AGREEMENT MADE AND ENTERED INTO AS OF THE 19TH DAY OF MARCH 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 XXXXXX INC.
a limited liability company, duly organized
and validly existing under the laws of
Delaware, having its head office at
Xxxxxxxxx Professional Center, Newark,
Delaware, 19711-3258 and an office at 0000
X. Xxxxxxxx Xxxxxxxx Xx., Xxxxxx, Xxxxxxx,
X.X.X., 00000, herein represented by Xx.
Xxxx Xxxxxxxx, its Vice-President and
Secretary, duly authorized as he so
declares,
hereinafter referred to as the "AGENT"
WHEREAS DONINI has acquired all of the issued and outstanding shares of Pizza
Donini Inc., a Canadian corporation and is in the process of becoming listed on
the Over-the-Counter Bulletin Board or Nasdaq for the purpose of selling its
stock over the counter;
WHEREAS the AGENT has provided certain marketing and sales services to DONINI,
its subsidiaries and affiliates since December 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 AGENT
wishes to continue to provide certain marketing and sales services to DONINI,
its subsidiaries and affiliates;
WHEREAS DONINI wishes to engage the services of the AGENT as of the effective
date, under the terms and conditions provided herein.
THE PARTIES HEREBY AGREE AS FOLLOWS:
1. The preamble shall form an integral part of this Agreement.
Page 1 of 7
2. DONINI shall engage the services of the AGENT for a period of three (3)
years commencing on the effective date and terminating thirty-six (36)
months thereafter.
3. The AGENT 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 territory consisting of California and Arizona (herein referred
to as the "Territory"), to the best of its abilities. In addition to the
Territory indicated hereinabove, the AGENT shall have the a right of first
refusal to expand the Territory into the state of Nevada for the purposes
stated in this Agreement, within fifteen (15) days of receipt of a written
notice from DONINI that it has received an acceptable offer, interest or
other commitment from a third party for the states or state so stipulated
and upon such terms and conditions of such third party offer, interest or
commitment. In the event that AGENT wishes to exercise its right hereunder,
it must so advise DONINI in writing prior to the expiration of the delay
provided herein and must consent; in writing, to fulfil all of the terms
and conditions of the third party offer, interest or commitment. Where the
AGENT fails or omits to provide satisfactory consulting and advisory
services pursuant to the terms hereof at any time, DONINI shall be entitled
to reasonably amend the present Agreement.
4. Within the context of the services to be provided by the AGENT herein, the
AGENT shall provide to DONINI, its affiliates and subsidiaries, design,
promotion and consulting services in connection with the construction and
development of one or more websites, e-portal and e-commerce centres,
either alone or in conjunction with others, with a view to servicing retail
customers and supporting wholesale supply business. Where the AGENT fails
or omits to provide satisfactory consulting and advisory services pursuant
to the terms hereof at any time, DONINI shall be entitled to reasonable
amend the present Agreement.
5. The AGENT 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) On or before August 30th, 2001, ONE HUNDRED AND FIFTY THOUSAND
(150,000) shares of common stock of DONINI, as fully paid and
non-assessable.
b) On or before August 30th, 2001, an additional ONE HUNDRED AND FIFTY
THOUSAND (150,000) common shares of DONINI, as fully paid and
non-assessable.
c) In the event that the AGENT shall cease to provide any of the services
outlined hereunder after the commencement date but prior to the
issuance of the shares pursuant to subparagraph b) above, the AGENT
shall forfeit the right to receive the shares outlined in
sub-paragraph b) above.
Page 2 of 7
d) 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.
6. In recognition of services rendered and provided that the AGENT is
continuing to act for DONINI as provided herein, the AGENT 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, the AGENT shall
receive an option to purchase FIFTY THOUSAND (50,000) shares of the
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
(24) months following the granting of the option.
b) Twelve (12) months following the granting of the option described in
sub-paragraph 6a) hereof, the AGENT shall receive an option to
purchase ONE HUNDRED THOUSAND (100,000) 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 as of the date of 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 sub-paragraph 6a) hereof, the AGENT shall receive an option to
purchase ONE HUNDRED AND FIFTY THOUSAND (150,000) 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 as of 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 herein may be exercised at any
time within twenty-four (24) months following the granting of the
option;
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d) In the event that the AGENT 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 the AGENT shall forfeit the right
to receive any option hereunder that has yet to be granted by DONINI.
In addition, where the AGENT has ceased to provide any of the services
outlined herein within six (6) months of the granting of any option
hereunder, the AGENT shall remit to DONINI for cancellation any option
or portion thereof, prorated to the amount of service provided by the
AGENT in that year;
7. DONINI and the AGENT 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 States of California and Arizona (the "Territory") within the context
of sales on a business to business level, pursuant to which the AGENT shall
receive a commission equal to between one percent (1%) and three percent
(3%) of any sums received by DONINI, its affiliates or subsidiaries, in
respect of sales of the Products introduced or sold directly through the
AGENT's efforts. The total commission payable to the AGENT 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. In addition to the Territory indicated hereinabove, the AGENT
shall have the a right of first refusal to expand the Territory into the
state of Nevada for the purposes stated in this paragraph, within fifteen
(15) days of receipt of a written notice from DONINI that it has received
an acceptable offer, interest or other commitment from a third party for
the states or state so stipulated and upon such terms and conditions of
such third party offer, interest or commitment. In the event that AGENT
wishes to exercise its right hereunder, it must so advise DONINI in writing
prior to the expiration of the delay provided herein and must consent; in
writing, to fulfil all of the terms and conditions of the third party
offer, interest or commitment. Where the AGENT fails or omits to secure
such satisfactory business-to-business agreements or contracts pursuant to
the terms hereof within five (5) months following the effective date,
DONINI shall be entitled to reasonably amend the present Agreement.
8. The AGENT shall be granted a master franchise agreement for the territory
consisting of the states of California and Arizona (the "Franchise
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 AGENT 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, less any and all amounts payable to any third
parties as provided herein. In addition to the Franchise Territory, DONINI
shall grant to the AGENT a right of first refusal to acquire master
Page 4 of 7
franchise rights for the state of Nevada during the term of the agreement.
The AGENT hereby acknowledges that ten percent (10%) of all commissions and
amounts payable to it hereunder shall be remitted to ZSQUARED, LLC. The
AGENT shall, on a timely basis, advise DONINI and ZSQUARED, LLC, Xxxx
Xxxxxxx and Xxxxxx Xxxxx of all information regarding franchisees and
potential franchisees within the Territory and of any change in such
franchisees and potential franchisees. The parties shall enter into such
master franchise agreement(s) as 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 AGENT fails or omits to
secure a satisfactory master franchise or sub-franchise agreement pursuant
to the terms hereof within ten (10) months following the effective date,
DONINI shall be entitled to reasonably amend the present Agreement.
9. 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 AGENT shall be entitled to receive a
maximum of ten percent (10%) of the commission on any 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 AGENT is instrumental
in assisting or advising DONINI and the Outside Agent. The amount to be
received by the AGENT shall be determined between the parties on a
case-by-case basis. The AGENT hereby acknowledge that it shall not be
entitled to any fees or commissions in respect of the rights granted by
DONINI to ZSQUARED, LLC, Xxxx Xxxxxxx and Xxxxxx Xxxxx (for the area
consisting of Georgia, Alabama, Tennessee, South Carolina, North Carolina
and Florida), to Xxxxx Parliament (for the area consisting of Michigan,
Wisconsin and Illinois) and to Xxxx Xxxxx (for the area consisting of Ohio,
Pennsylvania and Indiana), unless the AGENT, DONINI and the above-named
Outside Agents (or such other Outside Agents as shall be appointed by
DONINI, its subsidiaries and affiliates from time to time) have entered
into and executed a mutually acceptable agreement. DONINI shall advise the
AGENT from time to time of the appointment of any new Outside Agents and
the territories attributed to them as well as of such changes as may be
appropriate.
10. The AGENT shall have the option to open "Pizza Donini" retail stores within
the Territory under then current franchise and related agreements and
subject to the prior approval of DONINI or its nominee, save and except
that the initial franchise fees payable by the AGENT to DONINI shall be at
a reduced rate to be determined between the parties on a case by case
basis.
11. 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.
Page 5 of 7
12. This Agreement is personal to the AGENT and may not be sold, transferred,
assigned or otherwise conveyed without the prior written consent of DONINI,
which consent may be subject to additional terms, representations,
warranties and conditions. The AGENT hereby acknowledges and agrees that
any effective change of control or management within the AGENT shall
constitute a transfer pursuant to the terms hereof and shall be subject to
the consent of DONINI.
13. The present agreement supersedes and replaces all previous agreements,
understandings, instruments and contracts that may exist between the
parties, whether verbal or written.
14. 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.
15. 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 19TH DAY OF MARCH 2001.
DONINI, INC.
Per: /s/ XXXXX XXXXX /s/ XXXXXX XXXXXXXXXXX
------------------------- -------------------------
XXXXX XXXXX Witness
duly authorized for these purposes
SIGNED AT TUSCON, ARIZONA, U.S.A., AS OF THE 19TH DAY OF MARCH, 2001.
XX XXXXXX INC.
Per: /s/ XXXX XXXXXXXX
-------------------------
XXXX XXXXXXXX
duly authorized for these purposes
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SCHEDULE "A"
PRODUCTS TO BE SOLD
PURSUANT TO BROKERAGE AGREEMENT
--------------------------------------------------------------------------------
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. Microwaveable Frozen Dressed Pizza (single or multi serve);
7. Pizza and Pasta Sauce.
8. Raw Dough Balls
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