EXHIBIT 10.18
RUBIO'S TEST AGREEMENT
This Test Agreement (the "Test Agreement" or "Agreement") is made and
entered into this 4th day of August, 1995, by and between Xxxxx'x Restaurants,
Inc., having an address of 0000 Xxxxxxxx Xxxxx (Xxxxx 000), Xxx Xxxxx,
Xxxxxxxxxx 00000 (hereafter referred to as "Rubio's") , and Host International,
Inc., a Delaware corporation, having an address of 00000 Xxxxxxxx Xxxx, Attn:
Xxxx. 00/000, Xxxxxxxxxx, XX 00000 (hereafter referred to as "Host") , with
respect to the following:
W I T N E S S E T H:
X. Xxxxx'x is the owner of certain trademarks, service marks and
logotypes, including the xxxx "Rubio's" (together with any future marks
developed by Rubio's based upon some variation of the xxxx "Rubio's",
collectively referred to herein as the "Trademarks"), which it uses in
connection with the operation of food and beverage facilities and restaurants,
all of which are presently owned, leased and operated, or licensed by Rubio's.
X. Xxxxx'x has developed and adopted unique and uniform plans, processes,
trade secrets, and styles for the layout and operation of such businesses
including signs, interior and exterior decoration and decor, and lines of food
and beverage product, a pricing strategy and, in general, a style, system and
method of business operations developed through and by reason of Rubio's
business experience.
C. Host is engaged in the business of operating food and beverage
facilities at San Diego International Airport (the "Airport").
D. Host wishes to obtain a trademark license agreement which will
authorize it to operate a "Rubio's" facility at the location set forth on
Exhibit A, attached hereto and made a part
hereof (the "Licensed Location"), and Rubio's is willing to grant a trademark
license upon the terms and conditions herein set forth.
IN WITNESS WHEREOF, the parties hereto enter into this Test Agreement:
1. GRANT OF LICENSE. Rubio's grants to Host and Host accepts a
non-exclusive license to use and display the Trademarks and offer for sale the
Rubio's products at the Licensed Location or such other locations as may be
approved by Rubio's in writing, upon the terms and subject to the provisions of
this Agreement and all documents ancillary hereto.
2. LICENSED LOCATION. Host's Licensed Location shall be at the Airport.
3. TERM. Subject to the rights of termination set forth in Section 10
hereof, the term of this Agreement shall be for a test period of ***
(the "Test Period"), commencing with the opening of the Licensed Location for
business. At the end of the Test Period, the parties will confer regarding the
success or failure of the test, and if the test is successful, Rubio's and Host
may extend the term of this Agreement on mutually agreeable terms.
4. TRADEMARKS.
4.01. NON-OWNERSHIP OF TRADEMARKS. Host has no right, title or
interest in or to any of the Trademarks, except for Host's privilege and
license during the term hereof to display and use the Trademarks and offer
for sale Rubio's products. Host acknowledges that Host now asserts no
claim and later shall assert no claim to any goodwill, reputation or
ownership of the Trademarks by virtue of Host's licensed or franchised use
or both of them, or otherwise.
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4.02. ACTS IN DEROGATION OF THE TRADEMARKS. Host agrees that Host
shall not do or permit any act or thing to be done in derogation of any of
the rights of Rubio's in connection with the Trademarks, either during the
term of this Agreement or after, and that Host shall use the Trademarks
only for the uses and in the manner licensed or franchised or both under,
and as provided in, this Agreement.
4.03. PROHIBITION AGAINST DISPUTING RUBIO'S RIGHTS. During or
after the term of this Agreement, Host shall not in any way dispute or
impugn the validity of the Trademarks, or the rights of Rubio's to them, or
the rights of Rubio's or other licensees of Rubio's to use them.
4.04. Use of Trademarks.
(a) Host shall affix to the Licensed Location, at such
places within and without the Licensed Location as shall be
mutually designated by Rubio's and Host, signs containing the
Trademarks. Except as expressly permitted by Rubio's, Host shall
not erect or display any other signs, or display any other
trademarks, logo-types, symbols or service marks in, upon, or in
connection with the Licensed Location without Rubio's prior
written approval. Such approval shall not be unreasonably
withheld.
(b) Within ninety (90) days following termination of this
Agreement for any reason, Host shall cease use of and remove from
the Licensed Location, each and all of the Trademarks, and any
physical objects bearing or containing any of the Trademarks.
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4.05. ASSUMED NAME REGISTRATION. If Host is required to do so by
any statute or ordinance, Host shall promptly, upon the execution of this
Agreement or upon the opening of the Licensed Location, as the case may be,
file with applicable government agencies or offices a notice of Host's
intent to conduct Host's business at the Licensed Location under the name
"Rubio's." Promptly upon the termination of this Agreement for any reason
whatsoever Host shall execute and file such documents as may be necessary
to revoke or terminate such assumed name registrations.
4.06. TRADEMARK CHANGES. From time to time, Rubio's may modify
the Trademarks. Host shall accept, use and display, as may be applicable,
such modified Trademarks in accordance with the procedures, policies, rules
and regulations so long as they are consistent with the procedures,
policies, rules and regulations followed by Rubio's in all of its owned
retail operations, as though such modifications were specifically set forth
in this Agreement.
4.07. DEFENSE OF XXXX BY RUBIO'S. If Host receives notice or is
informed or learns of any claim, suit or demand against Host on account of
any alleged infringement, unfair competition, or similar matter relating to
Host's use of the Trademarks, Host shall promptly notify Rubio's of such
claim, suit or demand. Except as herein expressly provided, upon receiving
such notice Rubio's shall promptly take such action as may be necessary to
protect and defend Host against any such claim by any third party and shall
indemnify Host against any loss, cost or expense incurred in connection
with such claim. Host shall not settle or compromise any such claim
without the prior written consent of Rubio's. Rubio's shall have the right
to defend, compromise or settle any such claim at
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Rubio's sole cost and expense, using attorneys of its own choosing, and
Host agrees to cooperate fully with Rubio's in connection with the defense
of any such claim.
4.08. PROSECUTION OF INFRINGERS. If Host receives notice or is
informed or learns that any third party, which Host believes to be
unauthorized to use the Trademarks, is using the Trademarks or any variant
of them, Host shall promptly notify Rubio's of the facts relating to such
alleged infringing use. Thereupon, Rubio's shall take any action against
such third party on account of such alleged infringement of the Trademarks.
Host shall have no right to make any demand against any such alleged
infringer of Rubio's Trademarks or to prosecute any claim of any kind or
nature whatsoever against such alleged infringer of Rubio's Trademarks for
or on account of such infringement.
5. STANDARDS OF OPERATIONS. Rubio's shall furnish to Host a copy of its
various manuals which constitute the standards of operations (the "Standards of
Operation") developed by Rubio's for operation of the Licensed Location, which
standards include unique and uniform plans, processes, trade secrets, and styles
for the layout and operation of a "Rubio's" facility, including signs, interior
and exterior decoration and decor, and lines of food and beverage product, a
pricing strategy and, in general, a style, system and method of business
operations developed through and by reason of Rubio's business experience.
Rubio's may modify and supplement the Standards of Operation from time to time
upon written notice to Host and provided that such modification or supplement to
such Standards of Operation shall be consistent with the standards of operation
then in practice at Rubio's locations elsewhere.
The food and beverage products sold and services rendered by Host pursuant
to this Agreement shall at all times be sold and rendered with courtesy and with
a view to complete
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customer satisfaction, and shall be consistent with the standards of
excellence maintained by Rubio's as described in the Standards of Operation.
Rubio's may, but shall not be obligated to, enter the Licensed Location at
any time during normal business hours to examine the same and to determine if
Host is complying with its obligations under this Agreement.
Host shall be entitled to offer beverages at the Licensed Location in
conjunction with the sale of Rubio's proprietary products.
6. PERFORMANCE BY HOST AND RUBIO'S.
6.01. HOST PERFORMANCE. Host will abide by the Standards of
Operation provided pursuant to Section 5 of this Agreement.
6.02. RUBIO'S PERFORMANCE. Rubio's shall provide between ***
*** of management training at *** , for no more than *** Host
employees, at the Licensed Location or such other location agreed to
by Host. At least one Host employee must attend such management training.
Rubio's also will provide pre-opening training support and assistance to
Host at the Licensed Location, *** , for *** of Host's hourly
employees for at least *** prior to, and *** following, the opening of the
Licensed Location. Rubio's will develop,
*** , specific operations manuals and other supporting materials
needed to effectively operate the Rubio's concept at the Airport. Host agrees
to not use any of the manuals, concepts, or other supporting materials created
or supplied by Rubio's for any other purpose or at any other location except for
the Test Period at the Airport, without Rubio's prior written consent. Rubio's
also will provide *** operations support, *** ,
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with a minimum of *** Quality Assurance Evaluations for the Licensed Location,
on an *** basis. Rubio's will not be responsible for wages and benefits for
any Host employee.
Upon request by Host, Rubio's shall supply to Host such ingredients and
supplies as Host may reasonably require for performance of its obligations
hereunder. Nothing in this Agreement shall preclude Host, however, from
acquiring ingredients and supplies from third parties so long as such
ingredients and supplies reasonably comply with the standard specifications of
Rubio's for such items. Rubio's shall supply to Host only first quality
materials and fresh products complying with the specifications established in
writing by Rubio's.
7. COSTS AND FEES. Host shall pay Rubio's a license fee (the "License
Fee") during the Test Period, which equals *** of gross revenues from the
sale of the proprietary items set forth at Exhibit B (the "Proprietary Items").
8. RELATIONSHIP OF PARTIES. In all matters pertaining to the operation
of the Licensed Location, Host is and shall be an independent contractor of
Rubio's. Neither Host nor any officer or employee of Host shall be deemed to be
an employee of Rubio's. Nothing contained in this Agreement shall be construed
so as to create a partnership, joint venture or agency; and neither party to
this Agreement shall be liable for the debts or obligations of the other.
Rubio's shall not have the power to hire or fire Host's employees, may not
control or have access to Host's funds or the expenditures of these funds, or
any other way exercise control over Host's business.
9. ASSIGNMENT.
9.01. ASSIGNMENT BY RUBIO'S. Rubio's shall have the right to
assign this Agreement, and all of its rights and privileges, to any other
person, firm or corporation; provided, however, that all of the Trademarks
have been assigned to such person, firm or
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corporation and, with respect to any assignment resulting in the
subsequent performance by the assignee of the functions of Rubio's, (1) the
assignee shall, at the time of such assignment, be financially responsible
and capable of performing the obligations of Rubio's; and (2) the assignee
expressly shall assume and agree to perform such obligations.
9.02. ASSIGNMENT BY HOST. Host may assign, transfer or sell its
interest in this Agreement (voluntarily or by operation of law) or sell
such Licensed Location (collectively "Assignment"), voluntarily or
involuntarily, by operation of law or otherwise, in any manner without the
prior written consent of Rubio's, provided that Host sells or assigns
substantially all its assets at the Airport to the proposed purchaser or
assignee; provided, however, that Host may not assign, transfer or sell its
interest in this Agreement to a competitor of Rubio's without Rubio's prior
written consent to such assignment, transfer or sale. In all other
instances of transfer or assignment by Host of its rights hereunder,
Rubio's prior consent shall be required, such consent not to be
unreasonably withheld.
10. DEFAULT AND TERMINATION. If any one or more of the following events
shall occur:
(a) Either party fails to reasonably comply with the Standards of
Operations of Rubio's;
(b) Either party shall become insolvent, or shall take the benefit of
any present or future insolvency statute, or shall make a general
assignment for the benefit of creditors, or file a voluntary petition in
bankruptcy or a petition or answer seeking an arrangement for its
reorganization, or the readjustment of its indebtedness under the
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Federal bankruptcy laws, or under any other law or statute of the United
States or any state thereof, or shall consent to the appointment of a
receiver, trustee or liquidate of all or substantially all of its property;
(c) A petition under any part of the Federal bankruptcy laws, or an
action under any present or future insolvency law or statute, shall be
filed against either party and shall not be dismissed within thirty (30)
days after the filing thereof;
(d) Host shall fail duly and punctually to pay any License Fee when
due Rubio's within thirty (30) days after receipt of written demand for
payment by Rubio's; or
(e) Either party shall materially fail to keep, perform and observe
each and every other promise, covenant and agreement set forth in this
Agreement on its part to be kept, performed or observed,
and such breach or default shall continue for a period of more than thirty (30)
days after receipt of written notice of such breach or default, except where
fulfillment of its obligations requires activity over a period of time and the
party in default shall have commenced in good faith to perform whatever may be
required for fulfillment of its obligations and continued such performance
without interruption except for causes beyond its control, then in its
discretion Rubio's or Host, as the case may by, shall have the right to
terminate this Agreement. In the event that Host violates the terms of this
Agreement on *** within any *** period, and has received notice from Rubio's
with respect to such failure to comply for the *** *** , Rubio's shall not
be required to provide Host notice and the right to cure upon the third
violation, but may terminate this Agreement immediately upon notice to Host.
The remedies
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herein provided for shall not be exclusive, but shall be cumulative
upon all other remedies, legal or equitable in nature.
11. INSURANCE AND INDEMNIFICATION.
11.01. INSURANCE. Host, during the term of this Agreement, will,
at its sole cost and expense, maintain general public liability insurance
including blanket contractual liability, broad form property damage and all
risk coverage, personal injury, completed operations and products liability
and products property damage insurance with limits of not less than ***
for personal injury, disease or death to any persons arising out of an
occurrence and ***
*** for property damage for such damage arising out of an
occurrence. All policies, or certificates issued thereunder, insuring
against liability for personal injury, disease or death, or damage to
property shall contain an endorsement by which the insurer extends the
coverage thereunder, to the extent necessary, to include the contractual
liability of Host arising by reason of the indemnity provisions of this
Agreement, shall be issued in the names of Host and Rubio's, as their
interests may appear, and shall name Rubio's as an additional insured under
all such policies.
11.02. HOST'S INDEMNIFICATION OF RUBIO'S. For the consideration
stated in this Agreement, Host hereby agrees to indemnify and hold Rubio's,
its officers, directors, agents and affiliates harmless from and against
any and all claims, actions, expenses, losses, liabilities, damages, fines,
penalties, costs and demands whatsoever, together with reasonable counsel
fees and expenses, arising out of, concerning or affecting, in whole or in
part, this Agreement or the business conducted by Host, its agents or
employees,
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except for liability resulting from the sole negligence of Rubio's, its
employees, agents or servants.
12. INTEGRATION OF AGREEMENT.
12.01. ENTIRE AGREEMENT. This Agreement and all ancillary
agreements executed contemporaneously with it constitute the entire
agreement between the parties with reference to the subject matter of this
Agreement and supersede all prior negotiations, understandings,
representations and agreements, if any.
12.02. AMENDMENT. This Agreement, including but not limited to,
this provision, may not be amended orally, but may be amended only by a
written instrument signed by the parties. Rubio's and Host each expressly
acknowledge that no oral promises or declarations were made by either to
the other and that the obligation of both Rubio's and Host are confined
exclusively to the terms in this Agreement.
13. NOTICES. Any notice required or permitted to be given under this
Agreement shall be in writing and shall be served upon the other party
personally, or by return receipt requested, postage prepaid, and shall be deemed
given when received. Notices shall be addressed to the addresses first above
written.
14. MISCELLANEOUS.
14.01. CONSTRUCTION AND INTERPRETATION.
(a) This Agreement is to be construed in accordance with the
laws of the state of California.
(b) The titles and subtitles of the various sections and
paragraphs of this Agreement are inserted for convenience and shall
not be deemed to affect the
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meaning or construction of any of the terms, provisions, covenants and
conditions of this Agreement.
(c) The language in all parts of this Agreement shall in all
cases be construed simply according to its fair meaning and not
strictly for or against either party.
(d) If any provision of this Agreement is capable of two
constructions, one of which would render the provision void and the
other of which would render the provision valid, then the provision
shall have the meaning that renders it valid.
(e) The word "shall" as used in this Agreement is used as a
command. The word "including" as used in this Agreement is used in a
nonexclusive sense.
14.02. SEVERABILITY. Nothing contained in this Agreement shall be
construed as requiring the commission of any act contrary to law. Whenever
there is any conflict between any provisions of this Agreement and any
present or future statute, law, ordinance or regulation contrary to which
the parties have no legal right to contract, the latter shall prevail, but
in such event the provision of this Agreement thus effected shall be
curtailed and limited only to the extent necessary to bring it within the
requirements of the law. If any part, article, paragraph, sentence or
clause of this Agreement is held to be indefinite, invalid or otherwise
unenforceable, the entire Agreement shall not fail on account of such
holding, and the balance of this Agreement shall continue in full force and
effect.
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14.03. COUNTERPARTS. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original and all of
which together shall be deemed to be one and the same instrument.
14.04. EFFECT OF WAIVER. No failure on the part of either party to
this Agreement to exercise any power reserved to it by this Agreement or to
insist on strict compliance by the other xxxxx with any obligation or
condition under this Agreement, and no custom or practice of the parties
at variance with the terms of this Agreement, shall constitute a waiver of
such party's right to demand exact compliance with any of the terms in this
Agreement. Waiver by either party to this Agreement of any particular
default by the other party shall not affect or impair such parties rights
with respect to any subsequent default of the same, similar, or different
nature. Any delay, forbearance, or omission of either party to this
Agreement to exercise any power or right arising out of any breach or
default by the other party of any of the terms, provisions or covenants of
this Agreement, shall not affect or impair such party's rights under this
Agreement, or right to declare any subsequent breach or default and to
terminate this Agreement. Subsequent payments to Rubio's of any payments
due to it under this Agreement shall not be deemed to be a waiver by
Rubio's of any preceding breach by Host of any terms, covenants, or
conditions of this Agreement.
14.05. *** . In the event that the terms of this Test
Agreement *** with the terms of *** with the *** , the terms of
*** shall *** .
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day
and year first above written.
XXXXX'X RESTAURANTS, INC.
By: /s/ Xxxxxx Xxxxx
-------------------------------------
Vice President
HOST INTERNATIONAL, INC.
By: /s/ illegible
-------------------------------------
Vice President
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EXHIBIT "A"
LICENSED LOCATION
A-1
EXHIBIT "B"
LIST OF PROPRIETARY PRODUCTS
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B-1
