AGREEMENT AND COLLATERAL
ASSIGNMENT OF LEASE
This Agreement and Collateral Assignment is made this ____ day
of January, 1998, by and between VERMONT PURE SPRINGS, INC. (VPS) a Delaware
corporation with its principal place of business in Randolph, Vermont
("ASSIGNOR" or "BUYER") and SAGAMON SPRING WATER OF VERMONT, INC. (SSW), a
Vermont corporation with its principal place of business Rutland, Vermont
("ASSIGNEE" or "SELLER").
BACKGROUND
WHEREAS, VPS is a company engaged in the bottling and sale of
natural spring water with its manufacturing facility and principal place of
business in Xxxxxxxx Center, VT; and,
WHEREAS, SSW is a company, engaged in the bottling and sale of
water with its principal place of business in Rutland, VT, and
WHEREAS, both Parties have entered into an Asset Purchase
Agreement by which VPS shall purchased the business of SSW related to bottled
water, bottling equipments and spring water development, spring water withdrawal
rights and other assets listed on Exhibit A of said Asset Purchase Agreement.
NOW, THEREFORE, in consideration of the foregoing, the
promises made herein and for other good and valuable consideration received, the
parties hereto agree as follows:
Assignment. To secure the payment of all sums due
ASSIGNEE from ASSIGNOR pursuant to Paragraph 2.1(ii) and (iii) of the Asset
Purchase Agreement, Assignor
does hereby grant, transfer and assign to Assignee, Assignor's interest in (but
not their obligations under) Lease Agreement for Mineral Rights ("Lease")
attached hereto as Exhibit "A" to the extent provided in paragraph
2. Lease Rights. Prior to receiving any notice of default under the Note
referenced in paragraph 2.1(iii) of the Asset Purchase Agreement ("Note") from
Assignee, Assignor shall continue to enjoy its rights under the Lease pursuant
to its terms. In the event of a default under the Note, Assignee shall send
notice of default setting forth the amount of the default (ignoring any right of
acceleration contained in the Note) to Assignor by certified mail, return
receipt requested. In the event the default is not cured by the Assignor within
thirty (30) days as of the date of the aforementioned notice, Assignor's rights
in the Lease shall terminate and revert to the Assignee.
The Buyer shall not make any material modifications to or
terminate the Lease without the prior, express written consent of the Seller. If
a modification is made to the Lease, the modified Lease shall also be
collaterally assigned pursuant to the terms of this Assignment herein. Failure
of the Buyer to abide by the provisions of the paragraph shall constitute an
Event of Default.
Termination. This Assignment shall be null and void
at such time as all amounts due to Assignee under the Note have been paid.
Other Agreements Unaffected. No exercise of rights by the Assignee pursuant to
the terms of this Agreement and Collateral Assignment shall affect its
obligations to
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Assignor pursuant to that certain Asset Purchase Agreement by and between
Assignor and Assignee.
Notices. All notices required or permitted hereunder
shall be in writing and shall be deemed to be properly given when sent by
certified, postage prepaid, properly addressed to the party in time to receive
such notice at the address stated below:
Vermont Pure Springs, Inc.
Xxxxx 00
Xxxxxxxx Xxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx
Facsimile (000) 000-0000
With Copy to: Xxxxx X. Xxxxx, Esquire
Ledgewood Law Firm
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
To Seller: Sagamon Spring Water of Vermont
X.X. Xxx 000
Xxxxxxx, XX 00000
Attention: Xxxx Xxxxxxxxx and Xxx Xxxxx
6. GOVERNING LAW. This Agreement shall be construed,
interpreted and enforced in accordance with the laws of the State of Vermont
without regard to its conflicts of law.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement and Collateral Assignment as of the day, month and year first written
above.
WITNESS: VERMONT PURE SPRINGS, INC.
______________________ By:
Name:
Title:
SAGAMON SPRING WATER
OF VERMONT, INC
WITNESS:
By:
_______________________ Name:
Title:
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