COLLATERAL ASSIGNMENT AND ASSUMPTION OF LEASE TO EVOS USA, INC. DATED DECEMBER 14, 2005
EXHIBIT
10.3
COLLATERAL
ASSIGNMENT AND ASSUMPTION OF LEASE
TO
EVOS USA, INC. DATED DECEMBER 14,
2005
COLLATERAL
ASSIGNMENT AND ASSUMPTION OF LEASE
THIS
COLLATERAL ASSIGNMENT AND
ASSUMPTION OF LEASE (this “Assignment”) is effective
as of the effective date of the Lease (as defined below), between and among
EVOS USA, INC., a Florida corporation with its principal place
business at 000 Xxxxx Xxxxxx Xxxxxx, Xxxxx, Xxxxxxx 00000
(“we,” “us,” “our” or the
“Franchisor”),
and, HEALTHY FAST FOOD, Inc.,
whose current principal place of business is 0000 Xxxxxxxx Xxxxxxx – Xxxxx X,
Xxxxxxxxx, XX 00000 (“you”, “your” or the
“Franchisee”). You and we are sometimes
referred to
collectively as the “parties” or individually as a
“party.”
BACKGROUND
INFORMATION
We
entered into that certain Franchise
Agreement (the “Franchise Agreement”) effective as of December
14, 2005, with you, pursuant to which you plan to own and operate a franchised
EVOS® Restaurant (“EVOS® Restaurant”) located at
___________________________________________ (the
“Site”). In addition, pursuant to that certain Lease
Agreement (the “Lease”), you have leased or will lease certain
space containing the Site described therein from ___________________________
(the “Lessor” or “Landlord”). The
Franchise Agreement requires you to deliver this Assignment to us before you
open your EVOS® Restaurant and commence business.
OPERATIVE
TERMS:
We
and you agree as follows:
1. Background
Information. The background information is true and
correct. This Assignment will be interpreted by reference to, and
construed in accordance with, the background information. Terms not
otherwise defined in this Assignment will have the meanings as defined in the
Lease.
2. Indemnification. You
agree to indemnify and hold us and our affiliates, stockholders, directors,
officers and representatives (collectively, the “Indemnified
Parties”) harmless from and against any and all losses, liabilities,
claims, proceedings, demands, damages, judgments, injuries, attorneys’ fees,
costs and expenses that any of the Indemnified Parties incur as a result of
any
claim brought against any of the Indemnified Parties or any action which any
of
the Indemnified Parties are named as a party or which any of the Indemnified
Parties may suffer, sustain or incur by reason of, or arising out of, your
breach of any of the terms of the Lease, including the failure to pay rent
or
any other terms and conditions of the Lease.
3. Collateral
Assignment. You grant to us a security interest in and
to the Lease, all of the furniture, removable trade, fixtures, inventory,
licenses and supplies located in the Site and the franchise relating to your
EVOS® Restaurant, and all of your rights, title and interest in and to the Lease
as collateral for: (a) the payment of any obligation, liability or
other amount owed by you or your affiliates to the Lessor arising under the
Lease; (b) for any default or breach of any of the terms and provisions of
the
Lease; and (c) for any default or breach of any of the terms and provisions
of
the Franchise Agreement. The term “Collateral” shall specifically
exclude any items which are fixtures and thus property of the landlord under
Florida law and any personal property or other items owned by
Landlord. In the event of a breach or default by you under the terms
of the Lease, or in the event we make any payment to the Lessor as a result
of
your
breach of the
Lease, then such payment by us, or such breach or default by you, will at our
option be deemed to be an immediate default under the Franchise Agreement,
and
we will be entitled, subject to Section 16 hereof, to the possession of the
Site
and to all of your rights, title and interest in and to the Lease and to all
other remedies described herein, in the Franchise Agreement or at law or in
equity, without prejudice to any of our other rights or remedies under any
other
agreements or under other applicable laws or equities. This
Assignment will constitute a lien on your interest in and to the Lease until
satisfaction in full of all amounts owed by you to us. In addition,
our rights, as provided by this Assignment, to assume all obligations under
the
Lease are totally optional on our part, to be exercised in our sole
discretion. You will execute any and all Uniform Commercial Code
financing statements and all other documents and instruments deemed necessary
by
us to perfect or document the interests and assignments granted
herein.
4. No
Subordination. Other than the lien created by this
Assignment, the Franchise Agreement, the Lessor’s lien under the Lease, liens
securing bank financing for your operations in the Site, and the agreements
and
other instruments referenced herein, and any mortgage debt of the Lessor
(provided Lessor’s mortgagee enters into a non-disturbance agreement), you will
not permit the Lease to become subordinate to any lien without first obtaining
our written consent. You will not terminate, modify or amend any of
the provisions or terms of the Lease without our prior written
consent. Any attempt at termination, modification or amendment of any
of the terms without such written consent will be null and void.
5. Exercise
of Remedies. Subject to Section 16 hereof, we will be
entitled to exercise any one or more of the following remedies in our sole
discretion in the event of any default by you under the terms of the Lease
or
the Franchise Agreement:
(a) to
take possession of the Site, or any part thereof, personally, or by our agents
or attorneys;
(b) to,
in our discretion, without notice and with or without process of law, enter
upon
and take and maintain possession of all or any part of the Site, together with
all of your furniture, fixtures, inventory, books, records, papers and
accounts;
(c) to
exclude you, your agents or employees from the Site;
(d) as
attorney-in-fact for you, or in our own name, and under the powers herein
granted, to hold, operate, manage and control the EVOS® Restaurant and conduct
the business, if any, thereof, either personally or through our agents, with
full power to use such legally rectifiable measures which may, in our sole
discretion, be deemed proper or necessary to cure such default, including
actions of forcible entry or detainer and actions in distress of rent, hereby
granting full power and authority to us to exercise each and every of the
rights, privileges and powers herein granted at any and all times
hereafter;
(e) to
cancel or terminate any unauthorized agreements or subleases you entered into,
for any cause or ground which would entitle us to cancel the same;
(f) to
disaffirm any unauthorized agreement, sublease or subordinated lien and, with
Lessors consent, which shall not be unreasonably withheld, conditioned, or
delayed, to make all necessary or proper repairs, decorations, renewals,
replacements, alterations, additions, betterments and improvements to the Site
that are in our sole discretion judicious;
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(g) to
insure and reinsure the same for all risks incidental to our possession,
operation and management thereof; and/or
(h) notwithstanding
any provision of any agreement to the contrary, to declare all of your rights
but not obligations under the Franchise Agreement to be immediately terminated
as of the date of your default under the Lease.
If
Franchisor
exercises its rights hereunder and removes fixtures and personalty from the
Site, Franchisor shall repair any damage caused by Franchisor in connection
with
such removal.
6. Power
of Attorney. You irrevocably appoint us as your true and
lawful attorney-in-fact and authorize us, upon any default under the Lease
or
under the Franchise Agreement, with or without taking possession of the Site,
to
operate, rent, lease, and manage the Site to or by any person, firm or
corporation upon such terms and conditions as we may determine in our
discretion, and with the same rights and powers and immunities, exoneration
of
liability and rights of recourse and indemnity as we would have upon taking
possession of the Site pursuant to the provisions set forth in the Lease and
this Assignment. The power of attorney conferred upon us pursuant to
this Assignment is a power coupled with an interest and cannot be revoked,
modified or altered without our written consent.
7. Election
of Remedies. The provisions set forth in this Assignment
will be deemed a special remedy given to us and will not be deemed to exclude
any of the remedies granted in the Franchise Agreement or any other agreement
between you and us, but will be deemed an additional remedy and will be
cumulative with the remedies therein and elsewhere granted to us, all of which
remedies will be enforceable concurrently or successively. No
exercise by us or any of the rights hereunder will cure, waive or affect any
default hereunder or default under the Franchise Agreement. No
inaction or partial exercise of rights by us will be construed as a waiver
of
any of our rights and remedies and no waiver by us of any such rights and
remedies will be construed as a waiver by us of any future rights and
remedies.
8. Copies
of Reports. Franchisee hereby agrees that it will
provide to Franchisor copies of all reports and information that Franchisee
must
provide to Landlord under the Lease. Franchisee expressly permits the
Lessor to deliver to us all reports and information that you must provide it
under the Lease. The Lessor agrees to send us copies of such reports
on a timely basis, upon written request, but no more than twice per calendar
year during the term of the Lease. Any agreement that is made between
Landlord and Franchisee shall contain such language as to provide for the timely
and regular reporting of such information to Franchisor and notice of any and
all delinquency or defaults by Franchisee under the Lease or pending forfeiture
of Franchisee’s rights under the Lease.
9. Binding
Effect. This Assignment and all provisions herein will
be binding upon and inure to the benefit of the parties and their respective
successors-in-interest, heirs, and successors and assigns, except as otherwise
provided herein. All individuals executing on behalf of entities,
corporate or otherwise, hereby represent and warrant that such execution has
been duly authorized by all necessary authorizations and approvals.
10. Assignment
to Control. This Assignment will govern and control over
any conflicting provision in the Lease; provided that this agreement shall
in no
way limit or abridge the rights of Lessor under the Lease except as otherwise
provided herein.
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11. Attorney’s
Fees, Etc. In any action or dispute, at law or in
equity, that may arise under or otherwise relate to this Assignment, the
prevailing party will be entitled to reimbursement of its attorneys’ fees, costs
and expenses from the non-prevailing party. The term
“attorneys’ fees” means any and all charges levied by an
attorney for his or her services including time charges and other reasonable
fees including paralegal fees and legal assistant fees and includes fees earned
in settlement, at trial, appeal or in bankruptcy proceedings and/or in
arbitration proceedings.
12. Severability. If
any of the provisions of this Assignment or any section or subsection of this
Assignment are held invalid for any reason, the remainder of this Assignment
or
any such section or subsection will not be affected thereby and will remain
in
full force and effect in accordance with its terms.
13. Governing
Law and Forum. This Assignment and the rights and
obligations of the parties hereunder shall in all respects be governed by,
construed, and enforced in accordance with the laws of the State of Florida
except to the extent of procedural and substantive matters relating only to
the
creation, perfection, foreclosure, and enforcement of rights and remedies
against the Site, which such matters shall be governed by the laws of the State
where the Site is located.
The
parties hereby agree that any action
relating to this Assignment (other than those procedural and substantive matters
regarding the foreclosure and enforcement of right and remedies against the
Site) shall be brought in the State of Federal Courts of general jurisdiction
in
the Hillsborough County, Florida; and the parties irrevocably submit to the
jurisdiction of such courts and waive any objection they may have to either
the
jurisdiction or venue of such court.
14. Headings. The
headings contained in this Assignment are for convenience of reference only
and
must not in any way modify or limit the meaning or interpretation of this
Assignment.
15. Pronouns
and Gender. All terms and words used in this Assignment,
regardless of the number or gender in which they are used, will be deemed and
construed to include any other number, singular or plural, and any other gender,
masculine, feminine or neuter, as the context or sense of this Assignment or
any
section, subsection, paragraph or clause may require, as if such words had
been
fully and properly written in the appropriate number and gender.
16. Franchisor’s
Option of Assumption. Landlord hereby consents to
Franchisor’s assumption of all of Franchisee’s rights and obligations under the
Lease upon the occurrence of either of the following events under the terms
and
conditions set forth herein:
(a) Default
of Franchisee under the Lease: Landlord shall
immediately send to Franchisor notice of default by Franchisee under the Lease,
regardless of whether or not Landlord is obligated to deliver such notice to
Franchisee under the Lease. If Franchisee fails to cure the default
within the period specified within the Lease, then Landlord shall, within one
business day following the expiration of such cure period, give Franchisor
written notice thereof, specifying the default Franchisee has failed to cure,
and shall offer Franchisor the option to assume Franchisee’s interest in the
Lease (the “Assumption Notice”) so long as Franchisor cures
Franchisee’s defaults capable of being cured by Franchisor. Landlord
shall attach a complete copy of the Lease and any amendments thereto to the
Assumption Notice. If Franchisor accepts the Assumption Notice,
Franchisor must send written notice of its
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acceptance
to
Landlord and Franchisee (the “Acceptance”) within fifteen (15)
business days after receipt of the Assumption Notice from
Landlord. Failure of Franchisor to send the Acceptance shall
constitute a waiver of Franchisor’s right to assume the Lease. In the
event that Franchisor accepts the Assumption Notice, then Franchisor, in order
for the offer and acceptance thereof to remain in full force and effect, must
cure the Franchisee’s defaults that are capable of being cured by Franchisor
within five (5) business days of such acceptance (if such default is monetary),
or within thirty (30) days of such acceptance if such default is
non-monetary. If Franchisor is not capable of curing such
non-monetary default during said thirty (30) days, an extension of an additional
thirty (30) days shall be granted provided Franchisor is diligently pursuing
such cure. Failure of Franchisor to effect such cure within such time
periods shall constitute a rejection of the Assumption Notice.
(b) Upon
Termination of the Franchise Agreement. If during the
term of the Lease or any extensions thereof, Franchisor notifies Landlord,
in
writing, that Franchisee’s Franchise Agreement with Franchisor has been
terminated, then Landlord shall promptly give Franchisor written notice
specifying any defaults, if any, of the Franchisee under the Lease, and shall
offer Franchisor the option to assume all of Franchisee’s interest in the Lease
in accordance with the terms and conditions of 16(a) hereof.
17. Assignment
to Franchisor. In the event Franchisor elects to assume
Franchisee’s interest in the Lease in accordance with the terms set forth in
Section 16 hereof, Franchisee shall promptly vacate the premises and Landlord
shall promptly deliver possession of the same to Franchisor provided that
Franchisor has executed and delivered an assignment and assumption agreement
to
Landlord, in a form mutually agreeable to Landlord and Franchisor, and has
agreed to cure all of Franchisee’s defaults capable of being cured by the
Franchisor. Franchisee agrees that Landlord is not liable and shall
indemnify and hold Landlord harmless in the event that Landlord transfers
interest in the Lease to Franchisor in accordance with either (a) or (b)
above. After Franchisor assumes Franchisee’s interest under the
Lease, Franchisor may, at any time, assign such interest or sublet the premises
to one of its Franchisees upon written notice to Landlord, provided such
franchisee is of same, or greater, net worth as Franchisee
hereunder. Upon such transfer, Franchisor will have no further
liability or obligation to Landlord under the Lease accruing after such
transfer, and Landlord shall deliver to Franchisor a Collateral Assignment
and
Assumption of Lease Agreement in a form substantially similar to this
Agreement.
18. Amendment
of Lease. Franchisee shall not cancel, terminate,
modify, or amend the Lease without Franchisor’s prior written consent, which
shall not be unreasonably withheld. Franchisor hereby agrees to
respond to a request for approval of an amendment of the Lease within ten (10)
business days after receipt of such request. Franchisor’s failure to
respond to such request within the ten (10) business day period shall be deemed
an approval of the requested amendment.
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IN
WITNESS WHEREOF, the
parties have caused this Assignment to be executed as of the day and year first
above written.
| Witnesses as to Franchisor: | THE "FRANCHISOR": | |||
| EVOS USA, INC. | ||||
| 000 Xxxxx Xxxxxx Xxxxxx, Xxxxx, XX 00000 | ||||
| Print Name: | (000) 000-0000 | |||
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Title:
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Name: Date:
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| Print Name: | Signature: | |||
| (SEAL) |
| Witnesses as to Franchisee: | THE "FRANCHISEE": | |||
| HEALTHY FAST FOOD, INC. | ||||
| /s/ Xxxxxx Hagaer | Address of Note: 1075 American Pacific-Suite C, | |||
| Print Name: Xxxxxx Hagaer | Xxxxxxxxx, XX 00000 | |||
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Title:
President
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/s/
Xxxxxxx Xxxxxxxxx
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Name: Xxxxxxx
Xxxxxx Date: 12/14/05
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| Print Name: Xxxxxxx Xxxxxxxxx | Signature: /s/ Xxxxxxx X. Xxxxxx | |||
| (SEAL) |
The
Lessor hereby
consents, agrees with, approves of and joins in with this COLLATERAL ASSIGNMENT
AND ASSUMPTION LEASE.
| Witnesses as to Lessor: | THE "LESSOR": | |||
| Address of Note: | ||||
| Print Name: | ||||
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Title:
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Name:
Date:
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| Print Name: | Signature: | |||
| (SEAL) |
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