Exhibit 10.12
XXXXX' RIBS FRANCHISE CORP.
AREA DEVELOPMENT AGREEMENT
THIS AGREEMENT made as of November 3, 2003 by and between Xxxxx Ribs Franchise,
Corp., the ("Licensor"), a Florida corporation and Xxxxx' Ribs Canada, Inc., a
Canadian corporation, the ("Sub-Licensor").
DEFINED TERMS
"Exclusive Area" is the geographic area in which the Sub-Licensor has been
granted rights as described herein.
"XXXXX' RIBS(SM) System" or "System" means the unique concept, processes, and
procedures the Licensor has developed and further defined in the Licensor's
confidential operating manual(s).
"Territory Licenses" means the license agreement granting an exclusive
geographic territory that can support at least five (5) XXXXX' RIBS(SM)
restaurants.
"Store Franchise" is one XXXXX' RIBS(SM) restaurant operating under a Franchise
Agreement.
"Trademarks", "Marks", "Service Marks" are those images, logo's, names, etc.
that the Licensor has filed and registered with related government trademark
offices.
"Development Strategy" is the strategy the Licensor is using to sell and service
its XXXXX' RIBS(SM) System as described in Exhibit A attached hereto.
RECITALS
WHEREAS, Licensor, at a substantial expenditure of time, effort and money, has
developed and perfected a system of providing a unique restaurant service
concept called "home meal replacement" serving the consumer public utilizing the
" XXXXX' RIBS(SM) " System, domain and service xxxx and any other service marks
held in conjunction with the XXXXX' RIBS(SM) name collectively hereinafter
referred to as "XXXXX' RIBS(SM)".
AND WHEREAS, the Licensor is developing the XXXXX' RIBS(SM) System in the United
States of America through sale of Territory Licenses whereby each Territory
License is required to open a minimum of five (5) store locations within its
territory in a prescribed period of time, hereinafter referred to as the
"Development Strategy" and is described in Exhibit A.
AND WHEREAS, Sub-Licensor acknowledges Licensor's sole and exclusive ownership
of any rights to Licensor's current and future domain names, trade names,
trademarks and service marks to all current and future related practices,
procedures, methods, devices, techniques and systems.
AND WHEREAS, it is the Licensor's desire to grant this Area Development
Agreement to the Sub-Licensor for the development and sale of Territory Licenses
and Unit Franchises to operators of the Xxxxx Ribs System within said Exclusive
Area.
AND WHEREAS, the Sub-Licensor desires to acquire Exclusive Area rights for the
development and sale of Territory Licenses and Unit Franchises to operators of
the Xxxxx Ribs System within said Exclusive Area under the terms and conditions
described herein.
NOW THEREFORE, in consideration of the premises and the mutual agreements
hereinafter contained, the parties hereto agree as follows:
1. GRANT OF EXCLUSIVE AREA. The Licensor hereby grants the rights to
Sub-Licensor the Exclusive Area, operating rights and use of the System and the
Marks in connection with the XXXXX' RIBS(SM) System in the territory granted and
the Sub-Licensor hereby accepts such rights, upon the terms and subject to
conditions herein set forth in this agreement for the Exclusive Area as
described as follows:
a) The Country of Canada.
2. GRANT TO SELL TERRITORY LICENSES. The Licensor further grants the right to
Sub-Licensor to sell Territory Licenses within his Exclusive Area. The
Sub-Licensor agrees to comply with the Licensor's Development Strategy, which
may be changed from time to time by the Licensor. Approval for one store only
sites shall require special approval by Licensor. All Territory Licenses and
Unit Franchises must require final written approval and acceptance by the
Licensor. Licensor's approval shall not be arbitrarily withheld and this
approval shall be granted if the applicant Territory License or Store Franchise
complies with the specific written requirements in effect at the time of
application. Each Territory License must be obligated to open the first store
within the first six (6) months from date of execution of the Territory License
and open a store every six (6) months thereafter until minimum total is
completed in order to retain the exclusive territory rights for any particular
Territory License.
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3. * "TEXT OMITTED - CONFIDENTIAL TREATMENT REQUESTED."
4. TERRITORY LICENSE FEES, STORE FRANCHISE FEES AND ROYALTIES. The Sub-licensor
agrees to the schedule of fees payable from Territory Licenses and Store
Franchise Fees as described in Exhibit C. All fees are to be paid directly to
the Sub-licensor. Sub-licensor will pay to Licensor Fifty percent (50.0%) of all
royalties received by Sub-licensor from Territory License and Store Franchises
within the Exclusive Area and these payments to the Licensor shall be paid
within five (5) business days of receipt by the Sub-licensor. Sub-Licensor
agrees to the procedures regarding the sale of Territory Licenses and Store
Franchises as described in Exhibit D attached hereto. These procedures may be
changed from time to time, in writing, by mutual consent of the Licensor and
Sub-licensor.
5. SALE OF LICENSOR RETAIL PRODUCTS. Licensor owns and produces, under its
private label XXXXX' RIBS(SM), proprietary products that may from time to time
be sold to consumers through normal distribution channels such as, without
limitation, wholesalers, retailers, Internet, TV shopping. Whenever sales of
said proprietary products are made by Licensor or its affiliate(s) within the
Exclusive Area, Licensor shall provide a monthly accounting of such sales to
Sub-licensor and shall pay to Sub-licensor fifty percent (50.0%) of net profits
derived from said sales. Net Profits are defined as gross sales less any sales
tax, product costs, packaging costs, handling costs, shipping costs, advertising
and marketing expenses, selling commissions, labor and benefits, allocation for
all other operating expenses not exceed 10.0% of gross sales, and allocation of
overhead expenses not to exceed 5.0% of gross sales.
6. COMPLIANCE TO LICENSOR'S AGREEMENTS. Sub-licensor will use the standard
Territory License Agreement, attached as an Exhibit to the Licensor's Franchise
Offering Circular (the "UFOC"), and the standard Store Franchise Agreements,
attached as an Exhibit to the UFOC. Licensor may change or modify these
agreements at any time and Sub-licensor agrees to changes or modifications.
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7. PERFORMANCE. The Sub-licensor agrees to sell the XXXXX' RIBS(SM) System,
utilizing the Company's Development Strategy, Territory Licenses, to include
Store Franchise Agreements, in the geographic area in the numbers, States, and
timing as described in Exhibit E attached hereto.
8. SUB-LICENSOR'S COMMITMENT TO SALES AND SERVICE. Sub-licensor agrees that it
will provide the necessary organization, at its cost, to properly market and
sell Territory Licenses and Store Franchises in the Exclusive Area. Sub-licensor
further agrees that it will provide the necessary organization to service the
Territory Licenses and Store Franchises in the Exclusive Area. The Sub-licensor
agrees to comply with and promote the standards of the Licensor.
9. TRAINING CENTER. Sub-licensor agrees to open, at its cost, a corporate store
and training center in Ontario, Canada no later than June 30, 2004. The
Sub-licensor corporate store and training center will be available to Licensor
and other licensees and franchisees outside of Sub-licensor's territory for
purposes of selling Territory Licenses at no cost to Licensor. The Sub-licensor
corporate store and training center will be available to Licensor and other
licensees and franchisees outside of Sub-licensor's territory for purposes of
training at a cost to be established by Sub-licensor from time to time and to be
reasonable. All fees to be payable in advance of training services.
10. ADVERTISING & PROMOTION. The Sub-licensor will advertise and promote the
sale of the System to potential territory licensee's in the Sub-Licensor
Exclusive Area. From time to time, the Licensor and the Sub-licensor may
co-venture on advertising, trade shows, (etc.) at a shared cost of 50/50,
however, such co-venture will be first approved in writing by both parties.
11. LEAD GENERATION BY LICENSOR. The Licensor may, at its own cost, generate
potential leads for territory licensee's and/or store franchises. The Licensor
will provide said leads to Sub-licensor within his Exclusive Area at no cost to
the Sub-licensor.
12. LIMITATIONS ON USE. The System and the Marks shall be used by the
Sub-Licensor only in connection with the XXXXX' RIBS(SM) System and products
relating thereto and in accordance with such reasonable limitations or
restrictions as may be prescribed from time to time by Licensor. The
Sub-Licensor shall not use the System or the Marks for any other purpose or in
any other manner without the express authorization of Licensor. With the
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exception of the Exclusive Area, the Sub-Licensor acknowledges that the License
is non-exclusive and the Licensor may at any time use the System or any of the
Marks or license the use of the System or any of the Marks to any other persons
or entities for any purpose whatsoever.
Licensor agrees that, during the term of this License, Licensor will not
directly or indirectly, allow a XXXXX' RIBS(SM) System to be operated other than
by the Licensee within the territory granted in paragraph l.
13. PROPRIETARY NOTICES AND REGISTRATION. The Sub-Licensor agrees to use in
conjunction with the System or the Marks all notices or symbols of ownership and
registration as Licensor may specify from time to time. Licensor shall have the
sole right, but not the obligation, to apply for, maintain or renew trademark or
service xxxx registrations for any of the Marks anywhere in the world. In
further consideration of Licensor's grant of the License, the Sub-Licensor
agrees to cooperate fully with Licensor in obtaining or maintaining any such
registrations.
14. OWNERSHIP RIGHTS. The Sub-Licensor agrees and acknowledges that Licensor is
the sole owner of the System and Marks and the Sub-Licensor shall not create in
the License, nor shall the License be construed as assigning to the
Sub-Licensor, any ownership interest or legal or equitable title in or to any of
the System or the Marks. All goodwill associated with the System and the Marks
arising from the Sub-Licensor's use of the System and the Marks shall inure
solely to the benefit of Licensor and not to that of the Sub- Licensor. The
Sub-Licensor shall take no action at any time that would have the effect of
contesting or challenging the validity of Licensor's ownership of, or legal
title in or to, the System or any of the Marks or any registration of any of the
Marks.
15. CONFIDENTIALITY. The Sub-Licensor agrees that all disclosures and
communications of the System and the Marks made by Licensor to the Sub-Licensor,
and not available to the general public or otherwise available to the
Sub-Licensor through means not involving a breach of obligations of
confidentiality, shall be kept confidential and the Sub-Licensor shall not
disclose any information to any persons or entities, except as provided in this
Agreement.
16. DEFENSE OF THE MARKS AND INFRINGEMENTS. Licensor shall have absolute control
of any claim or litigation involving allegations of infringement of the Marks by
third parties. If Sub-Licensor learns of any use by any third party of a trade
name, trademark, service xxxx, logo or any other emblem confusingly similar to
the Marks, Sub-Licensor shall promptly notify Licensor. The Sub-Licensor agrees
to promptly notify Licensor of any potential, threatened or actual claim or
action against the Sub-Licensor or Licensor involving any of the Marks of which
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the Sub-Licensor becomes aware. The Sub-Licensor agrees to cooperate fully with
Licensor in protecting, enforcing and defending Licensor's rights in any of the
Marks. If requested by Licensor, Sub-Licensor shall join with Licensor in such
litigation as, in Licensor's sole discretion and at the cost of the Licensor,
Licensor may deem advisable for the protection of Sub-Licensor's or Licensor's
rights. Sub-Licensor shall not take any action with respect to the Marks, which
is substantially adversarial in nature or not otherwise explicitly permitted
under this Agreement without Licensor's express prior written approval.
17. SUPERVISION AND QUALITY CONTROL. The Sub-Licensor shall ensure that
licensees in his Exclusive Area shall provide services and produce and
distribute products pursuant to the License granted hereunder of high quality in
accordance will all applicable laws and regulations. The use by the licensee of
the System and Marks shall be of a high standard that shall not reflect in any
material adverse manner upon the good name of Licensor, the System or the Marks.
18. ADDITIONAL AGREEMENTS OF THE SUB-LICENSOR. The Sub-Licensor agrees that, at
all times during the term of this Agreement, it shall:
a) Ensure that all products sold by the licensee hereunder is of
high quality and substantially conforms to the method of
service, quality, packaging and other characteristics
specified by Licensor;
b) Maintain or cause to be maintained all literature, brochures,
appearance of employees, etc. in a first-class condition as to
present high quality standards and reputation for the System
and prescribed from time to time by Licensor.
c) Substantially comply will all applicable laws, ordinances,
regulations, rules and other requirements of all applicable
governmental authorities in connection with licensed
activities of the licensee, and
d) Permit Licensor at any and all reasonable times, without prior
notification, to inspect the System, evaluate any and all
operations of the system; interview and meet with any and all
employees and agents of the Licensee in order to assure itself
that the provisions of this Agreement are being observed and
maintained. Licensee agrees to correct any irregularities as
requested, in writing, by Licensor as a result of inspection
within a reasonable time as agreed.
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19. TERM AND TERMINATION. This Area Development Agreement shall be effective so
long as the Sub-Licensor operates the XXXXX' RIBS(SM) System except that this
License may be terminated according to the provisions of this paragraph, and
except that this Territory License may be terminated at anytime by mutual
agreement of Licensor and the Sub-Licensor with no refund of paid territory fee
and or:
a) The License shall terminate automatically immediately after to
the occurrence of any of the following: (i) The Sub-Licensor's
attempt to assign or sublicense, without prior written consent
of Licensor, any of its rights or obligations under the
License of this Agreement; (ii) The Sub-Licensor becoming
insolvent; (iii) The Sub-Licensor making a general assignment
for the benefit of creditors or suffering or permitting the
appointment of a receiver for its business or assets; (iv) The
Sub-Licensor filing a voluntary petition of bankruptcy or
becoming subject to any proceedings under any bankruptcy or
insolvency law, or; (v) The Sub-Licensor or any government
authority taking any action toward suspending or winding up
the business of the Sub- Licensor, dissolving the
Sub-Licensor, or liquidating or distributing substantially all
of the assets of the Sub- Licensor.
b) If the Sub-licensor fails to meet its obligations as defined
in this agreement, except paragraph 7, Exhibit E, and
Paragraph 19 a), then the Licensor at its sole discretion may
find the Sub-licensor in default of the License. Failure to
remedy such default within Thirty (30) days after written
notice or demand by the Licensor, the License shall terminate
automatically.
c) If the Sub-licensor fails to meet its performance as described
in paragraph 7 and Exhibit E, then the Licensor at its sole
discretion may find the Sub-licensor in default of its
Exclusive Area in which the Sub-licensor has not met its
performance obligations. Failure to remedy such default within
Ninety (90) days after receiving written notice or demand by
the Licensor, the portion of the Exclusive Area that is in
default will automatically revert back to the Licensor so the
Licensor may sell that portion of the Exclusive Area to
another party.
20. RIGHTS AND DUTIES UPON TERMINATION. Upon termination of the License for any
reason, all of the Sub-Licensor's right to use the System and the Marks shall
end and the Sub-Licensor shall take immediate action to cease and refrain from
all further use of the System and the Marks; and, the Sub-Licensor shall take
such actions as are necessary to change its name, and any filings for its name
or an assumed or fictitious name, to a name other than one that includes any one
or more of the Marks.
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21. ASSIGNMENT. Licensor may assign this Agreement at any time; provided,
however, that in the event of such assignment, the assignee or other designee of
Licensor shall assume all obligations of Licensor and the Sub-Licensor's rights
hereunder shall remain in full force and effect. The Sub-Licensor shall not
assign its rights or delegate its duties hereunder without the prior written
consent of Licensor.
22. INDEMNIFICATION.
a) By Sub-Licensor. Sub-Licensor agrees to indemnify, defend and
hold harmless the Licensor, its affiliates and its respective
shareholders, directors, officers, employees, agents,
successors, and assignees (the "Indemnified Parties") against
and to reimburse any one or more of the Indemnified Parties
for all claims, obligations and damages described in this
Section, any and all taxes described in this Agreement and any
and all claims and liabilities directly or indirectly arising
out of the operation of the business )even if the
Sub-Licensor's negligence is alleged) or its breach of this
Agreement. Sub-Licensor has the right to defend any such
claims against it. This indemnity will continue in full force
and effect subsequent to and notwithstanding the expiration or
termination of this Agreement. Under no circumstances will the
Licensor or any other Indemnified Party be required to seek
recovery from any insurer or other third party, or otherwise
to mitigate its, their or the Licensor's losses and expenses,
in order to maintain and recover fully a claim against it. The
Licensor agrees that a failure to pursue such recovery or
mitigate a loss will no way reduce or alter the amounts it or
another Indemnified Part may recover from Sub-Licensor.
b) By Licensor. Licensor agrees to indemnify, defend and hold
harmless the Sub-Licensor, its affiliates and its respective
shareholders, directors, officers, employees, agents,
successors, and assignees (the "Indemnified Parties") against
and to reimburse any one or more of the Indemnified Parties
for all claims, obligations and damages described in this
Section, any and all taxes described in this Agreement and any
and all claims and liabilities directly or indirectly arising
out of the operation of the business )even if the Licensor's
negligence is alleged) or its breach of this Agreement.
Licensor has the right to defend any such claims against it.
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This indemnity will continue in full force and effect
subsequent to and notwithstanding the expiration or
termination of this Agreement. Under no circumstances will the
Sub-Licensor or any other Indemnified Party be required to
seek recovery from any insurer or other third party, or
otherwise to mitigate its, their or the Sub-Licensor's losses
and expenses, in order to maintain and recover fully a claim
against it. The Sub-Licensor agrees that a failure to pursue
such recovery or mitigate a loss will no way reduce or alter
the amounts it or another Indemnified Part may recover from
Licensor.
c) Claims. For purposes of this indemnification, "claims"
includes all obligations, damages (actual, consequential or
otherwise) and costs reasonably incurred in the defense of any
claim against any of the Indemnified Parties, including,
without limitation, reasonable accountants', arbitrators',
attorneys', and expert witness fees, costs of investigation
and proof of facts, court costs, other expenses of litigation,
arbitration or alternative dispute resolution and travel and
living expenses
23. OTHER DOCUMENTS AND ACTIONS. Both Licensor and Sub-Licensor shall execute
and deliver any and all other documents and shall take whatever other action
necessary or appropriate to consummate the agreements and understandings
contemplated herein.
24. AMENDMENT. This Agreement may not be amended except by a written instrument
signed by both of the parties hereto.
25. SEVERABILITY. If any provision of this Agreement shall be held invalid or
unenforceable, the remaining provisions of this Agreement shall be unaffected
thereby and shall remain binding and in full force and effect, and in the case
any provision is found to be invalid or unenforceable, each of the parties shall
use its best efforts to find and employ an alternative means to achieve the same
or substantially the same results as the contemplated by such provision.
26. ENFORCEABILITY. If any one or more of the provisions of this Agreement shall
for any reason be held to be excessively broad as to time, duration,
geographical scope, activity, or subject, each such provision shall be
construed, by limiting and reducing it, so as to be enforceable to the extent
compatible with applicable law then in force.
27. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between
the parties and supersedes all prior agreements, representations, warranties,
statements, promises, arrangements and undertakings, whether oral or written,
express or implied, with respect to the subject matter of this Agreement.
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28. GOVERNING LAW. This Agreement shall be governed by, and be construed in
accordance with the laws of the State of Florida in the United States of
America.
29. HEADINGS. The underlined headings of paragraphs in this Agreement are
included for reference only and are not a part of this Agreement.
30. COSTS OF ENFORCEMENT. In the event it is necessary for any party to retain
the services of an attorney to initiate legal proceedings to enforce or
interpret the terms of this Agreement, the prevailing party shall be entitled to
recover from the non-prevailing party, all costs of such enforcement or
interpretation, including reasonable attorney's fees and including costs of
trial and appellate proceedings. Each Party will be responsible for their own
attorney's fees and costs.
31. NOTICES. All notices or other communications provided for herein to be given
or sent to a party by the other party shall be deemed validly given or sent if
in writing and mailed, postage prepaid, by registered or certified United States
mail, addressed to the parties at their addresses set forth below. Either party
may give notice to the other party at any time, by the method specified above,
of a change in the address at which, or the person to whom, notice is to be
addressed:
If to Licensor:
Xxxxx' Ribs Franchise Corp.
Attn: X. X. Xxxxxxxx, Chairman
P.O. Box 14414
Xxxxx, Xxxxxxx 00000
If to Sub-Licensor:
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32. WAIVER. No act, delay, omission or course of dealing between or among the
parties hereto will constitute a waiver of their respective rights or remedies
under this Agreement. No waiver, change, modification or discharge of any of the
rights and duties of the parties hereto will be effective unless contained in a
written instrument signed by the party sought to be bound
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33. COUNTERPARTS. This Agreement may be executed in counterparts, each of which
when so executed shall be deemed to be an original, and such counterparts
together shall constitute one and the same agreement.
34. BINDING EFFECT. This Agreement shall inure to the benefit of and shall be
binding upon the parties hereto, their legal representatives, transfers, heirs,
successors and assigns.
SIGNATURES ON FOLLOWING PAGE
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on their behalf as of the date and year first written above:
(APPLICANT):
XXXXX' RIBS CANADA, INC.
/s/ Xxxxx Xxxxx
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BY: Xxxxx Xxxxx
---------------------------------
Title: Director
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(WITNESS): Xxxx X. Xxxxxxx
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APPROVED BY:
XXXXX RIBS FRANCHISE CORP., (a Florida Corporation) (Licensor)
BY: /s/ Xxxx Xxxxx
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Title: President
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EXHIBIT A
LICENSOR'S DEVELOPMENT & FEE STRATEGY
The Licensor's current strategy to develop the System throughout the world is to
establish Exclusive Territory Licenses in markets that will support a minimum of
five (5) stores. The Territory Licensee must open and operate these stores in
the prescribed period of time.
The Territory License Fee for the territory development rights is determined by
the number of stores agreed upon for a territory multiplied by $20,000.00 per
store with a minimum of five (5) stores. This exclusive Territory License Fee,
in the amount of $100,000.00, is in addition to the franchise fee of each store
site. The Territory License Fee shall be fully earned by Licensor in
consideration of its execution of this agreement. The minimum population of each
territory is 250,000 people.
The Territory Licensee agrees to open a minimum of FIVE (5) STORES within the
specified territory boundaries. The first store must be open within the first
six (6) months from date of the signing of the Territory License and open a
store within every six (6) months thereafter until minimum total is completed in
order to retain the exclusive rights to the territory.
Each store must have a separate Store Franchise Agreement for that particular
site. The franchise fee for each store is $25,000.00 payable immediately upon
Licensor approving each site and the Store Franchise Agreement signed. Each
Store Franchisee is required to pay a royalty of 4% of gross sales and
contribute to a national advertising fund in the amount of 1% of gross sales.
Terms and conditions are described within the standard Store Franchise
Agreement. Licensor may change the standard Store Franchise Agreement from time
to time and the Territory Licensee agrees to execute said standard form.
The Licensor is searching for Territory Licensees who have a proven track record
in multi-unit restaurant and/or retail franchise ownership. Minimum net worth
requirements are $500,000.00.
The Licensor may change the Development Strategy and related fees from time to
time at the sole discretion of the Licensor.
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EXHIBIT B
PROMISSORY NOTE
N.A.
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EXHIBIT C
CURRENT FEES, ROYALTIES, ADVERTISING FUND
Territory Fees $20,000 per store committed
with a minimum of 5 stores plus the
first store franchise fee of $25,000
payable at execution of agreement
Store Franchise Fees $25,000 per store payable upon
Licensors approval of site after
first store.
Royalites 4% of gross sales
National Advertising Fund 1% of gross sales
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EXHIBIT D
SELLING & APPROVAL PROCEDURES
The following are guidelines regarding the procedures of Sub-licensor selling
and obtaining approvals from Licensor.
1. Sub-licensor identifies a candidate that meets the standards
of the Licensor;
2. Sub-licensor completes all the required application forms
along with the appropriate copy of check payable to
Sub-licensor and submits to the Licensor for approval;
3. Licensor will approve or decline application within 10
business days after receiving the application;
4. Upon approval of Licensor, Sub-licensor's attorney prepares
the necessary license/franchise agreements, franchisee signs
said documents and Sub-licensor will then deposit applicants
check in Sub-licensor's bank account;
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EXHIBIT E
PERFORMANCE BY SUB-LICENSOR
To maintain the Exclusive Area, the Sub-licensor must sell and close Territory
Licenses as follows:
1. Within 12 months following the date of this agreement, the
Sub-licensor will have sold and received the related franchise
fees for one (1) Territory Licenses as defined herein;
2. Within 24 months following the date of this agreement, the
Sub-licensor will have sold and received the related franchise
fees for an additional two (2) Territory Licenses as defined
herein achieving a cumulative total of three (3) Territory
Licenses;
3. Within 36 months following the date of this agreement, the
Sub-licensor will have sold and received the related franchise
fees for an additional three (3) Territory Licenses as defined
herein achieving a cumulative total of six (6) Territory
Licenses;
4. Within 48 months following the date of this agreement, the
Sub-licensor will have sold and received the related franchise
fees for an additional four (4) Territory Licenses as defined
herein achieving a cumulative total of ten (10) Territory
Licenses;
5. Within 60 months following the date of this agreement, the
Sub-licensor will have sold and received the related franchise
fees for an additional four (4) Territory Licenses as defined
herein achieving a cumulative total of fourteen (14) Territory
Licenses.
Once the total of fourteen (14) territories have been sold and related franchise
fees received, the Sub-licensor has satisfied its performance obligation as
defined herein.
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