This Note and the indebtedness evidenced hereby are subject to the terms of that certain Subordination Agreement between the Lender and TD Banknorth, N.A. dated as of September 24, 2007 (the “Subordination Agreement”) and this Note and the...
This
Note and the indebtedness evidenced hereby are subject to the terms of that
certain Subordination Agreement between the Lender and TD Banknorth, N.A. dated
as of September 24, 2007 (the “Subordination Agreement”) and this Note and the
indebtedness evidenced hereby are subordinated in the manner and to the extent
set forth in such Subordination Agreement, and each holder of this Note, by
its
acceptance hereof, shall be bound by the subordination provisions of the
Subordination Agreement.
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$965,000.00
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October
4, 2007
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FOR
VALUE
RECEIVED, KNOWFAT FRANCHISE COMPANY, INC., a Delaware corporation (hereinafter
called the “Borrower”), hereby promises to pay to the order of UFOOD RESTAURANT
GROUP, INC. (f/k/a UFood Franchise Company), a Nevada corporation (hereinafter
called the “Lender”), c/o Gottbetter & Partners LLP, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇
▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, the principal sum of Nine Hundred Sixty Five Thousand
Dollars ($965,000.00) (the “Loan”), in lawful money of the United States of
America and in immediately available funds.
1. The
outstanding principal balance of this Note, together with accrued and unpaid
interest thereon, shall be due and payable on February 1, 2008 (the “Due Date”),
which Due Date may be extended by the Borrower and the Lender in writing;
provided,
however,
that
upon the consummation of a merger between the Borrower and the Lender, or an
affiliate of the Lender (the “Merger”), all
indebtedness evidenced hereby shall be deemed canceled and paid in
full.
2. This
Note
shall bear interest at the rate of nine percent (9%) per annum on the unpaid
principal balance hereof. Interest shall be calculated on the basis of a year
of
three hundred sixty (360) days applied to the actual days on which there exists
an unpaid balance under this Note.
3. Interest
only shall be payable monthly in arrears, commencing thirty (30) days from
the
date hereof. Thereafter, on the first business day of each month through and
including the month in which the Due Date occurs, the Borrower shall pay monthly
installments of interest only.
4. Upon
an
“Event of Default,” as defined in the Bridge Loan Agreement described below, the
rate of interest accruing on the unpaid principal balance of this Note shall
increase to fifteen percent (15%) per annum. Such default interest rate shall
continue until all defaults are cured.
5. This
Note
is subject to the terms of a Bridge Loan Agreement (the “Bridge Loan Agreement”)
dated September 24, 2007 by and among the Borrower and the Lender. All
capitalized and undefined terms herein shall have the meaning given them in
the
Bridge Loan Agreement.
6. The
payment of the principal of and interest on this Note is subordinated, to the
extent and in the manner provided for in the Subordination Agreement, to the
prior full, final and indefeasible payment of the Senior Indebtedness (as
defined in the Subordination Agreement).
7. Upon
the
occurrence of an Event of Default under the Bridge Loan Agreement, the entire
principal amount outstanding hereunder and all accrued interest hereon, together
with all other sums due hereunder, shall, as provided in the Bridge Loan
Agreement, become immediately due and payable.
Notwithstanding
the foregoing, if an Event of Default is cured (or waived by the Lender), the
Borrower shall use its reasonable best efforts to ensure that the Merger and
the
Transactions are consummated.
8. In
addition to the rights and remedies given it by this Note, the Lender shall
have
all those rights and remedies allowed by applicable laws. The rights and
remedies of the Lender are cumulative and recourse to one or more right or
remedy shall not constitute a waiver of the others. The Borrower shall be liable
for all commercially reasonable costs, expenses and attorneys’ fees incurred by
the Lender in connection with the collection of the indebtedness evidenced
by
the Note.
9. To
the
extent permitted by applicable law, the Borrower waives all rights and benefits
of any statute of limitations, moratorium, reinstatement, marshalling,
forbearance, valuation, stay, extension, redemption, appraisement and exemption
now provided or which may hereafter by provided by law, both as to itself and
as
to all of its properties, real and personal, against the enforcement and
collection of the indebtedness evidenced hereby.
10. All
notices, requests, demands, and other communications with respect hereto shall
be in writing and shall be delivered by hand, sent prepaid by a
nationally-recognized overnight courier service or sent by the United States,
certified, postage prepaid, return receipt requested, at the addresses
designated in the Bridge Loan Agreement or such other address as the parties
may
designate to each other in writing.
11. This
Note
or any provision hereof may be waived, changed, modified or discharged only
by
agreement in writing signed by the Borrower and the Lender. The Borrower may
not
assign or transfer its obligation hereunder without the prior written consent
of
the Lender.
12. The
term
“the Borrower” shall include each person and entity now or hereafter liable
hereunder, whether as maker, successor, assignee or endorsee, each of whom
shall
be jointly, severally and primarily liable for all of the obligations set forth
herein.
13. If
any
provision of this Note shall for any reason be held invalid or unenforceable,
such invalidity or unenforceability shall not affect any other provision of
this
Note, but this Note shall be construed as if this Note had never contained
the
invalid or unenforceable provision.
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14. This
Note
shall be governed by and construed in accordance with the domestic laws of
the
State of New York, without giving effect to any choice of law provision or
rule.
Any controversy or dispute arising out of or relating to this Note shall be
settled solely and exclusively in accordance with the provisions of the Bridge
Loan Agreement, which provisions are incorporated by reference herein as though
fully set forth.
[Remainder
of Page Intentionally Left Blank]
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IN
WITNESS WHEREOF, the undersigned Borrower has caused the due execution of this
Bridge Loan Promissory Note as of the day and year first herein above written.
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KNOWFAT
FRANCHISE COMPANY, INC.
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By:
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Name:
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▇▇▇▇▇▇
▇▇▇▇▇▇▇
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Title:
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Chairman
and Chief Executive Officer
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