SUBSIDIARY GUARANTEE
Exhibit 10.10
SUBSIDIARY GUARANTEE, dated as of April 20, 2009 (this “Guarantee”), made by each of
the signatories hereto (together with any other entity that may become a party hereto as provided
herein, the “Guarantors”), in favor of the purchasers signatory (together with their
permitted assigns, the “Purchasers”) to that certain Securities Purchase Agreement, dated
as of the date hereof, between UFood Restaurant Group, Inc., a Nevada corporation (the
“Company”) and the Purchasers.
W I T N E S S E T H:
WHEREAS, pursuant to that certain Securities Purchase Agreement, dated as of the date hereof,
by and between the Company and the Purchasers (the “Purchase Agreement”), the Company has
agreed to sell and issue to the Purchasers, and the Purchasers have agreed to purchase from the
Company the Debentures, subject to the terms and conditions set forth therein; and
WHEREAS, each Guarantor will directly benefit from the extension of credit to the Company
represented by the issuance of the Debentures; and
NOW, THEREFORE, in consideration of the premises and to induce the Purchasers to enter into
the Purchase Agreement and to carry out the transactions contemplated thereby, each Guarantor
hereby agrees with the Purchasers as follows:
1. Definitions. Unless otherwise defined herein, terms defined in the Purchase
Agreement and used herein shall have the meanings given to them in the Purchase Agreement. The
words “hereof,” “herein,” “hereto” and “hereunder” and words of similar import when used in this
Guarantee shall refer to this Guarantee as a whole and not to any particular provision of this
Guarantee, and Section and Schedule references are to this Guarantee unless otherwise specified.
The meanings given to terms defined herein shall be equally applicable to both the singular and
plural forms of such terms. The following terms shall have the following meanings:
“Guarantee” means this Subsidiary Guarantee, as the same may be amended,
supplemented or otherwise modified from time to time.
“Obligations” means, in addition to all other costs and expenses of collection
incurred by Purchasers in enforcing any of such Obligations and/or this Guarantee, all of
the liabilities and obligations (primary, secondary, direct, contingent, sole, joint or
several) due or to become due, or that are now or may be hereafter contracted or acquired,
or owing to, by the Company or any Guarantor to the Purchasers, including, without
limitation, all obligations under this Guarantee, the Debentures and any other instruments,
agreements or other documents executed and/or delivered in connection herewith or
therewith, in each case, whether now or hereafter existing, voluntary or involuntary,
direct or indirect, absolute or
contingent, liquidated or unliquidated, whether or not jointly
owed with others, and whether or not from time to time decreased or extinguished and later
increased, created or incurred, and all or any portion of such obligations or liabilities
that are paid, to the extent all or any part of such payment is avoided or recovered
directly or indirectly from any of the Purchasers as a preference, fraudulent transfer or
otherwise as such obligations may be amended, supplemented, converted, extended or modified
from time to time. Without limiting the generality of the foregoing, the term
“Obligations” shall include, without limitation: (i) principal of, and interest on the
Debentures and the loans extended pursuant thereto; (ii) any and all other fees,
indemnities, costs, obligations and liabilities of the Company or any Guarantor from time
to time under or in connection with this Guarantee, the Debentures and any other
instruments, agreements or other documents executed and/or delivered in connection herewith
or therewith; and (iii) all amounts (including but not limited to post-petition interest)
in respect of the foregoing that would be payable but for the fact that the obligations to
pay such amounts are unenforceable or not allowable due to the existence of a bankruptcy,
reorganization or similar proceeding involving the Company or any Guarantor.
2. Guarantee.
(a) Guarantee.
(i) The Guarantors hereby, jointly and severally, unconditionally and
irrevocably, guarantee to the Purchasers and their respective successors,
indorsees, transferees and assigns, the prompt and complete payment and performance
when due (whether at the stated maturity, by acceleration or otherwise) of the
Obligations.
(ii) Anything herein or in any other Transaction Document to the contrary
notwithstanding, the maximum liability of each Guarantor hereunder and under the
other Transaction Documents shall in no event exceed the amount which can be
guaranteed by such Guarantor under applicable federal and state laws, including
laws relating to the insolvency of debtors, fraudulent conveyance or transfer or
laws affecting the rights of creditors generally (after giving effect to the right
of contribution established in Section 2(b)).
(iii) Each Guarantor agrees that the Obligations may at any time and from time
to time exceed the amount of the liability of such Guarantor hereunder without
impairing the guarantee contained in this Section 2 or affecting the rights and
remedies of the Purchasers hereunder.
(iv) The guarantee contained in this Section 2 shall remain in full force and
effect until all the Obligations and the obligations of each
Guarantor under the guarantee contained in this Section 2 shall have been
satisfied by indefeasible payment in full.
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(v) No payment made by the Company, any of the Guarantors, any other
guarantor or any other Person or received or collected by the Purchasers from the
Company, any of the Guarantors, any other guarantor or any other Person by virtue
of any action or proceeding or any set-off or appropriation or application at any
time or from time to time in reduction of or in payment of the Obligations shall
be deemed to modify, reduce, release or otherwise affect the liability of any
Guarantor hereunder which shall, notwithstanding any such payment (other than any
payment made by such Guarantor in respect of the Obligations or any payment
received or collected from such Guarantor in respect of the Obligations), remain
liable for the Obligations up to the maximum liability of such Guarantor
hereunder until the Obligations are indefeasibly paid in full.
(vi) Notwithstanding anything to the contrary in this Guarantee, with respect
to any defaulted non-monetary Obligations the specific performance of which by the
Guarantors is not reasonably possible (e.g. the issuance of the Company’s Common
Stock), the Guarantors shall only be liable for making the Purchasers whole on a
monetary basis for the Company’s failure to perform such Obligations in accordance
with the Transaction Documents.
(b) Right of Contribution. Subject to Section 2(c), each Guarantor hereby
agrees that to the extent that a Guarantor shall have paid more than its proportionate
share of any payment made hereunder, such Guarantor shall be entitled to seek and receive
contribution from and against any other Guarantor hereunder which has not paid its
proportionate share of such payment. Each Guarantor’s right of contribution shall be
subject to the terms and conditions of Section 2(c). The provisions of this Section 2(b)
shall in no respect limit the obligations and liabilities of any Guarantor to the
Purchasers and each Guarantor shall remain liable to the Purchasers for the full amount
guaranteed by such Guarantor hereunder.
(c) No Subrogation. Notwithstanding any payment made by any Guarantor
hereunder or any set-off or application of funds of any Guarantor by the Purchasers, no
Guarantor shall be entitled to be subrogated to any of the rights of the Purchasers against
the Company or any other Guarantor or any collateral security or guarantee or right of
offset held by the Purchasers for the payment of the Obligations, nor shall any Guarantor
seek or be entitled to seek any contribution or reimbursement from the Company or any other
Guarantor in respect of payments made by such Guarantor hereunder, until all amounts owing
to the Purchasers by the Company on account of the Obligations are indefeasibly paid in
full. If any amount shall be paid to any Guarantor on account of such
subrogation rights at any time when all of the Obligations shall not have been paid in
full, such amount shall be held by such Guarantor in trust for the Purchasers, segregated
from other funds of such Guarantor, and shall, forthwith upon receipt by such Guarantor, be
turned over to the Purchasers in the exact form received by such Guarantor (duly indorsed
by such Guarantor to the Purchasers, if required), to be applied against the Obligations,
whether matured or unmatured, in such order as the Purchasers may determine.
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(d) Amendments, Etc. With Respect to the Obligations. Each Guarantor shall
remain obligated hereunder notwithstanding that, without any reservation of rights against
any Guarantor and without notice to or further assent by any Guarantor, any demand for
payment of any of the Obligations made by the Purchasers may be rescinded by the Purchasers
and any of the Obligations continued, and the Obligations, or the liability of any other
Person upon or for any part thereof, or any collateral security or guarantee therefor or
right of offset with respect thereto, may, from time to time, in whole or in part, be
renewed, extended, amended, modified, accelerated, compromised, waived, surrendered or
released by the Purchasers, and the Purchase Agreement and the other Transaction Documents
and any other documents executed and delivered in connection therewith may be amended,
modified, supplemented or terminated, in whole or in part, as the Purchasers may deem
advisable from time to time, and any collateral security, guarantee or right of offset at
any time held by the Purchasers for the payment of the Obligations may be sold, exchanged,
waived, surrendered or released. The Purchasers shall have no obligation to protect,
secure, perfect or insure any Lien at any time held by them as security for the Obligations
or for the guarantee contained in this Section 2 or any property subject thereto.
(e) Guarantee Absolute and Unconditional. Each Guarantor waives any and all
notice of the creation, renewal, extension or accrual of any of the Obligations and notice
of or proof of reliance by the Purchasers upon the guarantee contained in this Section 2 or
acceptance of the guarantee contained in this Section 2; the Obligations, and any of them,
shall conclusively be deemed to have been created, contracted or incurred, or renewed,
extended, amended or waived, in reliance upon the guarantee contained in this Section 2;
and all dealings between the Company and any of the Guarantors, on the one hand, and the
Purchasers, on the other hand, likewise shall be conclusively presumed to have been had or
consummated in reliance upon the guarantee contained in this Section 2. Each Guarantor
waives to the extent permitted by law diligence,
presentment, protest, demand for payment and notice of default or nonpayment to or
upon the Company or any of the Guarantors with respect to the Obligations. Each Guarantor
understands and agrees that the guarantee contained in this Section 2 shall be construed as
a continuing, absolute and unconditional guarantee of payment and performance without
regard to (a) the validity or enforceability of the Purchase Agreement or any other
Transaction Document, any of the Obligations or any other collateral security therefor or
guarantee or right of offset with respect thereto at any time or
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from time to time held by
the Purchasers, (b) any defense, set-off or counterclaim (other than a defense of payment or performance
or fraud by Purchasers) which may at any time be available to or be asserted by the Company
or any other Person against the Purchasers, or (c) any other circumstance whatsoever (with
or without notice to or knowledge of the Company or such Guarantor) which constitutes, or
might be construed to constitute, an equitable or legal discharge of the Company for the
Obligations, or of such Guarantor under the guarantee contained in this Section 2, in
bankruptcy or in any other instance. When making any demand hereunder or otherwise pursuing
its rights and remedies hereunder against any Guarantor, the Purchasers may, but shall be
under no obligation to, make a similar demand on or otherwise pursue such rights and
remedies as they may have against the Company, any other Guarantor or any other Person or
against any collateral security or guarantee for the Obligations or any right of offset
with respect thereto, and any failure by the Purchasers to make any such demand, to pursue
such other rights or remedies or to collect any payments from the Company, any other
Guarantor or any other Person or to realize upon any such collateral security or guarantee
or to exercise any such right of offset, or any release of the Company, any other Guarantor
or any other Person or any such collateral security, guarantee or right of offset, shall
not relieve any Guarantor of any obligation or liability hereunder, and shall not impair or
affect the rights and remedies, whether express, implied or available as a matter of law,
of the Purchasers against any Guarantor. For the purposes hereof, “demand” shall include
the commencement and continuance of any legal proceedings.
(f) Reinstatement. The guarantee contained in this Section 2 shall continue to
be effective, or be reinstated, as the case may be, if at any time payment, or any part
thereof, of any of the Obligations is rescinded or must otherwise be restored or returned
by the Purchasers upon the insolvency, bankruptcy, dissolution, liquidation or
reorganization of the Company or any Guarantor, or upon or as a result of the appointment
of a receiver, intervenor or conservator of, or trustee or similar officer for, the Company
or any Guarantor or any substantial part of its property, or otherwise, all as though such
payments had not been made.
(g) Payments. Each Guarantor hereby guarantees that payments hereunder will be
paid to the Purchasers without set-off or counterclaim in U.S. dollars at the address set
forth or referred to in the Signature Pages to the Purchase Agreement.
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3. Representations and Warranties. Each Guarantor hereby makes the following
representations and warranties to Purchasers as of the date hereof:
(a) Organization and Qualification. The Guarantor is a corporation, duly
incorporated, validly existing and in good standing under the laws of the applicable
jurisdiction set forth on Schedule 1, with the requisite corporate power and authority to
own and use its properties and assets and to carry on its business
as currently conducted. The Guarantor has no subsidiaries other than those identified
as such on the Disclosure Schedules to the Purchase Agreement. The Guarantor is duly
qualified to do business and is in good standing as a foreign corporation in each
jurisdiction in which the nature of the business conducted or property owned by it makes
such qualification necessary, except where the failure to be so qualified or in good
standing, as the case may be, could not, individually or in the aggregate, (x) adversely
affect the legality, validity or enforceability of any of this Guaranty in any material
respect, (y) have a material adverse effect on the results of operations, assets,
prospects, or financial condition of the Guarantor or (z) adversely impair in any material
respect the Guarantor’s ability to perform fully on a timely basis its obligations under
this Guaranty (a “Material Adverse Effect”).
(b) Authorization; Enforcement. The Guarantor has the requisite corporate
power and authority to enter into and to consummate the transactions contemplated by this
Guaranty, and otherwise to carry out its obligations hereunder. The execution and delivery
of this Guaranty by the Guarantor and the consummation by it of the transactions
contemplated hereby have been duly authorized by all requisite corporate action on the part
of the Guarantor. This Guaranty has been duly executed and delivered by the Guarantor and
constitutes the valid and binding obligation of the Guarantor enforceable against the
Guarantor in accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws
relating to, or affecting generally the enforcement of, creditors’ rights and remedies or
by other equitable principles of general application.
(c) No Conflicts. The execution, delivery and performance of this Guaranty by
the Guarantor and the consummation by the Guarantor of the transactions contemplated
thereby do not and will not (i) conflict with or violate any provision of its Certificate
of Incorporation or By-laws or (ii) conflict with, constitute a default (or an event which
with notice or lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation of, any agreement, indenture
or instrument to which the Guarantor is a party, or (iii) result in a violation of any law,
rule, regulation, order, judgment, injunction, decree or other restriction of any court or
governmental authority to which the Guarantor is subject (including Federal and State
securities laws and regulations), or by which any material property or asset of the
Guarantor is bound or affected, except in the case of each of clauses (ii) and (iii), such
conflicts, defaults, terminations, amendments, accelerations, cancellations and violations
as could not, individually or in the aggregate, have or result in a Material Adverse
Effect. The business of the Guarantor is not being conducted in violation of any law,
ordinance or regulation of any governmental authority, except for violations which,
individually or in the aggregate, do not have a Material Adverse Effect.
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(d) Consents and Approvals. The Guarantor is not required to obtain any
consent, waiver, authorization or order of, or make any filing or registration with, any
court or other federal, state, local, foreign or other governmental authority or other
person in connection with the execution, delivery and performance by the Guarantor of this
Guaranty which has not been obtained.
(e) Purchase Agreement. The representations and warranties of the Company set
forth in the Purchase Agreement as they relate to such Guarantor, each of which is hereby
incorporated herein by reference, are true and correct as of each time such representations
are deemed to be made pursuant to such Purchase Agreement, and the Purchasers shall be
entitled to rely on each of them as if they were fully set forth herein, provided that each
reference in each such representation and warranty to the Company’s knowledge shall, for
the purposes of this Section 3, be deemed to be a reference to such Guarantor’s knowledge.
(f) Foreign Law. Each Guarantor has consulted with appropriate foreign legal
counsel with respect to any of the above representations for which non-U.S. law is
applicable. Such foreign counsel have advised each applicable Guarantor that such counsel
knows of no reason why any of the above representations would not be true and accurate.
Such foreign counsel were provided with copies of this Subsidiary Guarantee and the
Transaction Documents prior to rendering their advice.
4. Covenants.
(a) Each Guarantor covenants and agrees with the Purchasers that, from and after the
date of this Guarantee until the Obligations shall have been indefeasibly paid in full,
such Guarantor shall take, and/or shall refrain from taking, as the case may be, each
commercially reasonable action that is necessary to be taken or not taken, as the case may
be, so that no Event of Default (as defined in the Debentures) is caused by the failure to
take such action or to refrain from taking such action by such Guarantor.
(b) So long as any of the Obligations are outstanding, unless Purchasers holding at
least 80% of the aggregate principal amount of the then outstanding Debentures shall
otherwise consent in writing, each Guarantor will not directly or indirectly on or after
the date of this Guarantee:
i. except for Permitted Indebtedness (as defined in the Debentures), enter
into, create, incur, assume or suffer to exist any indebtedness for borrowed money
of any kind, including but not limited to, a guarantee, on or with respect to any
of its property or assets now owned or hereafter acquired or any interest therein
or any income or profits therefrom;
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ii. except for Permitted Liens (as defined in the Debentures), enter into,
create, incur, assume or suffer to exist any liens of any kind, on or with respect
to any of its property or assets now owned or hereafter acquired or any interest
therein or any income or profits therefrom;
iii. amend its certificate of incorporation, bylaws or other charter documents
so as to adversely affect any rights of any Purchaser;
iv. repay, repurchase or offer to repay, repurchase or otherwise acquire more
than a de minimis number of shares of its securities or debt obligations;
v. pay cash dividends on any equity securities of the Company;
vi. enter into any transaction with any Affiliate of the Guarantor which would
be required to be disclosed in any public filing of the Company with the
Commission, unless such transaction is made on an arm’s-length basis and expressly
approved by a majority of the disinterested directors of the Company (even if less
than a quorum otherwise required for board approval); or
vii. enter into any agreement with respect to any of the foregoing.
5. Miscellaneous.
(a) Amendments in Writing. None of the terms or provisions of this Guarantee
may be waived, amended, supplemented or otherwise modified except in writing by the
Purchasers.
(b) Notices. All notices, requests and demands to or upon the Purchasers or
any Guarantor hereunder shall be effected in the manner provided for in the Purchase
Agreement, provided that any such notice, request or demand to or upon any Guarantor shall
be addressed to such Guarantor at its notice address set forth on Schedule 5(b).
(c) No Waiver By Course Of Conduct; Cumulative Remedies. The Purchasers shall
not by any act (except by a written instrument pursuant to Section 5(a)), delay,
indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or
to have acquiesced in any default under the Transaction Documents or Event of Default. No
failure to exercise, nor any delay in exercising, on the part of the Purchasers, any right,
power or privilege hereunder shall operate as a waiver thereof. No single or partial
exercise of any right, power or privilege hereunder shall preclude any other or further
exercise thereof or the exercise of any other right, power or privilege. A waiver by the
Purchasers of any right or remedy hereunder on any one occasion shall not be construed
as a bar to any right or remedy which the Purchasers would otherwise have on any future
occasion. The rights and remedies herein provided are cumulative, may be exercised singly
or concurrently and are not exclusive of any other rights or remedies provided by law.
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(d) Enforcement Expenses; Indemnification.
(i) Each Guarantor agrees to pay, or reimburse the Purchasers for, all its
costs and expenses incurred in collecting against such Guarantor under the
guarantee contained in Section 2 or otherwise enforcing or preserving any rights
under this Guarantee and the other Transaction Documents to which such Guarantor is
a party, including, without limitation, the reasonable fees and disbursements of
counsel to the Purchasers.
(ii) Each Guarantor agrees to pay, and to save the Purchasers harmless from,
any and all liabilities with respect to, or resulting from any delay in paying, any
and all stamp, excise, sales or other taxes which may be payable or determined to
be payable in connection with any of the transactions contemplated by this
Guarantee.
(iii) Each Guarantor agrees to pay, and to save the Purchasers harmless from,
any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever
with respect to the execution, delivery, enforcement, performance and
administration of this Guarantee to the extent the Company would be required to do
so pursuant to the Purchase Agreement.
(iv) The agreements in this Section shall survive repayment of the Obligations
and all other amounts payable under the Purchase Agreement and the other
Transaction Documents.
(e) Successor and Assigns. This Guarantee shall be binding upon the successors
and assigns of each Guarantor and shall inure to the benefit of the Purchasers and their
respective successors and assigns; provided that no Guarantor may assign, transfer or
delegate any of its rights or obligations under this Guarantee without the prior written
consent of the Purchasers.
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(f) Set-Off. Each Guarantor hereby irrevocably authorizes the Purchasers at
any time and from time to time while an Event of Default under any of the Transaction
Documents shall have occurred and be continuing, without notice to such Guarantor or any
other Guarantor, any such notice being expressly waived by each Guarantor, to set-off and
appropriate and apply any and all deposits, credits, indebtedness or claims, in any
currency, in each case whether
direct or indirect, absolute or contingent, matured or unmatured, at any time held or
owing by the Purchasers to or for the credit or the account of such Guarantor, or any part
thereof in such amounts as the Purchasers may elect, against and on account of the
obligations and liabilities of such Guarantor to the Purchasers hereunder and claims of
every nature and description of the Purchasers against such Guarantor, in any currency,
whether arising hereunder, under the Purchase Agreement, any other Transaction Document or
otherwise, as the Purchasers may elect, whether or not the Purchasers have made any demand
for payment and although such obligations, liabilities and claims may be contingent or
unmatured. The Purchasers shall notify such Guarantor promptly of any such set-off and the
application made by the Purchasers of the proceeds thereof, provided that the failure to
give such notice shall not affect the validity of such set-off and application. The rights
of the Purchasers under this Section are in addition to other rights and remedies
(including, without limitation, other rights of set-off) which the Purchasers may have.
(g) Counterparts. This Guarantee may be executed by one or more of the parties
to this Guarantee on any number of separate counterparts (including by telecopy), and all
of said counterparts taken together shall be deemed to constitute one and the same
instrument.
(h) Severability. Any provision of this Guarantee which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the
extent of such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall
not invalidate or render unenforceable such provision in any other jurisdiction.
(i) Section Headings. The Section headings used in this Guarantee are for
convenience of reference only and are not to affect the construction hereof or be taken
into consideration in the interpretation hereof.
(j) Integration. This Guarantee and the other Transaction Documents represent
the agreement of the Guarantors and the Purchasers with respect to the subject matter
hereof and thereof, and there are no promises, undertakings, representations or warranties
by the Purchasers relative to subject matter hereof and thereof not expressly set forth or
referred to herein or in the other Transaction Documents.
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(k) Governing Laws. All questions concerning the construction, validity,
enforcement and interpretation of this Guarantee shall be governed by and construed and
enforced in accordance with the internal laws of the State of New York, without regard to
the principles of conflicts of law thereof. Each of the Company and the Guarantors agree
that all proceedings concerning the interpretations, enforcement and defense of the
transactions contemplated by this Guarantee (whether brought against a party hereto or its
respective affiliates,
directors, officers, shareholders, partners, members, employees or agents) shall be
commenced exclusively in the state and federal courts sitting in the City of New York,
Borough of Manhattan. Each of the Company and the Guarantors hereby irrevocably submits to
the exclusive jurisdiction of the state and federal courts sitting in the City of New York,
Borough of Manhattan for the adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby or discussed herein, and hereby
irrevocably waives, and agrees not to assert in any proceeding, any claim that it is not
personally subject to the jurisdiction of any such court, that such proceeding is improper.
Each party hereto hereby irrevocably waives personal service of process and consents to
process being served in any such proceeding by mailing a copy thereof via registered or
certified mail or overnight delivery (with evidence of delivery) to such party at the
address in effect for notices to it under this Guarantee and agrees that such service shall
constitute good and sufficient service of process and notice thereof. Nothing contained
herein shall be deemed to limit in any way any right to serve process in any manner
permitted by law. Each party hereto hereby irrevocably waives, to the fullest extent
permitted by applicable law, any and all right to trial by jury in any legal proceeding
arising out of or relating to this Guarantee or the transactions contemplated hereby.
(l) Acknowledgements. Each Guarantor hereby acknowledges that:
(i) it has been advised by counsel in the negotiation, execution and delivery
of this Guarantee and the other Transaction Documents to which it is a party;
(ii) the Purchasers have no fiduciary relationship with or duty to any
Guarantor arising out of or in connection with this Guarantee or any of the other
Transaction Documents, and the relationship between the Guarantors, on the one
hand, and the Purchasers, on the other hand, in connection herewith or therewith is
solely that of debtor and creditor; and
(iii) no joint venture is created hereby or by the other Transaction Documents
or otherwise exists by virtue of the transactions contemplated hereby among the
Guarantors and the Purchasers.
(m) Additional Guarantors. The Company shall cause each of its subsidiaries
formed or acquired on or subsequent to the date hereof to become a Guarantor for all
purposes of this Guarantee by executing and delivering an
Assumption Agreement in the form of Annex 1 hereto.
(n) Release of Guarantors. Each Guarantor will be released from all liability
hereunder concurrently with the indefeasible repayment in full of all amounts owed under
the Purchase Agreement, the Debentures and the other Transaction Documents.
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(o) Seniority. Except for the TD Bank Debt, the Obligations of each of the
Guarantors hereunder rank senior in priority to any other Indebtedness (as defined in the
Purchase Agreement) of such Guarantor.
(p) WAIVER OF JURY TRIAL. EACH GUARANTOR AND, BY ACCEPTANCE OF THE BENEFITS
HEREOF, THE PURCHASERS, HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY
LEGAL ACTION OR PROCEEDING RELATING TO THIS GUARANTEE AND FOR ANY COUNTERCLAIM THEREIN.
*********************
(Signature Pages Follow)
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IN WITNESS WHEREOF, each of the undersigned has caused this Guarantee
to be duly executed and delivered as of the date first above written.
KnowFat Franchise Company, Inc |
||||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Chief Executive Officer | |||
KnowFat Franchise Company, Inc |
||||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Chief Executive Officer | |||
KFLG Watertown, Inc. |
||||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Chief Executive Officer | |||
KnowFat of Landmark Center, Inc |
||||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Chief Executive Officer | |||
KnowFat of Downtown, Inc. |
||||
By: | /s/ Xxxxxx Xxxxxxx | |||
Name: | Xxxxxx Xxxxxxx | |||
Title: | Chief Executive Officer |
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SCHEDULE 1
GUARANTORS
The following are the names, notice addresses and jurisdiction of organization of each
Guarantor.
COMPANY | ||||
JURISDICTION OF | OWNED BY | |||
INCORPORATION | PERCENTAGE | |||
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Annex 1 to
SUBSIDIARY GUARANTEE
SUBSIDIARY GUARANTEE
ASSUMPTION
AGREEMENT, dated as of _____ _____,
_____
made by
__________, a
_____
corporation (the “Additional Guarantor”), in favor of the Purchasers pursuant to the
Purchase Agreement referred to below. All capitalized terms not defined herein shall have the
meaning ascribed to them in such Purchase Agreement.
W I T N E S S E T H :
WHEREAS, UFood Restaurant Group, Inc., a Nevada corporation (the “Company”) and the
Purchasers have entered into a Securities Purchase Agreement, dated
as of [________ _____, 2009 (as
amended, supplemented or otherwise modified from time to time, the “Purchase Agreement”);
WHEREAS, in connection with the Purchase Agreement, the Subsidiaries of the Company (other
than the Additional Guarantor) have entered into the Subsidiary Guarantee, dated as of
[________ _____, 2009 (as amended, supplemented or otherwise modified from time to time, the
“Guarantee”) in favor of the Purchasers;
WHEREAS, the Purchase Agreement requires the Additional Guarantor to become a party to the
Guarantee; and
WHEREAS, the Additional Guarantor has agreed to execute and
deliver this Assumption Agreement in order to become a party to the Guarantee;
NOW, THEREFORE, IT IS AGREED:
1. Guarantee. By executing and delivering this Assumption Agreement, the Additional
Guarantor, as provided in Section 5(m) of the Guarantee, hereby becomes a party to the Guarantee as
a Guarantor thereunder with the same force and effect as if originally named therein as a Guarantor
and, without limiting the generality of the foregoing, hereby expressly assumes all obligations and
liabilities of a Guarantor thereunder. The information set forth in Annex 1 hereto is hereby added
to the information set forth in Schedule 1 to the Guarantee. The Additional Guarantor hereby
represents and warrants that each of the representations and warranties contained in Section 3 of
the Guarantee is true and correct on and as the date hereof as to such Additional Guarantor (after
giving effect to this Assumption Agreement) as if made on and as of such date.
2. Governing Law. THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
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IN WITNESS WHEREOF, the undersigned has caused this Assumption
Agreement to be duly executed and delivered as of the date first above written.
[ADDITIONAL GUARANTOR] |
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By: | ||||
Name: | ||||
Title: | ||||
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