CONTRACT MADE AND ENTERED INTO AS OF THE 2ND DAY OF APRIL 2001 AT THE PLACES
INDICATED HEREINBELOW
BY AND BETWEEN:
DONINI, INC.
a New Jersey corporation, duly incorporated
and validly existing according to law,
having a registered office at 4555 des
Grandes Prairies Blvd., Suite 30, in the
City of St. Xxxxxxx, Province of Quebec, H1R
1A5, herein duly represented by Xx. Xxxxx
Xxxxx, its representative, duly authorized
for these purposes as he so declares,
hereinafter referred to as "DONINI"
AND: XX. XXXX XXXXXXX, businessman, residing and
domiciled at 0000 X. Xxxxxxxxx Xxxxx,
Xxxxxxx, Xxxxxxx, X.X.X. 00000.
hereinafter referred to as "XXXX"
AND: XX. XXXXXX XXXXX, businessman, residing and
domiciled at 0000 Xxxxxxxxxx Xx., Xxxxxxx,
Xxxxxxx, X.X.X. 00000.
hereinafter referred to as "XXXXXX"
AND: ZSQUARED, LLC
a limited liability company, duly organized
and validly existing under the laws of
Georgia, U.S.A., herein represented by Xx.
Xxxxxx Xxxxx, its co-manager, duly
authorized as he so declares,
hereinafter referred to as "ZSQUARED"
(XXXX, XXXXXX and ZSQUARED are sometimes
referred herein as the "AGENTS")
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WHEREAS DONINI has acquired the shares of Pizza Donini Inc., a Canadian
corporation and is in the process of becoming listed on Nasdaq for the purpose
of selling its stock on the Over-the-Counter bulletin board;
WHEREAS the AGENTS have provided to Pizza Donini Inc. certain marketing and
sales services since November 2000;
WHEREAS, upon the date on which the shares of DONINI begin trading on the
Over-the-Counter Bulletin Board or Nasdaq (the "effective date"), the AGENTS
wish to provide certain marketing and sales services to DONINI, its subsidiaries
and affiliates;
WHEREAS DONINI wishes to engage the services of the AGENTS as of the effective
date, under the terms and conditions provided herein.
1. The preamble shall form an integral part of this Agreement.
2. DONINI shall engage the services of the AGENTS for a period of three
(3) years commencing on the effective date and terminating thirty-six
(36) months thereafter.
3. The AGENTS shall provide to DONINI, its affiliates and subsidiaries
such marketing and sales services as DONINI shall require in order to
establish and expand the market presence of "Pizza Donini" products and
services within the United States of America, to the best of their
abilities. Where the AGENTS fail to provide consulting and advisory
services pursuant to the terms hereof at any time, DONINI shall be
entitled to reasonably amend the present Agreement.
4. The AGENTS shall receive, over the term of their agreement, and in
lieu of remuneration for services rendered, the following shares in the
capital stock of DONINI:
a) as of the date hereof, XXXXXX shall receive, in his capacity as
AGENT to DONINI, SEVENTY-FIVE THOUSAND (75,000) shares of common
stock of DONINI, as fully paid and non-assessable;
b) as of the date hereof, XXXX shall receive, in his capacity as
director of DONINI, SEVENTY-FIVE THOUSAND (75,000) shares of common
stock of DONINI, as fully paid and non-assessable;
c) on or before August 30th, 2001, DONINI shall issue to each of XXXX
and XXXXXX, in their capacity as AGENTS to DONINI, SEVENTY-FIVE
THOUSAND (75,000) shares common stock of DONINI, as fully paid and
non-assessable;
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d) on or before August 30th, 2001, DONINI shall issue to each of XXXX
and XXXXXX, in their capacity as AGENTS to DONINI, an additional
ONE HUNDRED AND FIFTY THOUSAND (150,000) common shares of DONINI,
as fully paid and non-assessable.
e) In the event that any of the AGENTS shall cease to provide any of
the services outlined after the commencement date but prior to the
issuance of the shares provided in subparagraph d) above, XXXX and
XXXXXX shall forfeit the right to receive the shares outlined in
sub-paragraph d) above.
f) All shares so issued shall be subject to all applicable federal and
state securities legislation, regulation and policy, including all
rules regarding the disposition of shares by insiders.
5. In addition to the above, DONINI shall reimburse or ensure that the
AGENTS be reimbursed for any out of pocket expenses incurred by them,
provided that prior to incurring such expenses, DONINI shall have
approved same. The AGENTS must submit, together with their claim for
reimbursement, such invoices, vouchers, cash register slips or other
items as DONINI, its affiliates or subsidiaries shall reasonably
require.
6. In recognition of services rendered and provided that the AGENTS are
continuing to act for DONINI as provided herein, they shall also
receive from DONINI certain stock options, the whole as detailed more
fully hereinbelow, which options and the shares that may be issued
pursuant thereto shall be subject to all applicable securities laws,
regulations and policies, including all rules regarding the
disposition of shares by insiders:
a) ninety-one (91) days following the effective date, each of XXXX and
XXXXXX shall receive an option to purchase SIXTY-FIVE THOUSAND
(65,000) shares of common stock of DONINI, at a price equal to
seventy-five percent (75%) of the five (5) day average trading
price immediately following the first ninety (90) days of trading
of the common stock of DONINI on the Over-the-Counter Bulletin
Board or Nasdaq (the "exercise price"), provided however that the
exercise price of the stock is not less than fifty percent (50%) of
the average of the five (5) highest closing prices during the
ninety (90) day period immediately following commencement of
trading. The option so granted may be exercised at any time between
the 96th day following the effective date and twenty-four months
following the granting of the option.
b) Twelve (12) months following the granting of the option described
in subparagraph 6a) hereof, each of XXXX and XXXXXX shall receive
an option to purchase ONE HUNDRED AND TWENTY-FIVE THOUSAND
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(125,000) shares of common stock of DONINI at a price equal to
seventy-five percent (75%) of the five (5) day average trading
price of the stock immediately following the granting of the option
described in this sub-paragraph (the "exercise price"), provided
however that the exercise price of the stock is not less than fifty
percent (50%) of the average of the five (5) highest closing prices
during the ninety (90) day period immediately following
commencement of trading. The option so granted may be exercised at
any time within twenty-four (24) months following the granting of
the said option.
c) Twenty-four (24) months following the granting of the option
described in subparagraph 6a) hereof, each of XXXX and XXXXXX shall
receive an option to purchase ONE HUNDRED AND NINETY THOUSAND
(190,000) shares of common stock of DONINI at a price equal to
seventy-five percent (75%) of the five (5) day average trading
price of the stock immediately following the granting of the option
described in this sub-paragraph on the Over-the-Counter Bulletin
Board or Nasdaq (the "exercise price"), provided however that the
exercise price of the stock is not less than fifty percent (50%) of
the average of the five (5) highest closing prices during the
ninety (90) day period immediately following commencement of
trading. The option so granted may be exercised at any time within
twenty-four (24) months following the granting of the said option;
d) In the event that the AGENTS shall cease to provide any of the
services outlined hereunder prior to the granting of any of the
options described in this paragraph 6 then XXXX and XXXXXX shall
forfeit the right to receive any option hereunder that has yet to
be granted by DONINI. In addition, where the AGENTS have ceased to
provide any of the services outlined herein within six (6) months
of the granting of any option hereunder, XXXX and XXXXXX shall
remit to DONINI for cancellation any option or portion thereof,
prorated to the amount of service provided by the AGENTS, or any of
them, in that year;
7. During the term hereof XXXX shall be appointed to the Board of
Directors of DONINI. DONINI shall provide reasonable directors'
liability insurance and shall assume such reasonable expenses incurred
by XXXX in respect of his duties as a director.
8. The AGENTS undertake to devote such time and effort as is mutually
agreed in order to diligently provide the services specified herein.
During the first twelve (12) months of the term of the agreement, the
AGENTS, either together or separately, shall attend a minimum of one
(1) day per month in planning meetings or such number of meetings as
DONINI may require, up to four (4) or five (5) days per month.
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9. DONINI and the AGENTS shall enter into a brokerage agreement, the terms
of which shall be mutually acceptable to the parties in respect of the
sale of the products listed in Schedule "A" annexed hereto (the
"Products") within the United States of America, pursuant to which the
AGENTS shall receive a commission equal to between one percent (1%) and
four percent (4%) of any sums received by DONINI, its affiliates or
subsidiaries, in respect of sales of the Products introduced or sold
directly through the AGENTS' efforts. The total commission payable to
the AGENTS in each instance shall be determined by DONINI on a
case-by-case basis and, in any event, the total commission payable by
DONINI, its subsidiaries and affiliates to any parties shall not exceed
five percent (5%) of the amounts received by DONINI, its affiliates or
subsidiaries in respect of the sales of the Products. Where the AGENTS
fail to provide a business-to-business plan within five (5) months
following the effective date, DONINI shall be entitled to reasonably
amend the present Agreement.
10. In the event that DONINI shall decide to open a U.S. national sales
office in Atlanta, Georgia, the AGENTS shall be responsible for setting
up the sales office. All plans, expenses and other material aspects in
setting up a DONINI national sales office in the U.S. shall be subject
to the prior express approval of DONINI and shall be at its expense.
The AGENTS shall be responsible for hiring national sales staff for the
DONINI U.S. national sales office, the whole upon the prior express
consent of DONINI.
11. The AGENTS shall have the right to open a "Pizza Donini" franchise
location during the term of the agreement in a mutually acceptable
location in Atlanta, Georgia. The financing for the building, equipping
and opening of the said location shall be arranged by TTByrne Capital
Investment Inc. or its nominee and the franchisee shall be controlled
by Xx. Xxxxxxx Xxxxx, Xx.. The franchisee shall not be liable for any
initial franchise fee in respect of this location, however the
franchisee shall pay such royalties and other fees normally payable by
"Pizza Donini" franchisees. The franchisee shall execute the standard
form Franchise Agreement and ancillary documents for the United States.
12. The AGENTS shall be granted a master franchise agreement for the
territory consisting of the state of Georgia (the "Territory"), and
shall have the right to sub-franchise to qualified persons or entities
the right and license to operate "Pizza Donini" restaurants under such
terms and conditions as are stipulated by DONINI, its affiliates and
subsidiaries. The AGENTS shall receive ten percent (10%) of the amount
of any initial franchise fee received by DONINI, its affiliates or
subsidiaries in respect of such sub-franchises as commission for the
sale of the said franchises and ten percent (10%) of any royalties
received in respect of such franchises. In addition to the Territory,
DONINI shall grant to the AGENTS a right of first refusal to acquire
master franchise rights for the states of Alabama, Tennessee, South
Carolina, North Carolina and Florida during the term of the agreement.
The parties shall enter into such master franchise agreement(s) as
Page 5 of 8
shall be required, which agreement(s) shall contain such terms and
conditions as are usually contained in similar agreements, including
provisions for the payment of master franchise fees, royalties and
other fees to DONINI. Where the AGENTS fail to provide a master
franchise plan within ten (10) months following the effective date,
DONINI shall be entitled to reasonably amend the present Agreement.
13. In the event that DONINI shall authorize any other sales agent for the
purpose of selling "Pizza Donini" franchises in the U.S. outside the
Territory (the "Outside Agent"), the AGENTS shall be entitled to
receive ten percent (10%) of the master franchise fee and of the
commission on any initial franchise fee received by the Outside Agent
on the sale of franchises by the Outside Agent and on the commissions
on royalties generated by the Outside Agent where the AGENTS are
instrumental in assisting or advising DONINI and the Outside Agent.
14. In the event that DONINI shall establish a national training center in
the United States ("Pizza Donini University"), where such center is
established further to the efforts, advice and assistance of the AGENTS
in Atlanta and where through the efforts of the AGENTS Pizza Donini
University becomes profitable, any profits shall be distributed between
DONINI and the AGENTS at the rate of 88% and 12% respectively. To the
extent that Pizza Donini University requires funding in addition to any
revenues that it may receive, all such expenses (including staff) shall
be paid by DONINI and shall be subject to its prior express approval.
15. In the event that DONINI shall establish any central order processing
centers ("call centers") within the United States, the AGENTS shall be
entitled to a right of first refusal to act as provider to DONINI. All
profits emanating from the call centers managed by the AGENTS shall be
divided between the AGENTS and DONINI at the rate of 35% and 65%,
respectively, and all costs and expenses shall be incurred by DONINI.
However, no profits shall be distributed by the call centers until such
time as DONINI shall have recaptured all set-up costs and expenses,
including depreciation.
16. The parties shall execute such further documents, agreements and
instruments as may be necessary in order to give full force and effect
to the foregoing and shall obtain such authorizations, approvals,
permits and consents as may be required by law or otherwise, including
any approvals of the Board of Directors of any corporate entities.
17. The present agreement supersedes and replaces all previous agreements,
understandings, instruments and contracts that may exist between the
parties, whether verbal or written.
Page 6 of 8
18. This Agreement shall be interpreted in accordance with the laws of the
state of New Jersey, U.S.A. and any and all disputes shall be submitted
to the Superior Court for the state of New Jersey.
19. This Agreement was drafted in English at the request of the parties
hereto. La presente convention a ete redigee en anglais a la demande
des parties aux presentes.
SIGNED AT XXXXXXXX, XXXXXX, XXXXXX AS OF THE 2ND DAY OF APRIL 2001.
DONINI INC.
Per: /s/ XXXXX XXXXX /s/ XXXXXX XXXXXXXXXXX
------------------------- -------------------------
XXXXX XXXXX Witness
duly authorized for these purposes
SIGNED AT ATLANTA, GEORGIA, U.S.A., AS OF THE 2ND DAY OF APRIL 2001.
/s/ XXXX XXXXXXX /s/ XXXXXXX XXXXXX
------------------------- -------------------------
XXXX XXXXXXX Witness
SIGNED AT ATLANTA, GEORGIA, U.S.A., AS OF THE 2ND DAY OF APRIL 2001.
/s/ XXXXXX XXXXX /s/ XXXXXXX XXXXXX
------------------------- -------------------------
XXXXXX XXXXX Witness
SIGNED AT ATLANTA, GEORGIA, U.S.A., AS OF THE 2ND DAY OF APRIL 2001.
ZSQUARED, LLC
Per: /s/ XXXXX XXXXX /s/ XXXXXXX XXXXXX
------------------------- -------------------------
XXXXXX XXXXX Witness
duly authorized for these purposes
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SCHEDULE "A"
PRODUCTS TO BE SOLD
PURSUANT TO CONTRACT WITH AGENTS
--------------------------------------------------------------------------------
1. Frozen Pizza Shells - Regular and Self-Rising;
2. Refrigerated and/or Frozen Raw Dressed Self-Rising Pizza (single or
multi-serve);
3. Refrigerated, Par-baked Crust, Deli-Counter Dressed Pizza (single or
multi-serve);
4. Frozen, Par-Baked Dressed Pizza (single or multi-serve);
5. Frozen Pizza Pockets (regular or microwave oven);
6. Microwavable Frozen Dressed Pizza (single or multi serve);
7. Pizza and Pasta Sauces.
8. Raw Dough Balls
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