a Clearing Agency Participant directing the Registrar to credit or cause to be credited to a specified Clearing Agency Participant’s account a beneficial interest in the Permanent Regulation S Global Note in a principal amount equal to that of the beneficial interest in such Rule 144A Global Note to be so exchanged or transferred, (ii) a written order given in accordance with the Applicable Procedures containing information regarding the account of the Clearing Agency Participant (and the Euroclear or Clearstream account, as the case may be) to be credited with, and the account of the Clearing Agency Participant to be debited for, such beneficial interest and (iii) a certificate in substantially the form of Exhibit B-2 hereto given by the Series 2021-1 Class A-2 Note Owner holding such beneficial interest in such Rule 144A Global Note, the Registrar shall instruct the Trustee, as custodian of DTC, to reduce the principal amount of such Rule 144A Global Note, and to increase the principal amount of the Permanent Regulation S Global Note, by the principal amount of the beneficial interest in such Rule 144A Global Note to be so exchanged or transferred, and to credit or cause to be credited to the account of the Person specified in such instructions (which shall be the Clearing Agency Participant for Euroclear or Clearstream or both, as the case may be) a beneficial interest in the Permanent Regulation S Global Note having a principal amount equal to the amount by which the principal amount of such Rule 144A Global Note was reduced upon such exchange or transfer.

(e)    If a Series 2021-1 Class A-2 Note Owner holding a beneficial interest in a Temporary Regulation S Global Note or a Permanent Regulation S Global Note wishes at any time to exchange its interest in such Temporary Regulation S Global Note or such Permanent Regulation S Global Note for an interest in the Rule 144A Global Note, or to transfer such interest to a Person who wishes to take delivery thereof in the form of a beneficial interest in the Rule 144A Global Note, such exchange or transfer may be effected, subject to the Applicable Procedures, only in accordance with the provisions of this Section 4.4(e). Upon receipt by the Registrar, at the applicable Corporate Trust Office, of (i) written instructions given in accordance with the Applicable Procedures from a Clearing Agency

 

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Participant directing the Registrar to credit or cause to be credited to a specified Clearing Agency Participant’s account a beneficial interest in the Rule 144A Global Note in a principal amount equal to that of the beneficial interest in such Temporary Regulation S Global Note or such Permanent Regulation S Global Note, as the case may be, to be so exchanged or transferred, (ii) a written order given in accordance with the Applicable Procedures containing information regarding the account of the Clearing Agency Participant (and the Euroclear or Clearstream account, as the case may be) to be credited with, and the account of the Clearing Agency Participant to be debited for, such beneficial interest and (iii) with respect to a transfer of a beneficial interest in such Temporary Regulation S Global Note (but not such Permanent Regulation S Global Note), a certificate in substantially the form set forth in Exhibit B-3 hereto given by such Series 2021-1 Class A-2 Note Owner holding such beneficial interest in such Temporary Regulation S Global Note, the Registrar shall instruct the Trustee, as custodian of DTC, to reduce the principal amount of such Temporary Regulation S Global Note or such Permanent Regulation S Global Note, as the case may be, and to increase the principal amount of the Rule 144A Global Note, by the principal amount of the beneficial interest in such Temporary Regulation S Global Note or such Permanent Regulation S Global Note to be so exchanged or transferred, and to credit or cause to be credited to the account of the Person specified in such instructions (which shall be the Clearing Agency Participant for DTC) a beneficial interest in the Rule 144A Global Note having a principal amount equal to the amount by which the principal amount of such Temporary Regulation S Global Note or such Permanent Regulation S Global Note, as the case may be, was reduced upon such exchange or transfer.

(f)    In the event that a Series 2021-1 Global Note or any portion thereof is exchanged for Series 2021-1 Class A-2 Notes other than Series 2021-1 Global Notes, such other Series 2021-1 Class A-2 Notes may in turn be exchanged (upon transfer or otherwise) for Series 2021-1 Class A-2 Notes that are not Series 2021-1 Global Notes or for a beneficial interest in a Series 2021-1 Global Note (if any is then outstanding) only in accordance with such procedures as may be adopted from time to time by the Co-Issuers and the Registrar, which shall be substantially consistent with the provisions of Section 4.4(a) through Section 4.4(e) and Section 4.4(g) of this Series Supplement (including the certification requirement intended to ensure that transfers and exchanges of beneficial interests in a Series 2021-1 Global Note comply with Rule 144A or Regulation S under the Securities Act, as the case may be) and any Applicable Procedures.

(g)    Until the termination of the Restricted Period with respect to any Series 2021-1 Class A-2 Note, interests in the Temporary Regulation S Global Notes representing such Series 2021-1 Class A-2 Note may be held only through Clearing Agency Participants acting for and on behalf of Euroclear and Clearstream; provided that this Section 4.4(g) shall not prohibit any transfer in accordance with Section 4.4(d) of this Series Supplement. After the expiration of the applicable Restricted Period, interests in the Permanent Regulation S Global Notes may be transferred without requiring any certifications other than those set forth in this Section 4.4.

(h)    The Series 2021-1 Class A-2 Notes Rule 144A Global Notes, the Series 2021-1 Class A-2 Notes Temporary Regulation S Global Notes and the Series 2021-1 Class A-2 Notes Permanent Regulation S Global Notes shall bear the following legend:

THE ISSUANCE AND SALE OF THIS SERIES 2021-1 CLASS A-2 NOTE HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER RELEVANT JURISDICTION. THE SERIES 2021-1 CLASS A-2 NOTES HAVE NOT BEEN AND WILL NOT BE QUALIFIED FOR DISTRIBUTION TO THE PUBLIC UNDER THE SECURITIES LAWS OF ANY PROVINCE OR TERRITORY OF CANADA. THE SERIES 2021-1 CLASS A-2 NOTES MAY NOT BE OFFERED OR

 

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SOLD IN CANADA, DIRECTLY OR INDIRECTLY. NEITHER DRIVEN BRANDS FUNDING, LLC (THE “ISSUER”) NOR DRIVEN BRANDS CANADA FUNDING CORPORATION (THE “CANADIAN CO-ISSUER”) HAS BEEN REGISTERED UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED (THE “1940 ACT”). THIS NOTE OR ANY INTEREST HEREIN MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A) TO A CO-ISSUER OR AN AFFILIATE THEREOF, (B) IN THE UNITED STATES, TO A PERSON WHO IS NOT A COMPETITOR AND IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE 1933 ACT (“RULE 144A”), ACTING FOR ITS OWN ACCOUNT OR ONE OR MORE ACCOUNTS WITH RESPECT TO WHICH SUCH PERSON EXERCISES SOLE INVESTMENT DISCRETION OR (C) OUTSIDE THE UNITED STATES, TO A PERSON WHO IS NOT A COMPETITOR AND IS NOT A “U.S. PERSON” AS DEFINED IN REGULATION S UNDER THE 1933 ACT (“REGULATION S”), ACTING FOR ITS OWN ACCOUNT OR ONE OR MORE ACCOUNTS WITH RESPECT TO WHICH SUCH PERSON EXERCISES SOLE INVESTMENT DISCRETION, NONE OF WHICH ARE A U.S. PERSON, IN OFFSHORE TRANSACTIONS IN RELIANCE ON REGULATION S, AND, IN EACH CASE, IN COMPLIANCE WITH THE CERTIFICATIONS AND OTHER REQUIREMENTS SPECIFIED IN THE INDENTURE REFERRED TO HEREIN AND ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR THE UNITED STATES, ANY APPLICABLE SECURITIES LAWS OF ANY PROVINCE OR TERRITORY OF CANADA AND ANY OTHER RELEVANT JURISDICTION.

BY ITS ACQUISITION OR ACCEPTANCE HEREOF, THE HOLDER (IF NOT A CO-ISSUER OR AN AFFILIATE OF THE CO-ISSUERS) REPRESENTS THAT (A) IT IS NOT A COMPETITOR AND IS (X) A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A OR (Y) NOT A U.S. PERSON AND IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION, AS APPLICABLE, (B) IT IS ACTING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ANOTHER PERSON WHICH IS NOT A COMPETITOR AND IS EITHER (X) A QUALIFIED INSTITUTIONAL BUYER OR (Y) NOT A U.S. PERSON, AND IN EACH CASE WITH RESPECT TO WHICH IT EXERCISES SOLE INVESTMENT DISCRETION, (C) IT AND EACH ACCOUNT FOR WHICH IT IS PURCHASING WILL HOLD AND TRANSFER AT LEAST THE MINIMUM DENOMINATION OF NOTES, (D) IT UNDERSTANDS THAT THE CO-ISSUERS MAY RECEIVE A LIST OF PARTICIPANTS HOLDING POSITIONS IN ITS NOTES FROM ONE OR MORE BOOK-ENTRY DEPOSITORIES AND (E) IT WILL PROVIDE NOTICE OF THE TRANSFER RESTRICTIONS TO ANY SUBSEQUENT TRANSFEREES.

EACH PERSON (IF NOT A CO-ISSUER OR AN AFFILIATE OF THE CO-ISSUERS) TAKING DELIVERY OF THIS NOTE OR AN INTEREST IN THIS NOTE WILL BE DEEMED TO HAVE MADE THE APPLICABLE REPRESENTATIONS AND AGREEMENTS REFERRED TO IN THE INDENTURE. EACH PERSON TAKING DELIVERY OF THIS NOTE OR AN INTEREST IN THIS NOTE IN THE FORM OF AN INTEREST IN A [TEMPORARY REGULATION S GLOBAL NOTE] [RULE 144A GLOBAL NOTE] [PERMANENT REGULATION S GLOBAL NOTE] WILL BE REQUIRED TO DELIVER A TRANSFER CERTIFICATE IN THE FORM REQUIRED BY THE INDENTURE AND WILL BE REQUIRED TO MAKE THE APPLICABLE REPRESENTATIONS AND AGREEMENTS REFERRED TO IN THE INDENTURE.

 

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ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING WILL BE OF NO FORCE AND EFFECT AND WILL BE VOID AB INITIO AND WILL NOT OPERATE TO TRANSFER ANY RIGHTS TO ANY PERSON CAUSING SUCH VIOLATION, NOTWITHSTANDING ANY INSTRUCTIONS TO THE CONTRARY TO ANY CO-ISSUER, THE TRUSTEE OR ANY INTERMEDIARY.

[IF THIS NOTE WAS ACQUIRED IN THE UNITED STATES, AND THE HOLDER IS DETERMINED TO BE A COMPETITOR OR NOT TO HAVE BEEN A QUALIFIED INSTITUTIONAL BUYER AT THE TIME OF ACQUISITION OF THIS NOTE, THE CO-ISSUERS HAVE THE RIGHT TO REQUIRE SUCH HOLDER TO SELL THIS NOTE TO A PURCHASER WHO IS NOT A COMPETITOR AND IS A QUALIFIED INSTITUTIONAL BUYER. THE CO-ISSUERS ALSO HAVE THE RIGHT TO REFUSE TO HONOR A TRANSFER TO A PERSON WHO IS NOT A QUALIFIED INSTITUTIONAL BUYER OR WHO IS A COMPETITOR.]

UNLESS PERMITTED UNDER THE APPLICABLE SECURITIES LAWS OF ANY PROVINCE OR TERRITORY OF CANADA, THE HOLDER OF THIS NOTE MUST NOT RESELL THIS NOTE IN CANADA BEFORE THE DATE THAT IS 4 MONTHS AND ONE DAY AFTER THE LATER OF (A) THE ORIGINAL ISSUE DATE OF THE NOTES AND (B) THE DATE ON WHICH BOTH THE CO-ISSUERS BECOME REPORTING ISSUERS UNDER THE APPLICABLE SECURITIES LAWS OF ANY PROVINCE OR TERRITORY OF CANADA.

[IF THIS NOTE WAS ACQUIRED OUTSIDE THE UNITED STATES, AND THE HOLDER IS DETERMINED TO BE A COMPETITOR OR TO HAVE BEEN A “U.S. PERSON” AT THE TIME OF ACQUISITION OF THIS NOTE, THE CO-ISSUERS HAVE THE RIGHT TO REQUIRE SUCH HOLDER TO SELL THIS NOTE TO A PURCHASER WHO IS NOT A COMPETITOR AND IS NOT A “U.S. PERSON.” THE CO-ISSUERS ALSO HAVE THE RIGHT TO REFUSE TO HONOR A TRANSFER TO A PERSON WHO IS A “U.S. PERSON” OR WHO IS A COMPETITOR.]

BY ACCEPTING THIS NOTE, EACH PURCHASER COVENANTS THAT IT WILL NOT AT ANY TIME PRIOR TO THE DATE WHICH IS ONE (1) YEAR AND ONE (1) DAY AFTER THE PAYMENT IN FULL OF THE LATEST MATURING NOTE, INSTITUTE AGAINST, OR JOIN WITH ANY OTHER PERSON IN INSTITUTING AGAINST, ANY SECURITIZATION ENTITY ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS, UNDER ANY FEDERAL, STATE, PROVINCIAL BANKRUPTCY, INSOLVENCY OR SIMILAR LAW.

(i)    The Series 2021-1 Class A-2 Notes Temporary Regulation S Global Notes shall also bear the following legend:

UNTIL FORTY (40) DAYS AFTER THE ORIGINAL ISSUE DATE OF THE NOTES (THE “RESTRICTED PERIOD”) IN CONNECTION WITH THE OFFERING OF THE NOTES IN THE UNITED STATES FROM OUTSIDE OF THE UNITED STATES, THE SALE, PLEDGE OR TRANSFER OF THIS NOTE IS SUBJECT TO CERTAIN CONDITIONS AND RESTRICTIONS. THE HOLDER HEREOF, BY PURCHASING OR OTHERWISE ACQUIRING THIS NOTE, ACKNOWLEDGES THAT SUCH HOLDER IS EITHER NOT A “U.S. PERSON” OR A CO-ISSUER OR AN AFFILIATE

 

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OF THE CO-ISSUERS, AND THAT THIS NOTE HAS NOT BEEN REGISTERED UNDER THE 1933 ACT AND AGREES FOR THE BENEFIT OF THE CO-ISSUERS THAT THIS NOTE MAY BE TRANSFERRED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY TO A HOLDER THAT IS NOT A “U.S. PERSON” OR TO A CO-ISSUER OR AN AFFILIATE OF THE CO-ISSUERS AND IN COMPLIANCE WITH THE 1933 ACT AND OTHER APPLICABLE LAWS OF THE STATES, TERRITORIES AND POSSESSIONS OF THE UNITED STATES GOVERNING THE OFFER AND SALE OF SECURITIES, AND PRIOR TO THE EXPIRATION OF THE RESTRICTED PERIOD, ONLY (I) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE 1933 ACT OR (II) PURSUANT TO AND IN ACCORDANCE WITH RULE 144A UNDER THE 1933 ACT.

(j)    The Series 2021-1 Global Notes issued in connection with the Series 2021-1 Class A-2 Notes shall also bear the following legend:

THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY (“DTC”), A NEW YORK CORPORATION, 55 WATER STREET, NEW YORK, NEW YORK 10004, OR A NOMINEE THEREOF. THIS NOTE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS NOTE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN DTC OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE. UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC TO A CO-ISSUER OR THE NOTE REGISTRAR, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC, AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC, ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL BECAUSE THE REGISTERED OWNER, CEDE & CO., HAS AN INTEREST HEREIN.

(k)    The required legends set forth above shall not be removed from the applicable Series 2021-1 Class A-2 Notes except as provided herein. The legend required for a Series 2021-1 Class A-2 Notes Rule 144A Global Note may be removed from such Series 2021-1 Class A-2 Notes Rule 144A Global Note if there is delivered to the Co-Issuers and the Registrar such satisfactory evidence, which may include an Opinion of Counsel, as may be reasonably required by the Co-Issuers that neither such legend nor the restrictions on transfer set forth therein are required to ensure that transfers of such Series 2021-1 Class A-2 Notes Rule 144A Global Note shall not violate the registration requirements of the Securities Act. Upon provision of such satisfactory evidence, the Trustee at the direction of the Co-Issuers (or the Managers, on their behalf), shall authenticate and deliver in exchange for such Series 2021-1 Class A-2 Notes Rule 144A Global Note a Series 2021-1 Class A-2 Note or Series 2021-1 Class A-2 Notes having an equal aggregate principal amount that does not bear such legend. If such a legend required for a Series 2021-1 Class A-2 Notes Rule 144A Global Note has been removed from a Series 2021-1 Class A-2 Note as provided above, no other Series 2021-1 Class A-2 Note issued in exchange for all or any part of such Series 2021-1 Class A-2 Note shall bear such legend, unless the Co-Issuers have reasonable cause to believe that such other Series 2021-1 Class A-2 Note is a “restricted security” within the meaning of Rule 144 under the Securities Act and instructs the Trustee to cause a legend to appear thereon.

 

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Section 4.5    Note Owner Representations and Warranties. Each Person who becomes a Note Owner of a beneficial interest in a Series 2021-1 Class A-2 Note pursuant to the Offering Memorandum shall be deemed to represent, warrant and agree on the date such Person acquires any interest in any Series 2021-1 Class A-2 Note as follows:

(a)    With respect to any sale of Series 2021-1 Class A-2 Notes pursuant to Rule 144A, it is a QIB pursuant to Rule 144A, and is aware that any sale of Series 2021-1 Class A-2 Notes to it shall be made in reliance on Rule 144A. Its acquisition of Series 2021-1 Class A-2 Notes in any such sale shall be for its own account or for the account of another QIB that is not a Competitor.

(b)    With respect to any sale of Series 2021-1 Class A-2 Notes pursuant to Regulation S, at the time the buy order for such Series 2021-1 Class A-2 Notes was originated, it was outside the United States and the offer was made to a Person who is not a U.S. Person, purchasing for their own account or the account of one or more persons, each of which is not a Competitor and not a U.S. Person.

(c)    It shall, and each account for which it is purchasing shall, hold and transfer at least the minimum denomination of Series 2021-1 Class A-2 Notes.

(d)    It understands that the Co-Issuers, the Managers and the Servicer may receive a list of participants holding positions in the Series 2021-1 Class A-2 Notes from one or more book-entry depositories.

(e)    It understands that the Managers, the Co-Issuers and the Servicer may receive (i) a list of Note Owners that have requested access to the Trustee’s password-protected website or that have voluntarily registered as a Note Owner with the Trustee and (ii) copies of Noteholder confirmations of representations and warranties executed to obtain access to the Trustee’s password-protected website.

(f)    It shall provide to each person to whom it transfers Series 2021-1 Class A-2 Notes notices of any restrictions on transfer of such Series 2021-1 Class A-2 Notes.

(g)    It understands that (i) the Series 2021-1 Class A-2 Notes are being offered in a transaction not involving any public offering in the United States within the meaning of the Securities Act, (ii) the Series 2021-1 Class A-2 Notes have not been registered under the Securities Act, (iii) such Series 2021-1 Class A-2 Notes may be offered, resold, pledged or otherwise transferred only (A) to a Co-Issuer or an Affiliate of the Co-Issuers, (B) in the United States to a Person who the seller reasonably believes is a QIB in a transaction meeting the requirements of Rule 144A and who is not a Competitor, (C) outside the United States to a Person who is not a U.S. Person in a transaction meeting the requirements of Regulation S and who is not a Competitor or (D) to a Person that is not a Competitor in a transaction exempt from the registration requirements of the Securities Act and the applicable securities laws of any state of the United States, any applicable securities laws of any province or territory of Canada and any other jurisdiction, in each such case in accordance with the Indenture and any applicable securities laws of any state of the United States and any applicable securities laws of any province or territory of Canada and (iv) it shall, and each subsequent holder of a Series 2021-1 Class A-2 Note is required to, notify any subsequent purchaser of a Series 2021-1 Class A-2 Note of the resale restrictions set forth in clause (iii) above.

(h)    It understands that the certificates evidencing the Rule 144A Global Notes shall bear legends substantially similar to those set forth in Section 4.4(h) and (j) of this Series Supplement.

(i)    It understands that the certificates evidencing the Temporary Regulation S Global Notes shall bear legends substantially similar to those set forth in Section 4.4(h), (i) and (j) of this Series Supplement.

 

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(j)    It understands that the certificates evidencing the Permanent Regulation S Global Notes shall bear legends substantially similar to those set forth in Section 4.4(h), (i) and (j) of this Series Supplement.

(k)    Either (i) it is not acquiring or holding the Series 2021-1 Class A-2 Notes (or any interest therein) for or on behalf of, or with the assets of, Plan or a governmental, church, non-U.S. or other plan which is subject to any Similar Law or (ii) its acquisition, holding and disposition of the Series 2021-1 Class A-2 Notes (or any interest therein) shall not constitute a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or, in the case of a governmental, church, non-U.S. or other plan, a non-exempt violation under any applicable Similar Law.

(l)    If it is using assets of a Plan to acquire or hold the Series 2021-1 Class A-2 Notes or any interest therein, then it further represents that (i) none of the Co-Issuers, the Initial Purchaser, any Guarantor, the Servicer, the Back-up Manager, the Trustee, nor any other party to the Securitization Transaction, nor any of their respective affiliates (collectively, the “Transaction Parties”) has acted as the Plan’s fiduciary, or has been relied upon for any advice, with respect to the Plan’s decision to acquire, hold, sell, exchange, vote or provide any consent with respect to the Series 2021-1 Class A-2 Notes, and none of the Transaction Parties shall at any time be relied upon as the Plan’s fiduciary with respect to the Plan’s decision to acquire, hold, sell, exchange, vote or provide any consent with respect to the Series 2021-1 Class A-2 Notes, and (ii) the decision to invest in the Series 2021-1 Class A-2 Notes has been made at the recommendation or direction of an independent fiduciary as contemplated by U.S. Code of Federal Regulations 29 C.F.R. Section 2510.3-21(c), as amended from time to time, who (a) is independent of the Transaction Parties; (b) is capable of evaluating investment risks independently, both in general and with respect to particular transactions and investment strategies; (c) is a fiduciary (under ERISA and/or Section 4975 of the Code) with respect to the Plan’s investment in the Series 2021-1 Class A-2 Notes and is responsible for exercising independent judgment in evaluating the investment in the Series 2021-1 Class A-2 Notes; and (e) is aware of and acknowledges that (1) none of the Transaction Parties is undertaking to provide impartial investment advice, or to give advice in a fiduciary capacity, in connection with the Plan’s investment in the Series 2021-1 Class A-2 Notes, and (2) the Transaction Parties have a financial interest in the Plan’s investment in the Series 2021-1 Class A-2 Notes.

(m)    It understands that any subsequent transfer of the Series 2021-1 Class A-2 Notes or any interest therein is subject to certain restrictions and conditions set forth in the Indenture and it agrees to be bound by, and not to resell, pledge or otherwise transfer the Series 2021-1 Class A-2 Notes or any interest therein except in compliance with, such restrictions and conditions and the Securities Act. In addition, it understands that the Series 2021-1 Class A-2 Notes are subject to certain transfer restrictions and may not be resold in Canada, directly or indirectly, except in reliance on an exemption from applicable prospectus requirements or discretionary relief under the applicable securities laws of any province or territory of Canada.

(n)    It is not a Competitor and is not purchasing for the account or benefit of a Competitor.

Section 4.6    Limitation on Liability. None of the Co-Issuers, the Trustee or any Paying Agent shall have any responsibility or liability for any aspects of the records maintained by DTC or its nominee or any of the Agent Members relating to or for payments made thereby on account of beneficial interests in a Rule l44A Global Note or a Regulation S Global Note. None of the Co-Issuers, the Trustee or the Paying Agent shall have any responsibility or liability with respect to any records maintained by the Noteholder with respect to the beneficial holders thereof or payments made thereby on account of beneficial interests held therein.

 

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ARTICLE V

GENERAL

Section 5.1    Information. On or before (x) the third Business Day prior to each Quarterly Payment Date, the Co-Issuers (or the Managers on their behalf) shall furnish, or cause to be furnished, a Quarterly Noteholders’ Allocation Report and (y) the third Business Day following the date when any Manager or any of their respective parent entities files its or their quarterly report, with respect to the first three fiscal quarters of each fiscal year, or annual report, with respect to the fourth fiscal quarter of such fiscal year, for such fiscal year with the SEC pursuant to the Exchange Act, the Co-Issuers (or the Managers on their behalf) shall furnish to the Trustee with a statement with the Quarterly Noteholders’ Report, in each case with respect to the Series 2021-1 Class A-2 Notes to the Trustee, setting forth, collectively, inter alia, the following information with respect to such Quarterly Payment Date:

(i)    the total amount available to be distributed to Series 2021-1 Class A-2 Noteholders on such Quarterly Payment Date;

(ii)    the amount of such distribution allocable to the payment of interest on the Series 2021-1 Class A-2 Notes;

(iii)    the amount of such distribution allocable to the payment of principal of the Series 2021-1 Class A-2 Notes;

(iv)    the amount of such distribution allocable to the payment of any Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration, if any;

(v)    the amount of such distribution allocable to the payment of any Release Prices;

(vi)    the amount of such distribution allocable to the payment of any fees or other amounts due to holders of Class A-1 Notes;

(vii)    whether, to the Actual Knowledge of the Co-Issuers, any Potential Rapid Amortization Event, Rapid Amortization Event, Default, Event of Default, Potential Manager Termination Event or Manager Termination Event has occurred, as of the related Quarterly Calculation Date, or any Cash Trapping Period is in effect, as of the related Quarterly Calculation Date;

(viii)    the DSCR for such Quarterly Payment Date and the three Quarterly Payment Dates immediately preceding such Quarterly Payment Date;

(ix)    the number of franchised locations and Securitization-Owned Locations located anywhere in the world that are open for business as of the last day of the preceding Quarterly Fiscal Period;

(x)    the amount of Driven Brands System-Wide Sales as of the related Quarterly Calculation Date; and

(xi)    the amount on deposit in the applicable Senior Notes Interest Reserve Accounts (and the availability under any Interest Reserve Letter of Credit relating to the Senior Notes) and the amount on deposit, if any, in the Cash Trap Reserve Accounts, in each case, as of the close of business on the last Business Day of the preceding Quarterly Fiscal Period.

 

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Any Series 2021-1 Class A-2 Noteholder may obtain copies of each Quarterly Noteholders’ Allocation Report and Quarterly Noteholders’ Report in accordance with the procedures set forth in Section 4.4 of the Base Indenture.

Section 5.2    Exhibits. The annexes, exhibits and schedules attached hereto and listed on the table of contents hereto supplement the annexes, exhibits and schedules included in the Base Indenture.

Section 5.3    Ratification of Base Indenture. As supplemented by this Series Supplement, the Base Indenture is in all respects ratified and confirmed and the Base Indenture as so supplemented by this Series Supplement shall be read, taken and construed as one and the same instrument.

Section 5.4    Requirements for Notices to the Rating Agencies. For purposes of Section 14.1 of the Base Indenture, the address for any notice or communication by any party to any Rating Agency shall be in writing and delivered in person, delivered by e-mail or mailed by first-class mail (registered or certified, return receipt requested), facsimile or overnight air courier guaranteeing next day delivery, to Rating Agency’s address:

If to S&P:

S&P Global Ratings

55 Water Street

New York, NY 10004

Attention: Structured Credit Surveillance Group

E-mail: servicer_reports@sandp.com

If to KBRA:

Kroll Bond Rating Agency, LLC

805 Third Ave., 29th Floor

New York, NY 10022

Attention: ABS Surveillance

E-mail: abssurveillance@kbra.com

Section 5.5    Certain Notices to the Rating Agencies. The Co-Issuers shall provide to each Rating Agency a copy of each Opinion of Counsel and Officer’s Certificate delivered to the Trustee pursuant to this Series Supplement or any other Transaction Document.

Section 5.6    Prior Notice by Trustee to the Controlling Class Representative and Control Party. Subject to Section 10.1 of the Base Indenture, the Trustee agrees that it shall not exercise any rights or remedies available to it as a result of the occurrence of a Rapid Amortization Event (subject to Section 3.6(b) and Section 3.6(d)(iii) of this Series Supplement) or an Event of Default until after the Trustee has given prior written notice thereof to the Controlling Class Representative and the Control Party and obtained the direction of the Control Party (subject to Section 11.4(e) of the Base Indenture, at the direction of the Controlling Class Representative).

 

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Section 5.7    Counterparts. This Series Supplement may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all of such counterparts shall together constitute but one and the same instrument.

Section 5.8    Electronic Signatures and Transmission. For purposes of this Series Supplement, any reference to “written” or “in writing” means any form of written communication, including, without limitation, electronic signatures, and any such written communication may be transmitted by Electronic Transmission. “Electronic Transmission” means any form of communication not directly involving the physical transmission of paper, including the use of, or participation in, one or more electronic networks or databases (including one or more distributed electronic networks or databases), that creates a record that may be retained, retrieved and reviewed by a recipient thereof and that may be directly reproduced in paper form by such a recipient through an automated process. The Trustee is authorized to accept written instructions, directions, reports, notices or other communications delivered by Electronic Transmission and shall not have any duty or obligation to verify or confirm that the Person sending instructions, directions, reports, notices or other communications or information by Electronic Transmission is, in fact, a Person authorized to give such instructions, directions, reports, notices or other communications or information on behalf of the party purporting to send such Electronic Transmission, and the Trustee shall not have any liability for any losses, liabilities, costs or expenses incurred or sustained by any party as a result of such reliance upon or compliance with such instructions, directions, reports, notices or other communications or information to the Trustee, including, without limitation, the risk of the Trustee acting on unauthorized instructions, notices, reports or other communications or information, and the risk of interception and misuse by third parties (except to the extent such action results from gross negligence, willful misconduct or fraud by the Trustee). Any requirement in this Series Supplement that is to be signed or authenticated by “manual signature” or similar language shall not be deemed to prohibit signature to be by facsimile or electronic signature and shall not be deemed to prohibit delivery thereof by Electronic Transmission. Notwithstanding anything to the contrary in this Series Supplement, any and all communications (both text and attachments) by or from the Trustee that the Trustee in its sole discretion deems to contain confidential, proprietary and/or sensitive information and sent by Electronic Transmission will be encrypted. The recipient of the Electronic Transmission will be required to complete a one-time registration process.

Section 5.9    Governing Law. THIS SERIES SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES (OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK).

Section 5.10    Amendments. This Series Supplement may not be modified or amended except in accordance with the terms of the Base Indenture and as described in Section 3.6(b) of this Series Supplement.

Section 5.11    Termination of Series Supplement. This Series Supplement shall cease to be of further effect when (i) all Outstanding Series 2021-1 Class A-2 Notes theretofore authenticated and issued have been delivered (other than destroyed, lost, or stolen Series 2021-1 Class A-2 Notes that have been replaced or paid) to the Trustee for cancellation and (ii) the Co-Issuers have paid all sums payable hereunder; provided that any provisions of this Series Supplement required for the Series 2021-1 Final Payment to be made shall survive until the Series 2021-1 Final Payment is paid to the Series 2021-1 Class A-2 Noteholders.

 

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Section 5.12    Entire Agreement. This Series Supplement, together with the exhibits and schedules hereto and the other Indenture Documents, contains a final and complete integration of all prior expressions by the parties hereto with respect to the subject matter hereof and shall constitute the entire agreement among the parties hereto with respect to the subject matter hereof, superseding all previous oral statements and other writings with respect thereto.

[Signature Pages Follow]

 

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IN WITNESS WHEREOF, the Co-Issuers, the Trustee and the Series 2021-1 Securities Intermediary have caused this Series Supplement to be duly executed by its respective duly authorized officer as of the day and year first written above.

 

DRIVEN BRANDS FUNDING, LLC,

as a Co-Issuer

By:  

/s/ Scott O’Melia

Name:   Scott O’Melia
Title:   Executive Vice President and Secretary
DRIVEN BRANDS CANADA FUNDING CORPORATION,
as a Co-Issuer
By:  

/s/ Scott O’Melia

Name:   Scott O’Melia
Title:   Executive Vice President and Secretary


CITIBANK, N.A., in its capacity as Trustee and as Series 2021-1 Securities Intermediary

By:

 

/s/ Anthony Bausa

 

Name:

  Anthony Bausa
 

Title:

  Senior Trust Officer


ANNEX A

SERIES 2021-1 SUPPLEMENTAL DEFINITIONS LIST

30/360 Basis” means the accrual of interest calculated on the basis of a 360-day year consisting of twelve 30-day months.

Agent Members” means members of, or participants in, DTC.

Cede” has the meaning set forth in Section 4.2(b)(i) of this Series 2021-1 Supplement.

Change of Control” means an event that will occur if as a result of any disposition or other event any combination of Permitted Holders in the aggregate fail to have the power, directly or indirectly, to vote or direct the voting of Equity Interests representing at least a majority of the ordinary voting power for the election of directors of DBI; provided that the occurrence of the foregoing event will not be deemed a Change of Control if, (i) prior to a Qualified IPO, (A) any combination of Permitted Holders in the aggregate otherwise have the right, directly or indirectly, to designate a majority of the board of directors of DBI at such time or (B) any combination of Permitted Holders in the aggregate own, directly or indirectly, a majority of the ordinary Voting Equity Interests of DBI at such time, (ii) upon or after a Qualified IPO, (A) no Person or “group” (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act as in effect on the Series 2016-1 Closing Date), other than any combination of the Permitted Holders, will have acquired beneficial ownership of more than the greater of (x) 35% on a fully diluted basis of the Voting Equity Interests of DBI and (y) the percentage owned, directly or indirectly, in the aggregate by the Permitted Holders on a fully diluted basis of the Voting Equity Interests of DBI and (B) during each period of twelve (12) consecutive months thereafter, a majority of the seats (other than vacant seats) on the board of directors of DBI will be occupied by Persons who were either (1) nominated by the board of directors of DBI or a Permitted Holder, (2) appointed by directors so nominated or (3) appointed by a Permitted Holder or (iii) in connection with an equity transfer, merger, consolidation or other combination transaction of DBI or one or more of its direct or indirect holding companies with or by another entity or entities, (A) any combination of Permitted Holders in the aggregate otherwise have the right, directly or indirectly, to designate or elect a percentage of the Board of Directors of DBI (or, if DBI is not a surviving entity as a result of such merger, such surviving entity) after giving effect to such transaction that is not less than the Permitted Holders’ ratable interest in DBI immediately before giving effect thereto or (B) any combination of Permitted Holders in the aggregate beneficially own, directly or indirectly, a percentage of the ordinary Voting Equity Interests of DBI (or, if DBI is not a surviving entity as a result of such merger, such surviving entity) after giving effect to such transaction that is not less than all Permitted Holders’ ratable interest in DBI immediately before giving effect thereto.

DBI” means Driven Brands, Inc., a Delaware corporation.

Definitive Notes” has the meaning set forth in Section 4.2(c) of this Series 2021-1 Supplement.

DTC” means The Depository Trust Company, and any successor thereto.

EU/UK Applicable Investor” means each Series 2021-1 Class A-2 Noteholder that has, on the relevant date, certified to the EU/UK Retention Holders (upon which certification the EU/UK Retention Holders may rely conclusively and without further enquiry) that (a) either (i) it is itself subject to the EU Securitization Laws or the UK Securitization Laws, or (ii) it is managed by an institution that is subject to the EU Securitization Laws or the UK Securitization Laws, and (b) in each case, such Holder will be relying on compliance by the EU/UK Retention Holders with the EU/UK Risk Retention Letter.


EU/UK Retention Holders” means the U.S. Manager and 12008432 Canada Inc., a Canadian corporation.

EU/UK Risk Retention Letter” means the letter agreement, dated as of the Series 2021-1 Closing Date, by the EU/UK Retention Holders in favor of the Co-Issuers, the Trustee (for the benefit of the EU/UK Applicable Investor) and the Initial Purchaser relating to the covenants and agreements made by the Managers in connection with compliance with certain relevant provisions under the Securitization Regulations.

EU Securitization Laws” means the EU Securitization Regulation, together with (i) any supplementary regulatory technical standards or implementing technical standards, (ii) any official binding guidance published in relation thereto by the European Banking Authority, the European Insurance and Occupational Pensions Authority or the European Securities and Markets Authority (including, in each case, any successor or replacement organization thereto) or by the European Commission, and (iii) any implementing laws or regulations (all, except as otherwise stated, as amended from time to time).

EU Securitization Regulation” means Regulation (EU) 2017/2402 (as amended by Regulation (EU) 2021/557) and, except as otherwise stated, means such Regulation as further amended from time to time.

Initial Purchaser” means Barclays Capital Inc.

KBRA” means Kroll Bond Rating Agency, LLC.

Offering Memorandum” means the final Offering Memorandum for the offering of the Series 2021-1 Class A-2 Notes, dated as of September 23, 2021, prepared by the Co-Issuers.

Outstanding Series 2021-1 Class A-2 Notes” means, with respect to the Series 2021-1 Class A-2 Notes, all Series 2021-1 Class A-2 Notes theretofore authenticated and delivered under the Base Indenture, except:

(i)    Series 2021-1 Class A-2 Notes theretofore canceled by the Registrar or delivered to the Registrar for cancellation;

(ii)    Series 2021-1 Class A-2 Notes, or portions thereof, for whose payment or redemption funds in the necessary amount have been theretofore irrevocably deposited in the Series 2021-1 Class A-2 Distribution Account and are available for payment of such Series 2021-1 Class A-2 Notes; provided that, if such Series 2021-1 Class A-2 Notes or portions thereof are to be redeemed, notice of such redemption has been duly given pursuant to the Indenture or provision therefore reasonably satisfactory to the Trustee has been made;

(iii)    Series 2021-1 Class A-2 Notes that have been defeased in accordance with Section 12.1 of the Base Indenture;

(iv)    Series 2021-1 Class A-2 Notes in exchange for, or in lieu of which, other Series 2021-1 Class A-2 Notes that have been authenticated and delivered pursuant to the Indenture, unless proof reasonably satisfactory to the Trustee is presented that any such Series 2021-1 Class A-2 Notes are held by a holder in due course or protected purchaser;


(v)    Series 2021-1 Class A-2 Notes alleged to have been mutilated, destroyed, lost or stolen for which replacement Series 2021-1 Class A-2 Notes have been issued as provided in the Indenture; and

(vi)    Series 2021-1 Class A-2 Notes which have been repurchased by a Co-Issuer or an Affiliate and thereafter cancelled;

provided that, (A) in determining whether the Noteholders of the requisite Outstanding Principal Amount have given any request, demand, authorization, direction, notice, consent, waiver or vote under the Indenture, the following Series 2021-1 Class A-2 Notes shall be disregarded and deemed not to be Outstanding: (x) Series 2021-1 Class A-2 Notes owned by the Driven Brands Entities or any other obligor upon the Series 2021-1 Class A-2 Notes or any Affiliate of any of them and (y) Series 2021-1 Class A-2 Notes held in any accounts with respect to which the Managers or any Affiliate thereof exercises discretionary voting authority; provided, further, that in determining whether the Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent, waiver or vote, only Series 2021-1 Class A-2 Notes as described under clause (x) or (y) above that a Trust Officer actually knows to be so owned shall be so disregarded; and (B) Series 2021-1 Class A-2 Notes owned in the manner indicated in clause (x) or (y) above that have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right so to act with respect to such Series 2021-1 Class A-2 Notes and that the pledgee is not a Driven Brands Entity or any other obligor or the Managers, an Affiliate thereof, or an account for which the Managers or an Affiliate of the Managers exercises discretionary voting authority.

Permanent Regulation S Global Notes” has the meaning set forth in Section 4.2(b)(ii) of this Series 2021-1 Supplement.

Prepayment Consideration End Date” has the meaning set forth in Section 3.6(e) of this Series 2021-1 Supplement.

Prepayment Notice” has the meaning set forth in Section 3.6(g)(i) of this Series 2021-1 Supplement.

Prepayment Record Date” means, with respect to the date of any Series 2021-1 Prepayment, the last day of the calendar month immediately preceding the date of such Series 2021-1 Prepayment unless such last day is less than ten (10) Business Days prior to the date of such Series 2021-1 Prepayment, in which case the “Prepayment Record Date” will be the last day of the second calendar month immediately preceding the date of such Series 2021-1 Prepayment.

Priority of Payments” shall have the meaning set forth in the Base Indenture.

Qualified Institutional Buyer” or “QIB” means a Person who is a “qualified institutional buyer” as defined in Rule 144A.

Rating Agencies” means S&P and/or KBRA, as applicable, and any successor or successors thereto. In the event that at any time the rating agencies rating the Series 2021-1 Class A-2 Notes do not include S&P or KBRA, references to rating categories of such former Rating Agency in this Series 2021-1 Supplement shall be deemed instead to be references to the equivalent categories of such other rating agency as then is rating the Series 2021-1 Class A-2 Notes as of the most recent date on which such other rating agency and such former Rating Agency’s published ratings for the type of security in respect of which such alternative rating agency is used.

Regulation S” means Regulation S promulgated under the Securities Act.


Regulation S Global Notes” means, collectively, the Temporary Regulation S Global Notes and the Permanent Regulation S Global Notes.

Restricted Period” means, with respect to any Series 2021-1 Class A-2 Notes sold pursuant to Regulation S, the period commencing on such Series 2021-1 Closing Date and ending on the 40th day after the Series 2021-1 Closing Date.

Rule 144A” means Rule 144A promulgated under the Securities Act.

Rule 144A Global Notes” has the meaning set forth in Section 4.2(b)(i) of this Series 2021-1 Supplement.

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

Securitization Laws” means the EU Securitization Laws and the UK Securitization Laws.

Securitization Regulations” means the EU Securitization Regulation and the UK Securitization Regulation; references to “each Securitization Regulation” or “either Securitization Regulation” shall be construed accordingly; and a reference to “the applicable Securitization Regulation” means, in relation to any EU/UK Applicable Investor, the Securitization Regulation to which such EU/UK Applicable Investor (or the relevant manager) is subject.

Series 2019-3 Class A-1 Note Purchase Agreement” means the Class A-1 Note Purchase Agreement, dated as of December 11, 2019, by and among the Co-Issuers, the Guarantors, the Managers, the Conduit Investors (as defined therein), the Committed Note Purchasers (as defined therein), the Funding Agents (as defined therein) for each Investor Group (as defined therein), and Barclays Bank PLC, as administrative agent thereunder, as amended on the Series 2020-2 Closing Date and as further amended, supplemented or otherwise modified from time to time.

Series 2021-1 Anticipated Repayment Date” has the meaning set forth in Section 3.6(b) of this Series 2021-1 Supplement. For purposes of the Base Indenture, the “Series 2021-1 Anticipated Repayment Date” shall be deemed to be an “Anticipated Repayment Date”.

Series 2021-1 Class A-2 Distribution Account” has the meaning set forth in Section 3.8(a) of this Series 2021-1 Supplement. For purposes of the Base Indenture, the “Series 2021-1 Class A-2 Distribution Account” shall be deemed to be a “Series Distribution Account”.

Series 2021-1 Class A-2 Note Owner” means, with respect to a Series 2021-1 Class A-2 Note that is a Book-Entry Note, the Person who is the beneficial owner of such Book-Entry Note, as reflected on the books of the Clearing Agency that holds such Book-Entry Note, or on the books of a Person maintaining an account with such Clearing Agency (directly or as an indirect participant, in accordance with the rules of such Clearing Agency).

Series 2021-1 Class A-2 Noteholder” means the Person in whose name a Series 2021-1 Class A-2 Note is registered in the Note Register.

Series 2021-1 Class A-2 Note Purchase Agreement” means the Purchase Agreement, dated as of September 23, 2021, by and among Barclays Capital Inc., on behalf of itself and as representative of the Initial Purchaser, the Co-Issuers, the Guarantors, the Managers, and Driven Brands Holdings Inc., as amended, supplemented or otherwise modified from time to time.


Series 2021-1 Class A-2 Note Rate” means 2.791% per annum. For purposes of the Base Indenture, the “Series 2021-1 Class A-2 Note Rate” shall be deemed to be a “Note Rate”.

Series 2021-1 Class A-2 Notes” has the meaning specified in the “Designation” of this Series 2021-1 Supplement.

Series 2021-1 Closing Date” means September 29, 2021. For purposes of the Base Indenture, the “Series 2021-1 Closing Date” shall be deemed to be a “Series Closing Date”.

Series 2021-1 Final Payment” means the payment of all accrued and unpaid interest on and principal of all Outstanding Series 2021-1 Class A-2 Notes.

Series 2021-1 Final Payment Date” means the date on which the Series 2021-1 Final Payment is made.

Series 2021-1 Global Notes” means, collectively, the Regulation S Global Notes and the Rule 144A Global Notes.

Series 2021-1 Ineligible Account” has the meaning set forth in Section 3.11 of this Series 2021-1 Supplement.

Series 2021-1 Initial Principal Amount” means the aggregate initial outstanding principal amount of the Series 2021-1 Class A-2 Notes, which is $450,000,000. For purposes of the Base Indenture, the “Series 2021-1 Initial Principal Amount” shall be deemed to be an “Initial Principal Amount”.

Series 2021-1 Legal Final Maturity Date” means October 2051. For purposes of the Base Indenture, the “Series 2021-1 Legal Final Maturity Date” shall be deemed to be a “Series Legal Final Maturity Date”.

Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration” means the amount (not less than zero) calculated by the Managers on behalf of the Co-Issuers equal to (i) the discounted present value as of a date not earlier than the fifth (5th) Business Day prior to the date of any relevant prepayment of the Series 2021-1 Class A-2 Notes (each, a “Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration Calculation Date”) of all future installments of interest (excluding any interest required to be paid on the related Series 2021-1 Prepayment Date) on and principal of the Series 2021-1 Class A-2 Notes that the Co-Issuers would otherwise be required to pay on the Series 2021-1 Class A-2 Notes (or such portion thereof to be prepaid) from the date of such prepayment to and including the Prepayment Consideration End Date, assuming principal payments are made pursuant to the then-applicable schedule of payments (giving effect to any ratable reductions in the Series 2021-1 Class A-2 Notes Scheduled Principal Payments due to optional and mandatory prepayments, including prepayments in connection with a Rapid Amortization Event and cancellations of repurchased Notes prior to the date of such prepayment and assuming no future prepayments are to be made in connection with a Rapid Amortization Event) and the entire remaining unpaid principal amount of the Series 2021-1 Class A-2 Notes or portion thereof is paid on the Prepayment Consideration End Date minus (ii) the Outstanding Principal Amount of the Series 2021-1 Class A-2 Notes (or portion thereof) being prepaid. For the purposes of the calculation of the discounted present value in clause (i) above, such present value shall be determined by the Managers using a discount rate equal to the sum of (x) the yield to maturity (adjusted to a quarterly bond-equivalent basis), on the Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration Calculation Date, of the United States Treasury Security having a maturity closest to the Prepayment Consideration End Date plus (y) 0.50%. For purposes of the Base Indenture, “Series 2021-1 Make-Whole Prepayment Consideration” shall be deemed to be a “Prepayment Consideration”.


Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration Calculation Date” has the meaning set forth in the definition of “Series 2021-1 Make-Whole Prepayment Consideration”.

Series 2021-1 Non-Amortization Test” means a test that will be satisfied on any Quarterly Payment Date (the “Reference Payment Date”) up to and including the Series 2021-1 Anticipated Repayment Date only if the level of the Senior Leverage Ratio is less than or equal to 5.00x as calculated on the Quarterly Calculation Date immediately preceding the Reference Payment Date. For purposes of the Base Indenture, the “Series 2021-1 Non-Amortization Test” shall be deemed to be a “Series Non-Amortization Test”.

Series 2021-1 Notes” has the meaning specified in the “Designation” of this Series 2021-1 Supplement.

Series 2021-1 Class A-2 Notes Optional Scheduled Principal Payment” means each principal payment made on each Quarterly Payment Date to the extent the Series 2021-1 Class A-2 Non-Amortization Test is satisfied for such Quarterly Payment Date, at the election of the Co-Issuers, in an amount not to exceed the Series 2021-1 Class A-2 Notes Scheduled Principal Payments Amounts that would otherwise be due on such Quarterly Payment Date if the Series 2021-1 Class A-2 Non-Amortization Test was not satisfied.

Series 2021-1 Outstanding Principal Amount” means, when used with respect to any date, an amount equal to (a) the Series 2021-1 Initial Principal Amount, minus (b) the aggregate amount of principal payments (whether pursuant to a Series 2021-1 Class A-2 Notes Scheduled Principal Payment, a prepayment, a purchase and cancellation, a redemption or otherwise) made to Series 2021-1 Class A-2 Noteholders with respect to Series 2021-1 Class A-2 Notes on or prior to such date. For purposes of the Base Indenture, the “Series 2021-1 Outstanding Principal Amount” shall be deemed to be an “Outstanding Principal Amount.”

Series 2021-1 Prepayment” has the meaning set forth in Section 3.6(e) of this Series 2021-1 Supplement.

Series 2021-1 Prepayment Amount” means the aggregate principal amount of the Series 2021-1 Class A-2 Notes to be prepaid on any Series 2021-1 Prepayment Date, together with all accrued and unpaid interest thereon to such date.

Series 2021-1 Prepayment Date” means the date on which any prepayment on the Series 2021-1 Class A-2 Notes is made pursuant to Section 3.6(d)(iii), Section 3.6(f) or Section 3.6(j) of this Series 2021-1 Supplement, which shall be, with respect to any Series 2021-1 Prepayment pursuant to Section 3.6(f) of this Series 2021-1 Supplement, the date specified as such in the applicable Prepayment Notice and, with respect to any Series 2021-1 Prepayment in connection with a Rapid Amortization Period, Release Prices or Asset Disposition Proceeds, the immediately succeeding Quarterly Payment Date.

Series 2021-1 Quarterly Interest” means an amount equal to the sum of (a) the accrued interest at the Series 2021-1 Class A-2 Note Rate on the Outstanding Principal Amount of the Series 2021-1 Class A-2 Notes (as of the first day of the related Interest Accrual Period or, if such day is the Series 2021-1 Closing Date, as of the Series 2021-1 Closing Date, after giving effect to all payments of principal made to such Noteholders as of such day or Quarterly Payment Date, as applicable, and also


giving effect to repurchases and cancellations of Series 2021-1 Class A-2 Notes during such Interest Accrual Period), calculated on a 30/360 Basis, and (b) the amount of any accrued and unpaid Series 2021-1 Quarterly Interest from any preceding Interest Accrual Periods. Such accrued interest will be due and payable in arrears on each Quarterly Payment Date. To the extent that such interest is not paid on any applicable Quarterly Payment Date, such unpaid amount will accrue interest to the extent legally permissible at the Series 2021-1 Default Rate. For purposes of the Base Indenture, “Series 2021-1 Quarterly Interest” shall be deemed to be a “Senior Notes Quarterly Interest Amount”.

Series 2021-1 Quarterly Post-ARD Additional Interest” has the meaning set forth in Section 3.5(b)(i) of this Series 2021-1 Supplement. For purposes of the Base Indenture, Series 2021-1 Quarterly Post-ARD Additional Interest shall be deemed to be “Senior Notes Accrued Quarterly Post-ARD Additional Interest Amounts”.

Series 2021-1 Quarterly Post-ARD Additional Interest Rate” has the meaning set forth in Section 3.5(b)(i) of this Series 2021-1 Supplement.

Series 2021-1 Class A-2 Notes Scheduled Principal Payment” means any payment of principal made pursuant to Section 3.2(f) of this Series 2021-1 Supplement. For purposes of the Base Indenture, the “Series 2021-1 Scheduled Principal Payments” shall be deemed to be “Scheduled Principal Payments”.

Series 2021-1 Class A-2 Notes Scheduled Principal Payment Deficiency Amount” means the amount, if positive, equal to the difference between (i) the Series 2021-1 Class A-2 Notes Scheduled Principal Payments Amounts due and payable, if any, on the related any Quarterly Payment Date plus any Series 2021-1 Class A-2 Notes Scheduled Principal Payments Amounts due but unpaid from any previous Quarterly Payment Dates and (ii) the amount of funds on deposit in the Senior Notes Principal Payment Accounts of the Co-Issuers with respect to the Series 2021-1 Class A-2 Notes (assuming for any Weekly Allocation Date within the Initial Currency Conversion Election Period, any Canadian Dollar amounts on deposit in any Senior Notes Principal Payment Account are settled pursuant to a Currency Conversion to U.S. Dollars as of such Weekly Allocation Date (based on the Spot Rate for any Currency Conversion settled for such Weekly Allocation Date or otherwise calculated based on the Deemed Spot Rate)).

Series 2021-1 Class A-2 Notes Scheduled Principal Payments Amounts” means, with respect to any Quarterly Payment Date commencing with the Quarterly Payment Date occurring in April 2021, an amount equal to 0.25% of the Series 2021-1 Initial Principal Amount (i.e., based on 1.0% of the Series 2021-1 Initial Principal Amount per annum) of the Series 2021-1 Class A-2 Notes; provided, that Series 2021-1 Class A-2 Notes Scheduled Principal Payments Amounts will only be due and payable on a Quarterly Payment Date if (i) the Series 2021-1 Non-Amortization Test is not satisfied with respect to the previous Quarterly Payment Date and (ii) such Quarterly Payment Date is prior to the Series 2021-1 Anticipated Repayment Date; provided, further, that, in connection with any optional prepayment of principal of the Series 2021-1 Class A-2 Notes, any prepayment of the Series 2021-1 Class A-2 Notes due to payments of Indemnification Amounts, Release Prices, Asset Disposition Proceeds or Insurance/Condemnation Proceeds or a Rapid Amortization Event or in connection with any repurchase and cancellation of any Series 2021-1 Class A-2 Notes, the Series 2021-1 Class A-2 Notes Scheduled Principal Payments Amounts for each remaining Quarterly Payment Date will be reduced ratably based on the amount of such prepayment or repurchase relative to the Outstanding Principal Amount of the Series 2021-1 Class A-2 Notes immediately prior to such prepayment or repurchase.

Series 2021-1 Securities Intermediary” has the meaning set forth in Section 3.9(a) of this Series 2021-1 Supplement.


Series 2021-1 Supplement” means this Series 2021-1 Supplement, dated as of the Series 2021-1 Closing Date, by and among the Co-Issuers, the Trustee and the Series 2021-1 Securities Intermediary, as amended, supplemented or otherwise modified from time to time.

Series Supplement” has the meaning specified in the preamble to this Series 2021-1 Supplement.

Similar Law” means any federal, state, local, or non-U.S. law that is substantially similar to the provisions of Section 406 of ERISA or Section 4975 of the Code.

Temporary Regulation S Global Notes” has the meaning set forth in Section 4.2(b)(ii) of this Series 2021-1 Supplement.

U.S. Person” has the meaning set forth in Section 4.2(a) of this Series 2021-1 Supplement.

UK Securitization Laws” means the UK Securitization Regulation, together with (i) any related technical standards, (ii) any official binding guidance published (or otherwise applicable) in relation thereto, and (iii) any implementing laws or regulations (all, except as otherwise stated, as amended from time to time).

UK Securitization Regulation” means Regulation (EU) 2017/2402, as it forms part of the domestic law of the UK by virtue of the European Union (Withdrawal) Act 2018 and as amended (including by the Securitisation (Amendment) (EU Exit) Regulations 2019) (and, except as otherwise stated, means such Regulation as further amended from time to time).


Exhibits to Series 2021-1 Supplement

 

EXHIBIT A-1-1

THE ISSUANCE AND SALE OF THIS RULE 144A GLOBAL SERIES 2021-1 CLASS A-2 NOTE HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER RELEVANT JURISDICTION. THIS RULE 144A GLOBAL SERIES 2021-1 CLASS A-2 NOTE HAS NOT BEEN AND WILL NOT BE QUALIFIED FOR DISTRIBUTION TO THE PUBLIC UNDER THE SECURITIES LAWS OF ANY PROVINCE OR TERRITORY OF CANADA. THIS RULE 144A GLOBAL SERIES 2021-1 CLASS A-2 NOTE MAY NOT BE OFFERED OR SOLD IN CANADA, DIRECTLY OR INDIRECTLY. NEITHER DRIVEN BRANDS FUNDING, LLC (THE “ISSUER”) NOR DRIVEN BRANDS CANADA FUNDING CORPORATION (THE “CANADIAN CO-ISSUER”) HAS BEEN REGISTERED UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED (THE “1940 ACT”). THIS NOTE OR ANY INTEREST HEREIN MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A) TO A CO-ISSUER OR AN AFFILIATE THEREOF, (B) IN THE UNITED STATES, TO A PERSON WHO IS NOT A COMPETITOR AND IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE 1933 ACT (“RULE 144A”), ACTING FOR ITS OWN ACCOUNT OR ONE OR MORE ACCOUNTS WITH RESPECT TO WHICH SUCH PERSON EXERCISES SOLE INVESTMENT DISCRETION OR (C) OUTSIDE THE UNITED STATES, TO A PERSON WHO IS NOT A COMPETITOR AND IS NOT A “U.S. PERSON” AS DEFINED IN REGULATION S UNDER THE 1933 ACT (“REGULATION S”), ACTING FOR ITS OWN ACCOUNT OR ONE OR MORE ACCOUNTS WITH RESPECT TO WHICH SUCH PERSON EXERCISES SOLE INVESTMENT DISCRETION, NONE OF WHICH ARE A U.S. PERSON, IN OFFSHORE TRANSACTIONS IN RELIANCE ON REGULATION S, AND, IN EACH CASE, IN COMPLIANCE WITH THE CERTIFICATIONS AND OTHER REQUIREMENTS SPECIFIED IN THE INDENTURE REFERRED TO HEREIN AND ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR THE UNITED STATES, ANY APPLICABLE SECURITIES LAWS OF ANY PROVINCE OR TERRITORY OF CANADA AND ANY OTHER RELEVANT JURISDICTION.

BY ITS ACQUISITION OR ACCEPTANCE HEREOF, THE HOLDER (IF NOT A CO-ISSUER OR AN AFFILIATE OF THE CO-ISSUERS) REPRESENTS THAT (A) IT IS NOT A COMPETITOR AND IS (X) A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A OR (Y) NOT A U.S. PERSON AND IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION, AS APPLICABLE, (B) IT IS ACTING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ANOTHER PERSON WHICH IS NOT A COMPETITOR AND IS EITHER (X) A QUALIFIED INSTITUTIONAL BUYER OR (Y) NOT A U.S. PERSON, AND IN EACH CASE WITH RESPECT TO WHICH IT EXERCISES SOLE INVESTMENT DISCRETION, (C) IT AND EACH ACCOUNT FOR WHICH IT IS PURCHASING WILL HOLD AND TRANSFER AT LEAST THE MINIMUM DENOMINATION OF NOTES, (D) IT UNDERSTANDS THAT THE CO-ISSUERS MAY RECEIVE A LIST OF PARTICIPANTS HOLDING POSITIONS IN ITS NOTES FROM ONE OR MORE BOOK-ENTRY DEPOSITORIES AND (E) IT WILL PROVIDE NOTICE OF THE TRANSFER RESTRICTIONS TO ANY SUBSEQUENT TRANSFEREES.

EACH PERSON (IF NOT A CO-ISSUER OR AN AFFILIATE OF THE CO-ISSUERS) TAKING DELIVERY OF THIS NOTE OR AN INTEREST IN THIS NOTE WILL BE DEEMED TO HAVE MADE THE APPLICABLE REPRESENTATIONS AND AGREEMENTS REFERRED TO IN THE INDENTURE. EACH PERSON TAKING DELIVERY OF THIS NOTE OR AN INTEREST IN THIS NOTE IN THE FORM OF AN INTEREST IN A TEMPORARY REGULATION S GLOBAL NOTE OR A PERMANENT REGULATION S GLOBAL NOTE WILL BE REQUIRED TO DELIVER A TRANSFER CERTIFICATE IN THE FORM REQUIRED BY THE INDENTURE AND WILL BE REQUIRED TO MAKE THE APPLICABLE REPRESENTATIONS AND AGREEMENTS REFERRED TO IN THE INDENTURE.

 

A-1-1-1


Exhibits to Series 2021-1 Supplement

 

ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING WILL BE OF NO FORCE AND EFFECT AND WILL BE VOID AB INITIO AND WILL NOT OPERATE TO TRANSFER ANY RIGHTS TO ANY PERSON CAUSING SUCH VIOLATION, NOTWITHSTANDING ANY INSTRUCTIONS TO THE CONTRARY TO ANY CO-ISSUER, THE TRUSTEE OR ANY INTERMEDIARY.

IF THIS NOTE WAS ACQUIRED IN THE UNITED STATES, AND THE HOLDER IS DETERMINED TO BE A COMPETITOR OR NOT TO HAVE BEEN A QUALIFIED INSTITUTIONAL BUYER AT THE TIME OF ACQUISITION OF THIS NOTE, THE CO-ISSUERS HAVE THE RIGHT TO REQUIRE SUCH HOLDER TO SELL THIS NOTE TO A PURCHASER WHO IS NOT A COMPETITOR AND IS A QUALIFIED INSTITUTIONAL BUYER. THE CO-ISSUERS ALSO HAVE THE RIGHT TO REFUSE TO HONOR A TRANSFER TO A PERSON WHO IS NOT A QUALIFIED INSTITUTIONAL BUYER OR WHO IS A COMPETITOR.

UNLESS PERMITTED UNDER THE APPLICABLE SECURITIES LAWS OF ANY PROVINCE OR TERRITORY OF CANADA, THE HOLDER OF THIS NOTE MUST NOT RESELL THIS NOTE IN CANADA BEFORE THE DATE THAT IS 4 MONTHS AND ONE DAY AFTER THE LATER OF (A) THE ORIGINAL ISSUE DATE OF THE NOTES AND (B) THE DATE ON WHICH BOTH THE CO-ISSUERS BECOME REPORTING ISSUERS UNDER THE APPLICABLE SECURITIES LAWS OF ANY PROVINCE OR TERRITORY OF CANADA.

IF THIS NOTE WAS ACQUIRED OUTSIDE THE UNITED STATES, AND THE HOLDER IS DETERMINED TO BE A COMPETITOR OR TO HAVE BEEN A “U.S. PERSON” AT THE TIME OF ACQUISITION OF THIS NOTE, THE CO-ISSUERS HAVE THE RIGHT TO REQUIRE SUCH HOLDER TO SELL THIS NOTE TO A PURCHASER WHO IS NOT A COMPETITOR AND IS NOT A “U.S. PERSON.” THE CO-ISSUERS ALSO HAVE THE RIGHT TO REFUSE TO HONOR A TRANSFER TO A PERSON WHO IS A “U.S. PERSON” OR WHO IS A COMPETITOR.

BY ACCEPTING THIS NOTE, EACH PURCHASER COVENANTS THAT IT WILL NOT AT ANY TIME PRIOR TO THE DATE WHICH IS ONE (1) YEAR AND ONE (1) DAY AFTER THE PAYMENT IN FULL OF THE LATEST MATURING NOTE, INSTITUTE AGAINST, OR JOIN WITH ANY OTHER PERSON IN INSTITUTING AGAINST, ANY SECURITIZATION ENTITY ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS, UNDER ANY FEDERAL, STATE, PROVINCIAL BANKRUPTCY, INSOLVENCY OR SIMILAR LAW.

THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY (“DTC”), A NEW YORK CORPORATION, 55 WATER STREET, NEW YORK, NEW YORK 10004, OR A NOMINEE THEREOF. THIS NOTE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS NOTE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN DTC OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE. UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC TO A CO-ISSUER OR THE NOTE REGISTRAR, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC, AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC, ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL BECAUSE THE REGISTERED OWNER, CEDE & CO., HAS AN INTEREST HEREIN.

 

A-1-1-2


Exhibits to Series 2021-1 Supplement

 

THE PRINCIPAL OF THIS NOTE IS PAYABLE AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF. ANY PERSON ACQUIRING THIS NOTE MAY ASCERTAIN ITS CURRENT PRINCIPAL AMOUNT BY INQUIRY OF THE TRUSTEE.

FORM OF RULE 144A GLOBAL SERIES 2021-1 CLASS A-2 NOTE

 

No. R-[__]    up to $[_____]

SEE REVERSE FOR CERTAIN CONDITIONS

CUSIP Number: 26209X AD3

ISIN Number: US26209XAD30

Common Code: 239142923

DRIVEN BRANDS FUNDING, LLC

SERIES 2021-1 2.791% FIXED RATE SENIOR SECURED NOTES, CLASS A-2

DRIVEN BRANDS FUNDING, LLC, a limited liability company formed under the laws of the State of Delaware (the “Issuer”) and DRIVEN BRANDS CANADA FUNDING CORPORATION, a corporation formed under the laws of Canada (the “Canadian Co-Issuer” and together with the Issuer, the “Co-Issuers” and each, a “Co-Issuer”), for value received, hereby promise to pay to CEDE & CO., or registered assigns, up to the principal sum of [_____] DOLLARS ($[_____]) as provided below and in the Indenture referred to herein. Payments of principal shall be payable in the amounts and at the times set forth in the Indenture described herein; provided, however, that the entire unpaid principal amount of this Note shall be due on the Quarterly Payment Date occurring in October 2051 (the “Series 2021-1 Legal Final Maturity Date”). The Co-Issuers will pay interest on this Rule 144A Global Series 2021-1 Class A-2 Note (this “Note”) at the Series 2021-1 Class A-2 Note Rate for each Interest Accrual Period in accordance with the terms of the Indenture. Such interest will be payable in arrears on each Quarterly Payment Date, which will be on the 20th day (or, if such 20th day is not a Business Day, the next succeeding Business Day) of each April, July, October and January, commencing October 20, 2021 (each, a “Quarterly Payment Date”). Such interest will accrue for each Quarterly Payment Date with respect to (i) initially, the period from and including the Series 2021-1 Closing Date to but excluding the 20th day of the calendar month that includes the first Quarterly Payment Date and (ii) thereafter, any period commencing on and including the 20th day of the calendar month in which the immediately preceding Quarterly Payment Date occurred to but excluding the 20th day of the calendar month that includes the then-current Quarterly Payment Date (each, an “Interest Accrual Period”). Interest with respect to the Notes (and interest on any defaulted payments of interest or principal) will be computed on the basis of a 360-day year consisting of twelve 30-day months. In addition, under the circumstances set forth in the Indenture, the Co-Issuers shall also pay additional interest on this Note at the Series 2021-1 Quarterly Post-ARD Additional Interest Rate, and such additional interest shall be computed and shall be payable in the amounts and at the times set forth in the Indenture.

The principal of and interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. All payments made by the Co-Issuers with respect to this Note shall be applied as provided in the Indenture.

This Note is subject to mandatory and optional prepayment as set forth in the Indenture.

 

A-1-1-3


Exhibits to Series 2021-1 Supplement

 

Interests in this Note are exchangeable or transferable in whole or in part for interests in a Temporary Regulation S Global Note or a Permanent Regulation S Global Note; provided that such transfer or exchange complies with the applicable provisions of the Indenture relating to the transfer of the Notes. Interests in this Note in certain circumstances may also be exchangeable or transferable in whole but not in part for duly executed and issued registered Definitive Notes; provided that such transfer or exchange complies with Section 2.8 of the Base Indenture and Section 4.2(c) of the Series 2021-1 Supplement.

Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note.

Although a summary of certain provisions of the Indenture is set forth below and on the reverse hereof and made a part hereof, this Note does not purport to summarize the Indenture and reference is made to the Indenture for information with respect to the interests, rights, benefits, obligations, proceeds and duties evidenced hereby and the rights, duties and obligations of the Co-Issuers and the Trustee. A copy of the Indenture may be requested from the Trustee by writing to the Trustee at Citibank, N.A., 388 Greenwich Street, New York, NY 10013, Attention: Agency & Trust—Driven Brands Funding, LLC. To the extent not defined herein, the capitalized terms used herein have the meanings ascribed to them in the Indenture. In the event of any inconsistency between the provisions of this Note and the Indenture, the provisions of the Indenture shall govern.

Subject to the next following paragraph, the Co-Issuers hereby certify and declare that all acts, conditions and things required to be done and performed and to have happened prior to the creation of this Note and to constitute it as the valid obligation of the Co-Issuers enforceable in accordance with its terms have been done and performed and have happened in due compliance with all applicable laws and in accordance with the terms of the Indenture.

Unless the certificate of authentication hereon has been executed by the Trustee whose name appears below by manual, facsimile or electronic signature, this Note shall not be entitled to any benefit under the Indenture referred to on the reverse hereof, or be valid or obligatory for any purpose.

[Remainder of page intentionally left blank]

 

A-1-1-4


Exhibits to Series 2021-1 Supplement

 

IN WITNESS WHEREOF, each of the Co-Issuers has caused this instrument to be signed, manually or in facsimile, by its Authorized Officer.

Date:                                                                                       

 

DRIVEN BRANDS FUNDING, LLC, as Co-Issuer
By:                                                                                                  
Name:
Title:
DRIVEN BRANDS CANADA FUNDING CORPORATION, as Co-Issuer
By:                                                                                                  
Name:
Title:

 

A-1-1-5


Exhibits to Series 2021-1 Supplement

 

CERTIFICATE OF AUTHENTICATION

This is one of the Series 2021-1 Class A-2 Notes issued under the within mentioned Indenture.

 

CITIBANK, N.A., as Trustee
By:                                                                                                  
Name:
Title: Authorized Signatory

 

A-1-1-6


Exhibits to Series 2021-1 Supplement

 

[REVERSE OF NOTE]

This Note is one of a duly authorized issue of Series 2021-1 Class A-2 Notes of the Co-Issuers designated as its Series 2021-1 2.791% Fixed Rate Senior Secured Notes, Class A-2 (herein called the “Series 2021-1 Class A-2 Notes”), all issued under (i) the Amended and Restated Base Indenture, dated as of April 24, 2018 (such Base Indenture, as amended by the Amendment No. 1 to the Base Indenture, dated as of March 19, 2019, Amendment No. 2 to the Base Indenture, dated as of June 15, 2019, Amendment No. 3 to the Base Indenture, dated as of September 17, 2019, Amendment No. 4 to the Base Indenture, dated as of July 6, 2020, Amendment No. 5 to the Base Indenture, dated as of December 14, 2020, Amendment No. 6 to the Base Indenture, dated as of March 30, 2021, Amendment No. 7 to the Base Indenture, dated as of March 30, 2021, Amendment No. 8 to the Base Indenture, dated as of September 29, 2021 and as may be further amended, restated, amended and restated, supplemented or modified, is herein called the “Base Indenture”), among the Co-Issuers and Citibank, N.A., as trustee (in such capacity, the “Trustee”, which term includes any successor Trustee under the Base Indenture) and as securities intermediary, and (ii) a Series 2021-1 Supplement to the Base Indenture, dated as of September 29, 2021 (the “Series 2021-1 Supplement”), among the Co-Issuers, the Trustee and Citibank, N.A., as Series 2021-1 securities intermediary. The Base Indenture and the Series 2021-1 Supplement are referred to herein as the “Indenture”. The Series 2021-1 Class A-2 Notes are subject to all terms of the Indenture. All terms used in this Note that are defined in the Indenture, as supplemented, modified or amended, shall have the meanings assigned to them in or pursuant to the Indenture, as so supplemented, modified or amended.

The Series 2021-1 Class A-2 Notes are and will be secured by the Collateral pledged as security therefor as provided in the Indenture.

The Notes will be issued in minimum denominations of $25,000 and in any whole number denomination in excess thereof.

As provided for in the Indenture, the Series 2021-1 Class A-2 Notes may be prepaid, in whole or in part, at the option of the Co-Issuers. In addition, the Series 2021-1 Class A-2 Notes are subject to mandatory prepayment as provided for in the Indenture. In certain circumstances, the Co-Issuers will be obligated to pay the Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration in connection with a mandatory or optional prepayment of the Series 2021-1 Class A-2 Notes as described in the Indenture. As described above, the entire unpaid principal amount of this Note shall be due and payable on the Series 2021-1 Legal Final Maturity Date. All payments of principal of the Series 2021-1 Class A-2 Notes will be made pro rata to the Series 2021-1 Class A-2 Noteholders entitled thereto.

Principal of and interest on this Note which is payable on a Quarterly Payment Date or on any date on which payments are permitted to be made as provided for in the Indenture shall be paid to the Person in whose name this Note (or one or more predecessor Notes) is registered at the close of business on the applicable Record Date or Prepayment Record Date, as the case may be.

Interest and additional interest, if any, will each accrue on the Series 2021-1 Class A-2 Notes at the rates set forth in the Indenture. The interest and additional interest, if any, will be computed on the basis set forth in the Indenture. The amount of interest payable on the Series 2021-1 Class A-2 Notes on each Quarterly Payment Date will be calculated as set forth in the Indenture.

Payments of principal and interest on this Note are subordinated to the payment of certain other amounts in accordance with the Priority of Payments.

 

A-1-1-7


Exhibits to Series 2021-1 Supplement

 

If an Event of Default shall occur and be continuing, this Note may become or be declared due and payable in the manner and with the effect provided in the Indenture.

Amounts payable in respect of this Note shall be made by wire transfer of immediately available funds to the account designated by DTC or its nominee.

As provided in the Indenture and subject to certain limitations set forth therein, the transfer of this Note may be registered on the Note Register upon surrender of this Note for registration of transfer at the office or agency designated by the Co-Issuers pursuant to the Indenture, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Trustee, the Co-Issuers and the Registrar duly executed by, the Series 2021-1 Class A-2 Noteholder hereof or its attorney duly authorized in writing, with such signature guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended, and accompanied by such other documents as the Trustee and the Registrar may require and as may be required by the Series 2021-1 Supplement, and thereupon one or more new Series 2021-1 Class A-2 Notes of authorized denominations in the same aggregate principal amount will be issued to the designated transferee or transferees. No service charge will be charged for any registration of transfer or exchange of this Note, but the transferor may be required to pay a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any such registration of transfer or exchange.

Each Series 2021-1 Class A-2 Noteholder, by acceptance of a Series 2021-1 Class A-2 Note, covenants and agrees by accepting the benefits of the Indenture that, prior to the date that is one year and one day after the payment in full of the latest maturing note issued under the Indenture, such Series 2021-1 Class A-2 Noteholder will not institute against, or join with any other Person in instituting against, any Securitization Entity any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings, under any federal or state bankruptcy or similar law; provided, however, that nothing herein shall constitute a waiver of any right to indemnification, reimbursement or other payment from the Securitization Entities pursuant to the Indenture or any other Transaction Document.

It is the intent of the Co-Issuers and each Series 2021-1 Class A-2 Noteholder that, for federal, state, local income and franchise tax purposes only, the Series 2021-1 Class A-2 Notes will evidence indebtedness of the Co-Issuers secured by the Collateral. Each Series 2021-1 Class A-2 Noteholder, by the acceptance of this Note, agrees to treat this Note (or beneficial interests herein) for all purposes of federal, state, local income or franchise taxes, and any other tax imposed on or measured by income, as indebtedness of the Co-Issuers or, if any Co-Issuer is treated as a division of another entity, such other entity.

The Indenture permits certain amendments to be made thereto without the consent of the Control Party, the Controlling Class Representative or any Series 2021-1 Class A-2 Noteholders, provided that certain conditions precedent are satisfied. The Indenture also permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Co-Issuers and the rights of the Series 2021-1 Class A-2 Noteholders under the Indenture at any time by the Co-Issuers with the consent of the Control Party (acting at the direction of the Controlling Class Representative) and without the consent of any Series 2021-1 Class A-2 Noteholders. The Indenture also contains provisions permitting the Control Party (acting at the direction of the Controlling Class Representative) to waive compliance by the Co-Issuers with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences without the consent of any Series 2021-1

 

A-1-1-8


Exhibits to Series 2021-1 Supplement

 

Class A-2 Noteholders. Any such consent or waiver of this Note (or any one or more predecessor Notes) shall be conclusive and binding upon such Series 2021-1 Class A-2 Noteholder and upon all future Series 2021-1 Class A-2 Noteholders of this Note and of any Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof whether or not notation of such consent or waiver is made upon this Note.

Each purchaser or transferee of this Note (or any interest herein) shall be deemed to represent and warrant that either (i) it is not acquiring or holding this Note (or any interest herein) for or on behalf of, or with the assets of, a Plan or a governmental, church, non-U.S. or other plan which is subject to any Similar Law or (ii) its acquisition, holding and disposition of this Note (or any interest herein) shall not constitute a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or, in the case of a governmental, church, non-U.S. or other plan, a non-exempt violation under any applicable Similar Law.

The term “Co-Issuer” as used in this Note includes any successor to a Co-Issuer.

The Series 2021-1 Class A-2 Notes are issuable only in registered form in denominations as provided in the Indenture, subject to certain limitations set forth therein.

This Note and the Indenture shall be governed by, and construed and interpreted in accordance with, the laws of the State of New York without regard to conflicts of law principles (other than Sections 5-1401 and 5-1402 of the General Obligations Law of the State of New York), and the obligations, rights and remedies of the parties hereunder and thereunder shall be determined in accordance with such laws.

No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Co-Issuers, which is absolute and unconditional, to pay the principal of and interest on this Note at the times, place and rate and in the coin or currency herein prescribed.

 

A-1-1-9


Exhibits to Series 2021-1 Supplement

 

ASSIGNMENT

Social Security or taxpayer I.D. or other identifying number of assignee:                                                                  

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto

 

 

(name and address of assignee)

the within Note and all rights thereunder, and hereby irrevocably constitutes and appoints

 

 

, attorney, to transfer said Note on the books kept for registration thereof, with full power of substitution in the premises.

Dated:                                                              

 

By:                                                                                                1
Signature Guaranteed:

 

 

 

1 

NOTE: The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Note, without alteration, enlargement or any change whatsoever.

 

A-1-1-10


Exhibits to Series 2021-1 Supplement

 

SCHEDULE OF EXCHANGES IN RULE 144A

GLOBAL SERIES 2021-1 CLASS A-2 NOTE

The initial principal balance of this Rule 144A Global Series 2021-1 Class A-2 Note is $[_____]. The following exchanges of an interest in this Rule 144A Global Series 2021-1 Class A-2 Note for an interest in a corresponding Temporary Regulation S Global Series 2021-1 Class A-2 Note or a Permanent Regulation S Global Series 2021-1 Class A-2 Note have been made:

 

Date

  

Amount of Increase

(or Decrease) in the

Principal Amount of this

Rule 144A Global Note

  

Remaining Principal

Amount of this Rule

144A Global Note

following the Increase

or Decrease

  

Signature of
Authorized Officer of
Trustee or Registrar

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

A-1-1-11


Exhibits to Series 2021-1 Supplement

 

EXHIBIT A-1-2

THE ISSUANCE AND SALE OF THIS TEMPORARY REGULATION S GLOBAL SERIES 2021-1 CLASS A-2 NOTE HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER RELEVANT JURISDICTION. THIS TEMPORARY REGULATION S GLOBAL SERIES 2021-1 CLASS A-2 NOTE HAS NOT BEEN AND WILL NOT BE QUALIFIED FOR DISTRIBUTION TO THE PUBLIC UNDER THE SECURITIES LAWS OF ANY PROVINCE OR TERRITORY OF CANADA. THIS TEMPORARY REGULATION S GLOBAL SERIES 2021-1 CLASS A-2 NOTE MAY NOT BE OFFERED OR SOLD IN CANADA, DIRECTLY OR INDIRECTLY. NEITHER DRIVEN BRANDS FUNDING, LLC (THE “ISSUER”) NOR DRIVEN BRANDS CANADA FUNDING CORPORATION (THE “CANADIAN CO-ISSUER”) HAS BEEN REGISTERED UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED (THE “1940 ACT”). THIS NOTE OR ANY INTEREST HEREIN MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A) TO A CO-ISSUER OR AN AFFILIATE THEREOF, (B) IN THE UNITED STATES, TO A PERSON WHO IS NOT A COMPETITOR AND IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE 1933 ACT (“RULE 144A”), ACTING FOR ITS OWN ACCOUNT OR ONE OR MORE ACCOUNTS WITH RESPECT TO WHICH SUCH PERSON EXERCISES SOLE INVESTMENT DISCRETION OR (C) OUTSIDE THE UNITED STATES, TO A PERSON WHO IS NOT A COMPETITOR AND IS NOT A “U.S. PERSON” AS DEFINED IN REGULATION S UNDER THE 1933 ACT (“REGULATION S”), ACTING FOR ITS OWN ACCOUNT OR ONE OR MORE ACCOUNTS WITH RESPECT TO WHICH SUCH PERSON EXERCISES SOLE INVESTMENT DISCRETION, NONE OF WHICH ARE A U.S. PERSON, IN OFFSHORE TRANSACTIONS IN RELIANCE ON REGULATION S, AND, IN EACH CASE, IN COMPLIANCE WITH THE CERTIFICATIONS AND OTHER REQUIREMENTS SPECIFIED IN THE INDENTURE REFERRED TO HEREIN AND ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR THE UNITED STATES, ANY APPLICABLE SECURITIES LAWS OF ANY PROVINCE OR TERRITORY OF CANADA AND ANY OTHER RELEVANT JURISDICTION.

BY ITS ACQUISITION OR ACCEPTANCE HEREOF, THE HOLDER (IF NOT A CO-ISSUER OR AN AFFILIATE OF THE CO-ISSUERS) REPRESENTS THAT (A) IT IS NOT A COMPETITOR AND IS (X) A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A OR (Y) NOT A U.S. PERSON AND IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION, AS APPLICABLE, (B) IT IS ACTING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ANOTHER PERSON WHICH IS NOT A COMPETITOR AND IS EITHER (X) A QUALIFIED INSTITUTIONAL BUYER OR (Y) NOT A U.S. PERSON, AND IN EACH CASE WITH RESPECT TO WHICH IT EXERCISES SOLE INVESTMENT DISCRETION, (C) IT AND EACH ACCOUNT FOR WHICH IT IS PURCHASING WILL HOLD AND TRANSFER AT LEAST THE MINIMUM DENOMINATION OF NOTES, (D) IT UNDERSTANDS THAT THE CO-ISSUERS MAY RECEIVE A LIST OF PARTICIPANTS HOLDING POSITIONS IN ITS NOTES FROM ONE OR MORE BOOK-ENTRY DEPOSITORIES AND (E) IT WILL PROVIDE NOTICE OF THE TRANSFER RESTRICTIONS TO ANY SUBSEQUENT TRANSFEREES.

EACH PERSON (IF NOT A CO-ISSUER OR AN AFFILIATE OF THE CO-ISSUERS) TAKING DELIVERY OF THIS NOTE OR AN INTEREST IN THIS NOTE WILL BE DEEMED TO HAVE MADE THE APPLICABLE REPRESENTATIONS AND AGREEMENTS REFERRED TO IN THE INDENTURE. EACH PERSON TAKING DELIVERY OF THIS NOTE OR AN INTEREST IN THIS NOTE IN THE FORM OF AN INTEREST IN A RULE 144A GLOBAL NOTE OR A PERMANENT REGULATION S GLOBAL NOTE WILL BE REQUIRED TO DELIVER A TRANSFER CERTIFICATE IN THE FORM REQUIRED BY THE INDENTURE AND WILL BE REQUIRED TO MAKE THE APPLICABLE REPRESENTATIONS AND AGREEMENTS REFERRED TO IN THE INDENTURE.

 

A-1-2-1


Exhibits to Series 2021-1 Supplement

 

ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING WILL BE OF NO FORCE AND EFFECT AND WILL BE VOID AB INITIO AND WILL NOT OPERATE TO TRANSFER ANY RIGHTS TO ANY PERSON CAUSING SUCH VIOLATION, NOTWITHSTANDING ANY INSTRUCTIONS TO THE CONTRARY TO ANY CO-ISSUER, THE TRUSTEE OR ANY INTERMEDIARY.

IF THIS NOTE WAS ACQUIRED IN THE UNITED STATES, AND THE HOLDER IS DETERMINED TO BE A COMPETITOR OR NOT TO HAVE BEEN A QUALIFIED INSTITUTIONAL BUYER AT THE TIME OF ACQUISITION OF THIS NOTE, THE CO-ISSUERS HAVE THE RIGHT TO REQUIRE SUCH HOLDER TO SELL THIS NOTE TO A PURCHASER WHO IS NOT A COMPETITOR AND IS A QUALIFIED INSTITUTIONAL BUYER. THE CO-ISSUERS ALSO HAVE THE RIGHT TO REFUSE TO HONOR A TRANSFER TO A PERSON WHO IS NOT A QUALIFIED INSTITUTIONAL BUYER OR WHO IS A COMPETITOR.

UNLESS PERMITTED UNDER THE APPLICABLE SECURITIES LAWS OF ANY PROVINCE OR TERRITORY OF CANADA, THE HOLDER OF THIS NOTE MUST NOT RESELL THIS NOTE IN CANADA BEFORE THE DATE THAT IS 4 MONTHS AND ONE DAY AFTER THE LATER OF (A) THE ORIGINAL ISSUE DATE OF THE NOTES AND (B) THE DATE ON WHICH BOTH THE CO-ISSUERS BECOME REPORTING ISSUERS UNDER THE APPLICABLE SECURITIES LAWS OF ANY PROVINCE OR TERRITORY OF CANADA.

IF THIS NOTE WAS ACQUIRED OUTSIDE THE UNITED STATES, AND THE HOLDER IS DETERMINED TO BE A COMPETITOR OR TO HAVE BEEN A “U.S. PERSON” AT THE TIME OF ACQUISITION OF THIS NOTE, THE CO-ISSUERS HAVE THE RIGHT TO REQUIRE SUCH HOLDER TO SELL THIS NOTE TO A PURCHASER WHO IS NOT A COMPETITOR AND IS NOT A “U.S. PERSON.” THE CO-ISSUERS ALSO HAVE THE RIGHT TO REFUSE TO HONOR A TRANSFER TO A PERSON WHO IS A “U.S. PERSON” OR WHO IS A COMPETITOR.

BY ACCEPTING THIS NOTE, EACH PURCHASER COVENANTS THAT IT WILL NOT AT ANY TIME PRIOR TO THE DATE WHICH IS ONE (1) YEAR AND ONE (1) DAY AFTER THE PAYMENT IN FULL OF THE LATEST MATURING NOTE, INSTITUTE AGAINST, OR JOIN WITH ANY OTHER PERSON IN INSTITUTING AGAINST, ANY SECURITIZATION ENTITY ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS, UNDER ANY FEDERAL, STATE, PROVINCIAL BANKRUPTCY, INSOLVENCY OR SIMILAR LAW.

UNTIL FORTY (40) DAYS AFTER THE ORIGINAL ISSUE DATE OF THE NOTES (THE “RESTRICTED PERIOD”) IN CONNECTION WITH THE OFFERING OF THE NOTES IN THE UNITED STATES FROM OUTSIDE OF THE UNITED STATES, THE SALE, PLEDGE OR TRANSFER OF THIS NOTE IS SUBJECT TO CERTAIN CONDITIONS AND RESTRICTIONS. THE HOLDER HEREOF, BY PURCHASING OR OTHERWISE ACQUIRING THIS NOTE, ACKNOWLEDGES THAT SUCH HOLDER IS EITHER NOT A “U.S. PERSON” OR A CO-ISSUER OR AN AFFILIATE OF THE CO-ISSUERS, AND THAT THIS NOTE HAS NOT BEEN REGISTERED UNDER THE 1933 ACT AND AGREES FOR THE BENEFIT OF THE CO-ISSUERS THAT THIS NOTE MAY BE TRANSFERRED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY TO A HOLDER THAT IS NOT A “U.S. PERSON” OR TO A CO-ISSUER OR AN AFFILIATE OF THE CO-ISSUERS AND IN COMPLIANCE WITH THE 1933 ACT AND

 

A-1-2-2


Exhibits to Series 2021-1 Supplement

 

OTHER APPLICABLE LAWS OF THE STATES, TERRITORIES AND POSSESSIONS OF THE UNITED STATES GOVERNING THE OFFER AND SALE OF SECURITIES, AND PRIOR TO THE EXPIRATION OF THE RESTRICTED PERIOD, ONLY (I) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE 1933 ACT OR (II) PURSUANT TO AND IN ACCORDANCE WITH RULE 144A UNDER THE 1933 ACT.

THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY (“DTC”), A NEW YORK CORPORATION, 55 WATER STREET, NEW YORK, NEW YORK 10004, OR A NOMINEE THEREOF. THIS NOTE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS NOTE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN DTC OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE. UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC TO A CO-ISSUER OR THE NOTE REGISTRAR, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC, AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC, ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL BECAUSE THE REGISTERED OWNER, CEDE & CO., HAS AN INTEREST HEREIN.

 

A-1-2-3


Exhibits to Series 2021-1 Supplement

 

THE PRINCIPAL OF THIS NOTE IS PAYABLE AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF. ANY PERSON ACQUIRING THIS NOTE MAY ASCERTAIN ITS CURRENT PRINCIPAL AMOUNT BY INQUIRY OF THE TRUSTEE.

FORM OF TEMPORARY REGULATION S GLOBAL SERIES 2021-1 CLASS A-2 NOTE

 

No. S-[_]    up to $[_____]

SEE REVERSE FOR CERTAIN CONDITIONS

CUSIP Number: U26488 AC7

ISIN Number: USU26488AC70

Common Code: 239142931

DRIVEN BRANDS FUNDING, LLC

SERIES 2021-1 2.791% FIXED RATE SENIOR SECURED NOTES, CLASS A-2

DRIVEN BRANDS FUNDING, LLC, a limited liability company formed under the laws of the State of Delaware (the “Issuer”) and DRIVEN BRANDS CANADA FUNDING CORPORATION, a corporation formed under the laws of Canada (the “Canadian Co-Issuer” and together with the Issuer, the “Co-Issuers” and each, a “Co-Issuer”), for value received, hereby promise to pay to CEDE & CO., or registered assigns, up to the principal sum of [_____] DOLLARS ($[_____]) as provided below and in the Indenture referred to herein. Payments of principal shall be payable in the amounts and at the times set forth in the Indenture described herein; provided, however, that the entire unpaid principal amount of this Note shall be due on the Quarterly Payment Date occurring in October 2051 (the “Series 2021-1 Legal Final Maturity Date”). The Co-Issuers will pay interest on this Temporary Regulation S Global Series 2021-1 Class A-2 Note (this “Note”) at the Series 2021-1 Class A-2 Note Rate for each Interest Accrual Period in accordance with the terms of the Indenture. Such interest will be payable in arrears on each Quarterly Payment Date, which will be on the 20th day (or, if such 20th day is not a Business Day, the next succeeding Business Day) of each April, July, October and January, commencing October 20, 2021 (each, a “Quarterly Payment Date”). Such interest will accrue for each Quarterly Payment Date with respect to (i) initially, the period from and including the Series 2021-1 Closing Date to but excluding the 20th day of the calendar month that includes the first Quarterly Payment Date and (ii) thereafter, any period commencing on and including the 20th day of the calendar month in which the immediately preceding Quarterly Payment Date occurred to but excluding the 20th day of the calendar month that includes the then-current Quarterly Payment Date (each, an “Interest Accrual Period”). Interest with respect to the Notes (and interest on any defaulted payments of interest or principal) will be computed on the basis of a 360-day year consisting of twelve 30-day months. In addition, under the circumstances set forth in the Indenture, the Co-Issuers shall also pay additional interest on this Note at the Series 2021-1 Quarterly Post-ARD Additional Interest Rate, and such additional interest shall be computed and shall be payable in the amounts and at the times set forth in the Indenture.

The principal of and interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. All payments made by the Co-Issuers with respect to this Note shall be applied as provided in the Indenture.

This Note is subject to mandatory and optional prepayment as set forth in the Indenture.

 

A-1-2-4


Exhibits to Series 2021-1 Supplement

 

Interests in this Note are exchangeable or transferable in whole or in part for interests in a Rule 144A Global Note or a Permanent Regulation S Global Note; provided that such transfer or exchange complies with the applicable provisions of the Indenture relating to the transfer of the Notes. Interests in this Note in certain circumstances may also be exchangeable or transferable in whole but not in part for duly executed and issued registered Definitive Notes; provided that such transfer or exchange complies with Section 2.8 of the Base Indenture and Section 4.2(c) of the Series 2021-1 Supplement.

Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note.

Although a summary of certain provisions of the Indenture is set forth below and on the reverse hereof and made a part hereof, this Note does not purport to summarize the Indenture and reference is made to the Indenture for information with respect to the interests, rights, benefits, obligations, proceeds and duties evidenced hereby and the rights, duties and obligations of the Co-Issuers and the Trustee. A copy of the Indenture may be requested from the Trustee by writing to the Trustee at Citibank, N.A., 388 Greenwich Street, New York, NY 10013, Attention: Agency & Trust—Driven Brands Funding, LLC. To the extent not defined herein, the capitalized terms used herein have the meanings ascribed to them in the Indenture. In the event of any inconsistency between the provisions of this Note and the Indenture, the provisions of the Indenture shall govern.

Subject to the next following paragraph, the Co-Issuers hereby certify and declare that all acts, conditions and things required to be done and performed and to have happened prior to the creation of this Note and to constitute it as the valid obligation of the Co-Issuers enforceable in accordance with its terms have been done and performed and have happened in due compliance with all applicable laws and in accordance with the terms of the Indenture.

Unless the certificate of authentication hereon has been executed by the Trustee whose name appears below by manual, facsimile or electronic signature, this Note shall not be entitled to any benefit under the Indenture referred to on the reverse hereof, or be valid or obligatory for any purpose.

[Remainder of page intentionally left blank]

 

A-1-2-5


Exhibits to Series 2021-1 Supplement

 

IN WITNESS WHEREOF, each of the Co-Issuers has caused this instrument to be signed, manually or in facsimile, by its Authorized Officer.

Date:                                                                              

 

DRIVEN BRANDS FUNDING, LLC, as Co-Issuer
By:                                                                                                  
Name:
Title:
DRIVEN BRANDS CANADA FUNDING CORPORATION, as Co-Issuer
By:                                                                                                  
Name:
Title:

 

A-1-2-6


Exhibits to Series 2021-1 Supplement

 

CERTIFICATE OF AUTHENTICATION

This is one of the Series 2021-1 Class A-2 Notes issued under the within mentioned Indenture.

 

CITIBANK, N.A., as Trustee
By:                                                                                                  
Name:
Title: Authorized Signatory

 

A-1-2-7


Exhibits to Series 2021-1 Supplement

 

[REVERSE OF NOTE]

This Note is one of a duly authorized issue of Series 2021-1 Class A-2 Notes of the Co-Issuers designated as its Series 2021-1 2.791% Fixed Rate Senior Secured Notes, Class A-2 (herein called the “Series 2021-1 Class A-2 Notes”), all issued under (i) the Amended and Restated Base Indenture, dated as of April 24, 2018 (such Base Indenture, as amended by the Amendment No. 1 to the Base Indenture, dated as of March 19, 2019, Amendment No. 2 to the Base Indenture, dated as of June 15, 2019, Amendment No. 3 to the Base Indenture, dated as of September 17, 2019, Amendment No. 4 to the Base Indenture, dated as of July 6, 2020, Amendment No. 5 to the Base Indenture, dated as of December 14, 2020, Amendment No. 6 to the Base Indenture, dated as of March 30, 2021, Amendment No. 7 to the Base Indenture, dated as of March 30, 2021, Amendment No. 8 to the Base Indenture, dated as of September 29, 2021 and as may be further amended, restated, amended and restated, supplemented or modified, is herein called the “Base Indenture”), among the Co-Issuers and Citibank, N.A., as trustee (in such capacity, the “Trustee”, which term includes any successor Trustee under the Base Indenture) and as securities intermediary, and (ii) a Series 2021-1 Supplement to the Base Indenture, dated as of September 29, 2021 (the “Series 2021-1 Supplement”), among the Co-Issuers, the Trustee and Citibank, N.A., as Series 2021-1 securities intermediary. The Base Indenture and the Series 2021-1 Supplement are referred to herein as the “Indenture”. The Series 2021-1 Class A-2 Notes are subject to all terms of the Indenture. All terms used in this Note that are defined in the Indenture, as supplemented, modified or amended, shall have the meanings assigned to them in or pursuant to the Indenture, as so supplemented, modified or amended.

The Series 2021-1 Class A-2 Notes are and will be secured by the Collateral pledged as security therefor as provided in the Indenture.

The Notes will be issued in minimum denominations of $25,000 and in any whole number denomination in excess thereof.

As provided for in the Indenture, the Series 2021-1 Class A-2 Notes may be prepaid, in whole or in part, at the option of the Co-Issuers. In addition, the Series 2021-1 Class A-2 Notes are subject to mandatory prepayment as provided for in the Indenture. In certain circumstances, the Co-Issuers will be obligated to pay the Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration in connection with a mandatory or optional prepayment of the Series 2021-1 Class A-2 Notes as described in the Indenture. As described above, the entire unpaid principal amount of this Note shall be due and payable on the Series 2021-1 Legal Final Maturity Date. All payments of principal of the Series 2021-1 Class A-2 Notes will be made pro rata to the Series 2021-1 Class A-2 Noteholders entitled thereto.

Principal of and interest on this Note which is payable on a Quarterly Payment Date or on any date on which payments are permitted to be made as provided for in the Indenture shall be paid to the Person in whose name this Note (or one or more predecessor Notes) is registered at the close of business on the applicable Record Date or Prepayment Record Date, as the case may be.

Interest and additional interest, if any, will each accrue on the Series 2021-1 Class A-2 Notes at the rates set forth in the Indenture. The interest and additional interest, if any, will be computed on the basis set forth in the Indenture. The amount of interest payable on the Series 2021-1 Class A-2 Notes on each Quarterly Payment Date will be calculated as set forth in the Indenture.

Payments of principal and interest on this Note are subordinated to the payment of certain other amounts in accordance with the Priority of Payments.

 

A-1-2-8


Exhibits to Series 2021-1 Supplement

 

If an Event of Default shall occur and be continuing, this Note may become or be declared due and payable in the manner and with the effect provided in the Indenture.

Amounts payable in respect of this Note shall be made by wire transfer of immediately available funds to the account designated by DTC or its nominee.

As provided in the Indenture and subject to certain limitations set forth therein, the transfer of this Note may be registered on the Note Register upon surrender of this Note for registration of transfer at the office or agency designated by the Co-Issuers pursuant to the Indenture, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Trustee, the Co-Issuers and the Registrar duly executed by, the Series 2021-1 Class A-2 Noteholder hereof or its attorney duly authorized in writing, with such signature guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended, and accompanied by such other documents as the Trustee and the Registrar may require and as may be required by the Series 2021-1 Supplement, and thereupon one or more new Series 2021-1 Class A-2 Notes of authorized denominations in the same aggregate principal amount will be issued to the designated transferee or transferees. No service charge will be charged for any registration of transfer or exchange of this Note, but the transferor may be required to pay a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any such registration of transfer or exchange.

Each Series 2021-1 Class A-2 Noteholder, by acceptance of a Series 2021-1 Class A-2 Note, covenants and agrees by accepting the benefits of the Indenture that, prior to the date that is one year and one day after the payment in full of the latest maturing note issued under the Indenture, such Series 2021-1 Class A-2 Noteholder will not institute against, or join with any other Person in instituting against, any Securitization Entity any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings, under any federal or state bankruptcy or similar law; provided, however, that nothing herein shall constitute a waiver of any right to indemnification, reimbursement or other payment from the Securitization Entities pursuant to the Indenture or any other Transaction Document.

It is the intent of the Co-Issuers and each Series 2021-1 Class A-2 Noteholder that, for federal, state, local income and franchise tax purposes only, the Series 2021-1 Class A-2 Notes will evidence indebtedness of the Co-Issuers secured by the Collateral. Each Series 2021-1 Class A-2 Noteholder, by the acceptance of this Note, agrees to treat this Note (or beneficial interests herein) for all purposes of federal, state, local income or franchise taxes, and any other tax imposed on or measured by income, as indebtedness of the Co-Issuers or, if any Co-Issuer is treated as a division of another entity, such other entity.

The Indenture permits certain amendments to be made thereto without the consent of the Control Party, the Controlling Class Representative or any Series 2021-1 Class A-2 Noteholders, provided that certain conditions precedent are satisfied. The Indenture also permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Co-Issuers and the rights of the Series 2021-1 Class A-2 Noteholders under the Indenture at any time by the Co-Issuers with the consent of the Control Party (acting at the direction of the Controlling Class Representative) and without the consent of any Series 2021-1 Class A-2 Noteholders. The Indenture also contains provisions permitting the Control Party (acting at the direction of the Controlling Class Representative) to waive compliance by the Co-Issuers with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences without the consent of any Series 2021-1

 

A-1-2-9


Exhibits to Series 2021-1 Supplement

 

Class A-2 Noteholders. Any such consent or waiver of this Note (or any one or more predecessor Notes) shall be conclusive and binding upon such Series 2021-1 Class A-2 Noteholder and upon all future Series 2021-1 Class A-2 Noteholders of this Note and of any Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof whether or not notation of such consent or waiver is made upon this Note.

Each purchaser or transferee of this Note (or any interest herein) shall be deemed to represent and warrant that either (i) it is not acquiring or holding this Note (or any interest herein) for or on behalf of, or with the assets of, a Plan or a governmental, church, non-U.S. or other plan which is subject to any Similar Law or (ii) its acquisition, holding and disposition of this Note (or any interest herein) shall not constitute a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or, in the case of a governmental, church, non-U.S. or other plan, a non-exempt violation under any applicable Similar Law.

The term “Co-Issuer” as used in this Note includes any successor to a Co-Issuer.

The Series 2021-1 Class A-2 Notes are issuable only in registered form in denominations as provided in the Indenture, subject to certain limitations set forth therein.

This Note and the Indenture shall be governed by, and construed and interpreted in accordance with, the laws of the State of New York without regard to conflicts of law principles (other than Sections 5-1401 and 5-1402 of the General Obligations Law of the State of New York), and the obligations, rights and remedies of the parties hereunder and thereunder shall be determined in accordance with such laws.

No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Co-Issuers, which is absolute and unconditional, to pay the principal of and interest on this Note at the times, place and rate and in the coin or currency herein prescribed.

 

A-1-2-10


Exhibits to Series 2021-1 Supplement

 

ASSIGNMENT

Social Security or taxpayer I.D. or other identifying number of assignee:                                                                                 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto

 

                                                                                                                                                                                                                                     

(name and address of assignee)

the within Note and all rights thereunder, and hereby irrevocably constitutes and appoints

                                                                                                                                                                                                                                     ,

attorney, to transfer said Note on the books kept for registration thereof, with full power of substitution in the premises.

Dated:                                                                      

 

By:                                                                                         1 
 
Signature Guaranteed:

 

 

1

NOTE: The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Note, without alteration, enlargement or any change whatsoever.

 

A-1-2-11


Exhibits to Series 2021-1 Supplement

 

SCHEDULE OF EXCHANGES IN TEMPORARY REGULATION S

GLOBAL SERIES 2021-1 CLASS A-2 NOTE

The initial principal balance of this Temporary Regulation S Global Series 2021-1 Class A-2 Note is $[_____]. The following exchanges of an interest in this Temporary Regulation S Global Series 2021-1 Class A-2 Note for an interest in a corresponding Rule 144A Global Series 2021-1 Class A-2 Note or a Permanent Regulation S Global Series 2021-1 Class A-2 Note have been made:

 

Date

  

Amount of Increase

(or Decrease) in the

Principal Amount of this

Temporary Regulation S

Global Note

  

Remaining Principal

Amount of this

Temporary Regulation

S Global Note

following the Increase

or Decrease

  

Signature of
Authorized Officer of
Trustee or Registrar

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

  

 

  

 

  

 

 

A-1-2-12


Exhibits to Series 2021-1 Supplement

 

EXHIBIT A-1-3

THE ISSUANCE AND SALE OF THIS PERMANENT REGULATION S GLOBAL SERIES 2021-1 CLASS A-2 NOTE HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER RELEVANT JURISDICTION. THIS PERMANENT REGULATION S GLOBAL SERIES 2021-1 CLASS A-2 NOTE HAS NOT BEEN AND WILL NOT BE QUALIFIED FOR DISTRIBUTION TO THE PUBLIC UNDER THE SECURITIES LAWS OF ANY PROVINCE OR TERRITORY OF CANADA. THIS PERMANENT REGULATION S GLOBAL SERIES 2021-1 CLASS A-2 NOTE MAY NOT BE OFFERED OR SOLD IN CANADA, DIRECTLY OR INDIRECTLY. NEITHER DRIVEN BRANDS FUNDING, LLC (THE “ISSUER”) NOR DRIVEN BRANDS CANADA FUNDING CORPORATION (THE “CANADIAN CO-ISSUER”) HAS BEEN REGISTERED UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED (THE “1940 ACT”). THIS NOTE OR ANY INTEREST HEREIN MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A) TO A CO-ISSUER OR AN AFFILIATE THEREOF, (B) IN THE UNITED STATES, TO A PERSON WHO IS NOT A COMPETITOR AND IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE 1933 ACT (“RULE 144A”), ACTING FOR ITS OWN ACCOUNT OR ONE OR MORE ACCOUNTS WITH RESPECT TO WHICH SUCH PERSON EXERCISES SOLE INVESTMENT DISCRETION OR (C) OUTSIDE THE UNITED STATES, TO A PERSON WHO IS NOT A COMPETITOR AND IS NOT A “U.S. PERSON” AS DEFINED IN REGULATION S UNDER THE 1933 ACT (“REGULATION S”), ACTING FOR ITS OWN ACCOUNT OR ONE OR MORE ACCOUNTS WITH RESPECT TO WHICH SUCH PERSON EXERCISES SOLE INVESTMENT DISCRETION, NONE OF WHICH ARE A U.S. PERSON, IN OFFSHORE TRANSACTIONS IN RELIANCE ON REGULATION S, AND, IN EACH CASE, IN COMPLIANCE WITH THE CERTIFICATIONS AND OTHER REQUIREMENTS SPECIFIED IN THE INDENTURE REFERRED TO HEREIN AND ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR THE UNITED STATES, ANY APPLICABLE SECURITIES LAWS OF ANY PROVINCE OR TERRITORY OF CANADA AND ANY OTHER RELEVANT JURISDICTION.

BY ITS ACQUISITION OR ACCEPTANCE HEREOF, THE HOLDER (IF NOT A CO-ISSUER OR AN AFFILIATE OF THE CO-ISSUERS) REPRESENTS THAT (A) IT IS NOT A COMPETITOR AND IS (X) A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A OR (Y) NOT A U.S. PERSON AND IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION, AS APPLICABLE, (B) IT IS ACTING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ANOTHER PERSON WHICH IS NOT A COMPETITOR AND IS EITHER (X) A QUALIFIED INSTITUTIONAL BUYER OR (Y) NOT A U.S. PERSON, AND IN EACH CASE WITH RESPECT TO WHICH IT EXERCISES SOLE INVESTMENT DISCRETION, (C) IT AND EACH ACCOUNT FOR WHICH IT IS PURCHASING WILL HOLD AND TRANSFER AT LEAST THE MINIMUM DENOMINATION OF NOTES, (D) IT UNDERSTANDS THAT THE CO-ISSUERS MAY RECEIVE A LIST OF PARTICIPANTS HOLDING POSITIONS IN ITS NOTES FROM ONE OR MORE BOOK-ENTRY DEPOSITORIES AND (E) IT WILL PROVIDE NOTICE OF THE TRANSFER RESTRICTIONS TO ANY SUBSEQUENT TRANSFEREES.

EACH PERSON (IF NOT A CO-ISSUER OR AN AFFILIATE OF THE CO-ISSUERS) TAKING DELIVERY OF THIS NOTE OR AN INTEREST IN THIS NOTE WILL BE DEEMED TO HAVE MADE THE APPLICABLE REPRESENTATIONS AND AGREEMENTS REFERRED TO IN THE INDENTURE. EACH PERSON TAKING DELIVERY OF THIS NOTE OR AN INTEREST IN THIS NOTE IN THE FORM OF AN INTEREST IN A TEMPORARY REGULATION S GLOBAL NOTE OR A RULE 144A GLOBAL NOTE WILL BE REQUIRED TO DELIVER A TRANSFER CERTIFICATE IN THE FORM REQUIRED BY THE INDENTURE AND WILL BE REQUIRED TO MAKE THE APPLICABLE REPRESENTATIONS AND AGREEMENTS REFERRED TO IN THE INDENTURE.

 

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Exhibits to Series 2021-1 Supplement

 

ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING WILL BE OF NO FORCE AND EFFECT AND WILL BE VOID AB INITIO AND WILL NOT OPERATE TO TRANSFER ANY RIGHTS TO ANY PERSON CAUSING SUCH VIOLATION, NOTWITHSTANDING ANY INSTRUCTIONS TO THE CONTRARY TO ANY CO-ISSUER, THE TRUSTEE OR ANY INTERMEDIARY.

IF THIS NOTE WAS ACQUIRED IN THE UNITED STATES, AND THE HOLDER IS DETERMINED TO BE A COMPETITOR OR NOT TO HAVE BEEN A QUALIFIED INSTITUTIONAL BUYER AT THE TIME OF ACQUISITION OF THIS NOTE, THE CO-ISSUERS HAVE THE RIGHT TO REQUIRE SUCH HOLDER TO SELL THIS NOTE TO A PURCHASER WHO IS NOT A COMPETITOR AND IS A QUALIFIED INSTITUTIONAL BUYER. THE CO-ISSUERS ALSO HAVE THE RIGHT TO REFUSE TO HONOR A TRANSFER TO A PERSON WHO IS NOT A QUALIFIED INSTITUTIONAL BUYER OR WHO IS A COMPETITOR.

UNLESS PERMITTED UNDER THE APPLICABLE SECURITIES LAWS OF ANY PROVINCE OR TERRITORY OF CANADA, THE HOLDER OF THIS NOTE MUST NOT RESELL THIS NOTE IN CANADA BEFORE THE DATE THAT IS 4 MONTHS AND ONE DAY AFTER THE LATER OF (A) THE ORIGINAL ISSUE DATE OF THE NOTES AND (B) THE DATE ON WHICH BOTH THE CO-ISSUERS BECOME REPORTING ISSUERS UNDER THE APPLICABLE SECURITIES LAWS OF ANY PROVINCE OR TERRITORY OF CANADA.

IF THIS NOTE WAS ACQUIRED OUTSIDE THE UNITED STATES, AND THE HOLDER IS DETERMINED TO BE A COMPETITOR OR TO HAVE BEEN A “U.S. PERSON” AT THE TIME OF ACQUISITION OF THIS NOTE, THE CO-ISSUERS HAVE THE RIGHT TO REQUIRE SUCH HOLDER TO SELL THIS NOTE TO A PURCHASER WHO IS NOT A COMPETITOR AND IS NOT A “U.S. PERSON.” THE CO-ISSUERS ALSO HAVE THE RIGHT TO REFUSE TO HONOR A TRANSFER TO A PERSON WHO IS A “U.S. PERSON” OR WHO IS A COMPETITOR.

BY ACCEPTING THIS NOTE, EACH PURCHASER COVENANTS THAT IT WILL NOT AT ANY TIME PRIOR TO THE DATE WHICH IS ONE (1) YEAR AND ONE (1) DAY AFTER THE PAYMENT IN FULL OF THE LATEST MATURING NOTE, INSTITUTE AGAINST, OR JOIN WITH ANY OTHER PERSON IN INSTITUTING AGAINST, ANY SECURITIZATION ENTITY ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS, UNDER ANY FEDERAL, STATE, PROVINCIAL BANKRUPTCY, INSOLVENCY OR SIMILAR LAW.

THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY (“DTC”), A NEW YORK CORPORATION, 55 WATER STREET, NEW YORK, NEW YORK 10004, OR A NOMINEE THEREOF. THIS NOTE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS NOTE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN DTC OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE. UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC TO A CO-ISSUER OR THE NOTE REGISTRAR, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC, AND ANY PAYMENT IS

 

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Exhibits to Series 2021-1 Supplement

 

MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC, ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL BECAUSE THE REGISTERED OWNER, CEDE & CO., HAS AN INTEREST HEREIN.

 

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Exhibits to Series 2021-1 Supplement

 

THE PRINCIPAL OF THIS NOTE IS PAYABLE AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF. ANY PERSON ACQUIRING THIS NOTE MAY ASCERTAIN ITS CURRENT PRINCIPAL AMOUNT BY INQUIRY OF THE TRUSTEE.

FORM OF PERMANENT REGULATION S GLOBAL SERIES 2021-1 CLASS A-2 NOTE

 

No. U-[_]   up to $[_____]

SEE REVERSE FOR CERTAIN CONDITIONS

CUSIP Number: U26488 AC7

ISIN Number: USU26488AC70

Common Code: 239142931

DRIVEN BRANDS FUNDING, LLC

SERIES 2021-1 2.791% FIXED RATE SENIOR SECURED NOTES, CLASS A-2

DRIVEN BRANDS FUNDING, LLC, a limited liability company formed under the laws of the State of Delaware (the “Issuer”) and DRIVEN BRANDS CANADA FUNDING CORPORATION, a corporation formed under the laws of Canada (the “Canadian Co-Issuer” and together with the Issuer, the “Co-Issuers” and each, a “Co-Issuer”), for value received, hereby promise to pay to CEDE & CO., or registered assigns, up to the principal sum of [_____] DOLLARS ($[_____]) as provided below and in the Indenture referred to herein. Payments of principal shall be payable in the amounts and at the times set forth in the Indenture described herein; provided, however, that the entire unpaid principal amount of this Note shall be due on the Quarterly Payment Date occurring in October 2051 (the “Series 2021-1 Legal Final Maturity Date”). The Co-Issuers will pay interest on this Permanent Regulation S Global Series 2021-1 Class A-2 Note (this “Note”) at the Series 2021-1 Class A-2 Note Rate for each Interest Accrual Period in accordance with the terms of the Indenture. Such interest will be payable in arrears on each Quarterly Payment Date, which will be on the 20th day (or, if such 20th day is not a Business Day, the next succeeding Business Day) of each April, July, October and January, commencing October 20, 2021 (each, a “Quarterly Payment Date”). Such interest will accrue for each Quarterly Payment Date with respect to (i) initially, the period from and including the Series 2021-1 Closing Date to but excluding the 20th day of the calendar month that includes the first Quarterly Payment Date and (ii) thereafter, any period commencing on and including the 20th day of the calendar month in which the immediately preceding Quarterly Payment Date occurred to but excluding the 20th day of the calendar month that includes the then-current Quarterly Payment Date (each, an “Interest Accrual Period”). Interest with respect to the Notes (and interest on any defaulted payments of interest or principal) will be computed on the basis of a 360-day year consisting of twelve 30-day months. In addition, under the circumstances set forth in the Indenture, the Co-Issuers shall also pay additional interest on this Note at the Series 2021-1 Quarterly Post-ARD Additional Interest Rate, and such additional interest shall be computed and shall be payable in the amounts and at the times set forth in the Indenture.

The principal of and interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. All payments made by the Co-Issuers with respect to this Note shall be applied as provided in the Indenture.

This Note is subject to mandatory and optional prepayment as set forth in the Indenture.

 

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Exhibits to Series 2021-1 Supplement

 

Interests in this Note are exchangeable or transferable in whole or in part for interests in a Rule 144A Global Note; provided that such transfer or exchange complies with the applicable provisions of the Indenture relating to the transfer of the Notes. Interests in this Note in certain circumstances may also be exchangeable or transferable in whole but not in part for duly executed and issued registered Definitive Notes; provided that such transfer or exchange complies with Section 2.8 of the Base Indenture and Section 4.2(c) of the Series 2021-1 Supplement.

Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note.

Although a summary of certain provisions of the Indenture is set forth below and on the reverse hereof and made a part hereof, this Note does not purport to summarize the Indenture and reference is made to the Indenture for information with respect to the interests, rights, benefits, obligations, proceeds and duties evidenced hereby and the rights, duties and obligations of the Co-Issuers and the Trustee. A copy of the Indenture may be requested from the Trustee by writing to the Trustee at Citibank, N.A., 388 Greenwich Street, New York, NY 10013, Attention: Agency & Trust—Driven Brands Funding, LLC. To the extent not defined herein, the capitalized terms used herein have the meanings ascribed to them in the Indenture. In the event of any inconsistency between the provisions of this Note and the Indenture, the provisions of the Indenture shall govern.

Subject to the next following paragraph, the Co-Issuers hereby certify and declare that all acts, conditions and things required to be done and performed and to have happened prior to the creation of this Note and to constitute it as the valid obligation of the Co-Issuers enforceable in accordance with its terms have been done and performed and have happened in due compliance with all applicable laws and in accordance with the terms of the Indenture.

Unless the certificate of authentication hereon has been executed by the Trustee whose name appears below by manual, facsimile or electronic signature, this Note shall not be entitled to any benefit under the Indenture referred to on the reverse hereof, or be valid or obligatory for any purpose.

[Remainder of page intentionally left blank]

 

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Exhibits to Series 2021-1 Supplement

 

IN WITNESS WHEREOF, each of the Co-Issuers has caused this instrument to be signed, manually or in facsimile, by its Authorized Officer.

Date:

 

DRIVEN BRANDS FUNDING, LLC, as Co-Issuer
By:  

 

Name:
Title:
DRIVEN BRANDS CANADA FUNDING CORPORATION, as Co-Issuer
By:  

 

Name:
Title:

 

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Exhibits to Series 2021-1 Supplement

 

CERTIFICATE OF AUTHENTICATION

This is one of the Series 2021-1 Class A-2 Notes issued under the within mentioned Indenture.

 

CITIBANK, N.A., as Trustee
By:  

 

Name:
Title: Authorized Signatory

 

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Exhibits to Series 2021-1 Supplement

 

[REVERSE OF NOTE]

This Note is one of a duly authorized issue of Series 2021-1 Class A-2 Notes of the Co-Issuers designated as its Series 2021-1 2.791% Fixed Rate Senior Secured Notes, Class A-2 (herein called the “Series 2021-1 Class A-2 Notes”), all issued under (i) the Amended and Restated Base Indenture, dated as of April 24, 2018 (such Base Indenture, as amended by the Amendment No. 1 to the Base Indenture, dated as of March 19, 2019, Amendment No. 2 to the Base Indenture, dated as of June 15, 2019, Amendment No. 3 to the Base Indenture, dated as of September 17, 2019, Amendment No. 4 to the Base Indenture, dated as of July 6, 2020, Amendment No. 5 to the Base Indenture, dated as of December 14, 2020, Amendment No. 6 to the Base Indenture, dated as of March 30, 2021, Amendment No. 7 to the Base Indenture, dated as of March 30, 2021, Amendment No. 8 to the Base Indenture, dated as of September 29, 2021 and as may be further amended, restated, amended and restated, supplemented or modified, is herein called the “Base Indenture”), among the Co-Issuers and Citibank, N.A., as trustee (in such capacity, the “Trustee”, which term includes any successor Trustee under the Base Indenture) and as securities intermediary, and (ii) a Series 2021-1 Supplement to the Base Indenture, dated as of September 29, 2021 (the “Series 2021-1 Supplement”), among the Co-Issuers, the Trustee and Citibank, N.A., as Series 2021-1 securities intermediary. The Base Indenture and the Series 2021-1 Supplement are referred to herein as the “Indenture”. The Series 2021-1 Class A-2 Notes are subject to all terms of the Indenture. All terms used in this Note that are defined in the Indenture, as supplemented, modified or amended, shall have the meanings assigned to them in or pursuant to the Indenture, as so supplemented, modified or amended.

The Series 2021-1 Class A-2 Notes are and will be secured by the Collateral pledged as security therefor as provided in the Indenture.

The Notes will be issued in minimum denominations of $25,000 and in any whole number denomination in excess thereof.

As provided for in the Indenture, the Series 2021-1 Class A-2 Notes may be prepaid, in whole or in part, at the option of the Co-Issuers. In addition, the Series 2021-1 Class A-2 Notes are subject to mandatory prepayment as provided for in the Indenture. In certain circumstances, the Co-Issuers will be obligated to pay the Series 2021-1 Class A-2 Notes Make-Whole Prepayment Consideration in connection with a mandatory or optional prepayment of the Series 2021-1 Class A-2 Notes as described in the Indenture. As described above, the entire unpaid principal amount of this Note shall be due and payable on the Series 2021-1 Legal Final Maturity Date. All payments of principal of the Series 2021-1 Class A-2 Notes will be made pro rata to the Series 2021-1 Class A-2 Noteholders entitled thereto.

Principal of and interest on this Note which is payable on a Quarterly Payment Date or on any date on which payments are permitted to be made as provided for in the Indenture shall be paid to the Person in whose name this Note (or one or more predecessor Notes) is registered at the close of business on the applicable Record Date or Prepayment Record Date, as the case may be.

Interest and additional interest, if any, will each accrue on the Series 2021-1 Class A-2 Notes at the rates set forth in the Indenture. The interest and additional interest, if any, will be computed on the basis set forth in the Indenture. The amount of interest payable on the Series 2021-1 Class A-2 Notes on each Quarterly Payment Date will be calculated as set forth in the Indenture.

Payments of principal and interest on this Note are subordinated to the payment of certain other amounts in accordance with the Priority of Payments.

 

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Exhibits to Series 2021-1 Supplement

 

If an Event of Default shall occur and be continuing, this Note may become or be declared due and payable in the manner and with the effect provided in the Indenture.

Amounts payable in respect of this Note shall be made by wire transfer of immediately available funds to the account designated by DTC or its nominee.

As provided in the Indenture and subject to certain limitations set forth therein, the transfer of this Note may be registered on the Note Register upon surrender of this Note for registration of transfer at the office or agency designated by the Co-Issuers pursuant to the Indenture, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Trustee, the Co-Issuers and the Registrar duly executed by, the Series 2021-1 Class A-2 Noteholder hereof or its attorney duly authorized in writing, with such signature guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended, and accompanied by such other documents as the Trustee and the Registrar may require and as may be required by the Series 2021-1 Supplement, and thereupon one or more new Series 2021-1 Class A-2 Notes of authorized denominations in the same aggregate principal amount will be issued to the designated transferee or transferees. No service charge will be charged for any registration of transfer or exchange of this Note, but the transferor may be required to pay a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any such registration of transfer or exchange.

Each Series 2021-1 Class A-2 Noteholder, by acceptance of a Series 2021-1 Class A-2 Note, covenants and agrees by accepting the benefits of the Indenture that, prior to the date that is one year and one day after the payment in full of the latest maturing note issued under the Indenture, such Series 2021-1 Class A-2 Noteholder will not institute against, or join with any other Person in instituting against, any Securitization Entity any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings, under any federal or state bankruptcy or similar law; provided, however, that nothing herein shall constitute a waiver of any right to indemnification, reimbursement or other payment from the Securitization Entities pursuant to the Indenture or any other Transaction Document.

It is the intent of the Co-Issuers and each Series 2021-1 Class A-2 Noteholder that, for federal, state, local income and franchise tax purposes only, the Series 2021-1 Class A-2 Notes will evidence indebtedness of the Co-Issuers secured by the Collateral. Each Series 2021-1 Class A-2 Noteholder, by the acceptance of this Note, agrees to treat this Note (or beneficial interests herein) for all purposes of federal, state, local income or franchise taxes, and any other tax imposed on or measured by income, as indebtedness of the Co-Issuers or, if any Co-Issuer is treated as a division of another entity, such other entity.

The Indenture permits certain amendments to be made thereto without the consent of the Control Party, the Controlling Class Representative or any Series 2021-1 Class A-2 Noteholders, provided that certain conditions precedent are satisfied. The Indenture also permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Co-Issuers and the rights of the Series 2021-1 Class A-2 Noteholders under the Indenture at any time by the Co-Issuers with the consent of the Control Party (acting at the direction of the Controlling Class Representative) and without the consent of any Series 2021-1 Class A-2 Noteholders. The Indenture also contains provisions permitting the Control Party (acting at the direction of the Controlling Class Representative) to waive compliance by the Co-Issuers with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences without the consent of any Series 2021-1

 

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Exhibits to Series 2021-1 Supplement

 

Class A-2 Noteholders. Any such consent or waiver of this Note (or any one or more predecessor Notes) shall be conclusive and binding upon such Series 2021-1 Class A-2 Noteholder and upon all future Series 2021-1 Class A-2 Noteholders of this Note and of any Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof whether or not notation of such consent or waiver is made upon this Note.

Each purchaser or transferee of this Note (or any interest herein) shall be deemed to represent and warrant that either (i) it is not acquiring or holding this Note (or any interest herein) for or on behalf of, or with the assets of, a Plan or a governmental, church, non-U.S. or other plan which is subject to any Similar Law or (ii) its acquisition, holding and disposition of this Note (or any interest herein) shall not constitute a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or, in the case of a governmental, church, non-U.S. or other plan, a non-exempt violation under any applicable Similar Law.

The term “Co-Issuer” as used in this Note includes any successor to a Co-Issuer.

The Series 2021-1 Class A-2 Notes are issuable only in registered form in denominations as provided in the Indenture, subject to certain limitations set forth therein.

This Note and the Indenture shall be governed by, and construed and interpreted in accordance with, the laws of the State of New York without regard to conflicts of law principles (other than Sections 5-1401 and 5-1402 of the General Obligations Law of the State of New York), and the obligations, rights and remedies of the parties hereunder and thereunder shall be determined in accordance with such laws.

No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Co-Issuers, which is absolute and unconditional, to pay the principal of and interest on this Note at the times, place and rate and in the coin or currency herein prescribed.

 

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Exhibits to Series 2021-1 Supplement

 

ASSIGNMENT

Social Security or taxpayer I.D. or other identifying number of assignee:                                                                          

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto

 

                                                                                                                                                                                                                                 

(name and address of assignee)

the within Note and all rights thereunder, and hereby irrevocably constitutes and appoints

                                                                                                                                                                                                                                 ,

attorney, to transfer said Note on the books kept for registration thereof, with full power of substitution in the premises.

Dated:                                                          

 

By:                                                                                                     1 
 
Signature Guaranteed:

 

 

1 

NOTE: The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Note, without alteration, enlargement or any change whatsoever.

 

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Exhibits to Series 2021-1 Supplement

 

SCHEDULE OF EXCHANGES IN PERMANENT REGULATION S

GLOBAL SERIES 2021-1 CLASS A-2 NOTE

The initial principal balance of this Permanent Regulation S Global Series 2021-1 Class A-2 Note is $[_____]. The following exchanges of an interest in this Permanent Regulation S Global Series 2021-1 Class A-2 Note for an interest in a corresponding Rule 144A Global Series 2021-1 Class A-2 Note have been made:

 

Date

  

Amount of Increase

(or Decrease) in the

Principal Amount of this

Permanent Regulation S

Global Note

  

Remaining Principal

Amount of this

Permanent Regulation

S Global Note

following the Increase

or Decrease

  

Signature of
Authorized Officer of
Trustee or Registrar

        

 

  

 

  

 

  

 

        

 

  

 

  

 

  

 

        

 

  

 

  

 

  

 

        

 

  

 

  

 

  

 

        

 

  

 

  

 

  

 

        

 

  

 

  

 

  

 

        

 

  

 

  

 

  

 

        

 

  

 

  

 

  

 

        

 

  

 

  

 

  

 

        

 

  

 

  

 

  

 

        

 

  

 

  

 

  

 

        

 

  

 

  

 

  

 

        

 

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Exhibits to Series 2021-1 Supplement

 

EXHIBIT B-1

FORM OF TRANSFER CERTIFICATE

FOR TRANSFERS OF INTERESTS IN RULE 144A GLOBAL NOTES

TO INTERESTS IN TEMPORARY REGULATION S GLOBAL NOTES

Citibank, N.A., as Trustee

480 Washington Boulevard, 30th Floor

Jersey City, New Jersey 07310

Attention: Securities Window – Driven Brands

 

Re:

Driven Brands Funding, LLC; Driven Brands Canada Funding Corporation $450,000,000 Series 2021-1 2.791% Fixed Rate Senior Secured Notes, Class A-2 (the “Notes”)

Reference is hereby made to (i) the Amended and Restated Base Indenture, dated as of April 24, 2018 (as amended by the Amendment No. 1 to the Base Indenture, dated as of March 19, 2019, Amendment No. 2 to the Base Indenture, dated as of June 15, 2019, Amendment No. 3 to the Base Indenture, dated as of September 17, 2019, Amendment No. 4 to the Base Indenture, dated as of July 6, 2020, Amendment No. 5 to the Base Indenture, dated as of December 14, 2020, Amendment No. 6 to the Base Indenture, dated as of March 30, 2021, Amendment No. 7 to the Base Indenture, dated as of March 30, 2021, Amendment No. 8 to the Base Indenture, dated as of September 29, 2021 and as may be further amended, restated, amended and restated, supplemented or modified, the “Base Indenture”), among Driven Brands Funding, LLC (the “Issuer”) and Driven Brands Canada Funding Corporation (the “Canadian Co-Issuer” and together with the Issuer, the “Co-Issuers” and each, a “Co-Issuer”), and Citibank, N.A., as trustee (in such capacity, the “Trustee”) and as securities intermediary, and (ii) the Series 2021-1 Supplement to the Base Indenture, dated as of September 29, 2021 (the “Supplement” and, together with the Base Indenture, the “Indenture”), among the Co-Issuers, the Trustee and Citibank, N.A., as Series 2021-1 securities intermediary. Capitalized terms used but not defined herein shall have the meanings assigned to them pursuant to the Indenture.

This certificate relates to U.S. $[_____] aggregate principal amount of Notes which are held in the form of an interest in a Rule 144A Global Note with DTC (CUSIP (CINS) No.26209X AD3) in the name of [_____] [name of transferor] (the “Transferor”), who wishes to effect the transfer of such Notes in exchange for an equivalent beneficial interest in a Temporary Regulation S Global Note in the name of [_____] [name of transferee] (the “Transferee”).

In connection with such request, and in respect of such Notes, the Transferee does hereby certify that either (A) the Transferee is a Co-Issuer or an Affiliate of a Co-Issuer or (B) such Notes are being transferred (i) in accordance with the transfer restrictions set forth in the Indenture and the Offering Memorandum, dated September 22, 2021, relating to the Notes, (ii) pursuant to an exemption from registration under the Securities Act of 1933, as amended (the “Securities Act”), and in accordance with any applicable securities laws of any state of the United States or any other jurisdiction and (iii) to a Person who is not a Competitor.

In addition, the Transferee hereby represents, warrants and covenants for the benefit of the Co-Issuers, the Registrar and the Trustee that either the Transferee is a Co-Issuer or an Affiliate of a Co-Issuer or:

1. the offer of the Notes was not made to a Person in the United States;

 

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Exhibits to Series 2021-1 Supplement

 

2. at the time the buy order was originated, the Transferee was outside the United States;

3. no directed selling efforts have been made in contravention of the requirements of Rule 903(a) or 904(a) of Regulation S, as applicable;

4. the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act, and the Transferee is aware that the sale to it is being made in reliance on an exemption from the registration requirements of the 1933 Act provided by Regulation S;

5. the Transferee is not a U.S. Person (as defined in Regulation S);

6. if the sale is made during a restricted period and the provisions of Rule 903(b)(2) or (3) or Rule 904(b)(1) of Regulation S are applicable thereto, the Transferee confirms that such sale has been made in accordance with the applicable provisions of Rule 903(b)(2) or (3) or Rule 904(b)(1), as the case may be;

7. the Transferee is not purchasing such Notes with a view to the resale, distribution or other disposition thereof in the United States or to a U.S. Person;

8. the Transferee will, and each account for which it is purchasing will, hold and transfer at least the minimum denomination of Notes;

9. the Transferee understands that the Managers, the Co-Issuers and the Servicer may receive a list of participants holding positions in the Notes from one or more book-entry depositories;

10. the Transferee understands that the Managers, the Co-Issuers and the Servicer may receive (i) a list of Note Owners that have requested access to the Trustee’s password-protected website or that have voluntarily registered as a Note Owner with the Trustee and (ii) copies of Noteholder confirmations of representations and warranties executed to obtain access to the Trustee’s password-protected website;

11. the Transferee will provide to each person to whom it transfers Notes notices of any restrictions on transfer of such Notes;

12. it is not a Competitor and is not purchasing for the account or benefit of a Competitor;

13. it is not a benefit plan investor or Plan that is subject to Similar Law or, if it is a benefit plan investor, its acquisition and holding of the Notes (or any interest therein) will not give rise to a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or, if it is a Plan that is subject to Similar Law, its acquisition and holding of the Notes (or any interest therein) will not result in a violation of Similar Law, and if the Transferee is a benefit plan investor or Plan, its fiduciary will be deemed to make the same representation and warranty;

14. if it is using assets of a Plan to acquire or hold the Series 2021-1 Class A-2 Notes or any interest therein, then it further represents that (i) none of the Co-Issuers, the Initial Purchaser, any Guarantor, the Servicer, the Back-up Manager, the Trustee, nor any other party to the Securitization Transaction, nor any of their respective affiliates (collectively, the “Transaction Parties”) has acted as the Plan’s fiduciary, or has been relied upon for any advice, with respect to the Plan’s decision to acquire,

 

B-1-2


Exhibits to Series 2021-1 Supplement

 

hold, sell, exchange, vote or provide any consent with respect to the Series 2021-1 Class A-2 Notes, and none of the Transaction Parties shall at any time be relied upon as the Plan’s fiduciary with respect to the Plan’s decision to acquire, hold, sell, exchange, vote or provide any consent with respect to the Series 2021-1 Class A-2 Notes, and (ii) the decision to invest in the Series 2021-1 Class A-2 Notes has been made at the recommendation or direction of an independent fiduciary as contemplated by U.S. Code of Federal Regulations 29 C.F.R. Section 2510.3-21(c), as amended from time to time, who (a) is independent of the Transaction Parties; (b) is capable of evaluating investment risks independently, both in general and with respect to particular transactions and investment strategies; (c) is a fiduciary (under ERISA and/or Section 4975 of the Code) with respect to the Plan’s investment in the Series 2021-1 Class A-2 Notes and is responsible for exercising independent judgment in evaluating the investment in the Series 2021-1 Class A-2 Notes; and (d) is aware of and acknowledges that (1) none of the Transaction Parties is undertaking to provide impartial investment advice, or to give advice in a fiduciary capacity, in connection with the Plan’s investment in the Series 2021-1 Class A-2 Notes, and (2) the Transaction Parties have a financial interest in the Plan’s investment in the Series 2021-1 Class A-2 Notes; and

15. it is:

_____ (check if applicable) a “United States person” within the meaning of Section 7701(a)(30) of the Internal Revenue Code of 1986, as amended (the “Code”); or

_____ (check if applicable) not a “United States person” within the meaning of Section 7701(a)(30) of the Code.

The representations made pursuant to clause 6 above shall be deemed to be made on each day from the date the Transferee acquires any interest in any Note through and including the date on which such Transferee disposes of its interest in the applicable Note. The Transferee agrees to provide prompt written notice to the Co-Issuers, the Registrar and the Trustee of any change of the status of the Transferee that would cause it to breach the representations made in clause 6 above. The Transferee further agrees to indemnify and hold harmless the Co-Issuers, the Trustee, the Registrar and the Initial Purchaser and their respective affiliates from any cost, damage or loss incurred by them as a result of the inaccuracy or breach of the foregoing representations, warranties and agreements in this clause and clause 6 above. Any purported transfer of the Notes (or interest therein) that does not comply with the requirements of this clause and clause 6 above shall be null and void ab initio.

The Transferee understands that the Co-Issuers, the Trustee, the Registrar and their respective counsel will rely upon the accuracy and truth of the foregoing representations, and are irrevocably authorized to produce this certificate or a copy hereof to any interested party in any administrative or legal proceeding or official inquiry with respect to the matters covered hereby, and the Transferee hereby consents to such reliance and authorization.

 

B-1-3


Exhibits to Series 2021-1 Supplement

 

[Name of Transferee]
By:                                                                                                  
Name:
Title:

Dated:                                     

 

Registered Name (if Nominee):

 

 

cc:

Driven Brands Funding, LLC

440 S. Church Street, Suite 700

Charlotte, NC 28202

Attention: General Counsel

Facsimile: (704) 376-7905

Driven Brands Canada Funding Corporation

1460 Stone Church Road E.

Hamilton, ON L8W 3V3

Attention: General Counsel

Facsimile: (704) 376-7905

with a copy to:

440 S. Church Street, Suite 700

Charlotte, NC 28202

Attention: General Counsel

Facsimile: (704) 376-7905

 

B-1-4


Exhibits to Series 2021-1 Supplement

 

EXHIBIT B-2

FORM OF TRANSFER CERTIFICATE

FOR TRANSFERS OF INTERESTS IN RULE 144A GLOBAL NOTES

TO INTERESTS IN PERMANENT REGULATION S GLOBAL NOTES

Citibank, N.A., as Trustee

480 Washington Boulevard, 30th Floor

Jersey City, New Jersey 07310

Attention: Securities Window – Driven Brands

 

Re:

Driven Brands Funding, LLC $450,000,000 Series 2021-1 2.791% Fixed Rate Senior Secured Notes, Class A-2 (the “Notes”)

Reference is hereby made to (i) the Amended and Restated Base Indenture, dated as of April 24, 2018 (as amended by the Amendment No. 1 to the Base Indenture, dated as of March 19, 2019, Amendment No. 2 to the Base Indenture, dated as of June 15, 2019, Amendment No. 3 to the Base Indenture, dated as of September 17, 2019, Amendment No. 4 to the Base Indenture, dated as of July 6, 2020, Amendment No. 5 to the Base Indenture, dated as of December 14, 2020, Amendment No. 6 to the Base Indenture, dated as of March 30, 2021, Amendment No. 7 to the Base Indenture, dated as of March 30, 2021, Amendment No. 8 to the Base Indenture, dated as of September 29, 2021 and as may be further amended, restated, amended and restated, supplemented or modified, the “Base Indenture”), among Driven Brands Funding, LLC (the “Issuer”) and Driven Brands Canada Funding Corporation (the “Canadian Co-Issuer” and together with the Issuer, the “Co-Issuers” and each, a “Co-Issuer”), and Citibank, N.A., as trustee (in such capacity, the “Trustee”) and as securities intermediary, and (ii) the Series 2021-1 Supplement to the Base Indenture, dated as of September 29, 2021 (the “Supplement” and, together with the Base Indenture, the “Indenture”), among the Co-Issuers, the Trustee and Citibank, N.A., as Series 2021-1 securities intermediary. Capitalized terms used but not defined herein shall have the meanings assigned to them pursuant to the Indenture.

This certificate relates to U.S.$ [_____] aggregate principal amount of Notes which are held in the form of an interest in a Rule 144A Global Note with DTC (CUSIP (CINS) No. 26209X AD3) in the name of [_____] [name of transferor] (the “Transferor”), who wishes to effect the transfer of such Notes in exchange for an equivalent beneficial interest in a Permanent Regulation S Global Note in the name of [_____] [name of transferee] (the “Transferee”).

In connection with such request, and in respect of such Notes, the Transferee does hereby certify that either (A) the Transferee is a Co-Issuer or an Affiliate of a Co-Issuer or (B) such Notes are being transferred (i) in accordance with the transfer restrictions set forth in the Indenture and the Offering Memorandum, dated September 22, 2021, relating to the Notes, (ii) pursuant to an exemption from registration under the Securities Act of 1933, as amended (the “Securities Act”), and in accordance with any applicable securities laws of any state of the United States or any other jurisdiction and (iii) to a Person who is not a Competitor.

In addition, the Transferee hereby represents, warrants and covenants for the benefit of the Co-Issuers, the Registrar and the Trustee that either the Transferee is a Co-Issuer or an Affiliate of a Co-Issuer or:

1. the offer of the Notes was not made to a Person in the United States;

 

B-2-1


Exhibits to Series 2021-1 Supplement

 

2. at the time the buy order was originated, the Transferee was outside the United States;

3. no directed selling efforts have been made in contravention of the requirements of Rule 903(a) or 904(a) of Regulation S, as applicable;

4. the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act, and the Transferee is aware that the sale to it is being made in reliance on an exemption from the registration requirements of the 1933 Act provided by Regulation S;

5. the Transferee is not a U.S. Person (as defined in Regulation S);

6. the Transferee is not purchasing such Notes with a view to the resale, distribution or other disposition thereof in the United States or to a U.S. Person;

7. the Transferee will, and each account for which it is purchasing will, hold and transfer at least the minimum denomination of Notes;

8. the Transferee understands that the Managers, the Co-Issuers and the Servicer may receive a list of participants holding positions in the Notes from one or more book- entry depositories;

9. the Transferee understands that the Managers, the Co-Issuers and the Servicer may receive (i) a list of Note Owners that have requested access to the Trustee’s password-protected website or that have voluntarily registered as a Note Owner with the Trustee and (ii) copies of Noteholder confirmations of representations and warranties executed to obtain access to the Trustee’s password-protected website;

10. the Transferee will provide to each person to whom it transfers Notes notices of any restrictions on transfer of such Notes;

11. it is not a Competitor and is not purchasing for the account or benefit of a Competitor;

12. it is not a benefit plan investor or Plan that is subject to Similar Law or, if it is a benefit plan investor, its acquisition and holding of the Notes (or any interest therein) will not give rise to a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or, if it is a Plan that is subject to Similar Law, its acquisition and holding of the Notes (or any interest therein) will not result in a violation of Similar Law, and if the Transferee is a benefit plan investor or Plan, its fiduciary will be deemed to make the same representation and warranty;

13. if it is using assets of a Plan to acquire or hold the Series 2021-1 Class A-2 Notes or any interest therein, then it further represents that (i) none of the Co-Issuers, the Initial Purchaser, any Guarantor, the Servicer, the Back-up Manager, the Trustee, nor any other party to the Securitization Transaction, nor any of their respective affiliates (collectively, the “Transaction Parties”) has acted as the Plan’s fiduciary, or has been relied upon for any advice, with respect to the Plan’s decision to acquire, hold, sell, exchange, vote or provide any consent with respect to the Series 2021-1 Class A-2 Notes, and none of the Transaction Parties shall at any time be relied upon as the Plan’s fiduciary with respect to the Plan’s decision to acquire, hold, sell, exchange, vote or provide any consent with respect to the Series 2021-1 Class A-2 Notes, and (ii) the decision to invest in the Series 2021-1 Class A-2 Notes has been made at the recommendation or direction of an independent fiduciary as contemplated by U.S. Code of

 

B-2-2


Exhibits to Series 2021-1 Supplement

 

Federal Regulations 29 C.F.R. Section 2510.3-21(c), as amended from time to time, who (a) is independent of the Transaction Parties; (b) is capable of evaluating investment risks independently, both in general and with respect to particular transactions and investment strategies; (c) is a fiduciary (under ERISA and/or Section 4975 of the Code) with respect to the Plan’s investment in the Series 2021-1 Class A-2 Notes and is responsible for exercising independent judgment in evaluating the investment in the Series 2021-1 Class A-2 Notes; and (d) is aware of and acknowledges that (1) none of the Transaction Parties is undertaking to provide impartial investment advice, or to give advice in a fiduciary capacity, in connection with the Plan’s investment in the Series 2021-1 Class A-2 Notes, and (2) the Transaction Parties have a financial interest in the Plan’s investment in the Series 2021-1 Class A-2 Notes; and

14. it is:

_____ (check if applicable) a “United States person” within the meaning of Section 7701(a)(30) of the Internal Revenue Code of 1986, as amended (the “Code”); or

_____ (check if applicable) not a “United States person” within the meaning of Section 7701(a)(30) of the Code.

The Transferee understands that the Co-Issuers, the Trustee, the Registrar and their respective counsel will rely upon the accuracy and truth of the foregoing representations, and are irrevocably authorized to produce this certificate or a copy hereof to any interested party in any administrative or legal proceeding or official inquiry with respect to the matters covered hereby, and the Transferee hereby consents to such reliance and authorization.

 

B-2-3


Exhibits to Series 2021-1 Supplement

 

[Name of Transferee]
By:                                                                                                  
Name:
Title:

Dated:                                 

 

Registered Name (if Nominee):

 

 

cc:

Driven Brands Funding, LLC

440 S. Church Street, Suite 700

Charlotte, NC 28202

Attention: General Counsel

Facsimile: (704) 376-7905

Driven Brands Canada Funding Corporation

1460 Stone Church Road E.

Hamilton, ON L8W 3V3

Attention: General Counsel

Facsimile: (704) 376-7905

with a copy to:

440 S. Church Street, Suite 700

Charlotte, NC 28202

Attention: General Counsel

Facsimile: (704) 376-7905

 

B-2-4


Exhibits to Series 2021-1 Supplement

 

EXHIBIT B-3

FORM OF TRANSFER CERTIFICATE

FOR TRANSFERS OF INTERESTS IN TEMPORARY REGULATION S GLOBAL NOTES

OR PERMANENT REGULATION S GLOBAL NOTES

TO INTERESTS IN RULE 144A GLOBAL NOTES

Citibank, N.A., as Trustee

480 Washington Boulevard, 30th Floor

Jersey City, New Jersey 07310

Attention: Securities Window – Driven Brands

 

Re:

Driven Brands Funding, LLC $450,000,000 Series 2021-1 2.791% Fixed Rate Senior Secured Notes, Class A-2 (the “Notes”)

Reference is hereby made to (i) the Amended and Restated Base Indenture, dated as of April 24, 2018 (as amended by the Amendment No. 1 to the Base Indenture, dated as of March 19, 2019, Amendment No. 2 to the Base Indenture, dated as of June 15, 2019, Amendment No. 3 to the Base Indenture, dated as of September 17, 2019, Amendment No. 4 to the Base Indenture, dated as of July 6, 2020, Amendment No. 5 to the Base Indenture, dated as of December 14, 2020, Amendment No. 6 to the Base Indenture, dated as of March 30, 2021, Amendment No. 7 to the Base Indenture, dated as of March 30, 2021, Amendment No. 8 to the Base Indenture, dated as of September 29, 2021 and as further amended, restated, amended and restated, supplemented or modified, the “Base Indenture”), among Driven Brands Funding, LLC (the “Issuer”) and Driven Brands Canada Funding Corporation (the “Canadian Co-Issuer” and together with the Issuer, the “Co-Issuers” and each, a “Co-Issuer”), and Citibank, N.A., as trustee (in such capacity, the “Trustee”) and as securities intermediary, and (ii) the Series 2021-1 Supplement to the Base Indenture, dated as of September 29, 2021 (the “Supplement” and, together with the Base Indenture, the “Indenture”), among the Co-Issuers, the Trustee and Citibank, N.A., as Series 2021-1 securities intermediary. Capitalized terms used but not defined herein shall have the meanings assigned to them pursuant to the Indenture.

This certificate relates to U.S.$ [_____] aggregate principal amount of Notes which are held in the form of [an interest in a Temporary Regulation S Global Note with DTC][an interest in an Permanent Regulation S Global Note with DTC] (CUSIP (CINS) No. U26488 AC7) in the name of [_____] [name of transferor] (the “Transferor”), who wishes to effect the transfer of such Notes in exchange for an equivalent beneficial interest in a Rule 144A Global Note in the name of [_____] [name of transferee] (the “Transferee”).

In connection with such request, and in respect of such Notes, the Transferee does hereby certify that either (A) the Transferee is a Co-Issuer or an Affiliate of a Co-Issuer or (B) such Notes are being transferred in accordance with (i) the applicable transfer restrictions set forth in the Indenture and in the Offering Memorandum, dated September 22, 2021, relating to the Notes and (ii) Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and any applicable securities laws of any state of the United States or any other jurisdiction, and that the Transferee is purchasing the Notes for its own account or one or more accounts with respect to which the Transferee exercises sole investment discretion, and the Transferee and any such account represent, warrant and agree that either it is a Co-Issuer or an Affiliate of a Co-Issuer or:

1. it is (a) a Qualified Institutional Buyer, (b) aware that the sale to it is being made in reliance on Rule 144A and (c) acquiring such Notes for its own account or for the account of another person who is a Qualified Institutional Buyer with respect to which it exercise sole investment discretion;

 

B-6-1


Exhibits to Series 2021-1 Supplement

 

2. it is not formed for the purpose of investing in the Notes, except where each beneficial owner is a Qualified Institutional Buyer;

3. it will, and each account for which it is purchasing will, hold and transfer at least the minimum denomination of Notes;

4. it understands that the Managers, the Co-Issuers and the Servicer may receive a list of participants holding positions in the Notes from one or more book-entry depositories;

5. it understands that the Managers, the Co-Issuers and the Servicer may receive (i) a list of Note Owners that have requested access to the Trustee’s password-protected website or that have voluntarily registered as a Note Owner with the Trustee and (ii) copies of Noteholder confirmations of representations and warranties executed to obtain access to the Trustee’s password-protected website;

6. it will provide to each person to whom it transfers Notes notices of any restrictions on transfer of such Notes;

7. it is not a Competitor and is not purchasing for the account or benefit of a Competitor;

8. it is not a benefit plan investor or Plan that is subject to Similar Law or, if it is a benefit plan investor, its acquisition and holding of the Notes (or any interest therein) will not give rise to a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or, if it is a Plan that is subject to Similar Law, its acquisition and holding of the Notes (or any interest therein) will not result in a violation of Similar Law, and if the Transferee is a benefit plan investor or Plan, its fiduciary will be deemed to make the same representation and warranty;

9. if it is using assets of a Plan to acquire or hold the Series 2021-1 Class A-2 Notes or any interest therein, then it further represents that (i) none of the Co-Issuers, the Initial Purchaser, any Guarantor, the Servicer, the Back-up Manager, the Trustee, nor any other party to the Securitization Transaction, nor any of their respective affiliates (collectively, the “Transaction Parties”) has acted as the Plan’s fiduciary, or has been relied upon for any advice, with respect to the Plan’s decision to acquire, hold, sell, exchange, vote or provide any consent with respect to the Series 2021-1 Class A-2 Notes, and none of the Transaction Parties shall at any time be relied upon as the Plan’s fiduciary with respect to the Plan’s decision to acquire, hold, sell, exchange, vote or provide any consent with respect to the Series 2021-1 Class A-2 Notes, and (ii) the decision to invest in the Series 2021-1 Class A-2 Notes has been made at the recommendation or direction of an independent fiduciary as contemplated by U.S. Code of Federal Regulations 29 C.F.R. Section 2510.3-21(c), as amended from time to time, who (a) is independent of the Transaction Parties; (b) is capable of evaluating investment risks independently, both in general and with respect to particular transactions and investment strategies; (c) is a fiduciary (under ERISA and/or Section 4975 of the Code) with respect to the Plan’s investment in the Series 2021-1 Class A-2 Notes and is responsible for exercising independent judgment in evaluating the investment in the Series 2021-1 Class A-2 Notes; and (d) is aware of and acknowledges that (1) none of the Transaction Parties is undertaking to provide impartial investment advice, or to give advice in a fiduciary capacity, in connection with the Plan’s investment in the Series 2021-1 Class A-2 Notes, and (2) the Transaction Parties have a financial interest in the Plan’s investment in the Series 2021-1 Class A-2 Notes; and

10. it is:

_____ (check if applicable) a “United States person” within the meaning of Section 7701(a)(30) of the Internal Revenue Code of 1986, as amended (the “Code”), and a properly completed and signed Internal Revenue Service (“IRS”) Form W-9 (or applicable successor form) is attached hereto; or

 

B-3-2


Exhibits to Series 2021-1 Supplement

 

_____ (check if applicable) not a “United States person” within the meaning of Section 7701(a)(30) of the Code.

The Transferee understands that the Co-Issuers, the Trustee, the Registrar and their respective counsel will rely upon the accuracy and truth of the foregoing representations, and are irrevocably authorized to produce this certificate or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to any matter covered hereby, and the Transferee hereby consents and agrees to such reliance and authorization.

 

B-3-3


Exhibits to Series 2021-1 Supplement

 

[Name of Transferee]
By:                                                                                                  
Name:
Title:

Dated:                                     

 

Registered Name (if Nominee):

 

 

cc:

Driven Brands Funding, LLC

440 S. Church Street, Suite 700

Charlotte, NC 28202

Attention: General Counsel

Facsimile: (704) 376-7905

Driven Brands Canada Funding Corporation

1460 Stone Church Road E.

Hamilton, ON L8W 3V3

Attention: General Counsel

Facsimile: (704) 376-7905

with a copy to:

440 S. Church Street, Suite 700

Charlotte, NC 28202

Attention: General Counsel

Facsimile: (704) 376-7905

 

B-3-4

EX-4.2

Exhibit 4.2

AMENDMENT NO. 8 TO THE AMENDED AND RESTATED BASE INDENTURE

THIS AMENDMENT NO. 8 TO THE AMENDED AND RESTATED BASE INDENTURE, dated and effective (subject to Section 2 below) as of September 29, 2021 (this “Amendment”), is entered into by and among (i) DRIVEN BRANDS FUNDING, LLC, a Delaware limited liability company, as a co-issuer (the “Issuer”), (ii) DRIVEN BRANDS CANADA FUNDING CORPORATION, a Canadian corporation, as a co-issuer (the “Canadian Co-Issuer” and together with the Issuer, the “Co-Issuers”), and (iii) CITIBANK, N.A., a national banking association, not in its individual capacity, but solely in its capacity as the trustee under the Indenture referred to below (together with its successors and assigns in such capacity, the “Trustee”). Capitalized terms used and not defined herein shall have the meanings set forth or incorporated by reference in the Indenture.

RECITALS

WHEREAS, the Co-Issuers (including the Canadian Co-Issuer as of the Series 2020-1 Closing Date) and the Trustee have entered into the Amended and Restated Base Indenture, dated as of April 24, 2018, as amended by Amendment No. 1 to the Amended and Restated Base Indenture, dated as of March 19, 2019, Amendment No. 2 to the Amended and Restated Base Indenture, dated as of June 15, 2019, Amendment No. 3 to the Amended and Restated Base Indenture, dated as of September 17, 2019, Amendment No. 4 to the Amended and Restated Base Indenture, dated as of July 6, 2020, Amendment No. 5 to the Amended and Restated Base Indenture, dated as of December 14, 2020, Amendment No. 6 to the Amended and Restated Base Indenture, dated as of March 30, 2021 and Amendment No. 7 to the Amended and Restated Base Indenture, dated as of March 30, 2021 (as the same may be further amended, supplemented or otherwise modified from time to time prior to the date hereof and exclusive of the Series Supplements thereto, the “Base Indenture” and together with each Series Supplement entered into on or prior to the date hereof and any additional Series Supplements thereto entered into from time to time, the “Indenture”).

WHEREAS, (x) Section 13.1(a) of the Base Indenture provides, among other things, that the Issuer and the Trustee, without the consent of any Noteholder, the Control Party, the Controlling Class Representative or any other Secured Party, may at any time, and from time to time, make certain amendments, waivers and other modifications to the Base Indenture, including the types of certain amendments set forth in this Amendment, and (y) Section 13.2(a) of the Base Indenture provides, among other things, that the Co-Issuers and the Trustee, with the consent of the Control Party (acting at the direction of the Controlling Class Representative), may at any time, and from time to time, make certain amendments, waivers and other modifications to the Base Indenture, including the types of certain of the amendments set forth in this Amendment.

WHEREAS, with respect to certain amendments set forth in this Amendment which are indicated to be effective as of the 2021 Springing Amendments Implementation Date, (a) the Holders of the Series 2021-1 Class A-2 Notes (as defined in the Series 2021-1 Supplement, dated as of the date hereof, to the Base Indenture referenced herein) have, by their purchase of such Series 2021-1 Class A-2 Notes, consented to such amendments and (b) any Holders of Additional Notes will be deemed to consent to such amendments by their purchase thereof. Therefore, effective as of the 2021 Springing Amendments Implementation Date, all Holders of the Notes will have consented to such amendments such that the separate consent of the Control Party is not also required pursuant to Section 13.2(a) of the Base Indenture.

 

1


WHEREAS, the Co-Issuers desire to amend the Base Indenture in certain respects, as hereinafter set forth.

NOW, THEREFORE, in consideration of the mutual agreements herein contained and other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged by the parties hereto, the parties hereto agree as follows:

1.    Amendments to the Base Indenture. The Base Indenture, including Annex A thereto, but excluding all other annexes, schedules, and exhibits attached thereto, is hereby amended as reflected in the marked copy of the Base Indenture attached as Exhibit A to this Amendment, with certain of such amendments, as indicated in Exhibit A in this Amendment taking effect upon the 2021 Springing Amendments Implementation Date, to delete the stricken text (indicated textually in the same manner as the following example: stricken text) and add the bold and double-underlined text (indicated textually in the same manner as the following example: bold and double-underlined text).

2.    Non-Amortization Test. For all existing Series of Notes for which the applicable Series Non-Amortization Test requires testing of both the Senior Leverage Ratio and the Driven Brands Leverage Ratio, the Co-Issuers shall give up their right to suspend payments under priority (x) of the Priority of Payments upon satisfaction of the related Series Non-Amortization Test.

3.    Effect of Amendment. Except as expressly amended and modified by this Amendment, all provisions of the Base Indenture shall remain in full force and effect and each reference to the Base Indenture and words of similar import in the Base Indenture, as amended hereby, shall be a reference to the Base Indenture as amended hereby and as the same may be further amended, supplemented or otherwise modified and in effect from time to time. This Amendment shall not be deemed to expressly or impliedly waive, amend or supplement any provision of the Base Indenture other than as set forth herein. This Amendment may not be amended, supplemented or otherwise modified except in accordance with the terms of the Base Indenture. This Amendment constitutes a Supplement pursuant to Section 13.3 of the Base Indenture. This Amendment shall inure to the benefit of and be binding on the respective successors and assigns of the parties hereto, each Noteholder and each other Secured Party.

4.    Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES (OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK).

5.    Counterparts. This Amendment may be executed by the parties hereto in several counterparts (including by facsimile, email, electronic signature or other electronic means of communication), each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute but one and the same agreement.

 

2


6.    Matters relating to the Trustee. The Trustee makes no representations or warranties as to the correctness of the recitals contained herein, which shall be taken as statements of the Co-Issuers, or the validity or sufficiency of this Amendment and the Trustee shall not be accountable or responsible for or with respect to nor shall the Trustee have any responsibility for any provisions thereof. In entering into this Amendment, the Trustee shall have all of the rights, powers, duties and obligations of the Trustee under the Base Indenture and any other Transaction Document to which the Trustee is party and, for the avoidance of doubt, shall be entitled to the benefit of every provision thereunder relating to the conduct of or affecting the liability of or affording protection to the Trustee.

7.    Representations and Warranties. Each party hereto represents and warrants to each other party hereto that this Amendment has been duly and validly executed and delivered by such party and constitutes its legal, valid and binding obligation, enforceable against such party in accordance with its terms.

[The remainder of this page is intentionally left blank.]

 

3


IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their respective officers thereunto duly authorized as of the day and year first above written.

 

DRIVEN BRANDS FUNDING, LLC,
as Issuer
By:  

/s/ Scott O’Melia

  Name:   Scott O’Melia
  Title:   Executive Vice President and Secretary
DRIVEN BRANDS CANADA FUNDING CORPORATION, as Canadian Co-Issuer
By:  

/s/ Scott O’Melia

  Name:   Scott O’Melia
  Title:   Executive Vice President and Secretary

 

Amendment No. 8 to Amended and Restated Base Indenture


CITIBANK, N.A., in its capacity as Trustee
      By:  

/s/ Anthony Bausa

  Name:   Anthony Bausa
  Title:   Senior Trust Officer

 

Amendment No. 8 to Amended and Restated Base Indenture


CONSENT AND DIRECTION OF SERVICER AND CONTROL PARTY:

In accordance with Section 2.4 of the Servicing Agreement, Midland Loan Services, a division of PNC Bank, National Association, as Servicer and in its capacity as Control Party with the consent and at the direction of the Controlling Class Representative (pursuant to Section 11.4(b) of the Base Indenture), hereby consents to the execution and delivery by the Co-Issuers and the Trustee of this Amendment (but for the avoidance of doubt, will be deemed not to consent to any provisions of this Amendment (including any provisions in the Indenture) to which it is not required to consent under the Base Indenture or Indenture). The Servicer’s consent is granted solely to the extent that the amendment of the Indenture pursuant to this Amendment materially increases the Servicer’s obligations or liabilities, or materially decreases the Servicer’s rights or remedies under the Servicing Agreement, the Indenture or any other Transaction Document, and in each such case, only for such limited purpose.

 

MIDLAND LOAN SERVICES,
a division of PNC Bank, National Association,
as Control Party and Servicer
By:  

/s/ David A. Eckels

  Name:   David A. Eckels
  Title:   Senior Vice President

 

Amendment No. 8 to Amended and Restated Base Indenture


CONSENT AND DIRECTION OF CONTROLLING CLASS REPRESENTATIVE:

Athene Annuity and Life Company, in its capacity as Controlling Class Representative, hereby consents to and directs the Control Party (pursuant to Section 11.4(b) of the Base Indenture) to consent to and to implement this Amendment, including via the execution and delivery by the parties hereto.

ATHENE ANNUITY AND LIFE COMPANY,

as Controlling Class Representative

By: Apollo Insurance Solutions Group LP, its investment adviser

By: Apollo Capital Management, L.P., its sub-adviser

By: Apollo Capital Management GP, LLC, its General Partner

 

By:  

/s/ Joseph D. Glatt

Name:   Joseph D. Glatt
Title:   Vice President

 

Amendment No. 8 to Amended and Restated Base Indenture


Exhibit A


CONFORMED THROUGH AMENDMENT NO. 78

 

 

DRIVEN BRANDS FUNDING, LLC,

as Issuer,

DRIVEN BRANDS CANADA FUNDING CORPORATION,

as Canadian Co-Issuer,

and

CITIBANK, N.A.,

as Trustee and Securities Intermediary

 

 

AMENDED AND RESTATED BASE INDENTURE

Dated as of April 24, 2018

 

 


TABLE OF CONTENTS

 

         Page  

Article I DEFINITIONS AND INCORPORATION BY REFERENCE

     2  

Section 1.1

 

Definitions

     2  

Section 1.2

 

Cross-References

     2  

Section 1.3

 

Accounting and Financial Determinations; No Duplication

     2  

Section 1.4

 

Rules of Construction

     2  

Article II THE NOTES

     3  

Section 2.1

 

Designation and Terms of Notes

     3  

Section 2.2

 

Notes Issuable in Series

     4  

Section 2.3

 

Series Supplement for Each Series

     8  

Section 2.4

 

Execution and Authentication

     9  

Section 2.5

 

Registrar and Paying Agent

     10  

Section 2.6

 

Paying Agent to Hold Money in Trust

     1111  

Section 2.7

 

Noteholder List

     12  

Section 2.8

 

Transfer and Exchange

     12  

Section 2.9

 

Persons Deemed Owners

     13  

Section 2.10      

 

Replacement Notes

     14  

Section 2.11

 

Treasury Notes

     14  

Section 2.12

 

Book-Entry Notes

     14  

Section 2.13

 

Definitive Notes

     1616  

Section 2.14

 

Cancellation

     16  

Section 2.15

 

Principal and Interest

     1717  

Section 2.16

 

Tax Treatment

     1818  

Article III SECURITY

     18  

Section 3.1

 

Grant of Security Interest

     18  

Section 3.2

 

Certain Rights and Obligations of the Issuer Unaffected

     20  

Section 3.3

 

Performance of Collateral Documents

     21  

Section 3.4

 

Stamp, Other Similar Taxes and Filing Fees

     21  

Section 3.5

 

Authorization to File Financing Statements

     2222  

Section 3.6

 

ULC Shares

     22  

Article IV REPORTS

     23  

Section 4.1

 

Reports and Instructions to Trustee

     23  

Section 4.2

 

Annual Noteholders’ Tax Statement

     2828  

Section 4.3

 

Rule 144A Information

     28  

Section 4.4

 

Reports, Financial Statements and Other Information to Noteholders

     29  

Section 4.5

 

Managers

     30  

Section 4.6

 

No Constructive Notice

     30  

 

i


Article V ALLOCATION AND APPLICATION OF COLLECTIONS

     3030  

Section 5.1

 

Management Accounts

     3030  

Section 5.2

 

Senior Notes Interest Reserve Accounts

     31  

Section 5.3

 

Senior Subordinated Notes Interest Reserve Accounts

     33  

Section 5.4

 

Cash Trap Reserve Accounts

     34  

Section 5.5

 

Collection Accounts

     3434  

Section 5.6

 

Collection Account Administrative Accounts

     3535  

Section 5.7

  Securitization-Owned Location Concentration Accounts; Product Sourcing Concentration Accounts; Claims Management Concentration Accounts      3838  

Section 5.8

 

Trustee as Securities Intermediary

     4141  

Section 5.9

 

Establishment of Series Accounts; Legacy Accounts

     43  

Section 5.10

 

Collections; Investment Income; Currency Conversions

     4343  

Section 5.11

 

Application of Weekly Collections on Weekly Allocation Dates

     5353  

Section 5.12

 

Quarterly Payment Date Applications

     5959  

Section 5.13

 

Determination of Quarterly Interest

     7474  

Section 5.14

 

Determination of Quarterly Principal

     7474  

Section 5.15

 

Prepayment of Principal

     7474  

Section 5.16

 

Retained Collections Contributions

     7474  

Section 5.17

 

Interest Reserve Letters of Credit

     7575  

Section 5.18      

 

Replacement of Ineligible Accounts

     7676  

Article VI DISTRIBUTIONS

     7676  

Section 6.1

 

Distributions in General

     7676  

Article VII REPRESENTATIONS AND WARRANTIES

     7777  

Section 7.1

 

Existence and Power

     7777  

Section 7.2

 

Company and Governmental Authorization

     7777  

Section 7.3

 

No Consent

     7878  

Section 7.4

 

Binding Effect

     7878  

Section 7.5

 

Litigation

     7878  

Section 7.6

 

Employee Benefit Plans

     7878  

Section 7.7

 

Tax Filings and Expenses

     7979  

Section 7.8

 

Disclosure

     7979  

Section 7.9

 

Investment Company Act

     7979  

Section 7.10

 

Regulations T, U and X

     8079  

Section 7.11

 

Solvency

     8080  

Section 7.12

 

Ownership of Equity Interests; Subsidiaries

     8080  

Section 7.13

 

Security Interests

     8080  

Section 7.14

 

Transaction Documents

     8181  

Section 7.15

 

Non-Existence of Other Agreements

     8181  

 

ii


Section 7.16

 

Compliance with Contractual Obligations and Laws

     8281  

Section 7.17

 

Other Representations

     8282  

Section 7.18

 

Insurance

     8282  

Section 7.19

 

Environmental Matters

     8282  

Section 7.20

 

Intellectual Property

     8383  

Section 7.21      

 

Payments on the Notes

     8383  

Article VIII COVENANTS

     8483  

Section 8.1

 

Payment of Notes

     8483  

Section 8.2

 

Maintenance of Office or Agency

     8484  

Section 8.3

 

Payment and Performance of Obligations

     8484  

Section 8.4

 

Maintenance of Existence

     8584  

Section 8.5

 

Compliance with Laws

     8585  

Section 8.6

 

Inspection of Property; Books and Records

     8585  

Section 8.7

 

Actions under the Transaction Documents

     8685  

Section 8.8

 

Notice of Defaults and Other Events

     8787  

Section 8.9

 

Notice of Material Proceedings

     8787  

Section 8.10

 

Further Requests

     8788  

Section 8.11

 

Further Assurances

     8788  

Section 8.12

 

Liens

     8989  

Section 8.13

 

Other Indebtedness

     8989  

Section 8.14

 

Employee Benefit Plans

     9090  

Section 8.15

 

Mergers

     9090  

Section 8.16

 

Asset Dispositions

     9090  

Section 8.17

 

Acquisition of Assets

     9191  

Section 8.18

 

Dividends, Officers’ Compensation, etc.

     9191  

Section 8.19

 

Legal Name, Location

     9292  

Section 8.20

 

Charter Documents

     9292  

Section 8.21

 

Investments

     9393  

Section 8.22

 

No Other Agreements

     9393  

Section 8.23

 

Other Business

     9393  

Section 8.24

 

Maintenance of Separate Existence

     9393  

Section 8.25

 

Covenants Regarding the Securitization IP

     9595  

Section 8.26

 

Insurance

     9797  

Section 8.27

 

Litigation

     9797  

Section 8.28

 

Environmental

     9797  

Section 8.29

 

Derivatives Generally

     9798  

Section 8.30

 

Future Securitization Entities and Future Brands

     9898  

Section 8.31

 

Tax Lien Reserve Amount

     9999  

Section 8.32

 

Bankruptcy or Insolvency Proceedings

     99100  

 

iii


Article IX REMEDIES

     100100  

Section 9.1

 

Rapid Amortization Events

     100100  

Section 9.2

 

Events of Default

     101101  

Section 9.3

 

Rights of the Control Party and Trustee upon Event of Default

     104105  

Section 9.4

 

Waiver of Appraisal, Valuation, Stay and Right to Marshaling

     107107  

Section 9.5

 

Limited Recourse

     108108  

Section 9.6

 

Optional Preservation of the Collateral

     108108  

Section 9.7

 

Waiver of Past Events

     108108  

Section 9.8

 

Control by the Control Party

     108108  

Section 9.9

 

Limitation on Suits

     109109  

Section 9.10      

 

Unconditional Rights of Noteholders to Receive Payment

     109109  

Section 9.11

 

The Trustee May File Proofs of Claim

     109109  

Section 9.12

 

Undertaking for Costs

     110110  

Section 9.13

 

Restoration of Rights and Remedies

     110110  

Section 9.14

 

Rights and Remedies Cumulative

     110110  

Section 9.15

 

Delay or Omission Not Waiver

     111111  

Section 9.16

 

Waiver of Stay or Extension Laws

     111111  

Article X THE TRUSTEE

     111111  

Section 10.1

 

Duties of the Trustee

     111111  

Section 10.2

 

Rights of the Trustee

     114114  

Section 10.3

 

Individual Rights of the Trustee

     117117  

Section 10.4

 

Notice of Events of Default and Defaults

     117117  

Section 10.5

 

Compensation and Indemnity

     117118  

Section 10.6

 

Replacement of the Trustee

     118118  

Section 10.7

 

Successor Trustee by Merger, etc.

     119119  

Section 10.8

 

Eligibility Disqualification

     119119  

Section 10.9

 

Appointment of Co-Trustee or Separate Trustee

     119120  

Section 10.10

 

Representations and Warranties of Trustee

     121121  

Article XI CONTROLLING CLASS REPRESENTATIVE AND CONTROL PARTY

     121121  

Section 11.1

 

Controlling Class Representative

     121121  

Section 11.2

 

Resignation or Removal of the Controlling Class Representative

     124124  

Section 11.3

 

Expenses and Liabilities of the Controlling Class Representative

     124124  

Section 11.4

 

Control Party

     125125  

Section 11.5

 

Note Owner List

     126126  

Article XII DISCHARGE OF INDENTURE

     127127  

Section 12.1

 

Termination of the Co-Issuers’ and Guarantors’ Obligations

     127127  

Section 12.2

 

Application of Trust Money

     130130  

Section 12.3

 

Repayment to the Co-Issuers

     130130  

Section 12.4

 

Reinstatement

     130130  

 

iv


Article XIII AMENDMENTS

     130131  

Section 13.1

 

Without Consent of the Controlling Class Representative or the Noteholders

     130131  

Section 13.2

 

With Consent of the Controlling Class Representative or the Noteholders

     132133  

Section 13.3

 

Supplements

     133134  

Section 13.4

 

Revocation and Effect of Consents

     133134  

Section 13.5

 

Notation on or Exchange of Notes

     134134  

Section 13.6

 

The Trustee to Sign Amendments, etc.

     134134  

Section 13.7

 

Amendments and Fees

     134135  

Article XIV MISCELLANEOUS

     134135  

Section 14.1

 

Notices

     134135  

Section 14.2

 

Communication by Noteholders With Other Noteholders

     138139  

Section 14.3

 

Officers’ Certificate as to Conditions Precedent

     138139  

Section 14.4

 

Statements Required in Certificate

     138139  

Section 14.5

 

Rules by the Trustee

     138139  

Section 14.6

 

Benefits of Indenture

     138139  

Section 14.7

 

Payment on Business Day

     139140  

Section 14.8

 

Governing Law

     139140  

Section 14.9

 

Successors

     139140  

Section 14.10      

 

Severability

     139140  

Section 14.11

 

Counterpart Originals

     139140  

Section 14.12

 

Table of Contents, Headings, etc.

     139140  

Section 14.13

 

No Bankruptcy Petition Against the Securitization Entities

     139140  

Section 14.14

 

Recording of Indenture

     140141  

Section 14.15

 

Waiver of Jury Trial

     140141  

Section 14.16

 

Submission to Jurisdiction; Waivers

     140141  

Section 14.17

 

Calculation of Driven Brands Leverage Ratio and Senior Leverage Ratio

     141142  

Section 14.18

 

Permitted Asset Dispositions and Permitted Brand Dispositions; Release of Collateral

     143144  

Section 14.19

 

FX Agent

     143144  

Section 14.20

 

Amendment and Restatement

     143144  

Section 14.21

 

Currency Indemnity

     144145  

Section 14.22

 

Hypothecary Representative

     144145  

Section 14.23

 

Electronic Signatures and Transmission

     145146  

 

v


ANNEXES

 

Annex A                Base Indenture Definitions List

EXHIBITS

 

Exhibit A                Form of Weekly Manager’s Certificate
Exhibit B    FX Exchange Report
Exhibit C    Form of Quarterly Noteholders’ Report
Exhibit C-1    Form of Quarterly Noteholders’ Allocation Report
Exhibit D-1    Form of Notice of Grant of Security Interest in Trademarks
Exhibit D-2    Form of Notice of Grant of Security Interest in Patents
Exhibit D-3    Form of Notice of Grant of Security Interest in Copyrights
Exhibit E-1    Form of Supplemental Notice of Grant of Security Interest in Trademarks
Exhibit E-2    Form of Supplemental Notice of Grant of Security Interest in Patents
Exhibit E-3    Form of Supplemental Notice of Grant of Security Interest in Copyrights
Exhibit F    Form of Investor Request Certification
Exhibit G    [Reserved]
Exhibit H    Form of CCR Election Notice
Exhibit I    Form of CCR Nomination for Controlling Class Representative
Exhibit J    Form of CCR Ballot for Controlling Class Representative
Exhibit K    Form of CCR Acceptance Letter
Exhibit L    Form of Note Owner Certificate

SCHEDULES

 

Schedule 7.3    Consents
Schedule 7.7    Proposed Tax Assessments
Schedule 7.18        Insurance
Schedule 7.20    Pending Actions or Proceedings Relating to the Securitization IP
Schedule 8.11    Non-Perfected Liens
Schedule 8.14    Employee Benefit Plans

 

vi


AMENDED AND RESTATED BASE INDENTURE, dated as of April 24, 2018 (as amended by Amendment No. 1 thereto, dated as of March 19, 2019, as further amended by Amendment No. 2 thereto, dated as of June 15, 2019, as further amended by Amendment No. 3 thereto, dated as of September 17, 2019, as further amended by Amendment No. 4 thereto, dated as of July 6, 2020, as further amended by Amendment No. 5 thereto, dated as of December 14, 2020, as further amended by Amendment No. 6 thereto, dated as of March 30, 2021, as further amended by Amendment No. 7 thereto, dated as of March 30, 2021, as further amended by Amendment No. 8 thereto, dated as of September 29, 2021 and as further amended, supplemented or otherwise modified from time to time, exclusive of any Series Supplements, the “Base Indenture”), by and among DRIVEN BRANDS FUNDING, LLC, a Delaware limited liability company (the “Issuer”), DRIVEN BRANDS CANADA FUNDING CORPORATION, a corporation amalgamated under the laws of Canada (the “Canadian Co-Issuer” and together with the Issuer, the “Co-Issuers”), and CITIBANK, N.A., a national banking association, as trustee (in such capacity, the “Trustee”) and as securities intermediary.

W I T N E S S E T H:

WHEREAS, the Issuer and the Trustee previously entered into that certain Base Indenture, dated as of July 31, 2015 (as amended, restated, supplemented or otherwise modified prior to April 24, 2018, the “Original Base Indenture”), to provide for the issuance from time to time of one or more series of notes (the “Notes”) and amended and restated the Original Base Indenture on April 24, 2018 (as amended, restated, supplemented or otherwise modified prior to July 6, 2020, the “Original Amended and Restated Base Indenture”);

WHEREAS, the Issuer amended the Original Amended and Restated Base Indenture pursuant to Amendment No. 4 to the Original Amended and Restated Base Indenture in the manner set forth herein to add the Canadian Co-Issuer as a party to the Original Amended and Restated Base Indenture as a co-issuer and a co-issuer of each Series of Notes previously issued in the manner provided in this Base Indenture, the Co-Issuers further amended the Original Amended and Restated Base Indenture pursuant to Amendment No. 5 to the Original Amended and Restated Base Indenture, Amendment No. 6 to the Original Amended and Restated Base Indenture, Amendment No. 7 to the Original Amended and Restated Base Indenture in the manner set forth herein, and the Co-Issuers desire to further amend the Original Amended and Restated Base Indenture pursuant to Amendment No. 58 to the Original Amended and Restated Base Indenture in the manner set forth herein, and to provide for the issuance on the Series 20202021 -21 Closing Date and from time to time thereafter of one or more series of Notes in the manner provided in this Base Indenture and in supplements to this Base Indenture and the Series Supplements hereto; and

WHEREAS, each Co-Issuer has duly authorized the execution and delivery of this Base Indenture (and the Amendment No. 4 to the Original Amended and Restated Base Indenture and the Amendment No. 5 to the Original Amended and Restated Base Indenture) and all other things necessary to make this Base Indenture a legal, valid and binding agreement of such Co-Issuer, in accordance with its terms, have been done, and such Co-Issuer proposes to do all the things necessary to make the Notes, when executed by such Co-Issuer and authenticated and delivered by the Trustee hereunder and duly issued by such Co-Issuer, the legal, valid and binding obligations of such Co-Issuer as hereinafter provided; and

WHEREAS, the Control Party previously consented to the amendmentamendments of the Original Amended and Restated Base Indenture as set forth in the Amendment No. 4 and Amendment No. 6 to the Original Amended and Restated Base Indenture and the Control Party and Trustee have received the Officers’ Certificate of the Co-Issuers and an Opinion of Counsel as described in Section 13.6 of the Original Amended and Restated Base Indenture.


WHEREAS, the amendment of the Original Amended and Restated Base Indenture as set forth in Amendment No. 7 to the Original Amended and Restated Base Indenture was effective as of the date of the execution thereof;

WHEREAS, the amendment of the Original Amended and Restated Base Indenture as set forth in Amendment No. 5 to the Original Amended and Restated Base Indenture will be effective as of the Amendment No. 5 Trigger Date;

NOW, THEREFORE, for and in consideration of the premises and the receipt of the Notes by the Noteholders, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Noteholders (in accordance with the priorities set forth herein and in any Series Supplement), as follows:

ARTICLE I

DEFINITIONS AND INCORPORATION BY REFERENCE

Section 1.1    Definitions.

(a)    Capitalized terms used herein (including the preamble and the recitals hereto) and not otherwise defined herein shall have the meanings assigned to such terms in the Base Indenture Definitions List attached hereto as Annex A (as amended, supplemented or otherwise modified from time to time in accordance with the provisions hereof, the “Base Indenture Definitions List”).

(b)    Any terms used in the Indenture (including, without limitation, for purposes of Article III) that are defined in the UCC or the PPSA and pertaining to Collateral shall be construed and defined as set forth in the UCC or the PPSA, as applicable, as the context may require, unless otherwise defined in the Indenture.

Section 1.2    Cross-References.

Unless otherwise specified, references in the Indenture and in each other Transaction Document to any Article or Section are references to such Article or Section of the Indenture or such other Transaction Document, as the case may be, and, unless otherwise specified, references in any Article, Section or definition to any clause are references to such clause of such Article, Section or definition.

Section 1.3    Accounting and Financial Determinations; No Duplication.

Where the character or amount of any asset or liability or item of income or expense is required to be determined, or any accounting computation is required to be made, for the purpose of the Indenture or any other Transaction Document, such determination or calculation shall be made, to the extent applicable and except as otherwise specified in the Indenture or such other Transaction Document, in accordance with GAAP. When used herein, the term “financial statement” shall include the notes and schedules thereto. All accounting determinations and computations hereunder or under any other Transaction Documents shall be made without duplication.

Section 1.4    Rules of Construction.

In the Indenture and the other Transaction Documents, unless the context otherwise requires:

(a)    the singular includes the plural and vice versa;

 

2


(b)    reference to any Person includes such Person’s successors and assigns but, if applicable, only if such successors and assigns are permitted by the Indenture and the other applicable Transaction Documents, as the case may be, and reference to any Person in a particular capacity only refers to such Person in such capacity;

(c)    reference to any gender includes the other gender;

(d)    reference to any Requirement of Law means such Requirement of Law as amended, modified, codified or reenacted, in whole or in part, and in effect from time to time;

(e)    “including” (and with correlative meaning “include”) means including without limiting the generality of any description preceding such term;

(f)    the word “or” is always used inclusively herein (for example, the phrase “A or B” means “A or B or both”, not “either A or B but not both”), unless used in an “either ... or” construction;

(g)    reference to any contract or agreement, including any Transaction Document, means such contract or agreement as amended, restated, amended and restated, supplemented or otherwise modified from time to time;

(h)    with respect to the determination of any period of time, except as otherwise specified, “from” means “from and including” and “to” means “to but excluding”;

(i)    without derogation of the joint and several liability of the Co-Issuers under the Indenture and unless the context otherwise requires, all references to representations, warranties, covenants and agreements of the Canadian Co-Issuer, as to itself and the other Canadian Securitization Entities (as of the Series 2020-1 Closing Date), herein or any other Transaction Document shall be made as of, and from, respectively, the Series 2020-1 Closing Date;

(j)    except to the extent otherwise specified in this Base Indenture, for purposes of measuring the quantum of Canadian Dollars that would be expressed in U.S. Dollars on a Weekly Allocation Date, it shall be assumed that any such Canadian Dollar amounts are settled pursuant to a Currency Conversion to U.S. Dollars as of such Weekly Allocation Date, based on the Spot Rate for any Currency Conversion settled for such Weekly Allocation Date or otherwise calculated based on the Deemed Spot Rate;

(k)    except to the extent otherwise specified in this Base Indenture, for purposes of measuring the quantum of Canadian Dollars that would be expressed in U.S. Dollars for purposes of computing financial ratios it shall be assumed that any such Canadian Dollar amounts are settled pursuant to a Currency Conversion to U.S. Dollars as of the applicable date of measurement and based on the Deemed Spot Rate as of such date.

ARTICLE II

THE NOTES

Section 2.1    Designation and Terms of Notes.

(a)    Each Series of Notes shall be substantially in the form specified in the applicable Series Supplement and shall bear, upon its face, the designation for such Series to which it belongs as selected by the Co-Issuers, with such appropriate insertions, omissions, substitutions and other variations as are required or permitted hereby or by the applicable Series Supplement and may have such letters,

 

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numbers or other marks of identification and such legends or endorsements placed thereon as may, consistently herewith, be determined to be appropriate by the Authorized Officer of each Co-Issuer executing such Notes, as evidenced by execution of such Notes by such Authorized Officer. All Notes of any Series shall, except as specified in the applicable Series Supplement and in this Base Indenture, be equally and ratably entitled as provided herein to the benefits hereof without preference, priority or distinction on account of the actual time or times of authentication and delivery, all in accordance with the terms and provisions of this Base Indenture and any applicable Series Supplement. The aggregate principal amount of Notes which may be authenticated and delivered under this Base Indenture is unlimited. The Notes of each Series shall be issued in the denominations set forth in the applicable Series Supplement.

(b)    With respect to the Series 2019-3 Class A-1 Note Purchase Agreement and any other Class A-1 Note Purchase Agreement entered into by the Co-Issuers in connection with the issuance of any Class A-1 Notes, whether or not any of the following shall have been specifically provided for in the applicable provision of the Indenture Documents, the following shall be true (except to the extent that the Series Supplement with respect to such Class of Notes or such Class A-1 Note Purchase Agreement provides otherwise):

(i)    for purposes of any provision of any Indenture Document relating to any vote, consent, direction, waiver or the like to be given by such Class on any date, with respect to the related Class A-1 Notes Outstanding, the relevant principal amount of such Class A-1 Notes to be used in tabulating the percentage of such Class voting, consenting, directing, waiving or the like will be deemed to be the related Class A-1 Notes Voting Amount;

(ii)    for purposes of any provisions of any Indenture Document relating to termination, discharge or the like, such Class shall continue to be deemed Outstanding unless and until all commitments to extend credit under such Class A-1 Note Purchase Agreement have been terminated thereunder and the Outstanding Principal Amount of such Class shall have been reduced to zero; and

(iii)    notwithstanding the foregoing, and for the avoidance of doubt, a Series Supplement or such Class A-1 Note Purchase Agreement may provide for different treatment of commitments of a Noteholder of a Class A-1 Note subject to such Series Supplement or such Class A-1 Note Purchase Agreement that has failed to make a payment required to be made by it under the terms of such Class A-1 Note Purchase Agreement, that has provided written notification that it does not intend to make a payment required to be made by it thereunder when due or that has become the subject of an Event of Bankruptcy.

Section 2.2    Notes Issuable in Series.

(a)    The Notes may be issued in one or more Series. Each Series of Notes shall be created by a Series Supplement.

(b)    So long as each of the certifications described in clause (iii)(I) and clause (vi) below are true and correct as of the applicable Series Closing Date, Notes of a new Series may from time to time be executed by the Co-Issuers and delivered to the Trustee for authentication and thereupon the same shall be authenticated and delivered by the Trustee upon the receipt by the Trustee of a Company Request at least five (5) Business Days (except in the case of the issuance of the Series of Notes on the Series 2015-1 Closing Date) in advance of the related Series Closing Date (which Company Request will be revocable by the Co-Issuers upon notice to the Trustee no later than 5:00 p.m. (New York City time)

 

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two (2) Business Days prior to the related Series Closing Date) and upon performance or delivery by the Co-Issuers to the Trustee and the Control Party, and receipt by the Trustee and the Control Party, of the following:

(i)    a Company Order authorizing and directing the authentication and delivery of the Notes of such new Series by the Trustee and specifying the designation of such new Series, the Initial Principal Amount (or the method for calculating the Initial Principal Amount) of such new Series to be authenticated and the Note Rate with respect to such new Series;

(ii)    a Series Supplement satisfying the criteria set forth in Section 2.3 executed by the Co-Issuers and the Trustee and specifying the Principal Terms of such new Series;

(iii)    in the case of any Additional Notes, if there is one or more Series of Notes Outstanding (apart from such Additional Notes) on the applicable Series Closing Date (unless all Series of Notes Outstanding (apart from such Additional Notes) will be repaid in full from the proceeds of the issuance of the Additional Notes or otherwise on the applicable Series Closing Date):

(A)    no Cash Trapping Period is in effect or will commence as a result of the issuance of such Additional Notes;

(B)    written confirmation from either the Co-Issuers or their respective Managers that the Rating Agency Condition with respect to the issuance of such Additional Notes has been satisfied;

(C)    no Rapid Amortization Event, Default or Event of Default has occurred and is continuing or will occur as a result of the issuance of such Additional Notes;

(D)    no Manager Termination Event has occurred and is continuing or will occur as a result of the issuance of such Additional Notes;

(E)    the New Series Pro Forma DSCR is greater than or equal to 2.00:1.00;

(F)    the Senior Leverage Ratio and the Driven Brands Leverage Ratio as of the applicable Series Closing Date are each less than or equal to 7.00:1.00 after giving pro forma effect to the issuance of such Additional Notes and any repayment of existing Indebtedness from such Additional Notes;

(G)     (i) prior to the Amendment No. 5 Trigger Date, the anticipated repayment date for such Additional Notes will not be prior to the anticipated repayment date of any Class of Notes then Outstanding (other than in the case of an issuance of Class A-1 Notes) and (ii) on and after the Amendment No. 5 Trigger Date, [RESERVED];1

(H)    the legal final maturity date for such Additional Notes will not be prior to the legal final maturity of any Class of Notes then Outstanding;

 

 

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Upon the Amendment No. 5 Trigger Date, clause (G) of this Section 2.2(b)(iii) will be amended, automatically, without any need for any further action, to replace such clause with the word “[Reserved]”.

 

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(I)    one or more Officers’ Certificates, each executed by an Authorized Officer of each Co-Issuer, dated as of the applicable Series Closing Date, certifying to the matters set forth in clauses (A) through (H) above and to the effect that:

(1)    all conditions precedent with respect to the authentication and delivery of such Additional Notes provided in this Base Indenture, the related Series Supplement and, if applicable, the related Note Purchase Agreement and any other related note purchase agreement executed in connection with the issuance of such Additional Notes have been satisfied or waived;

(2)    the Guarantee and Collateral Agreements are in full force and effect as to such Additional Notes;

(3)    each of the parties to the Transaction Documents with respect to such Additional Notes has covenanted and agreed in the Transaction Documents that, prior to the date which is one year and one day after the payment in full of the latest maturing Note, it will not institute against, or join with any other Person in instituting against, any Securitization Entity any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings, under any federal, state or Canadian bankruptcy or insolvency or similar law; and

(4)    all representations and warranties of the Co-Issuers in this Base Indenture and the other Transaction Documents are true and correct, and will continue to be true and correct after giving effect to such issuance on the Series Closing Date, in all material respects (other than any representation or warranty that, by its terms, is made only as of an earlier date, which representation and warranty shall remain true and correct as of such earlier date in all material respects);

(J)    the proposed issuance does not alter or change the terms of any Series of Notes Outstanding or the Series Supplement relating thereto without such consents as are required under this Base Indenture or the applicable Series Supplement;

(K)    all costs, fees and expenses with respect to the issuance of such new Series of Notes or relating to the actions taken in connection with such issuance that are required to be paid on the applicable Series Closing Date have been paid or will be paid from the proceeds of the issuance of such new Series of Notes; and

(L)    if such new Series of Notes includes Subordinated Debt, the terms of such new Series of Notes include the Subordinated Debt Provisions to the extent applicable.

(iv)    a Tax Opinion, dated the applicable Series Closing Date; provided that, if there are no Notes Outstanding or if all Series of Notes Outstanding will be repaid in full from the proceeds of the issuance of such new Series of Notes or otherwise on the applicable Series Closing Date, only the opinions set forth in clauses (b) and (c) of the definition of “Tax Opinion” will be required to be given in connection with the issuance of such new Series of Notes;

(v)    one or more Opinions of Counsel, subject to the assumptions and qualifications stated therein, and in a form reasonably acceptable to the Control Party, dated the applicable Series Closing Date, substantially to the effect that:

(A)    all of the instruments described in this Section 2.2(b) furnished to the Trustee and the Control Party conform to the requirements of this Base Indenture and

 

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the related Series Supplement and such new Series of Notes are permitted to be authenticated by the Trustee pursuant to the terms of this Base Indenture and the related Series Supplement (except that no such Opinion of Counsel shall be required to be delivered in connection with the issuance of Notes on the Series 2015-1 Closing Date);

(B)    the related Series Supplement has been duly authorized, executed and delivered by each Co-Issuer and constitutes a legal, valid and binding agreement of such Co-Issuer, enforceable against such Co-Issuer in accordance with its terms;

(C)    such new Series of Notes have been duly authorized by each Co-Issuer, and, when such Notes have been duly authenticated and delivered by the Trustee, such Notes will be legal, valid and binding obligations of such Co-Issuer, enforceable against such Co-Issuer in accordance with their terms;

(D)    none of the Securitization Entities is required to be registered under the Investment Company Act within the meaning of Section 3(a)(1) thereof;

(E)    the Lien and the security interests created by this Base Indenture and the Guarantee and Collateral Agreements on the Collateral remain perfected as required by this Base Indenture and the Guarantee and Collateral Agreements, and such Lien and security interests extend to any assets transferred to the Securitization Entities in connection with the issuance of such new Series of Notes;

(F)    (x) based on a reasoned analysis, the assets and liabilities of each U.S. Securitization Entity as a debtor in a bankruptcy proceeding in the United States would not be substantively consolidated with the assets and liabilities of Parent or the U.S. Manager, and (y) based on a reasoned analysis, the assets and liabilities of each Canadian Securitization Entity as a debtor in a bankruptcy or insolvency proceeding in Canada would not be substantively consolidated with the assets and liabilities of ParentDBI or the Canadian Manager;

(G)    neither the execution and delivery by each Co-Issuer of such Notes and the Series Supplement nor the performance by such Co-Issuer of its respective obligations under each of such Notes and the Series Supplement (i) conflicts with the Charter Documents of such Co-Issuer, (ii) constitutes a violation of, or a default under, any material agreement to which such Co-Issuer is a party (which agreements may be set forth in a schedule to such opinion), or (iii) contravenes any order or decree that is applicable to such Co-Issuer (which orders and decrees may be set forth in a schedule to such opinion);

(H)    neither the execution and delivery by each Co-Issuer of such Notes and the Series Supplement nor the performance by such Co-Issuer of its respective payment obligations under each of such Notes and the Series Supplement (i) violates any law, rule or regulation of any relevant jurisdiction or (ii) requires the consent, approval, licensing or authorization of, or any filing, recording or registration with, any governmental authority under any law, rule or regulation of any relevant jurisdiction except for those consents, approvals, licenses and authorizations already obtained and those filings, recordings and registrations already made;

(I)    there is no action, proceeding or investigation pending or threatened against ParentDBI or any of its Subsidiaries before any court or administrative agency that may reasonably be expected to have a Material Adverse Effect on the business or assets of the Securitization Entities;

 

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(J)    unless such Notes are being offered pursuant to a registration statement that has been declared effective under the Securities Act, it is not necessary in connection with the offer and sale of such Notes by the Co-Issuers to the initial purchaser thereof or by the initial purchaser to the initial investors in such Notes to register such Notes under the Securities Act; and

(K)    all conditions precedent to such issuance have been satisfied and the related Series Supplement is authorized or permitted pursuant to the terms and conditions of the Indenture (except that no such Opinion of Counsel relating to the satisfaction of conditions precedent shall be required to be delivered in connection with the issuance of Notes on the Series 2015-1 Closing Date);

(vi)    one or more Officers’ Certificates, each executed by an Authorized Officer of each Co-Issuer, dated as of the applicable Series Closing Date to the effect that:

(A)    the related Series Supplement has been duly authorized, executed and delivered by such Co-Issuers and constitutes a legal, valid and binding agreement of such Co-Issuer, enforceable against such Co-Issuer in accordance with its terms; and

(B)    all conditions precedent to such issuance have been satisfied and the related Series Supplement is authorized or permitted pursuant to the terms and conditions of the Indenture; and

(vii)    such other documents, instruments, certifications, agreements or other items as the Trustee may reasonably require.

(c)    Upon satisfaction, or waiver by the Control Party (as directed by the Controlling Class Representative) (which waiver shall be in writing), of the conditions set forth in Section 2.2(b), the Trustee shall authenticate and deliver, as provided above, such Additional Notes upon execution thereof by the Co-Issuers.

(d)    With regard to any new Series of Notes issued pursuant to this Section 2.2, the proceeds from such issuance may only be used to repay (i) Senior Subordinated Notes and Subordinated Notes if all Senior Notes have been repaid and (ii) Subordinated Notes if all Senior Notes and Senior Subordinated Notes have been repaid; provided that at any time on or after the Series Anticipated Repayment Date for any Series of Notes, the proceeds from the issuance of Subordinated Notes may only be used to repay Senior Notes, Senior Subordinated Notes or all Outstanding Classes of Senior Notes and Senior Subordinated Notes.

(e)    The issuance of Additional Notes shall not be subject to the consent of the Holders of any Series of Notes Outstanding. Additional Notes may be issued for any purpose consistent with the Transaction Documents, including acquisitions and refinancings of acquisitions by the Securitization Entities.

Section 2.3    Series Supplement for Each Series.

In conjunction with the issuance of a new Series, the parties hereto shall execute a Series Supplement, which shall specify the relevant terms with respect to such new Series of Notes, which may include, without limitation:

(a)    its name or designation;

 

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(b)    the Initial Principal Amount with respect to such Series;

(c)    the Note Rate with respect to such Series or each Class of such Series and the applicable Default Rate;

(d)    the Series Closing Date;

(e)    the Series Anticipated Repayment Date, if any;

(f)    the Series Legal Final Maturity Date;

(g)    the principal amortization schedule with respect to such Series, if any;

(h)    each Rating Agency rating such Series;

(i)    the name of the Clearing Agency, if any;

(j)    the names of the Series Distribution Accounts and any other Series Accounts to be used with respect to such Series and the terms governing the operation of any such account and the use of moneys therein;

(k)    the method of allocating amounts deposited into any Series Distribution Account with respect to such Series;

(l)    whether the Notes of such Series will be issued in multiple Classes or Subclasses and the rights and priorities of each such Class or Subclass;

(m)    any deposit of funds to be made in any Base Indenture Account or any Series Account on the Series Closing Date and whether any such Base Indenture Account or Series Account shall be U.S. Dollar-denominated or Canadian Dollar-denominated;

(n)    whether the Notes of such Series may be issued as either Definitive Notes or Book-Entry Notes and any limitations imposed thereon;

(o)    whether the Notes of such Series include Senior Notes, Senior Subordinated Notes and/or Subordinated Notes;

(p)    whether the Notes of such Series include Class A-1 Notes or subfacilities of Class A-1 Notes issued pursuant to a Class A-1 Note Purchase Agreement; and

(q)    any other relevant terms of such Series of Notes (all such terms, the “Principal Terms” of such Series).

Section 2.4    Execution and Authentication.

(a)    The Notes shall, upon issuance pursuant to Section 2.2, be executed on behalf of each Co-Issuer by an Authorized Officer of such Co-Issuer and delivered by the Co-Issuers to the Trustee for authentication and redelivery as provided herein. The signature of such Authorized Officers on the Notes may be manual or facsimile. If an Authorized Officer of a Co-Issuer whose signature is on a Note no longer holds that office at the time the Note is authenticated, the Note shall nevertheless be valid.

(b)    At any time and from time to time after the execution and delivery of this Base Indenture, the Co-Issuers may deliver Notes of any particular Series (issued pursuant to Section 2.2)

 

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executed by the Co-Issuers to the Trustee for authentication, together with one or more Company Orders for the authentication and delivery of such Notes, and the Trustee, in accordance with such Company Order and this Base Indenture, shall authenticate and deliver such Notes.

(c)    No Note shall be entitled to any benefit under the Indenture or be valid for any purpose unless there appears on such Note a certificate of authentication substantially in the form provided for below, duly executed by the Trustee by the manual, facsimile, or electronic signature of a Trust Officer (and the Luxembourg agent (the “Luxembourg Agent”) if applicable, if the Notes of the Series to which such Note belongs are listed on the Luxembourg Stock Exchange). Such signatures on such certificate shall be conclusive evidence, and the only evidence, that the Note has been duly authenticated under this Base Indenture. The Trustee may appoint an authenticating agent acceptable to the Issuer to authenticate Notes. Unless limited by the term of such appointment, an authenticating agent may authenticate Notes whenever the Trustee may do so. Each reference in this Base Indenture to authentication by the Trustee includes authentication by such authenticating agent. The Trustee’s certificate of authentication shall be in substantially the following form:

“This is one of the Notes of a Series issued under the within mentioned Indenture.

 

CITIBANK, N.A., as Trustee
By:  

                     

Name:  
Title:   Authorized Signatory”

(d)    Each Note shall be dated and issued as of the date of its authentication by the Trustee.

(e)    Notwithstanding the foregoing, if any Note shall have been authenticated and delivered hereunder but never issued and sold by the Co-Issuers, and a Co-Issuer (or the Co-Issuers) shall deliver such Note to the Trustee for cancellation as provided in Section 2.14 together with a written statement to the Trustee and the Servicer (which need not comply with Section 14.3) stating that such Note has never been issued and sold by the Co-Issuers, for all purposes of the Indenture such Note shall be deemed never to have been authenticated and delivered hereunder and shall not be entitled to the benefits of the Indenture.

Section 2.5    Registrar and Paying Agent.

(a)    The Co-Issuers shall (i) maintain an office or agency in the United States where Notes may be presented for registration of transfer or for exchange (the “Registrar”) and (ii) appoint a paying agent (which shall satisfy the eligibility criteria set forth in Section 10.8(a)) (the “Paying Agent”) at whose office or agency Notes may be presented for payment. The Registrar shall keep a register of the Notes (including the name and address of each such Noteholder) and of their transfer and exchange. The Trustee shall indicate in its books and records the commitment of each Noteholder, if applicable, and the principal amount owing to each Noteholder from time to time. The Co-Issuers may appoint one or more co-registrars and one or more additional paying agents. The term “Paying Agent” shall include any additional paying agent, and the term “Registrar” shall include any co-registrars. The Co-Issuers may change the Paying Agent or the Registrar without prior notice to any Noteholder. The Co-Issuers shall notify the Trustee in writing of the name and address of any Agent not a party to this Base Indenture. The Trustee is hereby initially appointed as the Registrar and the Paying Agent and shall send copies of all notices and demands received by the Trustee (other than those sent by the Co-Issuers to the Trustee and those addressed to the Co-Issuers) in connection with the Notes to the Co-Issuers. Upon any resignation or

 

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removal of the Registrar, the Co-Issuers shall promptly appoint a successor Registrar or, in the absence of such appointment, the Issuer (on behalf of itself and as agent for the Canadian Co-Issuer) shall assume the duties of the Registrar.

(b)    The Co-Issuers shall enter into an appropriate agency agreement with any Agent not a party to this Base Indenture. Such agency agreement shall implement the provisions of this Base Indenture that relate to such Agent. If the Co-Issuers fail to maintain a Registrar or the Co-Issuers fail to maintain a Paying Agent, the Trustee hereby agrees to act as such, and shall be entitled to appropriate compensation in accordance with this Base Indenture until the Co-Issuers shall appoint one or more replacement Registrar or Paying Agent, as applicable.

Section 2.6    Paying Agent to Hold Money in Trust.

(a)    The Co-Issuers will cause the Paying Agent (if the Paying Agent is not the Trustee) to execute and deliver to the Trustee an instrument in which the Paying Agent shall agree with the Trustee (and if the Trustee is the Paying Agent, it hereby so agrees), subject to the provisions of this Section 2.6, that the Paying Agent will:

(i)    hold all sums held by it for the payment of amounts due with respect to the Notes in trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided and pay such sums to such Persons as herein provided;

(ii)    give the Trustee notice of any Default by the Co-Issuers of which it has Actual Knowledge in the making of any payment required to be made with respect to the Notes;

(iii)    at any time during the continuance of any such Default, upon the written request of the Trustee, forthwith pay to the Trustee all sums so held in trust by the Paying Agent;

(iv)    immediately resign as the Paying Agent and forthwith pay to the Trustee all sums held by it in trust for the payment of Notes if at any time it ceases to meet the standards required to be met by a Trustee hereunder at the time of its appointment; and

(v)    comply with all requirements of the Code, the Tax Act and other applicable tax law with respect to the withholding from any payments made by it on any Notes of any applicable withholding taxes imposed thereon and with respect to any applicable reporting requirements in connection therewith.

(b)    The Co-Issuers may at any time, for the purpose of obtaining the satisfaction and discharge of the Indenture or for any other purpose, by Company Order direct the Paying Agent to pay to the Trustee all sums held in trust by the Paying Agent, such sums to be held by the Trustee in trust upon the same terms as those upon which the sums were held in trust by the Paying Agent. Upon such payment by the Paying Agent to the Trustee, the Paying Agent shall be released from all further liability with respect to such money.

(c)    Subject to applicable laws with respect to escheat of funds, any money held by the Trustee or the Paying Agent in trust for the payment of any amount due with respect to any Note and remaining unclaimed for two years after such amount has become due and payable shall be discharged from such trust and be paid to the Co-Issuers upon delivery of a Company Request, which payment shall be made to each Co-Issuer based on its contribution of such funds. The Holder of such Note shall thereafter, as an unsecured general creditor, look only to the Co-Issuers for payment thereof (but only to the extent of the

 

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amounts so paid to the Co-Issuers), and all liability of the Trustee or the Paying Agent with respect to such trust money paid to the Co-Issuers shall thereupon cease; provided, however, that the Trustee or the Paying Agent, before being required to make any such repayment, may, at the expense of the Co-Issuers, cause to be published once, in a newspaper published in the English language, customarily published on each Business Day and of general circulation in New York City, in newspapers published in the English or French language, customary published on each Business Day and of general circulation in Toronto or Montreal, respectively, and in a newspaper customarily published on each Business Day and of general circulation in London and Luxembourg (if the related Series of Notes has been listed on the Luxembourg Stock Exchange), if applicable, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than thirty (30) days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to the Co-Issuers. The Trustee may also adopt and employ, at the expense of the Co-Issuers, any other commercially reasonable means of notification of such repayment.

Section 2.7    Noteholder List.

(a)    The Trustee will furnish or cause to be furnished by the Registrar to the Co-Issuers, the Managers, the Control Party, the Controlling Class Representative or the Paying Agent, within five (5) Business Days after receipt by the Trustee of a request therefor from the Co-Issuers, the Managers, the Control Party, the Controlling Class Representative or the Paying Agent, respectively, in writing, the names and addresses of the Noteholders of each Series as of the most recent Record Date for payments to such Noteholders. Every Noteholder, by receiving and holding a Note, agrees that none of the Trustee, the Registrar, either Co-Issuer, the Servicer, the Controlling Class Representative nor any of their respective agents shall be held accountable by reason of any disclosure of any such information as to the names and addresses of the Noteholders in the Note Register.

(b)    The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Noteholders of each Series of Notes. If the Trustee is not the Registrar, the Co-Issuers shall furnish to the Trustee at least seven (7) Business Days before each Quarterly Payment Date and at such other time as the Trustee may request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Noteholders of each Series of Notes.

Section 2.8    Transfer and Exchange.

(a)    Upon surrender for registration of transfer of any Note at the office or agency of the Registrar, if the requirements of Section 2.8(f) and Section 8-401(a) of the New York UCC are met, the Co-Issuers shall execute and, after the Co-Issuers have executed, the Trustee shall authenticate and deliver to the Noteholder, in the name of the designated transferee or transferees, one or more new Notes, in any authorized denominations, of the same Series and Class (and, if applicable, Subclass) and a like original aggregate principal amount of the Notes so transferred. At the option of any Noteholder, Notes may be exchanged for other Notes of the same Series and Class in authorized denominations of like original aggregate principal amount of the Notes so exchanged, upon surrender of the Notes to be exchanged at any office or agency of the Registrar maintained for such purpose. Whenever Notes of any Series are so surrendered for exchange, if the requirements of Section 2.8(f) and Section 8-401(a) of the New York UCC are met, the Co-Issuers shall execute and, after the Co-Issuers have executed, the Trustee shall authenticate and deliver to the Noteholder the Notes which the Noteholder making the exchange is entitled to receive.

(b)    Every Note presented or surrendered for registration of transfer or exchange shall be (i) duly endorsed by, or be accompanied by a written instrument of transfer in form satisfactory to the Trustee, the Co-Issuers and the Registrar duly executed by, the Holder thereof or such Holder’s attorney duly authorized in writing with a medallion signature guarantee and (ii) accompanied by such other

 

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documents as the Trustee and the Registrar may require to document the identities and/or signatures of the transferor and the transferee. The Co-Issuers shall execute and deliver to the Trustee or the Registrar, as applicable, Notes in such amounts and at such times as are necessary to enable the Trustee to fulfill its responsibilities under the Indenture and the Notes.

(c)    All Notes issued and authenticated upon any registration of transfer or exchange of the Notes shall be the valid obligations of each Co-Issuer, evidencing the same indebtedness, and entitled to the same benefits under the Indenture, as the Notes surrendered upon such registration of transfer or exchange.

(d)    The preceding provisions of this Section 2.8 notwithstanding, (i) the Trustee, the Co-Issuers or the Registrar, as the case may be, shall not be required (A) to issue, register the transfer of or exchange any Note of any Series for a period beginning at the opening of business fifteen (15) days preceding the selection of any Series of Notes for redemption and ending at the close of business on the day of the mailing of the relevant notice of redemption or (B) to register the transfer of or exchange any Note so selected for redemption, and (ii) no assignment or transfer of a Note or any commitment in respect thereof shall be effective until such assignment or transfer shall have been recorded in the Note Register and in the books and records of the Trustee, as applicable, pursuant to Section 2.5(a).

(e)    No service charge shall be payable for any registration of transfer or exchange of Notes, but the Registrar or the Trustee, as the case may be, may require payment by the Noteholder of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any transfer or exchange of Notes.

(f)    Unless otherwise provided in the applicable Series Supplement, registration of transfer of Notes containing a legend relating to the restrictions on transfer of such Notes (which legend shall be set forth in the applicable Series Supplement) shall be effected only if the conditions set forth in such applicable Series Supplement are satisfied. Notwithstanding any other provision of this Section 2.8 and except as otherwise provided in Section 2.13, the typewritten Note or Notes representing Book-Entry Notes for any Series may be transferred, in whole but not in part, only to another nominee of the Clearing Agency for such Series, or to a successor Clearing Agency for such Series selected or approved by the Co-Issuers or to a nominee of such successor Clearing Agency, only if in accordance with this Section 2.8 and Section 2.12.

(g)    If the Notes of any Series are listed on the Luxembourg Stock Exchange, the Trustee or the Luxembourg Agent, as the case may be, shall send to the Co-Issuers upon any transfer or exchange of any such Note information reflected in the copy of the register for the Notes maintained by the Registrar or the Luxembourg Agent, as the case may be.

Section 2.9    Persons Deemed Owners.

Prior to due presentment for registration of transfer of any Note, the Trustee, the Servicer, the Controlling Class Representative, any Agent and the Co-Issuers may deem and treat the Person in whose name any Note is registered (as of the day of determination) as the absolute owner of such Note for the purpose of receiving payment of principal of and interest on such Note and for all other purposes whatsoever (other than purposes in which the vote or consent of a Note Owner is expressly required pursuant to this Base Indenture or the applicable Series Supplement), whether or not such Note is overdue, and none of the Trustee, the Servicer, the Controlling Class Representative, any Agent nor the Co-Issuers shall be affected by notice to the contrary.

 

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Section 2.10    Replacement Notes.

(a)    If (i) any mutilated Note is surrendered to the Trustee, or the Trustee receives evidence to its reasonable satisfaction of the destruction, loss or theft of any Note, and (ii) there is delivered to the Co-Issuers and the Trustee such security or indemnity as may be required by them to hold the Co-Issuers and the Trustee harmless, then, provided that the requirements of Section 2.8(f) and Section 8-405 of the New York UCC are met, the Co-Issuers shall execute and, upon its request, the Trustee or an authenticating agent appointed by the Trustee shall authenticate and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Note, a replacement Note; provided, however, that if any such destroyed, lost or stolen Note, but not a mutilated Note, shall have become, or within seven (7) days shall be, due and payable, instead of issuing a replacement Note, the Co-Issuers may pay such destroyed, lost or stolen Note when so due or payable without surrender thereof. If, after the delivery of such replacement Note or payment of a destroyed, lost or stolen Note pursuant to the preceding sentence, a protected purchaser (within the meaning of Section 8-303 of the New York UCC) of the original Note in lieu of which such replacement Note was issued presents for payment such original Note, the Co-Issuers and the Trustee shall be entitled to recover such replacement Note (or such payment) from the Person to whom it was delivered or any Person taking such replacement Note from such Person to whom such replacement Note was delivered or any assignee of such Person, except a protected purchaser, and shall be entitled to recover upon the security or indemnity provided therefor to the extent of any loss, damage, cost or expense incurred by the Co-Issuers or the Trustee in connection therewith.

(b)    Upon the issuance of any replacement Note under this Section 2.10, the Co-Issuers may require the payment by the Holder of such Note of a sum sufficient to cover any Tax or other governmental charge that may be imposed in relation thereto and any other reasonable expenses (including the fees and expenses of the Trustee and the Registrar) connected therewith.

(c)    Every replacement Note issued pursuant to this Section 2.10 in replacement of any mutilated, destroyed, lost or stolen Note shall constitute an original additional contractual obligation of the Co-Issuers and such replacement Note shall be entitled to all the benefits of the Indenture equally and proportionately with any and all other Notes duly issued under the Indenture (in accordance with the priorities and other terms set forth herein and in each applicable Series Supplement).

(d)    The provisions of this Section 2.10 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes.

Section 2.11    Treasury Notes.

In determining whether the Noteholders of the required Aggregate Outstanding Principal Amount of Notes or the required Outstanding Principal Amount of any Series or any Class of any Series of Notes, as the case may be, have concurred in any direction, waiver or consent, Notes owned, legally or beneficially, by a Co-Issuer or any Affiliate of a Co-Issuer shall be considered as though they are not Outstanding, except that for the purpose of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Notes of which a Trust Officer has received written notice of such ownership shall be so disregarded. Absent written notice to a Trust Officer of such ownership, the Trustee shall not be deemed to have knowledge of the identity of the individual Note Owners.

Section 2.12    Book-Entry Notes.

(a)    Unless otherwise provided in any applicable Series Supplement, the Notes of each Class of each Series, upon original issuance, shall be issued in the form of typewritten Notes representing Book-Entry Notes and delivered to the depository (or its custodian) specified in such Series Supplement

 

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(the “Depository”) which shall be the Clearing Agency on behalf of such Series or such Class. The Notes of each Class of each Series shall, unless otherwise provided in the applicable Series Supplement, initially be registered on the Note Register in the name of the Clearing Agency or the nominee of the Clearing Agency. No Note Owner will receive a definitive note representing such Note Owner’s interest in the related Series of Notes, except as provided in Section 2.13. Unless and until definitive, fully registered Notes of any Series or any Class of any Series (“Definitive Notes”) have been issued to Note Owners pursuant to Section 2.13:

(i)    the provisions of this Section 2.12 shall be in full force and effect with respect to each such Series;

(ii)    the Co-Issuers, the Paying Agent, the Registrar, the Trustee, the Servicer and the Controlling Class Representative may deal with the Clearing Agency and the applicable Clearing Agency Participants for all purposes (including the payment of principal of, premium, if any, and interest on the Notes and the giving of instructions or directions hereunder or under the applicable Series Supplement) as the sole Holder of the Notes, and shall have no obligation to the Note Owners;

(iii)    to the extent that the provisions of this Section 2.12 conflict with any other provisions of the Indenture, the provisions of this Section 2.12 shall control with respect to each such Class or Series of the Notes;

(iv)    subject to the rights of the Servicer and the Controlling Class Representative under the Indenture, and except for the rights granted pursuant to Section 11.5, the rights of Note Owners of each such Class or Series of Notes shall be exercised only through the Clearing Agency and the applicable Clearing Agency Participants and shall be limited to those established by law and agreements between such Note Owners and the Clearing Agency and/or the Clearing Agency Participants, and all references in the Indenture to actions by the Noteholders shall refer to actions taken by the Clearing Agency upon instructions from the Clearing Agency Participants, and all references in the Indenture to distributions, notices, reports and statements to the Noteholders shall refer to distributions, notices, reports and statements to the Clearing Agency, as registered holder of the Notes of such Series for distribution to the Note Owners in accordance with the procedures of the Clearing Agency; and

(v)    subject to the rights of the Servicer and the Controlling Class Representative under the Indenture, and except for rights granted pursuant to Section 11.5, whenever the Indenture requires or permits actions to be taken based upon instructions or directions of Noteholders evidencing a specified percentage of the Aggregate Outstanding Principal Amount of Notes or the Outstanding Principal Amount of a Series or Class of a Series of Notes, the applicable Clearing Agency shall be deemed to represent such percentage only to the extent that it has received instructions to such effect from Note Owners and/or their related Clearing Agency Participants owning or representing, respectively, such required percentage of the beneficial interest in the Outstanding Notes or such Series or such Class of such Series of Notes Outstanding, as the case may be, and has delivered such instructions in writing to the Trustee.

(b)    Pursuant to the Depository Agreement applicable to a Series, unless and until Definitive Notes of such Series are issued pursuant to Section 2.13, the initial Clearing Agency will make book-entry transfers among the Clearing Agency Participants and receive and transmit distributions of principal, premium, if any, and interest on the Notes to such Clearing Agency Participants.

 

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(c)    Whenever notice or other communication to the Noteholders is required under the Indenture, unless and until Definitive Notes shall have been issued to Note Owners pursuant to Section 2.13, the Trustee and the Co-Issuers shall give all such notices and communications specified herein to be given to Noteholders to the applicable Clearing Agency for distribution to the Note Owners in accordance with the Applicable Procedures of the Clearing Agency.

Section 2.13    Definitive Notes.

(a)    The Notes of any Series or Class of any Series, to the extent provided in the related Series Supplement, upon original issuance, may be issued in the form of Definitive Notes. All Class A-1 Notes of any Series shall be issued in the form of Definitive Notes. The applicable Series Supplement shall set forth the legend relating to the restrictions on transfer of such Definitive Notes and such other restrictions as may be applicable.

(b)    With respect to the Notes of any Series issued in the form of typewritten Notes representing Book-Entry Notes, if (i) (A) the Co-Issuers advise the Trustee in writing that the Clearing Agency with respect to any such Series of Notes is no longer willing or able to discharge properly its responsibilities under the applicable Depository Agreement and (B) the Trustee or the Co-Issuers are unable to locate a qualified successor or (ii) after the occurrence of a Rapid Amortization Event, with respect to any Series of Notes Outstanding, Note Owners holding a beneficial interest in excess of 50% of the aggregate Outstanding Principal Amount of such Series of Notes advise the Trustee and the applicable Clearing Agency through the applicable Clearing Agency Participants in writing that the continuation of a book-entry system through the applicable Clearing Agency is no longer in the best interests of such Note Owners, in each case, the Trustee shall notify all Note Owners of such Series, through the applicable Clearing Agency Participants, of the occurrence of any such event and of the availability of Definitive Notes to Note Owners of such Series. Upon surrender to the Trustee of the Notes of such Series by the applicable Clearing Agency, accompanied by registration instructions from the applicable Clearing Agency for registration, the Co-Issuers shall execute and the Trustee shall authenticate, upon receipt of a Company Order, and deliver an equal aggregate principal amount of Definitive Notes in accordance with the instructions of the Clearing Agency. Neither the Co-Issuers nor the Trustee shall be liable for any delay in delivery of such instructions and may each conclusively rely on, and shall be protected in relying on, such instructions. Upon the issuance of Definitive Notes of such Series of Notes, all references herein to obligations imposed upon or to be performed by the applicable Clearing Agency shall be deemed to be imposed upon and performed by the Trustee, to the extent applicable with respect to such Definitive Notes, and the Trustee shall recognize the Holders of the Definitive Notes of such Series as Noteholders of such Series hereunder and under the applicable Series Supplement.

Section 2.14    Cancellation.

The Co-Issuers may at any time deliver to the Trustee for cancellation any Notes previously authenticated and delivered hereunder which a Co-Issuer or an Affiliate thereof may have acquired in any manner whatsoever, and all Notes so delivered shall be promptly cancelled by the Trustee. Immediately upon the delivery of any Notes by the Co-Issuers to the Trustee for cancellation pursuant to this Section 2.14, the security interest of the Secured Parties in such Notes shall automatically be deemed to be released by the Trustee, and the Trustee shall execute and deliver to the Co-Issuers any and all documentation reasonably requested and prepared by the Co-Issuers at their expense to evidence such automatic release. The Registrar and the Paying Agent shall forward to the Trustee any Notes surrendered to them for registration of transfer, exchange or payment. The Trustee shall cancel all Notes surrendered for registration of transfer, exchange, payment, replacement or cancellation. Except as provided in any Note Purchase Agreement executed and delivered in connection with the issuance of any Series or any Class of any Series of Notes, the Co-Issuers may not issue new Notes to replace Notes that the Co-Issuers have

 

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redeemed or paid or that have been delivered to the Trustee for cancellation. All cancelled Notes held by the Trustee shall be disposed of in accordance with the Trustee’s standard disposition procedures unless the Co-Issuers shall direct that cancelled Notes be returned to either Co-Issuer for destruction pursuant to a Company Order. No cancelled Notes may be reissued. No provision of this Base Indenture or any Supplement that relates to prepayment procedures, penalties, fees, make-whole payments or any other related matters shall be applicable to any Notes cancelled pursuant to and in accordance with this Section 2.14.

Section 2.15    Principal and Interest.

(a)    The principal of and premium, if any, on each Series of Notes shall be due and payable at the times and in the amounts set forth in the applicable Series Supplement and in accordance with the Priority of Payments.

(b)    Each Series of Notes shall accrue interest as provided in the applicable Series Supplement and such interest shall be due and payable for such Series on each Quarterly Payment Date in accordance with the Priority of Payments.

(c)    Except as provided in the following sentence, the Person in whose name any Note is registered at the close of business on any Record Date with respect to a Quarterly Payment Date for such Note shall be entitled to receive the principal, premium, if any, and interest payable on such Quarterly Payment Date notwithstanding the cancellation of such Note upon any registration of transfer, exchange or substitution of such Note subsequent to such Record Date. Any interest payable at maturity shall be paid to the Person to whom the principal of such Note is payable.

(d)    Pursuant to the authority of the Paying Agent under Section 2.6(a)(v), except as otherwise provided pursuant to any Class A-1 Note Purchase Agreement to the extent that the Paying Agent has been notified in writing of such exception by the Co-Issuers or the applicable Class A-1 Administrative Agent, the Paying Agent shall make all payments of interest on the Notes net of any applicable withholding taxes and Noteholders shall be treated as having received as payments of interest any amounts withheld with respect to such withholding taxes.

(e)    For the purpose of disclosure pursuant to the Interest Act (Canada) as-applied to the Canadian Co-Issuer, the yearly rate of interest to which any rate of interest payable under the Indenture that is calculated on any basis other than a full calendar year is equivalent may be determined by multiplying such rate by a fraction the numerator of which is the actual number of days in the calendar year in which such yearly rate of interest is to be ascertained and the denominator of which is the number of days comprising such other basis. The rates of interest stipulated in the Indenture or in any of the Notes as-applied to the Canadian Co-Issuer are intended to be nominal rates and not effective rates or yields. The principle of deemed reinvestment of interest as-applied to the Canadian Co-Issuer shall not apply to any interest calculation under the Indenture or under the Notes.

(f)    If any provision of the Indenture would oblige the Co-Issuers to make any payment of interest or other amount payable to any Noteholder in an amount or calculated at a rate which would be prohibited by Requirements of Law or would result in a receipt by that Noteholder of “interest” at a “criminal rate” (as such terms are construed under the Criminal Code (Canada)), then, notwithstanding such provision, such amount or rate shall be deemed to have been adjusted with retroactive effect to the maximum amount or rate of interest, as the case may be, as would not be so prohibited by Requirements of Law or so result in a receipt by that Noteholder of “interest” at a “criminal rate”, such adjustment to be effected, to the extent necessary (but only to the extent necessary), by reducing any fees, commissions, costs, expenses, premiums and other amounts required to be paid to the affected Noteholder which would constitute interest for purposes of section 347 of the Criminal Code (Canada).

 

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Section 2.16    Tax Treatment.

The Co-Issuers have structured this Base Indenture and the Notes have been (or will be) issued with the intention that the Notes will qualify under applicable tax law in the United States as indebtedness of the Co-Issuers or, if a Co-Issuer is treated as a division of another entity for applicable tax purposes, such other entity, and any entity acquiring any direct or indirect interest in any Note by acceptance of its Notes (or, in the case of a Note Owner, by virtue of such Note Owner’s acquisition of a beneficial interest therein) agrees to treat the Notes (or beneficial interests therein) for all purposes of federal, state, provincial, territorial and local and other income or franchise taxes, and any other tax imposed on or measured by income, as indebtedness of the Co-Issuers or, if a Co-Issuer is treated as a division of another entity for applicable tax purposes, such other entity.

ARTICLE III

SECURITY

Section 3.1    Grant of Security Interest.

(a)    To secure its Obligations, each Co-Issuer (as of the date such Co-Issuer became party to this Base Indenture) hereby pledges, mortgages, charges, assigns, conveys, delivers, transfers and sets over to the Trustee, for the benefit of the Secured Parties, and hereby grants to the Trustee, for the benefit of the Secured Parties, a security interest in such Co-Issuer’s right, title and interest in, to and under all of the following property to the extent now owned or at any time hereafter acquired by such Co-Issuer (collectively, the “Indenture Collateral”):

(i)    the Equity Interests of any Person (including, without limitation, Franchisor Holdco, SPV Product Sales Holder, Radiator Product Sales Holder, Take 5 Properties, FUSA Properties, the Canadian SPV Franchising Entity LPs, Driven Canada Product Sourcing, Driven Canada Claims Management and the Canadian Securitization Entity GPs) owned by such Co-Issuer and all rights as a member, shareholder or partner of each such Person under the Charter Documents of each such Person;

(ii)    the Accounts of such Co-Issuer and all amounts on deposit in or otherwise credited to such Accounts;

(iii)    any rights in and to any Interest Reserve Letter of Credit;

(iv)    the books and records (whether in physical, electronic or other form) of such Co-Issuer;

(v)    the rights, powers, remedies and authorities of such Co-Issuer under each of the Transaction Documents (other than the Indenture and the Notes) to which it is a party;

(vi)    to the extent contributed to such Co-Issuer, all real and personal property of any Securitization-Owned Locations;

(vii)    any and all other property of such Co-Issuer now or hereafter acquired, including, without limitation, all accounts (including, without limitation, the rights to receive payments under short-term notes in respect of delinquent royalty payments from Franchisees), chattel paper, commercial tort claims, deposit accounts, futures accounts, documents, documents of title, equipment, fixtures, general intangibles, intangibles, health-care-insurance receivables, instruments, inventory, securities, securities accounts and other investment property and letter-of-credit rights; and

 

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(viii)    all payments, proceeds, supporting obligations and accrued and future rights to payment with respect to the foregoing;

provided that (A) the Indenture Collateral shall exclude the Collateral Exclusions; (B) the Co-Issuers shall not be required to pledge, and the Collateral shall not include, more than 65% of the Voting Equity Interests (and any rights associated with such Voting Equity Interests) of any foreign Subsidiary of any of the Co-Issuers that is a corporation for United States federal income tax purposes (other than the Canadian Securitization Entities); (C) the security interest in (1) the Senior Notes Interest Reserve Accounts, the Series Distribution Accounts with respect to the Senior Notes and the funds or securities deposited therein or credited thereto shall only be for the benefit of the Senior Noteholders and the Trustee, in its capacity as trustee for the Senior Noteholders, (2) the Senior Subordinated Notes Interest Reserve Accounts, the Series Distribution Accounts with respect to the Senior Subordinated Notes and the funds or securities deposited therein or credited thereto shall only be for the benefit of the Senior Subordinated Noteholders and the Trustee, in its capacity as trustee for the Senior Subordinated Noteholders, (3) the Series Distribution Accounts with respect to the Subordinated Notes and the funds or securities deposited therein or credited thereto shall only be for the benefit of the Subordinated Noteholders and the Trustee, in its capacity as trustee for the Subordinated Noteholders, (4) each Pre-Funding Account and the funds or securities deposited therein or credited thereto shall only be for the benefit of the applicable Noteholders identified in the Series Supplement establishing such Pre-Funding Account and (5) each Pre-Funding Reserve Account and the funds or securities deposited therein or credited thereto shall only be for the benefit of the applicable Noteholders identified in the Series Supplement establishing such Pre-Funding Reserve Account; and (D) any cash collateral deposited by any Non-Securitization Entities with a Co-Issuer to secure such Non-Securitization Entities’ obligations under any Letter of Credit Reimbursement Agreement will not constitute Indenture Collateral until such time (if any) as such Co-Issuer is entitled to withdraw such funds from the applicable bank account pursuant to the terms of such Letter of Credit Reimbursement Agreement to reimburse such Co-Issuer for any amounts due by such Non-Securitization Entities to such Co-Issuer pursuant to such Letter of Credit Reimbursement Agreement that such Non-Securitization Entities have not paid to such Co-Issuer in accordance with the terms thereof. The Trustee, on behalf of the Secured Parties, acknowledges that it shall have no security interest in any Collateral Exclusions. If the grant of the security interests hereunder by the Canadian Co-Issuer with respect to any contract, Intellectual Property or Permit would result in the termination or breach of such contract, Intellectual Property or Permit or is otherwise prohibited or ineffective (whether by the terms thereof or under applicable law), then such contract, Intellectual Property or Permit shall not be subject to the security interests granted hereunder but shall be held in trust by the Canadian Co-Issuer for the benefit of the Trustee (for its own benefit and for the benefit of the other Secured Parties) and, on the exercise by the Trustee of any of its rights or remedies under this Base Indenture following an Event of Default shall be assigned by the Canadian Co-Issuer as directed by the Trustee; provided that: (x) the security interests granted hereunder shall attach to such contract, Intellectual Property or Permit, or applicable portion thereof, immediately at such time as the condition causing such termination or breach is remedied, and (y) if a term in a contract that prohibits or restricts the grant of the security interests granted hereunder in the whole of an Account or Chattel Paper forming part of the Indenture Collateral is unenforceable against the Trustee under applicable law, then the exclusion from the security interests set out above shall not apply to such Account or Chattel Paper. In addition, the security interests granted hereunder do not attach to consumer goods (as defined in the PPSA) or extend to the last day of the term of any lease or agreement for lease of real property. Such last day shall be held by the Canadian Co-Issuer in trust for the Trustee (for its own benefit and for the benefit of the other Secured Parties) and, on the exercise by the Trustee of any of its rights or remedies under this Agreement following an Event of Default, shall be assigned by the Canadian Co-Issuer as directed by the Trustee. For greater certainty, no Intellectual Property in any trade-mark, get-up or trade dress is presently assigned to the Trustee by sole virtue of the grant of the security interests contained herein.

 

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(b)    The foregoing grant is made by each Co-Issuer in trust to secure the Obligations and to secure compliance by the Co-Issuers with the provisions of this Base Indenture and any Series Supplements, all as provided in this Base Indenture. The Trustee, on behalf of the Secured Parties, acknowledges such grant, accepts the trusts under this Base Indenture in accordance with the provisions of this Base Indenture and agrees to perform its duties required in this Base Indenture. The Indenture Collateral shall secure the Obligations equally and ratably without prejudice, priority or distinction (except, with respect to any Series of Notes, as otherwise stated in the applicable Series Supplement or in the applicable provisions of this Base Indenture).

(c)    The parties hereto agree and acknowledge that each certificated Equity Interest may be held by a custodian on behalf of the Trustee.

(d)    Each Co-Issuer confirms that value has been given by the Secured Parties to such Co-Issuer, that such Co-Issuer has rights in its Indenture Collateral existing at the date of this Base Indenture and that such Co-Issuer and the Trustee have not agreed to postpone the time for attachment of the security interests granted pursuant to Section 3.1(a) to any of the Indenture Collateral of such Co-Issuer. The security interests granted pursuant to Section 3.1(a) with respect to the Indenture Collateral of the Canadian Co-Issuer created by this Base Indenture shall have effect and be deemed to be effective whether or not the Obligations of the Canadian Co-Issuer or any part thereof are owing or in existence before or after or upon the date of this Base Indenture. Neither the execution and delivery of this Base Indenture nor the provision of any financial accommodation by any Secured Party shall oblige any Secured Party to make any financial accommodation or further financial accommodation available to the Canadian Co-Issuer or any other Person.

Section 3.2    Certain Rights and Obligations of the Issuer Unaffected.

(a)    Notwithstanding the grant of the security interest in the Indenture Collateral hereunder to the Trustee, on behalf of the Secured Parties, each Co-Issuer acknowledges that the U.S. Manager, on behalf of the Issuer and the Service Recipients organized in the United States or any State thereof, and the Canadian Manager, on behalf of the Canadian Co-Issuer and the Service Recipients organized in Canada or any province or territory thereof, shall, subject to the terms and conditions of the applicable Management Agreement, nevertheless have the right, subject to the Trustee’s right to revoke such right, in whole or in part, in the event of the occurrence of an Event of Default, (i) to give, in accordance with the applicable Managing Standard, all consents, requests, notices, directions, approvals, extensions and waivers, if any, which are required or permitted to be given by such Co-Issuer under the Collateral Documents, and to enforce all rights, remedies, powers, privileges and claims of such Co-Issuer under the Collateral Documents, (ii) to give, in accordance with the applicable Managing Standard, all consents, requests, notices, directions and approvals, if any, which are required or permitted to be given by such Co-Issuer under any IP License Agreement to which such Co-Issuer is a party and (iii) to take any other actions required or permitted under the terms of the applicable Management Agreement.

(b)    The grant of the security interest by each Co-Issuer in the Indenture Collateral to the Trustee on behalf of the Secured Parties shall not (i) relieve such Co-Issuer from the performance of any term, covenant, condition or agreement on such Co-Issuer’s part to be performed or observed under or in connection with any of the Collateral Documents or (ii) impose any obligation on the Trustee or any of the other Secured Parties to perform or observe any such term, covenant, condition or agreement on such Co-Issuer’s part to be so performed or observed or impose any liability on the Trustee or any of the other Secured Parties for any act or omission on the part of such Co-Issuer or from any breach of any representation or warranty on the part of such Co-Issuer.

 

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(c)    Each Co-Issuer hereby, jointly and severally, agrees to indemnify and hold harmless the Trustee and each other Secured Party (including their respective directors, officers, employees and agents) from and against any and all losses, liabilities (including liabilities for penalties), claims, demands, actions, suits, judgments, reasonable out-of-pocket costs and expenses arising out of or resulting from the security interest granted hereby, whether arising by virtue of any act or omission on the part of such Co-Issuer, the other Co-Issuer or otherwise, including, without limitation, the reasonable out-of-pocket costs, expenses and disbursements (including reasonable attorneys’ fees and expenses) incurred by the Trustee or any other Secured Party in enforcing the Indenture or any other Transaction Document or preserving any of its rights to, or realizing upon, any of the Collateral; provided, however, that the foregoing indemnification shall not extend to any action by the Trustee or any other Secured Party which constitutes gross negligence, bad faith or willful misconduct by the Trustee or such other Secured Party or any other indemnified person hereunder. The indemnification provided for in this Section 3.2 shall survive the removal of, or a resignation by, any Person as Trustee as well as the termination of this Base Indenture or any Series Supplement.

Section 3.3    Performance of Collateral Documents.

Upon the occurrence of a default or breach (after giving effect to any applicable grace or cure periods) by any Person party to (a) a Transaction Document or (b) a Franchise Document (only if a Manager Termination Event with respect to the Manager of the related Co-Issuer or an Event of Default has occurred and is continuing), promptly following a request from the Trustee to do so and at the Co-Issuers’ expense, each Co-Issuer agrees to take all such lawful action as permitted under this Base Indenture as the Trustee (acting at the direction of the Control Party (at the direction of the Controlling Class Representative)) may reasonably request to compel or secure the performance and observance by such Person of its obligations to such Co-Issuer, and to exercise any and all rights, remedies, powers and privileges lawfully available to such Co-Issuer to the extent and in the manner directed by the Trustee (acting at the direction of the Control Party (at the direction of the Controlling Class Representative)), including, without limitation, the transmission of notices of default and the institution of legal or administrative actions or proceedings to compel or secure performance by such Person of its obligations thereunder. If (i) either Co-Issuer shall have failed, within ten (10) Business Days of receiving the direction of the Trustee, to take commercially reasonable action to accomplish such directions of the Trustee, (ii) any such Co-Issuer refuses to take any such action, as reasonably determined by the Trustee in good faith, or (iii) the Control Party (at the direction of the Controlling Class Representative) reasonably determines that such action must be taken immediately, in any such case the Control Party (at the direction of the Controlling Class Representative) may, but shall not be obligated to, take, and the Trustee shall take (if so directed by the Control Party (at the direction of the Controlling Class Representative)), at the expense of the Co-Issuers, such previously directed action and any related action permitted under this Base Indenture which the Control Party (at the direction of the Controlling Class Representative) thereafter determines is appropriate (without the need under this provision or any other provision under this Base Indenture to direct either Co-Issuer to take such action), on behalf of the Co-Issuers and the Secured Parties.

Section 3.4    Stamp, Other Similar Taxes and Filing Fees.

Each Co-Issuer shall, jointly and severally, indemnify and hold harmless the Trustee and each other Secured Party from any present or future claim for liability for any stamp, documentary or other similar tax, and any penalties or interest and expenses with respect thereto, that may be assessed, levied or collected by any jurisdiction in connection with the Indenture, any other Transaction Document or any Indenture Collateral. Each Co-Issuer shall, jointly and severally, pay, and indemnify and hold harmless each Secured Party against, any and all amounts in respect of all search, filing, recording and registration fees, taxes, excise taxes and other similar imposts that may be payable or determined to be payable in respect of the execution, delivery, performance and/or enforcement of the Indenture or any other Transaction Document.

 

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Section 3.5    Authorization to File Financing Statements.

(a)    Each Co-Issuer hereby irrevocably authorizes the Servicer on behalf of the Secured Parties at any time and from time to time to file or record in any filing office in any applicable jurisdiction financing statements, financing change statements, and other filing or recording documents or instruments with respect to the Indenture Collateral, including, without limitation, any and all Securitization IP (to the extent set forth in Section 8.25(c)), to perfect the security interests of the Trustee for the benefit of the Secured Parties under this Base Indenture. Each Co-Issuer authorizes the filing of any such financing statement, financing change statement, document or instrument naming the Trustee as secured party and indicating that the Indenture Collateral includes “all assets” , “all present and after-acquired personal property” or words of similar effect or import regardless of whether any particular assets comprised in the Indenture Collateral fall within the scope of Article 9 of the UCC or the PPSA, as applicable, including, without limitation, any and all Securitization IP, or as being of an equal or lesser scope or with greater detail. Each Co-Issuer agrees to furnish any information necessary to accomplish the foregoing promptly upon the Servicer’s request. Each Co-Issuer also hereby ratifies and authorizes the filing on behalf of the Secured Parties of any financing statement and/or financing change statement with respect to the Indenture Collateral made prior to the date hereof.

(b)    Each Co-Issuer acknowledges that the Indenture Collateral includes certain rights of such Co-Issuer as a secured party under the Transaction Documents. Each Co-Issuer hereby irrevocably appoints the Trustee as its representative with respect to all financing statements and/or financing change statements filed to perfect such security interests and authorizes the Servicer on behalf of the Secured Parties to make such filings as it deems necessary to reflect the Trustee as secured party of record with respect to such financing statements.

(c)    Each Co-Issuer acknowledges receipt of an executed copy of this Base Indenture and, to the extent permitted by applicable law, waives the right to receive a copy of any financing statement or financing change statement registered in connection with this Base Indenture or any verification statement issued with respect to any such financing statement or financing change statement.

Section 3.6    ULC Shares.

The Canadian Co-Issuer acknowledges that certain of the Indenture Collateral of the Canadian Co-Issuer may in the future consist of ULC Shares, and that neither the Trustee nor any other Secured Party shall under any circumstances prior to realization thereon be a “member” or a “shareholder”, as applicable, of a ULC for the purposes of any ULC Laws. Therefore, notwithstanding any provisions to the contrary contained in this Base Indenture or any other Transaction Document, where the Canadian Co-Issuer is the registered owner of ULC Shares which are Indenture Collateral of the Canadian Co-Issuer, the Canadian Co-Issuer shall remain the sole registered owner of such ULC Shares until such time as such ULC Shares are effectively transferred into the name of the Trustee or its designee, any other Secured Party, or any other Person on the books and records of the applicable ULC. Accordingly, the Canadian Co-Issuer shall be entitled to receive and retain for its own account any dividend on or other distribution, if any, with respect to such ULC Shares (except for any dividend or distribution comprised of Canadian Collections required to be deposited to the Accounts in accordance with the terms hereof) and shall have the right to vote such ULC Shares and to control the direction, management and policies of the applicable ULC to the same extent as the Canadian Co-Issuer would if such ULC Shares were not pledged to the Trustee for the benefit of the Secured Parties pursuant hereto. Nothing in this Base Indenture or any other Transaction Document is intended to, and nothing in this Base Indenture or any other Transaction Document shall, constitute the Trustee, any other Secured Party, or any other Person other than the Canadian Co-Issuer, a

 

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member or shareholder of a ULC for the purposes of any ULC Laws (whether listed or unlisted, registered or beneficial), until such time as notice is given to such the Canadian Co-Issuer and further steps are taken pursuant hereto or thereto so as to register the Trustee or its designee, any other Secured Party, or such other Person, as specified in such notice, as the holder of the ULC Shares. To the extent any provision hereof would have the effect of constituting the Trustee, its designee or any other Secured Party as a member or a shareholder, as applicable, of any ULC prior to such time, such provision shall be severed herefrom and shall be ineffective with respect to ULC Shares which are Indenture Collateral of the Canadian Co-Issuer without otherwise invalidating or rendering unenforceable this Base Indenture or invalidating or rendering unenforceable such provision insofar as it relates to Indenture Collateral of the Canadian Co-Issuer which is not ULC Shares. Except upon the exercise of rights of the Trustee to sell, transfer or otherwise dispose of ULC Shares in accordance with this Base Indenture, the Canadian Co-Issuer shall not cause or permit, or enable any ULC in which it holds ULC Shares to cause or permit, the Trustee, its designee or any other Secured Party to: (a) be registered as a shareholder or member of such ULC; (b) have any notation entered in their favor in the share register of such ULC; (c) be held out as shareholders or members of such ULC; (d) receive, directly or indirectly, any dividends, property or other distributions from such ULC by reason of the grant of a security interest over the ULC Shares in favor of the Trustee; or (e) act as a shareholder of such ULC, or exercise any rights of a shareholder including the right to attend a meeting of shareholders of such ULC or to vote its ULC Shares.

ARTICLE IV

REPORTS

Section 4.1    Reports and Instructions to Trustee.

(a)    Weekly Managers Certificate. By 4:30 p.m. (New York City time) on (i) the fourth (4th) Business Day following the last day of a Weekly Collection Period for a Currency Conversion Opt-Out Weekly Allocation Date or (ii) the sixth (6th) Business Day following the last day of a Weekly Collection Period for a Currency Conversion Weekly Allocation Date, in each case, the Managers will provide to the Trustee and, the Servicer and the Back-Up Manager certificates substantially in the applicable form of Exhibit A specifying the allocation of Collections on the following Weekly Allocation Date (each, a “Weekly Managers Certificate”); provided that such Weekly Manager’s Certificate shall be considered confidential information and shall not be disclosed by such recipients to any Noteholder, Note Owner or other Person without the prior written consent of the Co-Issuers. Notwithstanding anything herein to the contrary, (x) the Weekly Manager’s Certificate delivered after the Series 2018-1 Closing Date shall not be required to account for U.S. Collections in respect of any Take 5 Company Locations, and amounts credited to the Accounts in respect of such Take 5 Company Locations shall not be required to be allocated pursuant to the Priority of Payments, until the first Weekly Allocation Date that occurs after the date that is 21 days after the Series 2018-1 Closing Date; provided, however, that (x) the first Weekly Manager’s Certificate that includes the Take 5 Company Locations shall include allocations of any amounts in respect of the Take 5 Company Locations received during the period from the Series 2018-1 Closing Date until the last day of the relevant Weekly Collection Period and (y) the Weekly Manager’s Certificate delivered after the Series 2020-1 Closing Date shall not be required to account for Canadian Collections, and amounts credited to the Accounts in respect of such Canadian Collections shall not be required to be allocated pursuant to the Priority of Payments, until the first Weekly Allocation Date following the first full weekly fiscal period following the Series 2020-1 Closing Date; provided, however, that at the election of the Managers pursuant to the Weekly Manager’s Certificate for the applicable Weekly Collection Period, the first Weekly Collection Period following the Series 2020-1 Closing Date with respect to any Canadian Collections will end at 11:59 p.m. (New York City time) on the Saturday of the second full weekly fiscal period following the Series 2020-1 Closing Date. Following the end of the first Weekly Collection Period with respect to Canadian Collections described in clause (y) of the previous sentence, the Weekly Manager’s Certificate

 

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for the following Weekly Allocation Date will provide that all U.S. Collections and Canadian Collections remaining in the Collection Accounts after giving effect to Section 5.11(b) for the Weekly Allocation Dates occurring during such Weekly Collection Period will be allocated or paid pursuant to the Priority of Payments on a pro forma basis in the manner set forth in the Series Supplement for the Series 2020-1 Notes as if such U.S. Collections and Canadian Collections had been available for distribution on such previous Weekly Allocation Dates (and taking into account any allocations or payments previously made pursuant to priorities (i)-(iii) and (v) of the Priority of Payments on such Weekly Allocation Dates).

(b)    FX Exchange Reports. By 12:00 p.m. (New York City time) on the fourth (4th) Business Day following the last day of a Weekly Collection Period for a Currency Conversion Weekly Allocation Date, the Managers will provide to the Trustee and the Servicer a statement substantially in the form of Exhibit B directing the FX Agent to settle a Currency Conversion that will result in a specified amount of U.S. Collections or Canadian Collections (each, a “FX Exchange Report”) on such Weekly Allocation Date. The FX Exchange Reports will be deemed confidential information and will not be disclosed by the Trustee to any Noteholder, Note Owner or other Person without the prior written consent of the Co-Issuers.

(c)    Quarterly Noteholders’ Allocation Report and Quarterly Noteholders’ Report.

(i)    On or before the third (3rd) Business Day prior to each Quarterly Payment Date, the Co-Issuers shall furnish, or cause the Managers to furnish, (x) a statement, substantially in the form of Exhibit C-1 and which shall be substantially in the form of Exhibit C other than the exclusion of certain specified line items, with respect to each Series of Notes (each, a “Quarterly Noteholders Allocation Report”), together with any applicable FX Exchange Report, and (y) a preliminary Quarterly Noteholders’ Report, which shall be preliminary as to the calculation of Run RateParent Adjusted EBITDA of the Driven Brands Entities for purposes of the Driven Brands Leverage Ratio and as to any other system information set forth on the quarterly report, with respect to the first three fiscal quarters of each fiscal year, or annual report, with respect to the fourth fiscal quarter of such fiscal year, for such fiscal year of any Manager or Parent or any of their respective parent entities filed with the SEC pursuant to the Exchange Act, in each case, in respect of such Quarterly Payment Date, to the Trustee, each Rating Agency (solely as to the Quarterly Noteholders’ Allocation Report), the Servicer and each Payment Agent, with a copy to the Back-Up Manager. Each Person furnished such preliminary Quarterly Noteholders’ Report shall be deemed to acknowledge and agree (i) such preliminary Quarterly Noteholders’ Report is provided to the recipient solely for informational purposes, (ii) the recipient understands the preliminary Quarterly Noteholders’ Report contains material nonpublic information and (iii) the recipient shall, subject to the confidentiality provisions of any Transaction Document to which it is a party, keep the information set forth thereon confidential and not disclose it to any other Person without the prior written consent of the Co-Issuers. The Trustee shall not post the preliminary Quarterly Noteholders’ Report on the Trustee’s internet website.

(ii)    On or before the 3rd Business Day following the date when any Manager or Parent or any of their respective parent entities files its or their quarterly report, with respect to the first three fiscal quarters of each fiscal year, or annual report, with respect to the fourth fiscal quarter of such fiscal year, for such fiscal year with the SEC pursuant to the Exchange Act, the Co-Issuers shall furnish, or cause the Managers to furnish, a statement substantially in the form of Exhibit C with respect to each Series of Notes (each such statement for the immediately preceding Quarterly Payment Date,

 

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which shall be substantially identical to the preliminary Quarterly Noteholders’ Report for such Quarterly Payment Date, except as to any superseding calculation of Run RateParent Adjusted EBITDA of the Driven Brands Entities for purposes of the Driven Brands Leverage Ratio or superseding reporting of any other system information described in clause (y) of the first sentence of Section 4.1(c)(i) to the extent required for such calculation or other system information to be consistent with the calculation or other system information set forth on such foregoing quarterly report or annual report, as applicable, together with the Quarterly Noteholders’ Allocation Report for such Quarterly Payment Date supplemented by such statement, a “Quarterly Noteholders Report”), together with any applicable FX Exchange Report in respect of such Quarterly Payment Date, to the Trustee, each Rating Agency, the Servicer and each Paying Agent, with a copy to the Back-Up Manager.

(iii)    For purposes of each Series Supplement entered into on or prior to the Series 2020-2 Closing Date and each other Transaction Document, all references to the Co-Issuers (or the Managers on their behalf) furnishing, or causing to be furnished, certain information set forth on a Quarterly Noteholders’ Report on or before each Quarterly Payment Date shall be deemed to refer to (x) such information set forth on a Quarterly Noteholders’ Allocation Report to the extent set forth thereon and (y) such information set forth on a Quarterly Noteholders’ Report to the extent solely set forth thereon and in respect of the immediately preceding Quarterly Payment Date, in each case, pursuant to this Base Indenture mutatis mutandis.

(iv)    If at any time neither Manager nor Parent nor any of their respective parent entities is then subject to Section 13 or Section 15(d) of the Exchange Act, then Section 4.1(c)(i) and Section 4.1(c)(iii) shall be disregarded in their entirety and the Quarterly Noteholders’ Report furnished pursuant to Section 4.1(c)(ii) shall be furnished on or before the third (3rd) Business Day prior to each Quarterly Payment Date and no Quarterly Noteholders’ Allocation Report or preliminary Quarterly Noteholders’ Report shall be required to be furnished under the Base Indenture.

(d)    Quarterly Compliance Certificates. On or before the third (3rd) Business Day prior to each Quarterly Payment Date, the Co-Issuers shall furnish, or cause the Managers to furnish, to the Trustee and each Rating Agency (with a copy to each of the Servicer and the Back-Up Manager) an Officers’ Certificate to the effect that, except as provided in a notice delivered pursuant to Section 8.8, no Potential Rapid Amortization Event, Rapid Amortization Event, Default or Event of Default has occurred or is continuing (each, a “Quarterly Compliance Certificate”).

(e)    Scheduled Principal Payments Deficiency Notices. On the Quarterly Calculation Date with respect to any Quarterly Fiscal Period, the Co-Issuers shall furnish, or cause the Managers to furnish, to the Trustee and each Rating Agency (with a copy to each of the Servicer and the Back-Up Manager) written notice of any Scheduled Principal Payments Deficiency Event with respect to any Class or Series of Notes that occurred with respect to such Quarterly Fiscal Period (any such notice, a “Scheduled Principal Payments Deficiency Notice”).

(f)    Annual Accountants Reports. Within one hundred and twenty (120) days after the end of each fiscal year, commencing with the fiscal year ending on or around December 30, 2017, each of the Co-Issuers shall furnish, or cause the applicable Manager to furnish, to the Trustee, the Servicer, the Back-Up Manager (to the extent such report is not being provided by the Back-Up Manager) and each Rating Agency the reports of the Independent Auditors or the Back-Up Manager required to be delivered to such Co-Issuer by the applicable Manager pursuant to the applicable Management Agreement.

 

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(g)    Securitization Entity Financial Statements. The Managers on behalf of the U.S. Securitization Entities and Canadian Securitization Entities, respectively, shall provide to the Trustee, the Servicer, the Back-Up Manager and each Rating Agency with respect to each Series of Notes Outstanding the following financial statements:

(i)    as soon as available and in any event within forty-five (45) days after the end of each of the first three fiscal quarters of each fiscal year, an unaudited consolidated balance sheet of the U.S. Securitization Entities and Canadian Securitization Entities, respectively, as of the end of such fiscal quarter and unaudited consolidated statements of operations and comprehensive income, changes in members’ equity and cash flows of such U.S. Securitization Entities and Canadian Securitization Entities, respectively, for such fiscal quarter and for the fiscal year-to-date period then ended (in the case of the second and third fiscal quarters of each fiscal year); provided, that solely with respect to the quarterly financial statements to be delivered for the fiscal quarter ending June 30, 2018, (x) the applicable balance sheet and unaudited consolidated statements of operations and comprehensive income, changes in members’ equity and cash flows shall be prepared for the U.S. Securitization Entities other than Take 5 Properties and (y) the U.S. Manager shall deliver a separate balance sheet and unaudited consolidated statements of operations and comprehensive income, changes in members’ equity and cash flows for Driven Sister Holdings, LLC and a supplementary schedule with an estimated balance sheet and statement of operations for Take 5 Properties; and

(ii)    as soon as available and in any event within one hundred and twenty (120) days after the end of each fiscal year, an audited consolidated balance sheet of the U.S. Securitization Entities and Canadian Securitization Entities, respectively, as of the end of such fiscal year and audited consolidated statements of operations and comprehensive income, changes in members’ equity and cash flows of such U.S. Securitization Entities and Canadian Securitization Entities, respectively, for such fiscal year, setting forth in comparative form (where appropriate) the comparable amounts for the previous fiscal year, prepared in accordance with GAAP and accompanied by an opinion thereon of the applicable Independent Auditors stating that such audited consolidated financial statements present fairly, in all material respects, the financial position of such U.S. Securitization Entities and Canadian Securitization Entities, respectively, and the results of their operations and cash flows in accordance with GAAP.

(h)    Manager Financial Statements.

(i)    So long as Driven Brands, Inc. is the U.S. Manager, the U.S. Manager on behalf of the U.S. Securitization Entities shall provide to the Trustee, the Servicer, the Back-Up Manager and each Rating Agency with respect to each Series of Notes Outstanding the following financial statements:

(A)    as soon as available and in any event within forty-five (45) days after the end of each of the first three fiscal quarters of each fiscal year, an unaudited consolidated balance sheet of the U.S. Manager as of the end of such fiscal quarter and unaudited consolidated statements of operations and comprehensive income and cash flows of the U.S. Manager for such fiscal quarter and for the fiscal year-to-date period then ended (in the case of the second and third fiscal quarters of each fiscal year); and

 

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(B)    as soon as available and in any event within one hundred and twenty (120) days after the end of each fiscal year, an audited consolidated balance sheet of the U.S. Manager as of the end of such fiscal year and audited consolidated statements of operations and comprehensive income, changes in stockholders’ equity and cash flows of the U.S. Manager for such fiscal year, setting forth in comparative form (where appropriate) the comparable amounts for the previous fiscal year, prepared in accordance with GAAP and accompanied by an opinion thereon of the Independent Auditors stating that such audited consolidated financial statements present fairly, in all material respects, the financial position of the U.S. Manager and the results of its operations and cash flows in accordance with GAAP.

(ii)    So long as Driven Brands, Inc. is the U.S. Manager and a direct or indirect parent of the Canadian Manager, the U.S. Manager shall provide, as agent of the Canadian Manager on behalf of the Canadian Securitization Entities, to the Trustee, the Servicer, the Back-Up Manager and each Rating Agency with respect to each Series of Notes Outstanding the financial statements described in Section 4.1(h)(i)(A)-(B).

(iii)    If Driven Brands, Inc. no longer serves as the U.S. Manager or is no longer a direct or indirect parent of the Canadian Manager, then so long as Driven Brands Canada Shared Services Inc. is the Canadian Manager, the Canadian Manager on behalf of the Canadian Securitization Entities shall provide to the Trustee, the Servicer, the Back-Up Manager and each Rating Agency with respect to each Series of Notes Outstanding financial statements consistent with the requirements of Section 4.1(h)(i)(A)-(B) as-applied to the Canadian Manager.

(i)    DBH Financial Statements. The Managers on behalf of the U.S. Securitization Entities and Canadian Securitization Entities, respectively, shall provide to the Trustee, the Servicer, the Back-Up Manager and each Rating Agency with respect to each Series of Notes Outstanding the following financial statements for so long as the U.S. Securitization Entities and Canadian Securitization Entities, respectively, are consolidated with DBH for purposes of DBH’s financial statements in accordance with GAAP:

(i)     as soon as available and in any event within forty-five (45) days after the end of each of the first three fiscal quarters of each fiscal year, a consolidated balance sheet and related statements of income showing the financial position of DBH and its Subsidiaries as of the close of such fiscal quarter and the consolidated results of their operations during such fiscal quarter and the then-elapsed portion of the fiscal year and setting forth in comparative form the corresponding figures for the corresponding periods of the prior fiscal year; provided that the delivery or public filing of quarterly reports on Form 10-Q (or any successor or comparable form) of DBH and its consolidated subsidiaries shall be deemed to be delivery to the Trustee, the Servicer, the Back-Up Manager, and each Rating Agency of such quarterly reports and shall satisfy the requirements of this Section 4.1(i)(i) to the extent such quarterly reports include the information specified in this Section 4.1(i)(i); and

(ii)     as soon as available and in any event within one hundred and twenty (120) days after the end of each fiscal year (commencing with the fiscal year ending on December 25, 2021), a consolidated cash flow statement, balance sheet and related statements of income showing the financial position of DBH and its

 

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Subsidiaries as of the close of such fiscal year and the consolidated results of their operations during such year and setting forth in comparative form the corresponding figures for the prior fiscal year, accompanied by an opinion of such accountants to the effect that such consolidated financial statements fairly present, in all material respects, the financial position and results of operations of the companies being reported on a consolidated basis in accordance with GAAP; provided that the delivery or public filing of annual reports on Form 10-K (or any successor or comparable form) of DBH and its consolidated subsidiaries shall be deemed to be delivery to the Trustee, the Servicer, the Back-Up Manager, and each Rating Agency of such annual reports and shall satisfy the requirements of this Section 4.1(i)(ii) to the extent such annual reports include the information specified in this Section 4.1(i)(ii).

(j)    (i) Additional Information. Each Co-Issuer shall furnish, or cause to be furnished, from time to time such additional information regarding the financial position, results of operations or business of ParentDBI or any U.S. Securitization Entity, in the case of the Issuer, or any Canadian Securitization Entity, in the case of the Canadian Co-Issuer, as the Trustee, the Servicer, the applicable Manager of such Co-Issuer or the Back-Up Manager may reasonably request, subject to Requirements of Law and to the confidentiality provisions of the Transaction Documents to which such recipient is a party.

(k)     (j) Instructions as to Withdrawals and Payments. Each Co-Issuer shall furnish, or cause to be furnished, to the Trustee or the Paying Agent, as applicable (with a copy to each of the Servicer, the Managers and the Back-Up Manager), written instructions to make withdrawals and payments from the Collection Accounts and any other Base Indenture Account or Series Account, as contemplated herein and in any Series Supplement; provided that such written instructions (other than those contained in Quarterly Noteholders’ Reports) shall be considered confidential information and shall not be disclosed by such recipients to any other Person without the prior written consent of the Co-Issuers; provided, further, that such written instructions shall be subject in all respects to the confidentiality provisions of any Transaction Documents to which such recipient is a party. The Trustee and the Paying Agent shall promptly follow any such written instructions.

(l)    (k) Copies to each Rating Agency. Each Co-Issuer shall deliver, or shall cause its respective Manager to deliver, a copy of each report, certificate or instruction, as applicable, described in this Section 4.1 to each Rating Agency at its address as listed in or otherwise designated pursuant to Section 14.1 or in the applicable Series Supplement, including any e-mail address.

Section 4.2    Annual Noteholders’ Tax Statement.

Unless otherwise specified in the applicable Series Supplement, on or before January 31 of each calendar year, beginning with calendar year 2018 (and beginning with calendar year 2021 with respect to any covenant of the Canadian Co-Issuer), the Paying Agent shall furnish, upon written request, to each Person who at any time during the preceding calendar year was a Noteholder a statement prepared by the Co-Issuers containing such information as the Co-Issuers deem necessary or desirable to enable the Noteholders to prepare their tax returns (each such statement, an “Annual Noteholders’ Tax Statement”); provided that such obligations to distribute the Annual Noteholders’ Tax Statement shall be deemed to have been satisfied to the extent that substantially comparable information shall be provided by the Paying Agent pursuant to any requirements of the Code or other applicable tax law as from time to time in effect.

Section 4.3    Rule 144A Information.

For so long as any of the Notes are “restricted securities” within the meaning of Rule 144(a)(3) under the Securities Act, the Co-Issuers agree to provide to any Noteholder or Note Owner, and to any prospective purchaser of Notes designated by such Noteholder or Note Owner upon the request of such Noteholder or Note Owner or prospective purchaser, any information required to be provided to such holder, owner or prospective purchaser to satisfy the conditions set forth in Rule 144A(d)(4) under the Securities Act.

 

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Section 4.4    Reports, Financial Statements and Other Information to Noteholders.

(a)    This Base Indenture, the Guarantee and Collateral Agreements, each Series Supplement, the Quarterly Noteholders’ Reports, the Quarterly Compliance Certificates, the financial statements referenced in Section 4.1(g) and Section 4.1(h) and the reports referenced in Section 4.1(f) shall be made available to (a) each Rating Agency pursuant to Section 4.1(kl) above and (b) the Servicer, the Managers, the Back-Up Manager, the Note Owners and the other Noteholders (but not to prospective investors) in a password-protected area of the Trustee’s internet website at www.sf.citidirect.com (or such other address as the Trustee may specify from time to time) or on a third-party investor information platform or such other address as the Co-Issuers may specify from time to time. Assistance in using the Trustee’s internet website can be obtained by calling the Trustee’s customer service desk at (888) 855-9695 or such other telephone number as the Trustee may specify from time to time. The Trustee or any such third-party platform, as the case may be, shall require each party (other than the Servicer, the Managers, the Back-Up Manager and any Rating Agency) accessing such password-protected area to register as a Noteholder and to make the applicable representations and warranties described below in an Investor Request Certification (which, for the avoidance of doubt, may take the form of an electronic submission). The Trustee and any such third-party platform may disclaim responsibility for any information distributed by it for which the Trustee or such third-party, as the case may be, was not the original source. Each time a Noteholder accesses such internet website, it will be deemed to have confirmed such representations and warranties as of the date thereof. The Trustee or any such third-party platform shall provide the Servicer and the Managers with copies of such Investor Request Certifications, including the identity, contact information, e-mail address and telephone number of such Noteholders, upon request, but shall have no responsibility for any of the information contained therein. The Trustee shall have the right to change the way any such information is made available in order to make such distribution more convenient and/or more accessible to the Noteholders and the Trustee, and the Trustee shall provide timely and adequate notification to all above parties regarding any such changes.

(b)    The Trustee shall (or shall request that the Managers) make available, upon reasonable advance notice and at the expense of the requesting party, copies of the Quarterly Noteholders’ Reports, the Quarterly Compliance Certificates, the financial statements referenced in Section 4.1(g) and Section 4.1(h) and the reports referenced in Section 4.1(f) to any Noteholder (or any Note Owner) and to any prospective investor that provides the Trustee with an Investor Request Certification to the effect that such party (i) is a Noteholder (or Note Owner) or prospective investor, as applicable, (ii) understands that the materials contain confidential information, (iii) is requesting the information solely for use in evaluating such party’s investment or potential investment, as applicable, in the Notes and will keep such information strictly confidential (provided that such party may disclose such information only (A) to (1) those personnel employed by it who need to know such information, (2) its attorneys and outside auditors that have agreed to keep such information confidential and to treat the information as confidential information, or (3) a regulatory or self-regulatory authority pursuant to applicable law or regulation or (B) by judicial process), and (iv) is not a Competitor. Notwithstanding the foregoing, a recipient of such materials may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the transactions and any related tax strategies to the extent necessary to prevent the transaction from being described as a “confidential transaction” under U.S. Treasury Regulationsregulations Section 1.6011-4(b)(3).

 

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Section 4.5    Managers.

Pursuant to the applicable Management Agreement, each Manager has agreed to provide certain reports, notices, instructions and other services on behalf of the applicable Co-Issuer. The Noteholders by their acceptance of the Notes consent to the provision of such reports and notices to the Trustee by the Managers or the applicable Manager in lieu of the Co-Issuers or the applicable Co-Issuer. Any such reports and notices that are required to be delivered to the Noteholders hereunder shall be delivered by the Trustee. The Trustee shall have no obligation whatsoever to verify, reconfirm or recalculate any information or material contained in any of the reports, financial statements or other information delivered to it pursuant to this Article IV or the applicable Management Agreement. All distributions, allocations, remittances and payments to be made by the Trustee or the Paying Agent hereunder or under any Supplement or Class A-1 Note Purchase Agreement shall be made based solely upon the most recently delivered written reports and instructions provided to the Trustee or Paying Agent, as the case may be, by the applicable Manager (or Managers).

Section 4.6    No Constructive Notice.

Delivery of reports, information, Officer’s Certificates, Officers’ Certificates and documents to the Trustee is for informational purposes only, and the Trustee’s receipt of such reports, information, Officer’s Certificates, Officers’ Certificates and documents will not constitute constructive notice to the Trustee of any information contained therein or determinable from information contained therein, including any Securitization Entity’s, any Manager’s or any other Person’s compliance with any of its covenants under the Indenture, the Notes or any other Transaction Document (as to which the Trustee is entitled to rely exclusively on the most recent Quarterly Compliance Certificate described above).

ARTICLE V

ALLOCATION AND APPLICATION OF COLLECTIONS

Section 5.1    Management Accounts.

(a)    Establishment of the Management Accounts. As of the Series 2020-1 Closing Date, the U.S. Manager and Canadian Manager, respectively, have caused (i) the Issuer and the Canadian Co-Issuer to establish in the name of and for the benefit of, respectively, the Issuer and the Canadian Co-Issuer, (A) for the Issuer, the U.S. Concentration Account and the related Lock-Box Accounts for the U.S. Securitization Entities and for the Canadian Co-Issuer, the Canadian Concentration Account and the related Lock-Box Accounts of the Canadian Co-Issuer, (B) the Asset Disposition Proceeds Accounts of the respective Co-Issuers, (C) the Insurance Proceeds Accounts of the respective Co-Issuers, and (D) for the Issuer, the Take 5 Securitization Lockbox; (ii) each other Canadian SPV Franchising Entity LP to establish in the name of and for the benefit of itself, the related Lock-Box Account for an applicable Driven Securitization Brand with operations in Canada; (iii) each Securitization Entity that owns Securitization-Owned Locations to establish in the name of and for its benefit one or more Securitization-Owned Location Concentration Accounts for an applicable Driven Securitization Brand; (iv) Driven Product Sourcing LLC to establish in the name of and for the benefit of Driven Product Sourcing LLC the Spire Supply Securitization Account; (v) Driven Product Sourcing LLC to establish in the name of Take 5 Properties and for the benefit of Driven Product Sourcing LLC the Oil Fleet Lockbox; (vi) Driven Canada Product Sourcing to establish in the name of and for its benefit one or more Product Sourcing Concentration Accounts and the Canadian Product Sourcing Lease Expense Account and (vii) Driven Canada Claims Management to establish in the name of and for its benefit one or more Claims Management Concentration Accounts and the Canadian Claims Management Lease Expense Account. Such accounts and lock-boxes, as of the Series 2018-1 Closing Date (or as of such later date of establishment of such account) and at all times thereafter, shall be (A) pledged to the Trustee for the benefit of the Secured Parties pursuant to Section 3.1

 

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or the Guarantee and Collateral Agreements and (B) if not established with the Trustee, subject to an Account Control Agreement; provided that only the Qualified Institution holding a Lock-Box Account shall have access to the items deposited therein. Each Management Account shall be an Eligible Account and, in addition, from time to time, the Issuer, the Canadian Co-Issuer, and any other Securitization Entity (or the applicable Manager on its behalf) may establish additional accounts for the purpose of depositing Collections therein (each such account and any investment accounts related thereto into which funds are transferred for investment purposes pursuant to Section 5.1(b), and excluding the Advertising Fund Accounts and any other Account of a Securitization Entity for the holding or disbursement of Excluded Amounts or other amounts constituting operating expenses of Securitization-Owned Locations, a Product Sourcing Business or a Claims Management Business and permitted to be paid under this Base Indenture, an “Additional Management Account”); provided that each such Additional Management Account is (A) an Eligible Account, (B) pledged by the Issuer, the Canadian Co-Issuer, or such other Securitization Entity to the Trustee for the benefit of the Secured Parties pursuant to Section 3.1 or the applicable Guarantee and Collateral Agreement, and (C) if not established with the Trustee, subject to an Account Control Agreement.

(b)    Administration of the Management Accounts. The Issuer or the Canadian Co-Issuer (or the applicable Manager or Sub-Manager on its behalf) may invest any amounts held in the applicable Management Accounts in Eligible Investments, and such amounts may be transferred by the Issuer or the Canadian Co-Issuer (or the applicable Manager or Sub-Manager on its behalf), on behalf of itself or as such agent, as applicable, into an investment account for the sole purpose of investing in Eligible Investments so long as such investment account is (A) an Eligible Account, (B) pledged by the applicable Securitization Entity to the Trustee for the benefit of the Secured Parties pursuant to Section 3.1 or the applicable Guarantee and Collateral Agreement and (C) if not established with the Trustee, subject to an Account Control Agreement; provided that any such investment in any Management Account (or in any such investment account) shall mature not later than the Business Day prior to the next succeeding Weekly Calculation Date. Notwithstanding anything herein or in any other Transaction Document, no Co-Issuer or Manager shall transfer any funds into any such investment account pursuant to this Section 5.1(b) until such time as an Account Control Agreement is entered into with respect thereto (if such account is not established with the Trustee), it being agreed that the execution and delivery of such Account Control Agreement shall not be required as a condition precedent to the issuance of Notes on any Series Closing Date. All income or other gain from such Eligible Investments shall be credited to the related Management Account, and any loss resulting from such Eligible Investments shall be charged to the related Management Account (and the Issuer or Canadian Co-Issuer, or the other Securitization Entities, respectively). No Co-Issuer (or other Securitization Entity) shall direct (or permit) the disposal of any Eligible Investments prior to the maturity thereof if such disposal would result in a loss of any portion of the initial purchase price of such Eligible Investment. Prior to any Sub-Manager acting on behalf of any U.S. Securitization Entity or Canadian Securitization Entity, as applicable, in accordance with this Section, it will provide to the Trustee all applicable know-your-customer documentation required by the Trustee.

(c)    Earnings from the Management Accounts. All interest and earnings (net of losses and investment expenses) paid on funds on deposit in the Management Accounts shall be deemed to be Investment Income of the Issuer or Canadian Co-Issuer, or the other Canadian Securitization Entities, as applicable, for distribution to the applicable Collection Account in accordance with Section 5.10.

(d)    No Duty to Monitor. The Trustee shall have no duty or responsibility to monitor the amounts of deposits into or withdrawals from any Management Account.

Section 5.2    Senior Notes Interest Reserve Accounts.

(a)    Establishment of the Senior Notes Interest Reserve Accounts. As of the Series 2015-1 Closing Date, the Issuer has established with the Trustee an account attributable to the Issuer

 

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(denominated in U.S. Dollars) in the name of the Trustee for the benefit of the Senior Noteholders and the Trustee, solely in its capacity as trustee for the Senior Noteholders, bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the foregoing Secured Parties (the “Issuer Interest Reserve Account for Senior Notes”). As of the Series 2020-1 Closing Date, the Canadian Co-Issuer has established with the Trustee an account attributable to the Canadian Co-Issuer (denominated in U.S. Dollars) in the name of the Trustee for the benefit of the Senior Noteholders and the Trustee, solely in its capacity as trustee for the Senior Noteholders, bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the foregoing Secured Parties (the “Canadian Co-Issuer Interest Reserve Account for Senior Notes” and together with the Issuer Interest Reserve Account for Senior Notes, the “Senior Notes Interest Reserve Accounts”). The Senior Notes Interest Reserve Accounts shall be Eligible Accounts.

(b)    Administration of the Senior Notes Interest Reserve Accounts. All amounts held in the Senior Notes Interest Reserve Accounts shall be invested in Eligible Investments at the written direction (which may be in the form of standing directions) of the Issuer or the Canadian Co-Issuer (or the applicable Manager on its behalf) into an investment account for the sole purpose of investing in Eligible Investments so long as such investment account is (A) an Eligible Account, (B) pledged by such Co-Issuer to the Trustee for the benefit of the Secured Parties pursuant to Section 3.1 and (C) if not established with the Trustee, subject to an Account Control Agreement; provided that any such investment in the Senior Notes Interest Reserve Accounts (or in any such investment account) shall mature not later than the Business Day prior to the next succeeding Weekly Calculation Date. In the absence of written investment instructions hereunder, funds on deposit in the Senior Notes Interest Reserve Accounts shall remain uninvested. All income or other gain from such Eligible Investments shall be credited to the applicable Senior Notes Interest Reserve Account, and any loss resulting from such Eligible Investments shall be charged to the applicable Senior Notes Interest Reserve Account (and the Issuer or the Canadian Co-Issuer). No Co-Issuer shall direct (or permit) the disposal of any Eligible Investments prior to the maturity thereof if such disposal would result in a loss of any portion of the initial purchase price of such Eligible Investment.

(c)    Earnings from the Senior Notes Interest Reserve Accounts. All interest and earnings (net of losses and investment expenses) paid on funds on deposit in the Senior Notes Interest Reserve Accounts shall be deemed to be Investment Income on deposit for distribution to the applicable Collection Account in accordance with Section 5.10.

(d)    Senior Notes Interest Reserve Account Excess Amount. On any Weekly Allocation Date when a deposit would otherwise be made to a Senior Notes Interest Reserve Account pursuant to priority (ix) of the Priority of Payments, the Co-Issuers (or the Managers on their behalf) may direct the Trustee pursuant to the applicable Weekly Manager’s Certificate to withdraw any Senior Notes Interest Reserve Account Excess Amount from the Senior Notes Interest Reserve Account of either Co-Issuer and transfer such Senior Notes Interest Reserve Account Excess Amount to the Senior Notes Interest Reserve Account of the other Co-Issuer and the allocation pursuant to priority (ix) of the Priority of Payments and calculation of the Senior Notes Interest Reserve Account Deficit Amount of the transferee Co-Issuer shall be deemed to occur after giving effect to such transfer of the Senior Notes Interest Reserve Account Excess Amount. Until such time as any such Senior Notes Interest Reserve Account Excess Amount is paid to any applicable third party (as opposed to transfers between Indenture Trust Accounts of the Co-Issuers pursuant to a Weekly Manager’s Certificate), the applicable Co-Issuer will hold such amount as agent on behalf of the other Co-Issuer. Following payment of any such Senior Notes Interest Reserve Account Excess Amount to a third party, such amount shall be treated as an intercompany loan with an interest rate determined by the applicable Manager in accordance with the applicable Managing Standard. For greater certainty, any payment out of a Co-Issuer’s Senior Notes Interest Reserve Account in respect of which a deposit has been made under this Section 5.2(b) shall be deemed to be paid first out of amounts allocated to such account out of such Co-Issuer’s own Collections and second out of any such Senior Notes Interest Reserve Account Excess Amount transferred from the other Co-Issuer.

 

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Section 5.3    Senior Subordinated Notes Interest Reserve Accounts.

(a)    Establishment of the Senior Subordinated Notes Interest Reserve Accounts. Upon the issuance of any Senior Subordinated Notes, each of the Issuer and Canadian Co-Issuer shall establish with the Trustee an account (denominated in U.S. Dollars) in the name of the Trustee for the benefit of the Senior Subordinated Noteholders and the Trustee, solely in its capacity as trustee for the Senior Subordinated Noteholders, bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the foregoing Secured Parties (the “Issuer Senior Subordinated Notes Interest Reserve Account” and the “Canadian Co-Issuer Senior Subordinated Notes Interest Reserve Account” and together with the Issuer Senior Subordinated Notes Interest Reserve Account, the “Senior Subordinated Notes Interest Reserve Accounts”). The Senior Subordinated Notes Interest Reserve Accounts shall be Eligible Accounts.

(b)    Administration of the Senior Subordinated Notes Interest Reserve Accounts. All amounts held in the Senior Subordinated Notes Interest Reserve Accounts (other than any Canadian Dollar-denominated Senior Subordinated Notes Interest Reserve Account) shall be invested in Eligible Investments at the written direction (which may be in the form of standing directions) of the applicable Co-Issuer (or the applicable Manager on its behalf), and such amounts may be transferred by such Co-Issuer (or the applicable Manager on its behalf) into an investment account for the sole purpose of investing in Eligible Investments so long as such investment account is (A) an Eligible Account, (B) pledged by such Co-Issuer to the Trustee for the benefit of the Secured Parties pursuant to Section 3.1 and (C) if not established with the Trustee, subject to an Account Control Agreement; provided that any such investment in the Senior Subordinated Notes Interest Reserve Accounts (or in any such investment account) shall mature not later than the Business Day prior to the next succeeding Weekly Calculation Date. In the absence of written investment instructions hereunder, funds on deposit in the Senior Subordinated Notes Interest Reserve Accounts shall remain uninvested. All income or other gain from such Eligible Investments shall be credited to the applicable Senior Subordinated Notes Interest Reserve Account, and any loss resulting from such Eligible Investments shall be charged to the applicable Senior Subordinated Notes Interest Reserve Account (and the Issuer or the Canadian Co-Issuer, respectively). No Co-Issuer shall direct (or permit) the disposal of any Eligible Investments prior to the maturity thereof if such disposal would result in a loss of any portion of the initial purchase price of such Eligible Investment.

(c)    Earnings from the Senior Subordinated Notes Interest Reserve Accounts. All interest and earnings (net of losses and investment expenses) paid on funds on deposit in the Senior Subordinated Notes Interest Reserve Accounts shall be deemed to be Investment Income on deposit for distribution to the applicable Collection Account in accordance with Section 5.10.

(d)    Senior Subordinated Notes Interest Reserve Account Excess Amount. On any Weekly Allocation Date when a deposit would otherwise be made to a Senior Subordinated Notes Interest Reserve Account pursuant to priority (ix) of the Priority of Payments, the Co-Issuers (or the Managers on their behalf) may direct the Trustee pursuant to the related Weekly Manager’s Certificate to withdraw any Senior Subordinated Notes Interest Reserve Account Excess Amount from the Senior Subordinated Notes Interest Reserve Account of either Co-Issuer and transfer such Senior Subordinated Notes Interest Reserve Account Excess Amount to the Senior Subordinated Notes Interest Reserve Account of the other Co-Issuer and the allocation pursuant to priority (ix) of the Priority of Payments and calculation of the Senior Subordinated Notes Interest Reserve Account Deficit Amount of the transferee Co-Issuer shall be deemed to occur after giving effect to such transfer of the Senior Subordinated Notes Interest Reserve Account Excess Amount. Until such time as any such Senior Subordinated Notes Interest Reserve Account Excess

 

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Amount is paid to any applicable third party (as opposed to transfers between Indenture Trust Accounts of the Co-Issuers pursuant to a Weekly Manager’s Certificate), the applicable Co-Issuer will hold such amount as agent on behalf of the other Co-Issuer. Following payment of any such Senior Subordinated Notes Interest Reserve Account Excess Amount, such amount shall be treated as an intercompany loan with an interest rate determined by the applicable Manager in accordance with the applicable Managing Standard. For greater certainty, any payment out of a Co-Issuer’s Senior Subordinated Notes Interest Reserve Account in respect of which a deposit has been made under this Section 5.3(b) shall be deemed to be paid first out of amounts allocated to such account out of such Co-Issuer’s own Collections and second out of any such Senior Subordinated Notes Interest Reserve Account Excess Amount transferred from the other Co-Issuer.

Section 5.4    Cash Trap Reserve Accounts.

(a)    Establishment of the Cash Trap Reserve Accounts. As of the Series 2015-1 Closing Date, the Issuer has established with the Trustee an account designated as the Issuer Cash Trap Reserve Account in the name of the Trustee for the benefit of the Secured Parties, bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Secured Parties (the “Issuer Cash Trap Reserve Account”). As of the Series 2020-1 Closing Date, the Canadian Co-Issuer has established with the Trustee an account designated as the Canadian Co-Issuer Cash Trap Reserve Account in the name of the Trustee for the benefit of the Secured Parties, bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Secured Parties (the “Canadian Co-Issuer Cash Trap Reserve Account” and together with the Issuer Cash Trap Reserve Account, the “Cash Trap Reserve Accounts”). The Cash Trap Reserve Accounts shall be Eligible Accounts.

(b)    Administration of the Cash Trap Reserve Accounts. All amounts held in the Cash Trap Reserve Accounts shall be invested in Eligible Investments at the written direction (which may be in the form of standing directions) of the applicable Co-Issuer (or the applicable Manager on its behalf), and such amounts may be transferred by such Co-Issuer (or the applicable Manager on its behalf) into an investment account for the sole purpose of investing in Eligible Investments so long as such investment account is (A) an Eligible Account, (B) pledged by such Co-Issuer to the Trustee for the benefit of the Secured Parties pursuant to Section 3.1 and (C) if not established with the Trustee, subject to an Account Control Agreement; provided that any such investment in the Cash Trap Reserve Accounts (or in any such investment account) shall mature not later than the Business Day prior to the next succeeding Weekly Calculation Date. In the absence of written investment instructions hereunder, funds on deposit in the Cash Trap Reserve Accounts shall remain uninvested. All income or other gain from such Eligible Investments shall be credited to the applicable Cash Trap Reserve Account, and any loss resulting from such Eligible Investments shall be charged to the applicable Cash Trap Reserve Account (and the Issuer or Canadian Co-Issuer, respectively). No Co-Issuer shall direct (or permit) the disposal of any Eligible Investments prior to the maturity thereof if such disposal would result in a loss of any portion of the initial purchase price of such Eligible Investment.

(c)    Earnings from the Cash Trap Reserve Accounts. All interest and earnings (net of losses and investment expenses) paid on funds on deposit in the Cash Trap Reserve Accounts shall be deemed to be Investment Income on deposit for distribution to the applicable Collection Account in accordance with Section 5.10.

Section 5.5    Collection Accounts.

(a)    Establishment of Collection Accounts. As of the Series 2020-1 Closing Date, the Trustee has established (i) two (2) segregated trust accounts denominated in U.S. Dollars designated as the “U.S. Collection Account” in the name of the Trustee for the benefit of the Secured Parties (x) one of which will hold U.S. Collections (the “Issuer U.S. Collection Account for U.S. Collections”) and (y) the other of which will hold any Canadian Allocation and Shortfall Payment Amount and any other Canadian

 

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Collections denominated in U.S. Dollars (the “Canadian Co-Issuer U.S. Collection Account for the Canadian Allocation and Shortfall Payment Amount”) and (ii) one (1) segregated trust accounts denominated in Canadian Dollars designated as the “Canadian Co-Issuer Canadian Collection Account for Canadian Collections” in the name of the Trustee for the benefit of the Secured Parties which will hold Canadian Collections (including any Canadian Allocation and Shortfall Payment Amount that will not be settled in U.S. Dollars). On or after the Series 2020-1 Closing Date, the Trustee shall establish, maintain, and administer one (1) segregated trust account denominated in Canadian Dollars which will hold any Canadian Dollar-denominated U.S. Shortfall Payment Amount. The Collection Accounts shall be Eligible Accounts.

(b)    Administration of the Collection Accounts. All amounts held in the Collection Accounts (other than any Canadian Dollar-denominated Collection Account) shall be invested in Eligible Investments at the written direction (which may be in the form of standing directions) of the applicable Co-Issuer (or the applicable Manager on its behalf), and such amounts may be transferred by such Co-Issuer (or the applicable Manager on its behalf) into an investment account for the sole purpose of investing in Eligible Investments so long as such investment account is (A) an Eligible Account, (B) pledged by such Co-Issuer to the Trustee for the benefit of the Secured Parties pursuant to Section 3.1 and (C) if not established with the Trustee, subject to an Account Control Agreement; provided that any such investment in the Collection Accounts (or in any such investment account) shall mature not later than the Business Day prior to the next succeeding Weekly Calculation Date. In the absence of written investment instructions hereunder, funds on deposit in the applicable Collection Accounts shall remain uninvested. All income or other gain from such Eligible Investments shall be credited to the applicable Collection Account, and any loss resulting from such Eligible Investments shall be charged to the applicable Collection Account (and the Issuer or the Canadian Co-Issuer, respectively). No Co-Issuer shall direct (or permit) the disposal of any Eligible Investments prior to the maturity thereof if such disposal would result in a loss of any portion of the initial purchase price of such Eligible Investment.

(c)    Earnings from the Collection Accounts. All interest and earnings (net of losses and investment expenses) paid on funds on deposit in the Collection Accounts shall be deemed to be Investment Income on deposit for distribution in accordance with Section 5.11.

Section 5.6    Collection Account Administrative Accounts.

(a)    Establishment of Collection Account Administrative Accounts. The following administrative accounts associated with the Collection Accounts, each of which shall be an Eligible Account, shall be established by the Trustee in the name of the Trustee for the benefit of the Secured Parties, bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Secured Parties (collectively, the “Collection Account Administrative Accounts”), either as of the Series 2015-1 Closing Date or, with respect to the Senior Subordinated Notes or the Subordinated Notes, after the Series 2015-1 Closing Date in connection with the initial issuance of any such Notes or in the case of any Collection Account Administrative Accounts with respect to the Canadian Co-Issuer, on the Series 2020-1 Closing Date or thereafter:

(i)    accounts denominated in U.S. Dollars for the Issuer (the “Issuer Class A-1 Notes Commitment Fees Account”), U.S. Dollars for the Canadian Co-Issuer (the “Canadian Co-Issuer Class A-1 Notes Commitment Fees Account (USD)”), and Canadian Dollars for the Canadian Co-Issuer (the “Canadian Co-Issuer Class A-1 Notes Commitment Fees Account (CAD)” and, collectively, with the Issuer Class A-1 Notes Commitment Fees Account and the Canadian Co-Issuer Class A-1 Notes Commitment Fees Account (USD), the “Class A-1 Notes Commitment Fees Accounts”), in each case for the deposit of the Class A-1 Notes Commitment Fees Amount;

 

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(ii)    accounts denominated in U.S. Dollars for the Issuer (the “Issuer Senior Notes Interest Payment Account”), U.S. Dollars for the Canadian Co-Issuer (the “Canadian Co-Issuer Senior Notes Interest Payment Account (USD)”), and Canadian Dollars for the Canadian Co-Issuer (the “Canadian Co-Issuer Senior Notes Interest Payment Account (CAD)” and, collectively, with the Issuer Senior Notes Interest Payment Account and the Canadian Co-Issuer Senior Notes Interest Payment Account (USD), the “Senior Notes Interest Payment Accounts”), in each case, for the deposit of the Senior Notes Quarterly Interest Amount;

(iii)    accounts denominated in U.S. Dollars for the Issuer (the “Issuer Senior Subordinated Notes Interest Payment Account”), U.S. Dollars for the Canadian Co-Issuer (the “Canadian Co-Issuer Senior Subordinated Notes Interest Payment Account (USD)”), and Canadian Dollars for the Canadian Co-Issuer (the “Canadian Co-Issuer Senior Subordinated Notes Interest Payment Account (CAD)” and, collectively, with the Issuer Senior Subordinated Notes Interest Payment Account and the Canadian Co-Issuer Senior Subordinated Notes Interest Payment Account (USD), the “Senior Subordinated Notes Interest Payment Accounts”), in each case, for the deposit of the Senior Subordinated Notes Quarterly Interest Amount, if any;

(iv)    accounts denominated in U.S. Dollars for the Issuer (the “Issuer Subordinated Notes Interest Payment Account”), U.S. Dollars for the Canadian Co-Issuer (the “Canadian Co-Issuer Subordinated Notes Interest Payment Account (USD)”), and Canadian Dollars for the Canadian Co-Issuer (the “Canadian Co-Issuer Subordinated Notes Interest Payment Account (CAD)” and, collectively, with the Issuer Subordinated Notes Interest Payment Account and the Canadian Co-Issuer Subordinated Notes Interest Payment Account (USD), the “Subordinated Notes Interest Payment Accounts”), in each case, for the deposit of the Subordinated Notes Quarterly Interest Amount, if any;

(v)    accounts denominated in U.S. Dollars for the Issuer (the “Issuer Senior Notes Principal Payment Account”), U.S. Dollars for the Canadian Co-Issuer (the “Canadian Co-Issuer Senior Notes Principal Payment Account (USD)”), and Canadian Dollars for the Canadian Co-Issuer (the “Canadian Co-Issuer Senior Notes Principal Payment Account (CAD)” and, collectively, with the Issuer Senior Notes Principal Payment Account and the Canadian Co-Issuer Senior Notes Principal Payment Account (USD), the “Senior Notes Principal Payment Accounts”), in each case, for the deposit of the amounts allocable to the payment of principal of the Senior Notes;

(vi)    accounts denominated in U.S. Dollars for the Issuer (the “Issuer Senior Subordinated Notes Principal Payment Account”), U.S. Dollars for the Canadian Co-Issuer (the “Canadian Co-Issuer Senior Subordinated Notes Principal Payment Account (USD)”), and Canadian Dollars for the Canadian Co-Issuer (the “Canadian Co-Issuer Senior Subordinated Notes Principal Payment Account (CAD)” and, collectively, with the Issuer Senior Subordinated Notes Principal Payment Account and the Canadian Co-Issuer Senior Subordinated Notes Principal Payment Account (USD), the “Senior Subordinated Notes Principal Payment Accounts”), in each case, for the deposit of amounts allocable to the payment of principal of the Senior Subordinated Notes, if any;

(vii)    accounts denominated in U.S. Dollars for the Issuer (the “Issuer Subordinated Notes Principal Payment Account”), U.S. Dollars for the Canadian Co-Issuer (the “Canadian Co-Issuer Subordinated Notes Principal Payment Account (USD)”), and Canadian Dollars for the Canadian Co-Issuer (the “Canadian Co-Issuer Subordinated Notes Principal Payment Account (CAD)” and, collectively, with the Issuer Subordinated Notes Principal

 

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Payment Account and the Canadian Co-Issuer Subordinated Notes Principal Payment Account (USD), the “Subordinated Notes Principal Payment Accounts”), in each case, for the deposit of amounts allocable to the payment of principal of the Subordinated Notes, if any;

(viii)    accounts denominated in U.S. Dollars for the Issuer (the “Issuer Post-ARD Additional Interest Account for Senior Notes”) and U.S. Dollars for the Canadian Co-Issuer (the “Canadian Co-Issuer Post-ARD Additional Interest Account for Senior Notes” and together with the Issuer Post-ARD Additional Interest Account for Senior Notes, the “Senior Notes Post-ARD Additional Interest Accounts”), in each case, for the deposit of Senior Notes Quarterly Post-ARD Additional Interest;

(ix)    accounts denominated in U.S. Dollars for the Issuer (the “Issuer Senior Subordinated Notes Post-ARD Additional Interest Account”) and U.S. Dollars for the Canadian Co-Issuer (the “Canadian Co-Issuer Senior Subordinated Notes Post-ARD Additional Interest Account” and together with the Issuer Senior Subordinated Notes Post-ARD Additional Interest Account, the “Senior Subordinated Notes Post-ARD Additional Interest Accounts”), in each case, for the deposit of Senior Subordinated Notes Quarterly Post-ARD Additional Interest, if any;

(x)    accounts denominated in U.S. Dollars for the Issuer (the “Issuer Subordinated Notes Post-ARD Additional Interest Account”) and U.S. Dollars for the Canadian Co-Issuer (the “Canadian Co-Issuer Subordinated Notes Post-ARD Additional Interest Account” and together with the Issuer Subordinated Notes Post-ARD Additional Interest Account, the “Subordinated Notes Post-ARD Additional Interest Accounts”), in each case, for the deposit of Subordinated Notes Quarterly Post-ARD Additional Interest, if any; and

(xi)    accounts denominated in U.S. Dollars for the Issuer (the “Issuer Securitization Operating Expense Account”), U.S. Dollars for the Canadian Co-Issuer (the “Canadian Securitization Operating Expense Account (USD)”), and Canadian Dollars for the Canadian Co-Issuer (the “Canadian Securitization Operating Expense Account (CAD)” and, collectively, with the Issuer Senior Notes Principal Payment Account and the Canadian Co-Issuer Senior Notes Principal Payment Account (USD), the “Securitization Operating Expense Accounts”), in each case, for the deposit of Securitization Operating Expenses.

(b)    Administration of the Collection Account Administrative Accounts. All amounts held in the Collection Account Administrative Accounts (other than any Canadian Dollar-denominated Collection Account Administrative Account) shall be invested in Eligible Investments at the written direction (which may be in the form of standing directions) of the applicable Co-Issuer (or the applicable Manager on its behalf), and such amounts may be transferred by such Co-Issuer (or the applicable Manager on its behalf) into an investment account for the sole purpose of investing in Eligible Investments so long as such investment account is (A) an Eligible Account, (B) pledged by such Co-Issuer to the Trustee for the benefit of the Secured Parties pursuant to Section 3.1 and (C) if not established with the Trustee, subject to an Account Control Agreement; provided that any such investment in the Collection Account Administrative Accounts (or in any such investment account) shall mature not later than the Business Day prior to the next succeeding Weekly Calculation Date. In the absence of written investment instructions hereunder, funds on deposit in the applicable Collection Account Administrative Accounts shall remain uninvested. All income or other gain from such Eligible Investments shall be credited to the applicable Collection Account Administrative Account, and any loss resulting from such Eligible Investments shall be charged to the applicable Collection Account Administrative Account (and the Issuer or the Canadian Co-Issuer, respectively). No Co-Issuer shall direct (or permit) the disposal of any Eligible Investments prior to the maturity thereof if such disposal would result in a loss of any portion of the initial purchase price of such Eligible Investment.

 

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(c)    Earnings from the Collection Account Administrative Accounts. All interest and earnings (net of losses and investment expenses) paid on funds on deposit in the Collection Account Administrative Accounts shall be deemed to be Investment Income on deposit for distribution to the Collection Accounts in accordance with Section 5.10.

(d)    Currency Conversions between certain Collection Account Administrative Accounts. On the Business Day following the tenth (10th) Weekly Allocation Date in each Quarterly Fiscal Period, the Trustee shall, pursuant to the FX Exchange Report appended to the Weekly Manager’s Certificate for such tenth (10th) Weekly Allocation Date, withdraw any Canadian Dollar-denominated amounts from the Class A-1 Notes Commitment Fees Account, Interest Payment Account, and Principal Payment Account for the Canadian Co-Issuer, transfer such amount to the FX Agent for a Currency Conversion and, following settlement of such Currency Conversion, deposit (or cause the FX Agent to deposit) the amount so converted in the corresponding U.S. Dollar-denominated Class A-1 Notes Commitment Fees Account, Interest Payment Account and Principal Payment Account of the Canadian Co-Issuer.

Section 5.7    Securitization-Owned Location Concentration Accounts; Product Sourcing Concentration Accounts; Claims Management Concentration Accounts.

(a)    Securitization-Owned Location Concentration Accounts.

(i)    On or prior to the Series 2020-1 Closing Date, the Securitization Entities that own Securitization-Owned Locations have established the Securitization-Owned Location Concentration Accounts (including the Take 5 Company Location Concentration Account established by Take 5 Properties on or prior to the Series 2018-1 Closing Date). Each Securitization-Owned Location Account (that is not a Securitization-Owned Location Concentration Account, including the Take 5 Securitization Lockbox and the Management Accounts in the name of Take 5 Properties opened as of the Series 2018-1 Closing Date) opened on and after the earliest applicable Series Closing Date, or such other date of contribution, with respect to Securitization Entities that own Securitization-Owned Locations is required to be (A) in the name of the applicable Securitization Entity and (B) either (x) subject to an Account Control Agreement or (y) a zero balance account which sweeps daily into an account subject to an Account Control Agreement (including a Securitization-Owned Location Concentration Account). After the opening of any such Securitization-Owned Location Concentration Account, the applicable Manager (on behalf of any applicable Securitization Entities or other Service Recipients) will deposit (or cause to be deposited) into the applicable Securitization-Owned Location Concentration Account:

(A)    all cash revenues generated by the applicable Securitization-Owned Locations within two (2) Business Days following receipt of such cash revenues; and

(B)    all credit card and debit card proceeds and any proceeds of the initial sale of gift cards at the applicable Securitization-Owned Locations; provided that if such proceeds are not deposited directly into a Securitization-Owned Location Concentration Account (including any applicable credit card and debit card sub-account of any Securitization-Owned Location Concentration Account), such proceeds will be deposited within two (2) Business Days for Securitization-Owned Locations located in the United States and three (3) Business Days for Securitization-Owned Locations located in Canada following receipt of such credit card and debit card proceeds and any proceeds of the initial sale of gift cards.

 

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(ii)    Each Securitization Entity that owns Securitization-Owned Locations has established and will be permitted to maintain local and regional accounts opened prior to the earliest applicable Series Closing Date, or such other date, when the related assets for such Driven Securitization Brand were contributed to the Securitization Entities pursuant to a Contribution Agreement, in connection with the collection of revenues of such Securitization-Owned Locations (the “Existing Local Securitization-Owned Location Accounts”). Each such Securitization Entity will be permitted to maintain amounts on deposit at the end of any banking day in Existing Local Securitization-Owned Location Accounts that are not subject to Account Control Agreements to the extent that (x) such Existing Local Securitization-Owned Location Accounts are zero balance accounts which sweep daily into an account subject to an Account Control Agreement, including the Take 5 Securitization Lockbox or any other Lock-Box Account of the Issuer or in the name of and for the benefit of Take 5 Properties or (y) the aggregate maximum amount held in all other Existing Local Securitization-Owned Location Accounts does not exceed $500,000; provided that, notwithstanding the foregoing requirement, no Existing Local Securitization-Owned Location Account for the Fix Auto Brand shall be required to be subject to an Account Control Agreement or in compliance with the foregoing conditions until one hundred twenty (120) days following the Series 2020-1 Closing Date.

(iii)    The applicable Manager may withdraw available amounts on deposit in any Securitization-Owned Location Concentration Account at any time in accordance with the applicable Managing Standard and as otherwise set forth in the Transaction Documents in order to pay operating expenses that are incurred or committed to be paid by the applicable Securitization-Owned Locations in the ordinary course of business, such as the cost of goods sold, labor (including wages, worker’s compensation-related expenses and other labor-related expenses for employees of Securitization-Owned Locations), repair, remodeling and maintenance expenses, insurance (including self-insurance), local advertising expenses, advertising fees allocable to such Securitization-Owned Locations and lease and other occupancy expenses, litigation and settlement costs relating to the Managed Assets, Pass-Through Amounts and, without duplication, Excluded Amounts described in clause (ii) or (iii) of the definition thereof and, at the option of the applicable Canadian Securitization Entity, any such Excluded Amount required or reasonably expected to be payable at or prior to the immediately following four (4) Quarterly Payment Dates or for which a reserve is maintained on account of quarterly or annual payment of such Excluded Amounts; provided that, after the occurrence and during the continuance of any Cash Trapping Period, Rapid Amortization Event or Event of Default, all operating expenses withdrawn from the Securitization-Owned Location Concentration Accounts shall be consistent with a monthly budget submitted to, and approved by, the Control Party (in consultation with the Back-Up Manager) prior to such withdrawal and withdrawals of any operating expenses from any Securitization-Owned Location Concentration Account in excess of amounts set forth in the monthly budget will be subject to (i) the delivery by the applicable Manager to the Control Party and Back-Up Manager of an explanation in reasonable detail for the variance together with related information and (ii) the prior approval of the Control Party (in consultation with the Back-Up Manager).

(iv)    The Canadian Manager may, at any time, acting in accordance with the applicable Managing Standard, permanently remove the designation of “Excluded Location” in respect of any company-owned location under a particular Driven Securitization Brand (including any individual brand comprising the Uniban Brand) or other brand described in clause (i) of the definition of “Excluded Location”, and as of such date of designation, such company-owned locations of such Driven Securitization Brand or other brand will be treated in the same manner as a newly acquired Securitization-Owned Location (or any analogous concept for the relevant Collateral) and the related assets (including any account for the collection of revenue) will constitute Securitization Assets.

 

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(b)    Product Sourcing Concentration Accounts and Claims Management Concentration Accounts

(i)    On or prior to the Series 2020-1 Closing Date, Driven Canada Product Sourcing and Driven Canada Claims Management have established the Canadian Product Sourcing Concentration Account and the Canadian Claims Management Concentration Account. Each Product Sourcing Account and Claims Management Account (that is not a Product Sourcing Concentration Account or Claims Management Concentration Account) opened on or after an applicable Series Closing Date, or such other date of contribution, with respect to Securitization Entities that own a Product Sourcing Business or Claims Management Business is required to be (A) in the name of the applicable Securitization Entity and (B) either (x) subject to an Account Control Agreement or (y) a zero balance account which sweeps daily into an account subject to an Account Control Agreement (including a Product Sourcing Concentration Account or Claims Management Concentration Account, as applicable).    After the opening of any such Securitization-Owned Location Concentration Account, the applicable Manager (on behalf of any applicable Securitization Entities or other Service Recipients) will deposit (or cause to be deposited) into the applicable Securitization-Owned Location Concentration Account:

(A)    all cash revenues generated by the applicable Product Sourcing Business or applicable Claims Management Business within three (3) Business Days following receipt of such cash revenues; and

(B)    all credit card and debit card proceeds generated by the applicable Product Sourcing Business or applicable Claims Management Business; provided that if such proceeds are not deposited directly into an applicable Concentration Account (including any applicable credit card and debit card sub-account of any such Concentration Account), such proceeds will be deposited within three (3) Business Days following receipt of such credit card and debit card proceeds.

(ii)    Each Securitization Entity that owns a Product Sourcing Business or Claims Management Business has established and is permitted to maintain local and regional accounts opened prior to the earliest applicable Series Closing Date, or such other date, when the related assets for such Product Sourcing Business or Claims Management Business were contributed to the Securitization Entities pursuant to a Contribution Agreement in connection with the collection of their respective revenues (the “Existing Local Product Sourcing Amounts” and the “Existing Local Claims Management Accounts” respectively, and collectively, the “Existing Local Product Sourcing and Claims Management Accounts”). Each Securitization Entity that owns a Product Sourcing Business or Claims Management Business may establish and is permitted to maintain amounts on deposit at the end of any banking day in Existing Local Product Sourcing and Claims Management Accounts that are not subject to Account Control Agreements to the extent that (x) such Existing Local Product Sourcing and Claims Management Accounts are zero balance accounts which sweep daily into an account subject to an Account Control Agreement or (y) the aggregate maximum amount held in all Existing Local Product Sourcing and Claims Management Accounts in respect of Canadian Securitization Entities does not exceed CAN$3,000,000 and in respect of any applicable U.S. Securitization Entities does not exceed $3,000,000 or such other amount approved by the Control Party (acting at the direction of the Controlling Class Representative); provided that,

 

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notwithstanding the foregoing requirements, no Existing Local Product Sourcing and Claims Management Account in respect of Driven Canada Product Sourcing or Driven Canada Claims Management shall be required to be subject to an Account Control Agreement or in compliance with the foregoing conditions until one hundred twenty (120) days following the Series 2020-1 Closing Date.

(iii)    The applicable Manager may withdraw available amounts on deposit in any Product Sourcing Concentration Account or Claims Management Concentration Account at any time in accordance with the applicable Managing Standard and as otherwise set forth in the Transaction Documents in order to pay operating expenses that are incurred or committed to be paid in respect of the applicable Product Sourcing Business or Claims Management Business in the ordinary course of business, such as the cost of goods sold, labor (including wages, worker’s compensation-related expenses and other labor-related expenses for employees of the applicable Product Sourcing Business or Claims Management Business), insurance (including self-insurance), local advertising expenses, lease and other occupancy expenses, and litigation and settlement costs relating to the applicable Managed Assets and other Excluded Amounts, including insurance company rebates and other fees and payments payable to Franchisees, locations owned by Non-Securitization Entities, Excluded Locations or third parties and Excluded Amounts described in clause (ii) or (iii) of the definition thereof and, at the option of the applicable Securitization Entity, any such Excluded Amount required or reasonably expected to be payable at or prior to the immediately following four (4) Quarterly Payment Dates or for which a reserve is maintained on account of quarterly or annual payment of such Excluded Amounts; provided that, after the occurrence and during the continuance of any Cash Trapping Period, Rapid Amortization Event or Event of Default, all operating expenses withdrawn from any Product Sourcing Concentration Account or Claims Management Concentration Account shall be consistent with a monthly budget submitted to, and approved by, the Control Party (in consultation with the Back-Up Manager) prior to such withdrawal and withdrawals of any operating expenses from any such Product Sourcing Concentration Account or Claims Management Concentration Account in excess of amounts set forth in the monthly budget will be subject to (i) the delivery by the applicable Manager to the Control Party and Back-Up Manager of an explanation in reasonable detail for the variance together with related information and (ii) the prior approval of the Control Party (in consultation with the Back-Up Manager).

Section 5.8    Trustee as Securities Intermediary.

(a)    The Trustee or other Person holding any Base Indenture Account held in the name of the Trustee for the benefit of the Secured Parties (collectively, the “Trustee Accounts”) shall be the “Securities Intermediary”. If the Securities Intermediary in respect of any Trustee Account is not the Trustee, the Issuer shall obtain the express agreement of such other Person to the obligations of the Securities Intermediary set forth in this Section 5.8.

(b)    The Securities Intermediary agrees that:

(i)    the Trustee Accounts are accounts to which “financial assets” within the meaning of Section 8-102(a)(9) (“Financial Assets”) of the New York UCC and each applicable STA will or may be credited;

(ii)    the Trustee Accounts are “securities accounts” within the meaning of Section 8-501 of the New York UCC and each applicable STA and the Securities Intermediary qualifies as a “securities intermediary” under Section 8-102(a) of the New York UCC and each applicable STA;

 

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(iii)    all securities or other property (other than cash) underlying any Financial Assets credited to any Trustee Account shall be registered in the name of the Securities Intermediary, indorsed to the Securities Intermediary or in blank or credited to another securities account maintained in the name of the Securities Intermediary, and in no case will any Financial Asset credited to any Trustee Account be registered in the name of the applicable Co-Issuer, payable to the order of the applicable Co-Issuer or specially indorsed to the applicable Co-Issuer;

(iv)    all property delivered to the Securities Intermediary pursuant to this Base Indenture will be promptly credited to the appropriate Trustee Account;

(v)    each item of property (whether investment property, security, instrument or cash) credited to a Trustee Account shall be treated as a Financial Asset under Article 8 of the New York UCC and each applicable STA;

(vi)    if at any time the Securities Intermediary shall receive any entitlement order from the Trustee (including those directing transfer or redemption of any Financial Asset) relating to the Trustee Accounts, the Securities Intermediary shall comply with such entitlement order without further consent by the Issuer or any other Person;

(vii)    the Trustee Accounts shall be governed by the laws of the State of New York, regardless of any provision of any other agreement; for purposes of all applicable UCCs and STAs and all issues specified in Article 2(1) of the Hague Convention on the Law Applicable to Certain Rights in Respect of Securities Held with an Intermediary, New York shall be deemed to be the Securities Intermediary’s jurisdiction, and the Trustee Accounts (as well as the “securities entitlements” (as defined in Section 8-102(a)(17) of the New York UCC and each applicable STA) related thereto) shall be governed by the laws of the State of New York;

(viii)    the Securities Intermediary has not entered into, and until termination of this Base Indenture will not enter into, any agreement with any other Person relating to the Trustee Accounts and/or any Financial Assets credited thereto pursuant to which it has agreed to comply with entitlement orders (as defined in Section 8-102(a)(8) of the New York UCC and each applicable STA) of such other Person and the Securities Intermediary has not entered into, and until the termination of this Base Indenture will not enter into, any agreement with either Co-Issuer purporting to limit or condition the obligation of the Securities Intermediary to comply with entitlement orders as set forth in Section 5.8(b)(vi); and

(ix)    except for the claims and interest of the Trustee, the Secured Parties, the Co-Issuers and the other Securitization Entities in the Trustee Accounts, neither the Securities Intermediary nor, in the case of the Trustee, any Trust Officer knows of any claim to, or interest in, the Trustee Accounts or any Financial Asset credited thereto; if the Securities Intermediary or the Trustee has Actual Knowledge of the assertion by any other person of any Lien, encumbrance or adverse claim (including any writ, garnishment, judgment, warrant of attachment, execution or similar process) against any Trustee Account or any Financial Asset carried therein, the Securities Intermediary will promptly notify the Trustee, the Servicer, the Managers, the Back-Up Manager and the Co-Issuers thereof.

(c)    At any time after the occurrence and during the continuation of an Event of Default, the Trustee shall possess all right, title and interest in all funds on deposit from time to time in the Trustee Accounts and in all Proceeds thereof, and (acting at the direction of the Controlling Class Representative) shall be the only Person authorized to originate entitlement orders in respect of the Trustee

 

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Accounts; provided that at all other times the applicable Co-Issuer (or the applicable Manager on its behalf) shall, subject to the terms of the Indenture and the other Transaction Documents, be authorized to instruct the Trustee to originate entitlement orders in respect of the applicable Trustee Accounts.

Section 5.9    Establishment of Series Accounts; Legacy Accounts.

(a)    Establishment of Series Accounts. To the extent specified in the Series Supplement with respect to any Series of Notes, the Trustee may establish and maintain one or more Series Accounts and/or administrative accounts of any such Series Account in accordance with the terms of such Series Supplement.

(b)    Legacy Accounts. In the case of any mandatory or optional redemption in full of any Class or Series of Notes issued pursuant to this Base Indenture, on the Notes Discharge Date with respect to such Class or Series of Notes, either or both Co-Issuers may (but are not required to) elect to have all or any portion of the funds held in any Legacy Account with respect to such Class or Series of Notes transferred to the applicable distribution account for such Class or Series of Notes, for application toward the prepayment of such Class or Series of Notes. If the Co-Issuers do not elect to have such funds so transferred, or if the Co-Issuers elect to have only a portion of such funds so transferred, any funds remaining in the applicable Legacy Account after the applicable Notes Discharge Date shall be deposited into the applicable Collection Account for application in accordance with the Priority of Payments. When the balance of any Legacy Account has been reduced to zero, the Trustee may close such account. The Trustee shall make the distributions and transfers and shall close any accounts as contemplated by this Section 5.9 pursuant to instructions delivered by the Co-Issuers to the Trustee.

Section 5.10    Collections; Investment Income; Currency Conversions.

(a)    Deposits to the Concentration Accounts.

(i)    Until the Indenture is terminated pursuant to Section 12.1, the Issuer shall deposit (or cause to be deposited) the following amounts to the U.S. Concentration Account, in each case, to the extent owed to it or the other U.S. Securitization Entities or any applicable Take 5 Company Locations located in the United States and promptly after receipt (unless otherwise specified below):

(A)    all Franchisee Payments owed to the U.S. SPV Franchising Entities shall be deposited directly to the U.S. Concentration Account or made to a Lock-Box Account; provided that all Franchisee Payments owed to the U.S. SPV Franchising Entities made to a Lock-Box Account shall be deposited to the U.S. Concentration Account within two (2) Business Days following the receipt of such amounts in such Lock-Box Account;

(B)    within five (5) Business Days after the end of each fiscal week, the Weekly Estimated Securitization-Owned Location Profits Amount;

(C)    on or before the tenth (10th) Business Day following the last day of each Monthly Fiscal Period, the Monthly Securitization-Owned Location Profits True-up Amount, if any, from amounts on deposit in the Securitization-Owned Location Concentration Accounts, and/or draws on the Series 2019-3 Notes;

(D)    within three (3) Business Days of receipt, all amounts received under any IP License Agreement (including any Canadian IP License Agreement or other IP License Agreement entered into with a Canadian Securitization Entity), other license fees and any other amounts received in respect of the applicable Securitization IP, including recoveries from the enforcement of the applicable Securitization IP;

 

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(E)    within three (3) Business Days of receipt, equity contributions, if any, made by any Non-Securitization Entity to the Issuer (directly or indirectly) to the extent such equity contributions are directed to be made to the U.S. Concentration Account; and

(F)    within five (5) Business Days of receipt, all other amounts constituting Retained Collections with respect to the operation of the Driven Securitization Brands in the United States not referred to in the preceding clauses other than Indemnification Amounts, Release Prices, Insurance/Condemnation Proceeds, Asset Disposition Proceeds and other amounts required to be deposited directly to other Management Accounts of the U.S. Securitization Entities or to the U.S. Collection Account for U.S. Collections.

(ii)    Until the Indenture is terminated pursuant to Section 12.1, the Canadian Co-Issuer shall deposit (or cause to be deposited) the following amounts to the Canadian Concentration Account, in each case, to the extent owed to it or the other Canadian Securitization Entities and promptly after receipt (unless otherwise specified below):

(A)    all Franchisee Payments owed to the Canadian SPV Franchising Entities will be deposited directly to the Canadian Concentration Account or made to a Lock-Box Account; provided that all Franchisee Payments owed to the Canadian SPV Franchising Entities made to a Lock-Box Account will be deposited to the Canadian Concentration Account within three (3) Business Days following the receipt of such amounts in such Lock-Box Account;

(B)    within five (5) Business Days after the end of each fiscal week, the Weekly Estimated Securitization-Owned Location Profits Amount, the Weekly Estimated Product Sourcing Profits Amount and Weekly Estimated Claims Management Profits Amount;