SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------------------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 5, 1999
SFORZA ENTERPRISES INC.
(Exact name of registrant as specified in its charter)
Florida 000-23251 65-0705377
------- --------- ----------
(State or other jurisdiction (Commission File Number) (IRS Employer
incorporation) Identification No.)
222 Clematis Street, Suite 202, West Palm Beach, Florida 33401
- -------------------------------------------------------- -----
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (561) 366-0027
Not Applicable
--------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE>
SFORZA ENTERPRISES INC.
FORM 8-K
CURRENT REPORT
Item 2. Acquisition or Disposition of Assets
On August 5, 1999, Sforza Enterprises Inc. (the "Company"), directly
and through wholly owned subsidiaries, purchased 48% limited partnership
interests and 1% general partnership interests in three limited partnerships,
Max's Beach Grill Ltd., Unique Brickell, Ltd. and Unique Weston, Ltd. (the
"Partnerships") which each operate a restaurant in South Florida. The Company
previously held a 51% limited partnership interest in each of the Partnerships,
and now holds 100% interests in the Partnerships.
The Partnerships interests were purchased from Unique SEI Holdings,
Inc. ("Seller"), which is an affiliate of Unique Restaurant Concepts, Inc.
("Licensor").
The restaurants operated by the Partnerships are Max's Beach Place and
Max's Grille Las Olas Riverfront, both located in Ft. Lauderdale, Florida, and
Max's Grille in Weston, Florida ("Restaurants").
The aggregate purchase price for the 49% partnership interests was
$160,000. In addition, Seller was granted three year options to purchase up to
20,000 shares of common stock of the Company at $2.50 per share. The options may
be exercised for up to 10,000 shares at any time within five calendar days after
the market price of the stock equals or exceeds $5.00 per share for 20
consecutive trading days. The holder has the right to exercise the options for
the remaining 10,000 shares at any time within five business days after the
market price of the common stock equals or exceeds $7.00 per share for 20
consecutive trading days. The options were issued pursuant to an exemption from
registration under the Securities Act of 1933 as amended as a transaction which
is not a public offering.
The Partnerships have operated the Restaurants under the Max's Grille
or Max's Beach Place name pursuant to licensing agreements with Licensor. The
Restaurants have been operated for the Partnerships by Licensor under a
management agreement. As part of the purchase transaction, the Partnerships and
Licensor agreed to terminate the Licensor's management agreement, and the
Restaurants will now be operated directly by wholly owned subsidiaries of the
Company as the general partners of the Partnerships.
In addition, the Partnerships entered into Amended and Restated License
Agreements with Licensor under which Licensor is to consult with Partnerships,
furnish new menu items and procedures and train the chef of the Restaurants with
respect to new menu items. The Partnerships will pay Licensor a license fee of
1.75% of Gross Revenues (as defined in the agreement) of the restaurant for
Max's Grille Las Olas Riverfront and for Max's Grille (Weston). The license fee
for Max's Beach Place will be .75% of Gross Revenues for the first nine months
and 1% of Gross Revenues thereafter.
<PAGE>
The Max's Beach Place license agreement may be terminated by the
Partnership at any time upon 30 days notice.
The license for the other two restaurants may be terminated by the
Partnership at any time on 90 days notice, except that the license fee shall in
any event be payable for one year, or, under certain circumstances, for 18
months.
The source of funds for the purchase was the Company's working capital.
Item 7. Financial Statements, Proforma Financial Statements and Exhibits
(a) Financial Statements of Businesses Acquired.
Max's Beach Grill, Ltd., Unique Brickell, Ltd., and Unique Weston, Ltd.
Report of independent accountants F-1
Combined financial statements:
Combined balance sheet - December 31, 1998 F-2
Combined statement of operations - for the year ended
December 31, 1998 F-3
Combined statement of cash flows - for the year ended
December 31, 1998 F-4
Notes to combined financial statements F-5 - F-9
Interim combined financial statements (unaudited):
Combined condensed balance sheet - June 30, 1999
(unaudited) F-10
Combined condensed statement of income - for the six
months ended June 30, 1999 (unaudited) F-11
Combined condensed statement of cash flows - for the six
months ended June 30, 1999 (unaudited) F-12
Notes to interim combined condensed financial statements
(unaudited) F-13
(b) Pro Forma Financial Information. F-14
Sforza Enterprises Inc. and Subsidiaries
Pro forma consolidated condensed balance sheet - June 30,
1999 (unaudited) F-15
Pro forma consolidated condensed statement of operations -
for the six months ended June 30, 1999 (unaudited) F-16
Pro forma consolidated condensed statement of operations -
for the year ended December 31, 1998 (unaudited) F-17
(c) Exhibits:
10.5 - License Agreement by and between Unique Restaurant
Concepts, Inc. and Unique Brickell, Ltd. - deleted.
10.5(1) - Amended and Restated License Agreement between
Unique Restaurant Concepts, Inc. and Unique Brickell Inc. dated August 5, 1999.
10.6 - License Agreement between Unique Restaurant Concepts,
Inc. and Unique Weston, Ltd. - deleted.
10.6(1) - Amended and Restated License Agreement between
Unique Restaurant Concepts, Inc. and Unique Weston, Inc. dated August 5, 1999.
10.8 - License Agreement between Unique Restaurant Concepts,
Inc. and Max's Beach Grill, Ltd. - deleted.
10.8(1) - Amended and Restated License Agreement between
Unique Restaurant Concepts, Inc. and Max's Beach Grill, Ltd. - dated August 5,
1999.
10.9(1) - Termination of Management Agreement among Unique
Restaurant Concepts, Inc., Max's Beach Grill, Ltd., Unique Brickell, Ltd. and
Unique Weston, Ltd. dated August 5, 1999.
10.22 - Agreement for Purchase and Sale of Partnership
Interests dated August 5, 1999 among Unique SEI Holdings, Inc., Max's Beach
Grill, Inc., Unique Brickell, Inc., Unique Weston, Inc. and Sforza Enterprises
Inc.
10.23 - Stock Option Agreement dated August 5, 1999 between
Sforza Enterprises Inc. and Unique SEI Holdings, Inc.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
SFORZA ENTERPRISES INC.
Date: August 13, 1999 By: /s/ Gerald J. Visconti, Jr.
-----------------------------------
Gerald J. Visconti, Jr.
President and Chief Executive Officer
<PAGE>
SFORZA ENTERPRISES INC.
INDEX TO FINANCIAL STATEMENT
Report of independent accountants F-1
Combined financial statements:
Combined balance sheet - December 31, 1998 F-2
Combined statement of operations - for the year ended
December 31, 1998 F-3
Combined statement of cash flows - for the year ended
December 31, 1998 F-4
Notes to combined financial statements F-5 - F-9
Interim combined financial statements (unaudited):
Combined condensed balance sheet - June 30, 1999
(unaudited) F-10
Combined condensed statement of income - for the six
months ended June 30, 1999 (unaudited) F-11
Combined condensed statement of cash flows - for the six
months ended June 30, 1999 (unaudited) F-12
Notes to interim combined condensed financial statements
(unaudited) F-13
Pro Forma Financial Information F-14
Sforza Enterprises Inc. and Subsidiaries
Pro forma consolidated condensed balance sheet - June 30,
1999 (unaudited) F-15
Pro forma consolidated condensed statement of operations -
for the six months ended June 30, 1999 (unaudited) F-16
Pro forma consolidated condensed statement of operations -
for the year ended December 31, 1998 (unaudited) F-17
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Partners
Max's Beach Grill, Ltd.
Unique Brickell, Ltd.
Unique Weston, Ltd.
We have audited the accompanying combined balance sheet of Max's Beach Grill,
Ltd. (a limited partnership), Unique Brickell, Ltd. (a limited partnership), and
Unique Weston, Ltd. (a limited partnership) as of December 31, 1998, and the
related combined statements of operations and cash flows for the year then
ended. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and the significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, such combined financial statements present fairly, in all
material respects, the combined financial position of Max's Beach Grill, Ltd.,
Unique Brickell, Ltd., and Unique Weston, Ltd. as of December 31, 1998, and the
combined results of their operations and their cash flows for the year then
ended, in conformity with generally accepted accounting principles.
/s/ Templeton & Company, P.A.
Royal Palm Beach, Florida
April 1, 1999, except for Note 8, as to
which the date is August 12, 1999
F-1
<PAGE>
<TABLE>
<CAPTION>
MAX'S BEACH GRILL, LTD.,
UNIQUE BRICKELL, LTD.,
AND
UNIQUE WESTON, LTD.
COMBINED BALANCE SHEET
December 31, 1998
ASSETS
<S> <C>
Current assets:
Cash and cash equivalents $ 279,195
Inventories 117,428
Other current assets 274,063
----------
Total current assets 670,686
Property and equipment, net 1,972,259
Other assets 27,495
----------
Total assets $2,670,440
==========
LIABILITIES AND PARTNERS' EQUITY
Current liabilities:
Accounts payable $ 552,748
Accrued expenses 604,068
Due to affiliate 50,000
Current portion of obligation under capital
leases 49,990
----------
Total current liabilities 1,256,806
Obligation under capital leases, net 150,302
----------
Total liabilities 1,407,108
Partners' equity 1,263,332
----------
Total liabilities and partners' equity $2,670,440
==========
</TABLE>
See accompanying notes.
F-2
<PAGE>
<TABLE>
<CAPTION>
MAX'S BEACH GRILL, LTD.,
UNIQUE BRICKELL, LTD.,
AND
UNIQUE WESTON, LTD.
COMBINED STATEMENT OF OPERATIONS
For the Year Ended December 31, 1998
<S> <C>
Restaurant sales, net $5,722,623
----------
Cost and expenses:
Cost of sales 3,076,234
Operating expenses 2,830,078
Depreciation and amortization 180,116
Pre-opening expenses 462,163
Interest expense, net 38,900
----------
Total cost and expenses 6,587,491
----------
Loss from operations (864,868)
Other income, net 13,005
----------
Net loss $ (851,863)
==========
</TABLE>
See accompanying notes.
F-3
<PAGE>
<TABLE>
<CAPTION>
MAX'S BEACH GRILL, LTD.,
UNIQUE BRICKELL, LTD.,
AND
UNIQUE WESTON, LTD.
COMBINED STATEMENT OF CASH FLOWS
For the Year Ended December 31, 1998
<S> <C>
Cash flows from operating activities:
Net loss $ (851,863)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation and amortization 180,116
Increase in inventories (77,691)
Increase in other current assets (37,619)
Increase in accounts payable 206,997
Increase in accrued expenses 431,296
----------
Net cash used in operating activities (148,764)
----------
Cash flows from investing activities:
Purchase of property and equipment (758,535)
Decrease in other assets 19,790
----------
Net cash used in investing activities (738,745)
----------
Cash flows from financing activities:
Repayments and borrowings from affiliates, net 411,895
Principal payments on obligation under capital
leases (42,170)
----------
Net cash provided by financing activities 369,725
----------
Net decrease in cash and cash equivalents (517,784)
Cash and cash equivalents, beginning of year 796,979
----------
Cash and cash equivalents, end of year $ 279,195
==========
</TABLE>
See accompanying notes.
F-4
<PAGE>
MAX'S BEACH GRILL, LTD.,
UNIQUE BRICKELL, LTD.,
AND
UNIQUE WESTON, LTD.
NOTES TO COMBINED FINANCIAL STATEMENTS
Note 1 - Organization and Description of Business
Max's Beach Grill, Ltd. (Beach Grill), Unique Brickell, Ltd. (Brickell), and
Unique Weston, Ltd. (Weston), (collectively, the Partnerships), are separate
limited partnerships which are affiliated by common ownership. Sforza
Enterprises Inc. (Sforza) owns a 51% limited partnership interest in each of the
partnerships. Each of the partnerships were formed as Florida limited
partnerships and are governed by separate limited partnership agreements. The
agreements each vest the overall management and control of all aspects of the
business and affairs of the Partnerships exclusively in the general partner. The
Partnerships will terminate upon the occurrence of certain specified events or
on January 31, 2027.
Beach Grill owns and operates the Max's Beach Place Restaurant located on the
beach in Ft. Lauderdale, Florida which opened for business in April 1997.
Brickell owns and operates the Max's Grille at Las Olas Riverfront Restaurant
located in downtown Ft. Lauderdale, Florida which opened in June 1998. Weston
owns and operates the Max's Grille Restaurant located in Weston, Florida which
opened in October 1998.
Note 2 - Summary of Significant Accounting Policies
A summary of the significant accounting policies used in preparing the
accompanying combined financial statements follows:
Principles of Combination
-------------------------
The combined financial statements include the accounts of Beach Grill,
Brickell, and Weston. All significant intercompany accounts and
transactions are eliminated in combination.
Cash Equivalents
----------------
For purposes of the statement of cash flows, the Partnerships consider all
temporary cash investments with maturities of three months or less, when
purchased, to be cash equivalents.
Inventories
-----------
Inventories consist of various food and beverage items which are stated at
the lower of cost or market using the first-in, first-out method.
F-5
<PAGE>
MAX'S BEACH GRILL, LTD.,
UNIQUE BRICKELL, LTD.,
AND
UNIQUE WESTON, LTD.
NOTES TO COMBINED FINANCIAL STATEMENTS, CONTINUED
Note 2 - Summary of Significant Accounting Policies, Continued
Property and Equipment
----------------------
Property and equipment is stated at cost. Depreciation is provided using
the straight-line method over the estimated useful lives of the assets,
which range from three to ten years. Leasehold improvements are amortized
using the straight-line method over the estimated useful lives of the
improvements or the term of the lease, whichever is shorter. Equipment
leased under capital leases is amortized over the lives of the respective
leases.
Restaurant Pre-Opening Expenses
-------------------------------
Restaurant pre-opening expenses include the costs incurred to prepare a
restaurant for its initial commencement of operations. Such costs include
training, utilities, staff recruitment, insurance, and other start-up
costs. Prior to 1998, the Partnerships capitalized such costs and
amortized the balance to expense over a twelve-month period. During 1998,
the Partnerships adopted Statement of Position Number 98-5, which requires
such costs to be expensed as incurred.
Income Taxes
------------
Federal income taxes are not payable by, or provided for, the
Partnerships, as partners are taxed on their proportionate shares of the
Partnerships' taxable income or loss.
Management Estimates
--------------------
Preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and
assumptions that affect certain reported amounts and disclosures.
Concentration of Credit Risk
----------------------------
Financial instruments which potentially subject the Partnerships to
concentrations of credit risk include temporary cash investments. The
Partnerships place their cash and temporary cash investments with high
credit quality financial institutions. Such balances generally exceed the
FDIC insurance limit.
F-6
<PAGE>
MAX'S BEACH GRILL, LTD.,
UNIQUE BRICKELL, LTD.,
AND
UNIQUE WESTON, LTD.
NOTES TO COMBINED FINANCIAL STATEMENTS, CONTINUED
Note 3 - Property and Equipment
<TABLE>
<CAPTION>
Property and equipment consists of the following at December 31, 1998:
<S> <C>
Leasehold improvements $ 777,671
Equipment leased under capital leases 269,007
Furniture, fixtures, and equipment 1,179,500
----------
2,226,178
Less accumulated depreciation and amortization (253,919)
----------
$1,972,259
==========
</TABLE>
Depreciation and amortization of property and equipment, including equipment
leased under capital leases, totaled $180,116 for 1998.
Note 4 - Description of Leasing Arrangements
The Partnerships' restaurants operate primarily in facilities leased from
entities owned by third parties. The leases have specified monthly payments over
ten-year terms and require the Partnerships to pay specified percentages of
sales in excess of certain levels as additional rent. The Partnerships also
lease certain equipment under various operating leases.
During 1998, certain landlords contributed approximately $1,353,000 toward the
construction of leasehold improvements. Such contributions were recorded as
reductions of the related asset. Amounts received by the Partnerships in excess
of the cost of the related leasehold improvements, totaling $70,758 and included
in accrued expenses, are amortized over the life of the related lease as a
reduction of rent expense.
In addition, the Partnerships lease certain equipment from unrelated parties
under capital leases. The combined balance sheet at December 31, 1998 includes
the following regarding equipment leased under capital leases:
<TABLE>
<CAPTION>
<S> <C>
Equipment leased under capital leases $ 269,007
Accumulated amortization (64,050)
---------
$ 204,957
=========
</TABLE>
F-7
<PAGE>
MAX'S BEACH GRILL, LTD.,
UNIQUE BRICKELL, LTD.,
AND
UNIQUE WESTON, LTD.
NOTES TO COMBINED FINANCIAL STATEMENTS, CONTINUED
Note 4 - Description of Leasing Arrangements, Continued
Minimum annual rentals for leases in effect at December 31, 1998 follow:
<TABLE>
<CAPTION>
Equipment
Year Ending Under Capital Operating
December 31, Leases Leases
------------ ------ ------
<S> <C> <C> <C>
1999 $ 80,491 $ 702,753
2000 80,491 715,276
2001 80,491 726,631
2002 21,445 744,208
2003 - 745,798
Thereafter - 3,205,804
--------- ----------
Total minimum rentals 262,918 $6,840,470
==========
Less interest portion (62,626)
---------
Present value of net
minimum rentals $ 200,292
=========
</TABLE>
Total rent expense under operating leases for the year 1998 amounted to
$505,693, including $23,446 in contingent rentals.
Note 5 - Related Party Transactions
Management Agreements
---------------------
Unique Restaurant Concepts, Inc. (URCI) provides restaurant management and
accounting services to each of the partnerships pursuant to management
agreements dated December 30, 1997. Under these agreements, URCI was
delegated the general partner's powers (see Note 1). These agreements
require a base management fee of $1.5% of the gross revenue with an
additional amount payable to Unique of up to 2.5% of the gross revenue for
reimbursement of certain common expenses. Management fees amounted to
$222,396 in 1998.
Construction Services
---------------------
The Partnerships contracted the construction of certain restaurant
leasehold improvements from an entity controlled by a principal of the
Partnerships. Payments to the entity during 1998 for construction services
performed totaled $1,409,308.
F-8
<PAGE>
MAX'S BEACH GRILL, LTD.,
UNIQUE BRICKELL, LTD.,
AND
UNIQUE WESTON, LTD.
NOTES TO COMBINED FINANCIAL STATEMENTS, CONTINUED
Note 5 - Related Party Transactions, Continued
Due to Affiliate
----------------
The Partnerships periodically borrow funds for working capital purposes
from entities related through common ownership. Outstanding borrowings are
uncollateralized and non-interest bearing with no stipulated repayment
terms.
Note 6 - Changes in Partners' Equity
The changes in partners' equity for the year ended December 31, 1998 are
presented as follows:
<TABLE>
<CAPTION>
Max's
Beach Unique Unique Total
Grill, Brickell, Weston, Partners'
Ltd. Ltd. Ltd. Equity
---- ---- ---- ------
<S> <C> <C> <C> <C> <C>
Balance, January 1, 1998 $ 665,195 $ 800,000 $ 650,000 $2,115,195
Net loss for 1998 (212,934) (462,703) (176,226) (851,863)
--------- --------- --------- ----------
Balance, December 31, 1998 $ 452,261 $ 337,297 $ 473,774 $1,263,332
========= ========= ========= ==========
</TABLE>
The limited partnership agreements provide for partners to receive a priority
return of their capital account upon the liquidation of a partnership or a
partner's interest.
Note 7 - Supplemental Statement of Cash Flows Information
Supplemental statement of cash flows information for the year ended December 31,
1998 follows:
Cash payments for interest $38,900
========
Note 8 - Subsequent Event
During August 1999, Sforza acquired the remaining 49% partnership interests in
each of the limited partnerships (see Note 1). In connection with the purchase,
the management agreements with URCI were terminated and separate license
agreements were executed. The license agreements require the Partnerships to pay
a license fee ranging from .75% to 1.75% of revenue during the twelve month
period after the acquisition. The license agreements generally may be cancelled
after twelve months.
F-9
<PAGE>
<TABLE>
<CAPTION>
MAX'S BEACH GRILL, LTD.,
UNIQUE BRICKELL, LTD.,
AND
UNIQUE WESTON, LTD.
COMBINED CONDENSED BALANCE SHEET
June 30, 1999
(Unaudited)
ASSETS
<S> <C>
Current assets:
Cash and cash equivalents $ 118,349
Inventories 74,603
Other current assets 126,086
----------
Total current assets 319,038
Property and equipment, net 1,867,111
Other assets 26,981
----------
Total assets $2,213,130
==========
LIABILITIES AND PARTNERS' EQUITY
Current liabilities:
Accounts payable $ 231,338
Accrued expenses 441,679
Due to affiliate 40,000
Current portion of obligation under capital
leases 48,889
----------
Total current liabilities 761,906
Obligation under capital leases, net 127,428
----------
Total liabilities 889,334
Partners' equity 1,323,796
----------
Total liabilities and partners' equity $2,213,130
==========
</TABLE>
See note to interim combined condensed financial statements.
F-10
<PAGE>
<TABLE>
<CAPTION>
MAX'S BEACH GRILL, LTD.,
UNIQUE BRICKELL, LTD.,
AND
UNIQUE WESTON, LTD.
COMBINED CONDENSED STATEMENT OF OPERATIONS
For the Six Months Ended June 30, 1999
(Unaudited)
<S> <C>
Restaurant sales, net $4,752,117
----------
Cost and expenses:
Cost of sales 2,393,108
Operating expenses 2,307,351
Interest expense 16,270
----------
Total cost and expenses 4,716,729
----------
Income from operations 35,388
Other income, net 5,076
----------
Net income $ 40,464
==========
</TABLE>
See note to interim combined condensed financial statements.
F-11
<PAGE>
<TABLE>
<CAPTION>
MAX'S BEACH GRILL, LTD.,
UNIQUE BRICKELL, LTD.,
AND
UNIQUE WESTON, LTD.
COMBINED CONDENSED STATEMENT OF CASH FLOWS
For the Six Months Ended June 30, 1999
(Unaudited)
<S> <C>
Cash flows from operating activities:
Net income $ 40,464
Adjustments to reconcile net income to net cash
used in operating activities:
Depreciation and amortization 138,035
Decrease in inventories 42,825
Decrease in other current assets 147,977
Decrease in accounts payable (321,410)
Decrease in accrued expenses (162,389)
----------
Net cash used in operating activities (114,498)
----------
Cash flows from investing activities:
Purchase of property and equipment (32,887)
Decrease in other assets 514
----------
Net cash used in investing activities (32,373)
----------
Cash flows from financing activities:
Borrowings from affiliates, net 10,000
Principal payments on obligation under capital
leases (23,975)
----------
Net cash used in financing activities (13,975)
----------
Net decrease in cash and cash equivalents (160,846)
Cash and cash equivalents, beginning of period 279,195
----------
Cash and cash equivalents, end of period $ 118,349
==========
</TABLE>
See note to interim combined condensed financial statements.
F-12
<PAGE>
MAX'S BEACH GRILL, LTD.,
UNIQUE BRICKELL, LTD.,
AND
UNIQUE WESTON, LTD.
NOTE TO COMBINED CONDENSED FINANCIAL STATEMENTS (Unaudited)
Basis of Presentation
- ---------------------
The combined condensed financial statements as of June 30, 1999 and for the six
months then ended are unaudited; however, in the opinion of management, all
adjustments (consisting of normal recurring adjustments) necessary for a fair
presentation of the combined financial statements for the interim period have
been included. The results of the interim period ended June 30, 1999 are not
necessarily indicative of the results to be obtained for the full fiscal year
ending December 31, 1999.
F-13
<PAGE>
(b) Pro Forma Financial Information.
On December 30, 1997, Sforza Enterprises Inc. and subsidiaries (the Company)
acquired 51.% limited partnership interests in each of three limited
partnerships that operate or planned to operate a Max's Grille Restaurant at a
separate location in South Florida pursuant to a partnership subscription
agreement. The aggregate purchase price for the three limited partnership
interests was $2,386,000. The business of the limited partnerships was governed
by similar limited partnership agreemens that vest overall management and
control of the limited partnerships to Unique Restaurant Concepts, Inc. (URCI)
through separate management agreements with the limited partnerships. The
Company accounted for the investments in the limited partnerships using the
equity method through June 30, 1999.
One of the restaurants was opened during 1997 and two restaurants were opened
during 1998. The three limited partnerships that own and operate the Max's
Grille Restaurants are Max's Beach Grille, Ltd., Unique Brickell, Ltd., and
Unique Weston, Inc. (collectively, the Partnerships).
During August 1999, the Company purchased from an affiliate of URCI the
remaining 49% partnership interests for an aggregate purchase price of $160,000.
In addition, the affiliate was granted options to purchase up to 20,000 shares
of the Company's common stock at $2.50 per share. The agreement also terminates
the management agreements and requires the limited partnerships to pay license
fees to URCI ranging from .75% to 1.75% of the Max's Grille Restaurants' revenue
during the twelve month period following the acquisition. The license
arrangement generally may be terminated after twelve months. The management
agreements provided for a fee of 4% of revenue. The Company will consolidate the
Partnerships in its financial statements for periods subsequent to the
acquisition date.
The accompanying pro forma financial information presents unaudited pro forma
consolidated condensed statements of operations for the year ended December 31,
1998 and for the six months ended June 30, 1999 prepared assuming the
transaction was consummated on January 1, 1998. Also presented is the unaudited
pro forma consolidated balance sheet as of June 30, 1999 prepared assuming the
transaction was consummated on that date.
F-14
<PAGE>
<TABLE>
<CAPTION>
SFORZA ENTERPRISES INC. AND SUBSIDIARIES
PRO FORMA CONSOLIDATED CONDENSED BALANCE SHEET
JUNE 30, 1999
(UNAUDITED)
Pro Forma
Company Partnerships Adjustments Pro Forma
------- ------------ ----------- ---------
ASSETS
<S> <C> <C> <C>
Current assets:
Cash and cash
equivalents $ 878,857 $ 118,349 $ (160,000)3 $ 837,206
Inventories 60,001 74,603 - 134,604
Other current assets 70,522 126,086 (40,000)1 156,608
---------- ---------- ------------ ----------
Total current assets 1,009,380 319,038 (200,000) 1,128,418
Investments in unconsol-
idated subsidiaries 1,933,968 - (1,933,968)2 -
Property and equipment,
net 868,940 1,867,111 - 2,736,051
160,000 3
Other assets, net 64,495 26,981 610,172 2 861,648
---------- ---------- ----------- ----------
Total assets $3,876,783 $2,213,130 $(1,363,796) $4,726,117
========== ========== =========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 93,636 $ 231,338 $ - $ 324,974
Accrued expenses 170,826 441,679 - 612,505
Installment note payable 626 40,000 (40,000)1 626
Current portion of
obligations under
capital leases 18,634 48,889 - 67,523
---------- ---------- ----------- ----------
Total current
liabilities 283,722 761,906 (40,000) 1,005,628
Obligations under
capital leases, net 10,675 127,428 - 138,103
---------- ---------- ----------- ----------
Total liabilities 294,397 889,334 (40,000) 1,143,731
---------- ---------- ----------- ----------
Shareholders' equity:
Common stock 17,100 - - 17,100
Additional paid-in
capital 5,097,064 1,323,796 (1,323,796) 5,097,064
Accumulated deficit (1,531,778) - - (1,531,778)
---------- ---------- ----------- ----------
Total shareholders'
equity 3,582,386 1,323,796 (1,323,796) 3,582,386
---------- ---------- ----------- ----------
Total liabilities and
shareholders' equity $3,876,783 $2,213,130 $(1,363,796) $4,726,117
========== ========== =========== ==========
</TABLE>
- --------
Explanatory footnotes:
1. Adjustment to eliminate loan between the Company and the Partnerships.
2. Adjustment to eliminate the Partnerships' equity against the Company's
investment and record the difference of $610,172 as goodwill.
3. Adjustment to reflect the aggregate cash purchase price of $160,000.
F-15
<PAGE>
<TABLE>
<CAPTION>
SFORZA ENTERPRISES INC. AND SUBSIDIARIES
PRO FORMA CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999
(UNAUDITED)
Pro Forma
Company Partnerships Adjustments Pro Forma
------- ------------ ----------- ---------
<S> <C> <C> <C> <C>
Net sales $2,241,521 $4,752,117 $ - $6,993,638
---------- ---------- ----------- ----------
Cost and expenses:
Cost of sales 1,102,070 2,393,108 - 3,495,178
10,000 3
Operating expenses 1,242,890 2,307,351 (106,923)1 3,453,318
Interest expense 3,294 16,270 - 19,564
---------- ---------- ----------- ----------
Total cost and
expenses 2,348,254 4,716,729 (96,923) 6,968,060
---------- ---------- ---------- ----------
Operating income (loss) (106,733) 35,388 96,923 25,578
Other income (expense):
Other income, net 25,601 5,076 - 30,677
Equity in income of
unconsolidated
affiliates 7,097 - (7,097)2 -
---------- ---------- ---------- ----------
Income (loss) before
income taxes (74,035) 40,464 89,826 56,255
Income taxes - - -4 -
---------- ---------- ---------- ----------
Net income (loss) $ (74,035) $ 40,464 $ 89,826 $ 56,255
========== ========== ========== ==========
Basic earnings (net loss)
per common share $ (0.04) $ 0.03
========== ==========
Weighted average shares
outstanding 1,710,000 1,710,000
========== ==========
</TABLE>
Explanatory footnotes:
1. Adjustment to reverse management fees and charge license fees.
2. Adjustment to reverse equity method income in limited partnerships.
3. Adjustment to amortize goodwill of $160,000 over eight years.
4. Income taxes are not provided due to available net operating loss carryovers.
F-16
<PAGE>
<TABLE>
<CAPTION>
SFORZA ENTERPRISES INC. AND SUBSIDIARIES
PRO FORMA CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1998
(UNAUDITED)
Pro Forma
Company Partnerships Adjustments Pro Forma
------- ------------ ----------- ---------
<S> <C> <C> <C> <C>
Net sales $3,774,366 $5,722,623 $ - $ 9,496,989
---------- ---------- ----------- -----------
Cost and expenses:
Cost of sales 1,887,946 3,076,234 - 4,964,180
Operating expenses 2,174,814 3,010,194 (122,250)1 5,082,758
20,000 3
Pre-opening expenses - 462,163 - 462,163
Interest expense, net 11,166 38,900 - 50,066
---------- ---------- ---------- -----------
Total cost and
expenses 4,073,926 6,587,491 (102,250) 10,559,167
---------- ---------- ---------- -----------
Operating loss (299,560) (864,868) 102,250 (1,062,178)
Other income (expense);
Other income, net 12,364 13,005 - 25,369
Equity in losses of
unconsolidated
affiliates (450,415) - 450,415 2 -
---------- ---------- ---------- -----------
Loss before income
taxes (737,611) (851,863) 552,665 (1,036,809)
Income taxes - - - -
---------- ---------- ---------- -----------
Net loss $ (737,611) $ (851,863) $ 552,665 $(1,036,089)
========== ========== ========== ===========
Basic net loss per
common share $ (.43) $ (.61)
========== ===========
Weighted average shares
outstanding 1,710,000 1,710,000
========== ===========
</TABLE>
Explanatory footnotes:
1. Adjustment to reverse management fees and charge license fees.
2. Adjustment to reverse equity method losses in limited partnerships.
3. Adjustment to amortize goodwill of $160,000 over eight years.
F-17
EXHIBIT 10.5(1)
---------------
AMENDED AND RESTATED
LICENSE AGREEMENT
THIS AMENDED AND RESTATED LICENSE AGREEMENT ("Agreement") is made and
entered into as of the 5th day of August, 1999, by and between UNIQUE RESTAURANT
CONCEPTS, INC., a Florida corporation ("Licensor"), and UNIQUE BRICKELL, LTD., a
Florida limited partnership ("Licensee").
WITNESSETH:
WHEREAS, Licensor and Licensee heretofore entered into that certain
License Agreement dated December 30, 1997 ("Original License Agreement") and now
desire to amend and restate the terms and conditions of their license
arrangement; and
WHEREAS, Licensor is the owner, originator and creator of a restaurant
concept known as "Max's Grille" (the "Restaurant"), which Restaurant utilizes
certain products, recipes, services, procedures, standards, techniques, trade
dress and other proprietary information (collectively, the "System"); and
WHEREAS, Licensor is the sole and exclusive owner of all proprietary
and other property rights and interests in and to the service mark, trade name
and logo: "Max's Grille," including all derivations thereof (the "Name"); and
WHEREAS, it is understood by the parties that Licensor operates
Restaurants in Florida, and may itself establish additional Restaurants and that
the success of Licensor's System will depend largely upon the acceptance and
confidence of the public in the quality and standards of all of Licensor's
establishments; and
WHEREAS, it is also understood by the parties that each Restaurant will
be dependent on each of the others to establish and maintain the good will
necessary for a successful operation, and therefore it is of benefit to, as well
as an obligation of, each licensee to conform strictly to the terms and
conditions of their respective license agreements, all of which are essential
for such purposes; and Licensor must demand and receive rigid compliance and the
maintenance of high, uniform standards of operation in order to insure the
mutual success of all licensees; and
WHEREAS, Licensee is desirous of retaining a license to use the Name
and the System in the operation of a Restaurant at the location hereinafter
identified;
1
<PAGE>
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter contained and other valuable consideration, the receipt of which is
hereby acknowledged, it is understood and agreed between the parties hereto as
follows:
ARTICLE I
GRANT OF LICENSE
1.1 The recitals set forth above are hereby incorporated herein by
reference. The Original License Agreement is hereby superseded, in its entirety,
by this Agreement.
1.2 Licensor hereby grants to Licensee a non-exclusive license to use
the Name and the System in the operation of a Restaurant located in the space in
which it is presently located at Las Olas Riverfront, Fort Lauderdale, Florida
("Licensed Business").
1.3 During the "Term" (as hereinafter defined), and for a period of two
years after the Term, regardless of the reason of termination, Licensor shall
not, within an eight (8) mile radius of the Licensed Business, directly or
indirectly, own, manage, invest in or acquire any economic stake or interest, or
otherwise engage or participate in any manner whatsoever, including, without
limitation, as a partner, shareholder, investor, manager, owner, agent, lender,
borrower, guarantor, broker, independent contractor, consultant, advisor or
otherwise, in any business operating under the Name or the System; provided,
however, that the foregoing shall apply after the Term only if Licensee
continues to operate a restaurant at the location of the Licensed Business and,
provided further, that if the restaurant being operated by Licensee after the
Term is not similar, in food style, mix of food and beverage, and price, to a
Restaurant, then Licensor's covenant as aforedescribed shall be reduced to a
five (5) mile radius from the formerly Licensed Business.
1.4 Licensor covenants and agrees that during the Term and for a period
of two (2) years after the Term, it shall not in any manner, directly or
indirectly, as partner, shareholder, investor, manager, owner, agent, lender,
borrower, guarantor, broker, independent contractor, consultant, advisor or
otherwise, interfere with the business of Licensee by soliciting, hiring,
inducing, attempting to solicit or induce, by combining or conspiring with, or
attempting to do so, or in any other manner influencing any individuals that are
then current employees of Licensee to terminate his or her position or
relationship in order to become an employee for Licensor or its affiliates. For
purposes of the foregoing, Licensor shall not be in violation if Licensor or its
affiliates hire or otherwise engage any person who has not been employed by
Licensee for a period of sixty (60) days prior to such hiring or engagement.
1.5 Licensee covenants and agrees that during the Term and for a period
of two (2) years after the Term, it shall not in any manner, directly or
indirectly, as partner, shareholder, investor, manager, owner, agent, lender,
borrower, guarantor, broker, independent contractor, consultant, advisor or
otherwise, interfere with the business of
2
<PAGE>
Licensor or its affiliates by soliciting, inducing, attempting to solicit or
induce, by combining or conspiring with, or attempting to do so, or in any other
manner influencing any individuals that are then current employees of Licensor
or its affiliates to terminate his or her position or relationship in order to
become an employee of Licensee or its affiliates. For purposes of the foregoing,
Licensee shall not be in violation if Licensee or its affiliates hire or
otherwise engage any person who has not been employed by Licensor or its
affiliates for a period of sixty (60) days prior to such hiring or engagement.
1.6 Licensor and Licensee acknowledge, understand and agree that:
(a) The agreements and covenants each of Licensor and Licensee
in Sections 1.3, 1.4 and 1.5 are reasonable and necessary for the protection of
each of such party's legitimate interests and the transactions contemplated by
this Agreement;
(b) Licensee will be irreparably damaged and its substantial
investments in the license granted by this Agreement will be materially impaired
if Licensor were to enter into any activity competing with the business of
Licensee in violation of the terms of this Agreement;
(c) Each of Licensor and Licensee will be irreparably damaged
if either were to solicit the other's employees in violation of the terms of
this Agreement;
(d) The scope and length of the non-compete and
non-solicitation provisions of this Agreement and the geographical restrictions
contained herein are fair and reasonable and not the result of over reaching,
duress or coercion of any kind;
(e) The full, uninhibited and faithful observance of each of
the agreements and covenants contained in Sections 1.3, 1.4 and 1.5 by each of
Licensor and Licensee, as applicable, will not cause the other party any undue
hardship, financial or otherwise; and
(f) Enforcement of each of the covenants contained in Sections
1.3, 1.4 and 1.5 will not impair Licensor's ability, if it so desires, to engage
in the restaurant business outside of the geographical restrictions of this
Agreement on terms fully acceptable to it.
ARTICLE II
TERM OF LICENSE
2.1 The term of this Agreement ("Term") shall commence on the date
hereof and continue in perpetuity unless terminated as hereinafter provided.
2.2 The Term and the License granted hereto shall expire upon the
occurrence of any of the following events:
3
<PAGE>
(a) If Licensee shall dissolve, be adjudicated a bankrupt,
becomes insolvent, or if a receiver or custodian (permanent or temporary) of its
property or any part thereof is appointed by a court of competent authority; if
it makes a general assignment for the benefit of creditors; if a final judgment
remains unsatisfied of record for thirty (30) days or longer (unless a
supersedeas bond is filed) or if execution is levied against Licensee's business
or property, or a suit to foreclose any lien or mortgage against the Licensed
Business is instituted against Licensee and not dismissed within thirty (30)
days; if the Licensed Business ceases operations, which cessation shall be
conclusively deemed to have occurred if the Licensed Business fails to be open
for business for ten (10) consecutive business days during which all other
businesses in the retail complex in which the Licensed Business is located are
open for business; provided, however, that in the event the Licensed Business
must temporarily suspend operations in order to undertake emergency repairs or
substantial improvements thereto, same shall not be violation hereof provided
that the Licensee has provided advance written notice to Licensor of its intent
to temporarily close the Licensed Business for such purposes and the Licensor
consents thereto, which consent shall not be unreasonably withheld or delayed.
(b) On the date specified by Licensee that is at least ninety
(90) days after Licensee delivers to Licensor written notice of Licensee's
desire to end the Term; provided, however, that notwithstanding such
termination, the fees provided for in Article III shall in any event be payable
through the end of the "Initial Period" (as hereinafter defined), except that
such fees shall be payable only through the date of termination of the Term if
the Licensee has ceased operation of the Licensed Business or any other
restaurant at the location of the Licensed Business on or before that date. The
"Initial Period" shall mean the period commencing on the date hereof and ending
on the first anniversary of the date hereof except, if the aggregate net income
before taxes of the Licensed Business and the Restaurant located at Las Olas
Riverfront, Fort Lauderdale, Florida (or, in either case, successor restaurants
owned by Licensee) for the period ending on the first anniversary date as
determined in accordance with generally accepted accounting principles is equal
to or greater than $150,000, the Initial Period shall be extended for an
additional six (6) months.
ARTICLE III
LICENSE FEE
3.1 In consideration for the grant of this license and the rights to
use the Name and the System, Licensee shall pay to Licensor a license fee (the
"License Fee") based on a percentage of Gross Revenue of the Licensed Business.
For purposes of this Agreement, the term "Gross Revenue" shall mean all revenues
actually received by Licensee from the operation of the Licensed Business from
whatever source as determined by generally accepted accounting principles,
including, without limitation, all departments, services and operations, sales
by sub-tenants or concessionaires, telephone revenue (less service and toll
charges payable to third party providers), valet parking and sales and services
in, about and originating from the Licensed Business (excluding only: interest
income; proceeds from the
4
<PAGE>
sale of used equipment, furniture and other capital assets; loan proceeds,
capital contributions, condemnation proceeds that are attributed to property and
not lost revenue or income, insurance proceeds that are attributed to property
and not lost revenue or income and such other credits, allowances and refunds as
are customary in the restaurant industry and treated as reductions in gross
revenue under generally accepted accounting principles, service charges paid by
customers to the extent paid to employees of the Licensed Business as tips and
gratuities, the amount of any sales, user excise taxes, taxes on rent and other
similar taxes). With respect to any License Fee due to Licensor following
expiration of the Term pursuant to Section 2.2(c) hereof, the term "Licensed
Business" for purposes of calculating Gross Revenue shall refer to the
restaurant operated by Licensee in the location of the Licensed Business, even
though such restaurant is not operated under the Name or the System.
3.2 The License Fee for the period commencing on the date hereof and
ending on the first anniversary of the date hereof shall be an amount equal to
1.75% of Gross Revenue during that period. After the first anniversary date
hereof, the License Fee for the immediately succeeding 12 months and for each
subsequent 12 month period thereafter (or earlier termination of this License)
shall be an amount equal to (i) 1.50% of the first $3,330,000 of Gross Revenue;
(ii) 1.25% of Gross Revenue in excess of $3,300,001 up to $3,800,000; and (iii)
1% of Gross Revenue in excess of $3,800,000.
3.3 Licensee shall pay the License Fee to Licensor quarterly, in
arrears, within 15 days after the end of each calendar quarter, commencing with
the quarter ending September 30, 1999. The License Fee payable for the quarter
ending September 30, 1999 and any quarter during which the Term ends, if less
than a full quarter, shall be prorated. The License Fee due with respect any
period immediately prior to expiration of the Term shall be due and payable
within 15 days of the date of expiration. Payment shall be made by wire transfer
of immediately available funds to an account specified by Licensor.
Contemporaneously with payment of the License Fee, Licensee shall deliver to
Licensor a detailed statement, signed by an authorized officer of Licensee,
setting forth the amount of the Gross Revenue for the applicable period and the
calculation of the License Fee.
3.4 Licensee agrees that Licensor, its attorneys and accountants shall
have the right to examine, copy and audit the books and records of Licensee
relating to the Licensed Business at any time upon reasonable prior written
notice and during regular business hours in order to verify Gross Revenue. In
addition, Licensee shall have the right to examine, copy and audit the books and
records relating to the Licensed Business and the Restaurant located at Waterway
Shoppes of Weston to determine the aggregate net income before taxes of such
restaurants for the Initial Period. In the event Licensor disputes any
determination by Licensee of the License Fee due to Licensor for any period, it
shall notify Licensee in writing, setting forth the basis for its dispute and
the amount of the License Fee it believes is due to Licensor. In the event that
within ten (10) days of such notice the parties can not agree upon the amount of
the License Fee in dispute, they shall, within three (3) days thereafter, select
a firm of independent certified public accountants that does not represent
5
<PAGE>
either party who shall determine the amount of the License Fee due to Licensor
in accordance with this Agreement. In the event that Licensor and Licensee have
not agreed upon a firm of accountants within such three (3) day period, the
dispute may thereafter be submitted by either party for resolution by
arbitration by three arbitrators under the auspices of the American Arbitration
Association in Broward County, Florida, which arbitration shall be conducted in
accordance with the laws of the State of Florida and the commercial arbitration
rules of the American Arbitration Association. The agreed upon accountant or
arbitrator(s) (either, the "Arbitrator") shall be requested by Licensor and
Licensee to render a decision within thirty (30) days following selection of the
Arbitrator and the determination of the Arbitrator shall be final and binding
upon Licensor and Licensee. In the event Licensee is determined to owe
additional License Fees to Licensor, the Arbitrator shall require the payment of
interest at the statutory rate from the date such additional License Fees were
due and payable until the date actually paid, which payment of License Fees and
interest must be made by the Licensee no later than three (3) business days
following the determination of the Arbitrator. In addition, if it is determined
that the Licensee underpaid the License Fee with respect to any license fee
payment period by an amount equal to or greater than two percent (2%), then
Licensee shall be obligated to reimburse Licensor for the costs and expenses of
the Arbitrator and the attorneys or accountants that initially examined the
books and records of Licensee with respect to such quarter on behalf of
Licensor; otherwise, the fees and expenses of the Licensor's audit and the
Arbitrator shall be borne by Licensor.
ARTICLE IV
RESTAURANT PREMISES AND NAME
4.1 The Licensed Business was constructed by Licensee in accordance
with general plans, specifications and designs approved in writing by Licensor.
The leasehold improvements, furnishings, fixtures, equipment, bar, interior
layout and design, tableware, menus, accessories and all other tangible assets
located in the Licensed Business and used in the operation thereof are
acceptable to Licensor as exists as of the date hereof. Licensee shall not make
any material changes or alterations or replacements to the premises except as
otherwise approved, in writing, by Licensor and Licensor shall not unreasonably
withhold consent, if such modification is consistent with the System and an
upscale restaurant.
4.2 Licensee disclaims any right or interest in the creation or
development of the Name or any other of Licensor's service marks and trade names
used in connection with a Restaurant and to the good-will derived therefrom and
acknowledges that Licensor has the sole right to use the Name, such service
marks and trade marks. Licensee will use the Name, such service marks and/or
trade names only in the manner and to the extent specifically permitted in this
Agreement. All advertising, publicity, signs, decorations, furnishings,
equipment or other matter employing in any way whatsoever the Name including,
without limitation, the words "Max's Grille" or "Max's," shall be submitted to
Licensor for its approval, which shall not be unreasonably withheld, prior to
publication or use and shall bear
6
<PAGE>
a SM designation and, if requested by Licensor, a phrase acknowledging
Licensor's ownership thereof.
4.3 Licensee shall not in any way do anything to infringe upon, harm or
contest the rights of Licensor in the Name or incorporate the Name in its firm
name or corporate name without having obtained the prior written approval of
Licensor.
4.4 In the event Licensee learns of any claim or infringement of the
Name licensed hereunder, or any claim of unfair competition or other challenge
to Licensee's right to use the System or any service mark or trade name licensed
hereunder (collectively, "Infringement"), Licensee shall promptly notify
Licensor. Licensor shall defend, indemnify and hold Licensee harmless from any
and all Infringement claims, demands, causes of action, damages, costs and
expenses whatsoever (including, but not limited to, reasonable attorneys' fees)
arising from or out of Licensee's use of the Name or System. Licensor shall have
the sole and exclusive right, in its reasonable discretion, at its own cost and
expense and for its own use and benefit, to institute suit or take such other
action as it may deem proper to restrain any such infringement and defend any
other such claim. In the event Licensor reasonably determines not to restrain
any such infringement or not to commence or thereafter not to prosecute any
suit, Licensee shall not have the right to commence any such proceeding. Each of
the parties hereto shall be entitled to be represented in any proceeding
relating to the matters covered by this section in which the other party is
involved, at its own cost and expense. Each party hereto shall fully cooperate
with the other in any such proceeding, provided that it is reimbursed for its
costs and expenses for doing so, not including counsel fees, if any.
4.5 Licensee agrees not to contest, directly or indirectly, Licensor's
rights or interest in and to the service marks, trade names, trade secrets,
methods, procedure and advertising techniques which are part of Licensor's
business. Licensee, moreover, will not contest, directly or indirectly,
Licensor's rights to use or license others to use such service marks, trade
names, trade secrets, methods, procedures and techniques outside the territory
reserved to Licensee. Licensee acknowledges that the recipes, products,
proprietary formulations, technology, know-how and operation of the Licensed
Business is derived from information disclosed by Licensor to Licensee and that
such information is proprietary and confidential and constitutes a trade secret
of Licensor. Licensee shall take all action necessary to, and shall, at all
times, treat all such confidential information as confidential, and shall
maintain such information as secret, divulging the same only to such of its
employees as must have access to such confidential information in order to
properly operate the Licensed Business. Upon termination hereof for any reason
whatsoever all of Licensee's rights to use such information shall cease.
4.6 Licensee covenants and agrees, as a material inducement to Licensor
granting the license hereunder to Licensee, as follows:
7
<PAGE>
(a) Within fifteen (15) days following the date hereof,
Licensee shall notify, in writing, each vendor that provides goods or services
to the Licensed Business as of the date hereof, and each new vendor within
fifteen (15) days after selection, that the Licensed Business is not owned by
Licensor or any party affiliated with Licensor, but operates only pursuant to a
license, and that such vendor shall have no recourse to Licensor or any of its
affiliates with respect to any business transactions engaged in between such
vendor and the Licensed Business;
(b) Within five (5) days following the date hereof, Licensee
shall notify each employee of the Licensed Business that the Licensed Business
is not owned by Licensor or any affiliate of Licensor, but operates pursuant to
a license from Licensor, and that such employees' payroll and other benefits
shall be payable solely by the Licensed Business, and not by Licensor or any
affiliate of Licensor;
(c) Licensee shall cause Licensor and Unique Restaurant
Concepts, Ltd., and their respective successors and assigns, to be named as
additional insured parties on the comprehensive liability insurance coverage
obtained by Licensee for the Licensed Business and shall deliver to Licensor,
within thirty (30) days of the date hereof and within thirty (30) days following
renewal of each such policy, a certificate of the insurer reflecting such
endorsement in favor of the aforedescribed parties.
(d) Licensee hereby agrees to indemnify and hold Licensor and
its affiliates and their respective shareholders, officers and directors
(collectively, the "Indemnified Parties") harmless from any loss, liability,
claim, damage (including incidental, special and consequential damages), expense
(including costs of investigation and defense and reasonable attorneys' and
paralegal fees) arising, directly or indirectly, from a breach by Licensee of
its obligations under this Agreement or from Licensee's ownership and operation
of the Licensed Business from and after the date hereof. For purposes of this
provision, a "Third Party Claim" shall mean any threatened or actual claim or
investigation, or the commencement of any proceeding made other than by Licensor
based upon an assertion which, if true, would entitle Licensor or any other
Indemnified Party to obtain indemnification from Licensee under this Section
4.6(d). Promptly after receipt by an Indemnified Party of notice of commencement
of any Third Party Claim against it, such Indemnified Party will, if a claim is
to be made against Licensee, give prompt notice to Licensee of such Third Party
Claim, but the failure to give such notice shall not relieve Licensee of any
liability that it may have to an Indemnified Party, except to the extent that
the Licensee is actually prejudiced by the failure or delay in giving such
notice. Upon receipt of notice of a Third Party Claim, Licensee shall assume the
defense of such Third Party Claim at its own expense and with counsel reasonably
satisfactory to the Indemnified Party provided, however, that Licensee shall not
have the right to assume the defense if it is also a party to the Third Party
Claim and joint representation would be inappropriate based upon potential
conflicts between Licensee and Licensor with respect to same or Licensee is
unable to provide reasonable assurance to the Indemnified Party of its financial
capacity to defend such Third Party Claim and provide indemnification with
respect to same. If the Indemnified
8
<PAGE>
Party assumes defense of a Third Party Claim, same shall be at the expense of
Licensee. If Licensee assumes defense of the Third Party Claim, any Indemnified
Party may, at its own expense, participate in the defense thereof and employ its
own counsel for such purpose. If Licensee assumes defense of a Third Party
Claim, no compromise or settlement of such claim may be effected by Licensee
without prior consent of the Indemnified Party unless there is no finding or
admission of any wrongdoing by Indemnified Party, the sole relief against the
Indemnified Party is monetary damages that are paid in full by Licensee and the
Indemnified Party receives and unconditional release of such Third Party Claim.
If notice is given to Licensee of a Third Party Claim and Licensee does not,
within ten (10) days after notice is given, give notice to the Indemnified Party
of its election to assume the defense of such Third Party Claim, Licensee will
be bound by any determination made in such Third Party Claim or any compromise
or settlement effected by the Indemnified Party. Any other claim for
indemnification under this Section 4.6(d) for any matter not involving a Third
Party Claim may be asserted by notice to Licensee.
ARTICLE V
COMPLIANCE WITH SYSTEM
5.1 Licensee agrees to diligently operate the Licensed Business in
strict compliance with the System and to abide by all recommendations of
Licensor relating to, and changes in, said System.
5.2 Licensee recognizes and acknowledges that the System includes,
without limitation, specified food and beverage items which may be served, and
no others, recipes relating to same, menu design and layout, kitchen operating
procedures, order taking procedures, server training, techniques and uniforms,
use and display of the Name in specified places and such other procedures,
techniques and systems as required to create and maintain an upscale but casual
decor and atmosphere in each of the Restaurants. Licensee agrees to diligently
operate the Licensed Business in strict compliance with the System, as same may
be modified by Licensor, from time to time, and to abide by all recommendations
of Licensor relating to, and changes in, said System. Licensee agrees that,
without the prior written consent of Licensor in each instance, it shall not
modify or alter any aspect of the System now in effect, including, without
limitation, by failing to strictly follow recipes, by changing the uniforms worn
by servers, by adding entertainment (except soft background music) or otherwise
modifying the atmosphere of the Licensed Business. In the event that Licensee
desires to make any modification whatsoever to the System, it shall present its
request to Licensor in writing and Licensor shall not unreasonably withhold its
consent, if such modification is consistent with the System and an upscale
restaurant.
5.3 Licensor shall promptly furnish to Licensee any new menus, recipes,
procedures, or other System modifications or additions developed by Licensor or
used by any Restaurant not licensed to Licensee or its affiliates or successors
and assigns. Licensor shall cause Dennis Max to consult monthly at a meeting
with Licensee at the Restaurant. A
9
<PAGE>
representative of Licensor shall train the chef of the Licensed Business with
respect to any new menu items. The representative of Licensor shall be John
Belleme, as long as he serves as the Senior Chef for the Restaurants, or any
successor to that position. All training will take place at the Mizner Park
Restaurant. Licensor agrees that its failure to comply with this Section 5.3
shall cause irreparable harm to Licensee and that the damages suffered by
Licensee in such event are impossible to ascertain. Accordingly, Licensor agrees
that for each day following the tenth (10th) day after written notice from
Licensee that Licensor is not in full compliance with the provisions of Section
5.3, it shall pay Licensee $1,000 as liquidated damages and not as a penalty,
and such amount shall be due and payable by Licensor daily.
5.4 In order to monitor Licensee's compliance with the covenants
contained in this Article V and elsewhere in this Agreement, Licensee agrees
that during hours of operation of the Licensed Business, Licensor shall have the
right to inspect the premises, including the kitchen, and to interview employees
and independent contractors of the Licensed Business. In furtherance thereof,
Licensee agrees that once each month during the Term, two (2) persons designated
by Licensor may each (at the same time) order for their own consumption on the
premises, food and beverages at the Licensed Business without charge, but not to
exceed $150 per month including server gratuities.
ARTICLE VI
COVENANTS OF LICENSEE
6.1 Licensee further agrees as follows:
(a) To maintain a high moral standard and atmosphere at Licensee's
Restaurant; to train and supervise its employees in compliance with all local
and state health code and food preparation laws; to properly and in a sanitary
manner prepare all food and beverages and to serve the same in a wholesome,
appetizing and efficient manner; to maintain the Licensed Business in a clean,
safe and orderly manner; to provide efficient, courteous and high quality
service to the public, to the end that the Licensed Business shall help to
create and build good will among the public for Max's Grille restaurants as a
whole, and so that Licensor, Licensee, and each member of said System shall be
benefited, and the public assured uniform, efficient, courteous, high quality
service on a standardized national basis.
(b) To advertise, sell or offer for sale only those items which are
sold by Licensor in its company-owned Restaurants or approved by Licensor in
writing prior to offering the same for sale.
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(c) Not to carry on or conduct or permit others to carry on or
conduct any other business activity or operation from the approved premises
other than the operation of the Licensed Business.
ARTICLE VII
ASSIGNMENT
7.1 Licensee shall neither sell, assign, transfer or encumber this
Agreement or any rights or interests therein or thereunder, or offer or permit
any such sale, assignment, transfer or encumbrance to occur by operation of law
or otherwise, without the prior written consent of Licensor in each instance,
provided, however, that Licensor's consent shall not be unreasonably withheld if
the proposed assignee has proven ability to operate a restaurant of similar
caliber as the Licensed Business. For purposes hereof, the term "Assignment"
shall include a sale or transfer, whether in a single transaction or in a series
of transactions, of more than 50% ownership interest in Licensee or a transfer
of control of the corporate general partner of Licensee. Licensee is authorized
to assign this Agreement to Sforza Enterprises, Inc. ("Sforza") and, subject to
Sforza's guarantee of Licensee's obligations hereunder, to any entity controlled
by Sforza. A change in Shareholders of Sforza (or any successor publicly-traded
controlling person of Licensee) shall not be deemed an assignment.
ARTICLE VIII
TERMINATION
8.1 Upon termination of this Agreement, Licensee's right to use in any
manner the Name or any other of Licensor's marks used by Licensee (or insignia
or slogan used in connection therewith), or any confusingly similar trademark,
service mark, trade name or insignia shall terminate forthwith. Licensee shall
not thereafter directly or indirectly identify itself in any manner as a Max's
Grille or publicly identify itself as a former Max's Grille or use any of
Licensor's trade secrets, signs, symbols, devices, recipes, formulas or other
materials constituting part of the System.
8.2 Upon the termination of this Agreement, the Licensee shall
immediately discontinue the use of all service marks, trade names, signs,
structures, and forms of advertising indicative of Max's Grille, its symbols,
service marks or its menu items; and, so far as the Licensee may lawfully do so,
shall make or cause to be made such removals of or changes in signs, buildings
and structures as the Licensor shall reasonably direct so as to eliminate the
names "Max's Grille" from the premises.
8.3 Licensee shall fully comply with the obligations imposed on it by
Sections 8.1 and 8.2 hereof no later than ten (10) days following termination of
this Agreement provided Licensee pays the License Fee for such ten (10) day
period. Licensee agrees that its failure to do so shall cause irreparable harm
to Licensor and that the damages suffered by
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Licensor in such event are impossible to ascertain. Accordingly, Licensee agrees
that for each day following the tenth (10th) day after termination of this
Agreement that it is not in full compliance with the provisions of Sections 8.1
and 8.2, it shall pay Licensor a license fee of $1,000 for Licensee's continued
use of any part of the Name and the System in violation of this Agreement.
Licensee acknowledges that such violation shall cause irreparable harm to
Licensor and the damages suffered by Licensor in such event are impossible to
ascertain and, accordingly the $1,000 per day license fee is payable to Licensor
as liquidated damages, and not as a penalty, and is due and payable to Licensor
daily.
ARTICLE IX
MISCELLANEOUS
9.1 Entire Agreement. The privileges herein granted to Licensee
contemplate the operation of a Restaurant at the licensed location and the
rights herein granted shall not be applied or extended, directly or indirectly,
to any other business or enterprise without the express consent in writing of
Licensor. This Agreement contains the entire agreement of the parties with
respect to the license of the Name, other service marks and System and no
representations, inducements, promises or agreements, oral or otherwise, between
the parties not embodied herein shall be of any force or effect. No failure of
Licensor to exercise any power given it hereunder or to insist upon strict
compliance by Licensee of any obligation hereunder, and no custom or practice of
the parties at variance with the terms hereof shall constitute a waiver of
Licensor's right to demand exact compliance with the terms hereof. Waiver by the
Licensor of any particular default by the Licensee shall not affect or impair
the Licensor's rights in respect of any subsequent default of the same or of a
different nature, nor shall any default or omission of the Licensor to exercise
any rights arising from such defaults affect or impair the Licensor's rights as
to such default or any subsequent default.
9.2 Force Majeure. Neither Licensor nor Licensee shall be liable to
perform any of its obligations under this Agreement if such failure to perform
is due to strikes, lockouts, stoppages, accidents, transportation delays, war,
government regulations or act of God or other cause beyond the reasonable
control of Licensor or Licensee and the happening of any such cause of delays
shall extend the time of performance by the time occasioned by any such cause of
delay.
9.3 Severability. If any covenant or other provision of this Agreement
is invalid, or incapable of being enforced, by reason of any rule of law or
public policy, all other conditions and provisions of this Agreement shall,
nevertheless, remain in full force and effect, and no covenant or provision
shall be deemed dependent upon any other covenant or provision unless so
expressed herein.
9.4 Compliance with Laws. Licensee shall conduct its business and
maintain the Restaurant in strict compliance with all applicable laws,
ordinances, regulations, and other
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requirements of any federal, state, county, municipal, or other consent for the
operation of its business.
9.5 Amendments. Neither this Agreement nor any provision hereof may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which endorsement of the change, waiver,
discharge or termination is sought.
9.6 Binding Effect. This Agreement shall be binding upon the parties,
their permitted successors and assigns.
9.7 Governing Law. This License Agreement shall be governed by the laws
of the State of Florida.
9.8 Litigation. If any party hereto engages in litigation against the
other party hereto, either as plaintiff or as defendant, in order to enforce or
defend any of its rights under this Agreement, and such litigation results in a
final judgment in favor of such party ("Prevailing Party"), then the party
against whom said final judgment is obtained shall reimburse the Prevailing
Party for all direct, indirect or incidental expenses incurred by the Prevailing
Party in so enforcing or defending its rights hereunder, including, but not
limited to, all attorneys' fees and court costs and other expenses incurred
throughout all negotiations, trials or appeals undertaken in order to enforce
the Prevailing Party's rights hereunder.
9.9 Notices. Any notice required or permitted to be delivered to either
party under the provisions of this Agreement shall be deemed delivered, whether
actually received or not, when deposited in a United States Postal Service
Depository, postage prepaid, registered or certified, return receipt requested,
and addressed to the party at the address set forth below, or such other address
as shall be specified by written notice delivered to the other party:
If to Licensor: Unique Restaurant Concepts, Inc.
1515 South Federal Highway, Suite 211
Boca Raton, Florida 33432
Attention: Dennis Max, President
With a copy to: Ruden, McClosky, Smith,
Schuster & Russell, P.A.
P.O. Box 1900
Fort Lauderdale, Florida 33301
Attention: Michael H. Krul, Esq.
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If to Licensee: Unique Brickell, Ltd.
c/o Sforza Enterprises, Inc.
330 Clematis Street, Suite 211
West Palm Beach, Florida 33401
Attention: Gerald J. Visconti, Jr.
With a copy to: Gunster, Yoakley, Valdes-Fauli & Stewart, P.A.
777 S. Flagler Drive, Suite 500 East
West Palm Beach, Florida 33401
Attention: Steven J. Serling, Esq.
All notices, demands and requests shall be effective upon being deposited in the
United States mail. However, the time period in which a response to any such
notice, demand or request must be given shall commence to run from the date of
receipt on the return receipt of the notice, demand or request by the addressee
thereof or the date of actual receipt in the case of delivery by other means.
Rejection or other refusal to accept or the inability to deliver because of
changed address of which no notice was given shall be deemed to be receipt of
the notice, demand or request when sent.
9.10 Counterparts. This Agreement may be execute in one or more
counterparts, all of which shall be considered one and the same agreement, and
shall become effective when one or more such counterparts have been signed by
each of the parties and delivered to each of the other parties.
[THIS SPACE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Amended and Restated License Agreement as of the date and year first above
written.
UNIQUE RESTAURANT CONCEPTS,
INC., a Florida corporation
By: /s/ Dennis Max
------------------------
Dennis Max, President
UNIQUE BRICKELL, LTD.
By: Unique Brickell, Inc., a Florida
corporation, as General Partner
By: /s/ Gerald J. Visconti, Jr.
---------------------------------
Gerald J. Visconti, Jr., President
15
EXHIBIT 10.6(1)
---------------
AMENDED AND RESTATED
LICENSE AGREEMENT
THIS AMENDED AND RESTATED LICENSE AGREEMENT ("Agreement") is made and
entered into as of the 5th day of August, 1999, by and between UNIQUE RESTAURANT
CONCEPTS, INC., a Florida corporation ("Licensor"), and UNIQUE WESTON, LTD., a
Florida limited partnership ("Licensee").
WITNESSETH:
WHEREAS, Licensor and Licensee heretofore entered into that certain
License Agreement dated December 30, 1997 ("Original License Agreement") and now
desire to amend and restate the terms and conditions of their license
arrangement; and
WHEREAS, Licensor is the owner, originator and creator of a restaurant
concept known as "Max's Grille" (the "Restaurant"), which Restaurant utilizes
certain products, recipes, services, procedures, standards, techniques, trade
dress and other proprietary information (collectively, the "System"); and
WHEREAS, Licensor is the sole and exclusive owner of all proprietary
and other property rights and interests in and to the service mark, trade name
and logo: "Max's Grille," including all derivations thereof (the "Name"); and
WHEREAS, it is understood by the parties that Licensor operates
Restaurants in Florida, and may itself establish additional Restaurants and that
the success of Licensor's System will depend largely upon the acceptance and
confidence of the public in the quality and standards of all of Licensor's
establishments; and
WHEREAS, it is also understood by the parties that each Restaurant will
be dependent on each of the others to establish and maintain the good will
necessary for a successful operation, and therefore it is of benefit to, as well
as an obligation of, each licensee to conform strictly to the terms and
conditions of their respective license agreements, all of which are essential
for such purposes; and Licensor must demand and receive rigid compliance and the
maintenance of high, uniform standards of operation in order to insure the
mutual success of all licensees; and
WHEREAS, Licensee is desirous of retaining a license to use the Name
and the System in the operation of a Restaurant at the location hereinafter
identified;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter contained and other valuable consideration, the receipt of which is
hereby acknowledged, it is understood and agreed between the parties hereto as
follows:
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ARTICLE I
GRANT OF LICENSE
1.1 The recitals set forth above are hereby incorporated herein by
reference. The Original License Agreement is hereby superseded, in its entirety,
by this Agreement.
1.2 Licensor hereby grants to Licensee a non-exclusive license to use
the Name and the System in the operation of a Restaurant located in the space in
which it is presently located at The Waterway Shoppes of Weston in Weston,
Florida ("Licensed Business").
1.3 During the "Term" (as hereinafter defined), and for a period of two
years after the Term, regardless of the reason of termination, Licensor shall
not, within an eight (8) mile radius of the Licensed Business, directly or
indirectly, own, manage, invest in or acquire any economic stake or interest, or
otherwise engage or participate in any manner whatsoever, including, without
limitation, as a partner, shareholder, investor, manager, owner, agent, lender,
borrower, guarantor, broker, independent contractor, consultant, advisor or
otherwise, in any business operating under the Name or the System; provided,
however, that the foregoing shall apply after the Term only if Licensee
continues to operate a restaurant at the location of the Licensed Business and,
provided further, that if the restaurant being operated by Licensee after the
Term is not similar, in food style, mix of food and beverage, and price, to a
Restaurant, then Licensor's covenant as aforedescribed shall be reduced to a
five (5) mile radius from the formerly Licensed Business.
1.4 Licensor covenants and agrees that during the Term and for a period
of two (2) years after the Term, it shall not in any manner, directly or
indirectly, as partner, shareholder, investor, manager, owner, agent, lender,
borrower, guarantor, broker, independent contractor, consultant, advisor or
otherwise, interfere with the business of Licensee by soliciting, hiring,
inducing, attempting to solicit or induce, by combining or conspiring with, or
attempting to do so, or in any other manner influencing any individuals that are
then current employees of Licensee to terminate his or her position or
relationship in order to become an employee for Licensor or its affiliates. For
purposes of the foregoing, Licensor shall not be in violation if Licensor or its
affiliates hire or otherwise engage any person who has not been employed by
Licensee for a period of sixty (60) days prior to such hiring or engagement.
1.5 Licensee covenants and agrees that during the Term and for a period
of two (2) years after the Term, it shall not in any manner, directly or
indirectly, as partner, shareholder, investor, manager, owner, agent, lender,
borrower, guarantor, broker, independent contractor, consultant, advisor or
otherwise, interfere with the business of Licensor or its affiliates by
soliciting, inducing, attempting to solicit or induce, by combining or
conspiring with, or attempting to do so, or in any other manner influencing any
individuals that are then current employees of Licensor or its affiliates to
terminate his or her position or relationship in order to become an employee of
Licensee or its affiliates. For purposes of
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the foregoing, Licensee shall not be in violation if Licensee or its affiliates
hire or otherwise engage any person who has not been employed by Licensor or its
affiliates for a period of sixty (60) days prior to such hiring or engagement.
1.6 Licensor and Licensee acknowledge, understand and agree that:
(a) The agreements and covenants each of Licensor and Licensee
in Sections 1.3, 1.4 and 1.5 are reasonable and necessary for the protection of
each of such party's legitimate interests and the transactions contemplated by
this Agreement;
(b) Licensee will be irreparably damaged and its substantial
investments in the license granted by this Agreement will be materially impaired
if Licensor were to enter into any activity competing with the business of
Licensee in violation of the terms of this Agreement;
(c) Each of Licensor and Licensee will be irreparably damaged
if either were to solicit the other's employees in violation of the terms of
this Agreement;
(d) The scope and length of the non-compete and
non-solicitation provisions of this Agreement and the geographical restrictions
contained herein are fair and reasonable and not the result of over reaching,
duress or coercion of any kind;
(e) The full, uninhibited and faithful observance of each of
the agreements and covenants contained in Sections 1.3, 1.4 and 1.5 by each of
Licensor and Licensee, as applicable, will not cause the other party any undue
hardship, financial or otherwise; and
(f) Enforcement of each of the covenants contained in Sections
1.3, 1.4 and 1.5 will not impair Licensor's ability, if it so desires, to engage
in the restaurant business outside of the geographical restrictions of this
Agreement on terms fully acceptable to it.
ARTICLE II
TERM OF LICENSE
2.1 The term of this Agreement ("Term") shall commence on the date
hereof and continue in perpetuity unless terminated as hereinafter provided.
2.2 The Term and the License granted hereto shall expire upon the
occurrence of any of the following events:
(a) If Licensee shall dissolve, be adjudicated a bankrupt,
becomes insolvent, or if a receiver or custodian (permanent or temporary) of its
property or any part thereof is appointed by a court of competent authority; if
it makes a general assignment for the benefit of creditors; if a final judgment
remains unsatisfied of record for thirty (30) days or longer (unless a
supersedeas bond is filed) or if execution is levied against Licensee's
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business or property, or a suit to foreclose any lien or mortgage against the
Licensed Business is instituted against Licensee and not dismissed within thirty
(30) days; if the Licensed Business ceases operations, which cessation shall be
conclusively deemed to have occurred if the Licensed Business fails to be open
for business for ten (10) consecutive business days during which all other
businesses in the retail complex in which the Licensed Business is located are
open for business; provided, however, that in the event the Licensed Business
must temporarily suspend operations in order to undertake emergency repairs or
substantial improvements thereto, same shall not be violation hereof provided
that the Licensee has provided advance written notice to Licensor of its intent
to temporarily close the Licensed Business for such purposes and the Licensor
consents thereto, which consent shall not be unreasonably withheld or delayed.
(b) On the date specified by Licensee that is at least ninety
(90) days after Licensee delivers to Licensor written notice of Licensee's
desire to end the Term; provided, however, that notwithstanding such
termination, the fees provided for in Article III shall in any event be payable
through the end of the "Initial Period" (as hereinafter defined), except that
such fees shall be payable only through the date of termination of the Term if
the Licensee has ceased operation of the Licensed Business or any other
restaurant at the location of the Licensed Business on or before that date. The
"Initial Period" shall mean the period commencing on the date hereof and ending
on the first anniversary of the date hereof except, if the aggregate net income
before taxes of the Licensed Business and the Restaurant located at Las Olas
Riverfront, Fort Lauderdale, Florida (or, in either case, successor restaurants
owned by Licensee) for the period ending on the first anniversary date as
determined in accordance with generally accepted accounting principles is equal
to or greater than $150,000, the Initial Period shall be extended for an
additional six (6) months.
ARTICLE III
LICENSE FEE
3.1 In consideration for the grant of this license and the rights to
use the Name and the System, Licensee shall pay to Licensor a license fee (the
"License Fee") based on a percentage of Gross Revenue of the Licensed Business.
For purposes of this Agreement, the term "Gross Revenue" shall mean all revenues
actually received by Licensee from the operation of the Licensed Business from
whatever source as determined by generally accepted accounting principles,
including, without limitation, all departments, services and operations, sales
by sub-tenants or concessionaires, telephone revenue (less service and toll
charges payable to third party providers), valet parking and sales and services
in, about and originating from the Licensed Business (excluding only: interest
income; proceeds from the sale of used equipment, furniture and other capital
assets; loan proceeds, capital contributions, condemnation proceeds that are
attributed to property and not lost revenue or income, insurance proceeds that
are attributed to property and not lost revenue or income and such other
credits, allowances and refunds as are customary in the restaurant industry and
treated as reductions in gross revenue under generally accepted accounting
principles, service charges paid by customers to the extent paid to employees of
the Licensed Business as tips
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and gratuities, the amount of any sales, user excise taxes, taxes on rent and
other similar taxes). With respect to any License Fee due to Licensor following
expiration of the Term pursuant to Section 2.2(c) hereof, the term "Licensed
Business" for purposes of calculating Gross Revenue shall refer to the
restaurant operated by Licensee in the location of the Licensed Business, even
though such restaurant is not operated under the Name or the System.
3.2 The License Fee for the period commencing on the date hereof and
ending on the first anniversary of the date hereof shall be an amount equal to
1.75% of Gross Revenue during that period. After the first anniversary date
hereof, the License Fee for the immediately succeeding 12 months and for each
subsequent 12 month period thereafter (or earlier termination of this License)
shall be an amount equal to (i) 1.50% of the first $3,330,000 of Gross Revenue;
(ii) 1.25% of Gross Revenue in excess of $3,300,001 up to $3,800,000; and (iii)
1% of Gross Revenue in excess of $3,800,000.
3.3 Licensee shall pay the License Fee to Licensor quarterly, in
arrears, within 15 days after the end of each calendar quarter, commencing with
the quarter ending September 30, 1999. The License Fee payable for the quarter
ending September 30, 1999 and any quarter during which the Term ends, if less
than a full quarter, shall be prorated. The License Fee due with respect any
period immediately prior to expiration of the Term shall be due and payable
within 15 days of the date of expiration. Payment shall be made by wire transfer
of immediately available funds to an account specified by Licensor.
Contemporaneously with payment of the License Fee, Licensee shall deliver to
Licensor a detailed statement, signed by an authorized officer of Licensee,
setting forth the amount of the Gross Revenue for the applicable period and the
calculation of the License Fee.
3.4 Licensee agrees that Licensor, its attorneys and accountants shall
have the right to examine, copy and audit the books and records of Licensee
relating to the Licensed Business at any time upon reasonable prior written
notice and during regular business hours in order to verify Gross Revenue. In
addition, Licensee shall have the right to examine, copy and audit the books and
records relating to the Licensed Business and the Restaurant located at Las Olas
Riverfront to determine the aggregate net income before taxes of such
restaurants for the Initial Period. In the event Licensor disputes any
determination by Licensee of the License Fee due to Licensor for any period, it
shall notify Licensee in writing, setting forth the basis for its dispute and
the amount of the License Fee it believes is due to Licensor. In the event that
within ten (10) days of such notice the parties can not agree upon the amount of
the License Fee in dispute, they shall, within three (3) days thereafter, select
a firm of independent certified public accountants that does not represent
either party who shall determine the amount of the License Fee due to Licensor
in accordance with this Agreement. In the event that Licensor and Licensee have
not agreed upon a firm of accountants within such three (3) day period, the
dispute may thereafter be submitted by either party for resolution by
arbitration by three arbitrators under the auspices of the American Arbitration
Association in Broward County, Florida, which arbitration shall be conducted in
accordance with the laws of the State of Florida and the commercial arbitration
rules of the American Arbitration Association. The agreed upon accountant or
arbitrator(s) (either, the
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"Arbitrator") shall be requested by Licensor and Licensee to render a decision
within thirty (30) days following selection of the Arbitrator and the
determination of the Arbitrator shall be final and binding upon Licensor and
Licensee. In the event Licensee is determined to owe additional License Fees to
Licensor, the Arbitrator shall require the payment of interest at the statutory
rate from the date such additional License Fees were due and payable until the
date actually paid, which payment of License Fees and interest must be made by
the Licensee no later than three (3) business days following the determination
of the Arbitrator. In addition, if it is determined that the Licensee underpaid
the License Fee with respect to any license fee payment period by an amount
equal to or greater than two percent (2%), then Licensee shall be obligated to
reimburse Licensor for the costs and expenses of the Arbitrator and the
attorneys or accountants that initially examined the books and records of
Licensee with respect to such quarter on behalf of Licensor; otherwise, the fees
and expenses of the Licensor's audit and the Arbitrator shall be borne by
Licensor.
ARTICLE IV
RESTAURANT PREMISES AND NAME
4.1 The Licensed Business was constructed by Licensee in accordance
with general plans, specifications and designs approved in writing by Licensor.
The leasehold improvements, furnishings, fixtures, equipment, bar, interior
layout and design, tableware, menus, accessories and all other tangible assets
located in the Licensed Business and used in the operation thereof are
acceptable to Licensor as exists as of the date hereof. Licensee shall not make
any material changes or alterations or replacements to the premises except as
otherwise approved, in writing, by Licensor and Licensor shall not unreasonably
withhold consent, if such modification is consistent with the System and an
upscale restaurant.
4.2 Licensee disclaims any right or interest in the creation or
development of the Name or any other of Licensor's service marks and trade names
used in connection with a Restaurant and to the good-will derived therefrom and
acknowledges that Licensor has the sole right to use the Name, such service
marks and trade marks. Licensee will use the Name, such service marks and/or
trade names only in the manner and to the extent specifically permitted in this
Agreement. All advertising, publicity, signs, decorations, furnishings,
equipment or other matter employing in any way whatsoever the Name including,
without limitation, the words "Max's Grille" or "Max's," shall be submitted to
Licensor for its approval, which shall not be unreasonably withheld, prior to
publication or use and shall bear a SM designation and, if requested by
Licensor, a phrase acknowledging Licensor's ownership thereof.
4.3 Licensee shall not in any way do anything to infringe upon, harm or
contest the rights of Licensor in the Name or incorporate the Name in its firm
name or corporate name without having obtained the prior written approval of
Licensor.
4.4 In the event Licensee learns of any claim or infringement of the
Name licensed hereunder, or any claim of unfair competition or other challenge
to Licensee's right
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to use the System or any service mark or trade name licensed hereunder
(collectively, "Infringement"), Licensee shall promptly notify Licensor.
Licensor shall defend, indemnify and hold Licensee harmless from any and all
Infringement claims, demands, causes of action, damages, costs and expenses
whatsoever (including, but not limited to, reasonable attorneys' fees) arising
from or out of Licensee's use of the Name or System. Licensor shall have the
sole and exclusive right, in its reasonable discretion, at its own cost and
expense and for its own use and benefit, to institute suit or take such other
action as it may deem proper to restrain any such infringement and defend any
other such claim. In the event Licensor reasonably determines not to restrain
any such infringement or not to commence or thereafter not to prosecute any
suit, Licensee shall not have the right to commence any such proceeding. Each of
the parties hereto shall be entitled to be represented in any proceeding
relating to the matters covered by this section in which the other party is
involved, at its own cost and expense. Each party hereto shall fully cooperate
with the other in any such proceeding, provided that it is reimbursed for its
costs and expenses for doing so, not including counsel fees, if any.
4.5 Licensee agrees not to contest, directly or indirectly, Licensor's
rights or interest in and to the service marks, trade names, trade secrets,
methods, procedure and advertising techniques which are part of Licensor's
business. Licensee, moreover, will not contest, directly or indirectly,
Licensor's rights to use or license others to use such service marks, trade
names, trade secrets, methods, procedures and techniques outside the territory
reserved to Licensee. Licensee acknowledges that the recipes, products,
proprietary formulations, technology, know-how and operation of the Licensed
Business is derived from information disclosed by Licensor to Licensee and that
such information is proprietary and confidential and constitutes a trade secret
of Licensor. Licensee shall take all action necessary to, and shall, at all
times, treat all such confidential information as confidential, and shall
maintain such information as secret, divulging the same only to such of its
employees as must have access to such confidential information in order to
properly operate the Licensed Business. Upon termination hereof for any reason
whatsoever all of Licensee's rights to use such information shall cease.
4.6 Licensee covenants and agrees, as a material inducement to Licensor
granting the license hereunder to Licensee, as follows:
(a) Within fifteen (15) days following the date hereof,
Licensee shall notify, in writing, each vendor that provides goods or services
to the Licensed Business as of the date hereof, and each new vendor within
fifteen (15) days after selection, that the Licensed Business is not owned by
Licensor or any party affiliated with Licensor, but operates only pursuant to a
license, and that such vendor shall have no recourse to Licensor or any of its
affiliates with respect to any business transactions engaged in between such
vendor and the Licensed Business;
(b) Within five (5) days following the date hereof, Licensee
shall notify each employee of the Licensed Business that the Licensed Business
is not owned by Licensor or any affiliate of Licensor, but operates pursuant to
a license from Licensor, and that such
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employees' payroll and other benefits shall be payable solely by the Licensed
Business, and not by Licensor or any affiliate of Licensor;
(c) Licensee shall cause Licensor and Unique Restaurant
Concepts, Ltd., and their respective successors and assigns, to be named as
additional insured parties on the comprehensive liability insurance coverage
obtained by Licensee for the Licensed Business and shall deliver to Licensor,
within thirty (30) days of the date hereof and within thirty (30) days following
renewal of each such policy, a certificate of the insurer reflecting such
endorsement in favor of the aforedescribed parties.
(d) Licensee hereby agrees to indemnify and hold Licensor and
its affiliates and their respective shareholders, officers and directors
(collectively, the "Indemnified Parties") harmless from any loss, liability,
claim, damage (including incidental, special and consequential damages), expense
(including costs of investigation and defense and reasonable attorneys' and
paralegal fees) arising, directly or indirectly, from a breach by Licensee of
its obligations under this Agreement or from Licensee's ownership and operation
of the Licensed Business from and after the date hereof. For purposes of this
provision, a "Third Party Claim" shall mean any threatened or actual claim or
investigation, or the commencement of any proceeding made other than by Licensor
based upon an assertion which, if true, would entitle Licensor or any other
Indemnified Party to obtain indemnification from Licensee under this Section
4.6(d). Promptly after receipt by an Indemnified Party of notice of commencement
of any Third Party Claim against it, such Indemnified Party will, if a claim is
to be made against Licensee, give prompt notice to Licensee of such Third Party
Claim, but the failure to give such notice shall not relieve Licensee of any
liability that it may have to an Indemnified Party, except to the extent that
the Licensee is actually prejudiced by the failure or delay in giving such
notice. Upon receipt of notice of a Third Party Claim, Licensee shall assume the
defense of such Third Party Claim at its own expense and with counsel reasonably
satisfactory to the Indemnified Party provided, however, that Licensee shall not
have the right to assume the defense if it is also a party to the Third Party
Claim and joint representation would be inappropriate based upon potential
conflicts between Licensee and Licensor with respect to same or Licensee is
unable to provide reasonable assurance to the Indemnified Party of its financial
capacity to defend such Third Party Claim and provide indemnification with
respect to same. If the Indemnified Party assumes defense of a Third Party
Claim, same shall be at the expense of Licensee. If Licensee assumes defense of
the Third Party Claim, any Indemnified Party may, at its own expense,
participate in the defense thereof and employ its own counsel for such purpose.
If Licensee assumes defense of a Third Party Claim, no compromise or settlement
of such claim may be effected by Licensee without prior consent of the
Indemnified Party unless there is no finding or admission of any wrongdoing by
Indemnified Party, the sole relief against the Indemnified Party is monetary
damages that are paid in full by Licensee and the Indemnified Party receives and
unconditional release of such Third Party Claim. If notice is given to Licensee
of a Third Party Claim and Licensee does not, within ten (10) days after notice
is given, give notice to the Indemnified Party of its election to assume the
defense of such Third Party Claim, Licensee will be bound by any determination
made in such Third Party Claim or any compromise or settlement effected by the
Indemnified Party. Any other
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claim for indemnification under this Section 4.6(d) for any matter not involving
a Third Party Claim may be asserted by notice to Licensee.
ARTICLE V
COMPLIANCE WITH SYSTEM
5.1 Licensee agrees to diligently operate the Licensed Business in
strict compliance with the System and to abide by all recommendations of
Licensor relating to, and changes in, said System.
5.2 Licensee recognizes and acknowledges that the System includes,
without limitation, specified food and beverage items which may be served, and
no others, recipes relating to same, menu design and layout, kitchen operating
procedures, order taking procedures, server training, techniques and uniforms,
use and display of the Name in specified places and such other procedures,
techniques and systems as required to create and maintain an upscale but casual
decor and atmosphere in each of the Restaurants. Licensee agrees to diligently
operate the Licensed Business in strict compliance with the System, as same may
be modified by Licensor, from time to time, and to abide by all recommendations
of Licensor relating to, and changes in, said System. Licensee agrees that,
without the prior written consent of Licensor in each instance, it shall not
modify or alter any aspect of the System now in effect, including, without
limitation, by failing to strictly follow recipes, by changing the uniforms worn
by servers, by adding entertainment (except soft background music) or otherwise
modifying the atmosphere of the Licensed Business. In the event that Licensee
desires to make any modification whatsoever to the System, it shall present its
request to Licensor in writing and Licensor shall not unreasonably withhold its
consent, if such modification is consistent with the System and an upscale
restaurant.
5.3 Licensor shall promptly furnish to Licensee any new menus, recipes,
procedures, or other System modifications or additions developed by Licensor or
used by any Restaurant not licensed to Licensee or its affiliates or successors
and assigns. Licensor shall cause Dennis Max to consult monthly at a meeting
with Licensee at the Restaurant. A representative of Licensor shall train the
chef of the Licensed Business with respect to any new menu items. The
representative of Licensor shall be John Belleme, as long as he serves as the
Senior Chef for the Restaurants, or any successor to that position. All training
will take place at the Mizner Park Restaurant. Licensor agrees that its failure
to comply with this Section 5.3 shall cause irreparable harm to Licensee and
that the damages suffered by Licensee in such event are impossible to ascertain.
Accordingly, Licensor agrees that for each day following the tenth (10th) day
after written notice from Licensee that Licensor is not in full compliance with
the provisions of Section 5.3, it shall pay Licensee $1,000 as liquidated
damages and not as a penalty, and such amount shall be due and payable by
Licensor daily.
5.4 In order to monitor Licensee's compliance with the covenants
contained in this Article V and elsewhere in this Agreement, Licensee agrees
that during hours of
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operation of the Licensed Business, Licensor shall have the right to inspect the
premises, including the kitchen, and to interview employees and independent
contractors of the Licensed Business. In furtherance thereof, Licensee agrees
that once each month during the Term, two (2) persons designated by Licensor may
each (at the same time) order for their own consumption on the premises, food
and beverages at the Licensed Business without charge, but not to exceed $150
per month including server gratuities.
ARTICLE VI
COVENANTS OF LICENSEE
6.1 Licensee further agrees as follows:
(a) To maintain a high moral standard and atmosphere at
Licensee's Restaurant; to train and supervise its employees in compliance with
all local and state health code and food preparation laws; to properly and in a
sanitary manner prepare all food and beverages and to serve the same in a
wholesome, appetizing and efficient manner; to maintain the Licensed Business in
a clean, safe and orderly manner; to provide efficient, courteous and high
quality service to the public, to the end that the Licensed Business shall help
to create and build good will among the public for Max's Grille restaurants as a
whole, and so that Licensor, Licensee, and each member of said System shall be
benefited, and the public assured uniform, efficient, courteous, high quality
service on a standardized national basis.
(b) To advertise, sell or offer for sale only those items
which are sold by Licensor in its company-owned Restaurants or approved by
Licensor in writing prior to offering the same for sale.
(c) Not to carry on or conduct or permit others to carry on or
conduct any other business activity or operation from the approved premises
other than the operation of the Licensed Business.
ARTICLE VII
ASSIGNMENT
7.1 Licensee shall neither sell, assign, transfer or encumber this
Agreement or any rights or interests therein or thereunder, or offer or permit
any such sale, assignment, transfer or encumbrance to occur by operation of law
or otherwise, without the prior written consent of Licensor in each instance,
provided, however, that Licensor's consent shall not be unreasonably withheld if
the proposed assignee has proven ability to operate a restaurant of similar
caliber as the Licensed Business. For purposes hereof, the term "Assignment"
shall include a sale or transfer, whether in a single transaction or in a series
of transactions, of more than 50% ownership interest in Licensee or a transfer
of control of the corporate
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general partner of Licensee. Licensee is authorized to assign this Agreement to
Sforza Enterprises, Inc. ("Sforza") and, subject to Sforza's guarantee of
Licensee's obligations hereunder, to any entity controlled by Sforza. A change
in Shareholders of Sforza (or any successor publicly-traded controlling person
of Licensee) shall not be deemed an assignment.
ARTICLE VIII
TERMINATION
8.1 Upon termination of this Agreement, Licensee's right to use in any
manner the Name or any other of Licensor's marks used by Licensee (or insignia
or slogan used in connection therewith), or any confusingly similar trademark,
service mark, trade name or insignia shall terminate forthwith. Licensee shall
not thereafter directly or indirectly identify itself in any manner as a Max's
Grille or publicly identify itself as a former Max's Grille or use any of
Licensor's trade secrets, signs, symbols, devices, recipes, formulas or other
materials constituting part of the System.
8.2 Upon the termination of this Agreement, the Licensee shall
immediately discontinue the use of all service marks, trade names, signs,
structures, and forms of advertising indicative of Max's Grille, its symbols,
service marks or its menu items; and, so far as the Licensee may lawfully do so,
shall make or cause to be made such removals of or changes in signs, buildings
and structures as the Licensor shall reasonably direct so as to eliminate the
names "Max's Grille" from the premises.
8.3 Licensee shall fully comply with the obligations imposed on it by
Sections 8.1 and 8.2 hereof no later than ten (10) days following termination of
this Agreement provided Licensee pays the License Fee for such ten (10) day
period. Licensee agrees that its failure to do so shall cause irreparable harm
to Licensor and that the damages suffered by Licensor in such event are
impossible to ascertain. Accordingly, Licensee agrees that for each day
following the tenth (10th) day after termination of this Agreement that it is
not in full compliance with the provisions of Sections 8.1 and 8.2, it shall pay
Licensor a license fee of $1,000 for Licensee's continued use of any part of the
Name and the System in violation of this Agreement. Licensee acknowledges that
such violation shall cause irreparable harm to Licensor and the damages suffered
by Licensor in such event are impossible to ascertain and, accordingly the
$1,000 per day license fee is payable to Licensor as liquidated damages, and not
as a penalty, and is due and payable to Licensor daily.
ARTICLE IX
MISCELLANEOUS
9.1 Entire Agreement. The privileges herein granted to Licensee
contemplate the operation of a Restaurant at the licensed location and the
rights herein granted shall not be applied or extended, directly or indirectly,
to any other business or enterprise without the express consent in writing of
Licensor. This Agreement contains the entire agreement of the
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parties with respect to the license of the Name, other service marks and System
and no representations, inducements, promises or agreements, oral or otherwise,
between the parties not embodied herein shall be of any force or effect. No
failure of Licensor to exercise any power given it hereunder or to insist upon
strict compliance by Licensee of any obligation hereunder, and no custom or
practice of the parties at variance with the terms hereof shall constitute a
waiver of Licensor's right to demand exact compliance with the terms hereof.
Waiver by the Licensor of any particular default by the Licensee shall not
affect or impair the Licensor's rights in respect of any subsequent default of
the same or of a different nature, nor shall any default or omission of the
Licensor to exercise any rights arising from such defaults affect or impair the
Licensor's rights as to such default or any subsequent default.
9.2 Force Majeure. Neither Licensor nor Licensee shall be liable to
perform any of its obligations under this Agreement if such failure to perform
is due to strikes, lockouts, stoppages, accidents, transportation delays, war,
government regulations or act of God or other cause beyond the reasonable
control of Licensor or Licensee and the happening of any such cause of delays
shall extend the time of performance by the time occasioned by any such cause of
delay.
9.3 Severability. If any covenant or other provision of this Agreement
is invalid, or incapable of being enforced, by reason of any rule of law or
public policy, all other conditions and provisions of this Agreement shall,
nevertheless, remain in full force and effect, and no covenant or provision
shall be deemed dependent upon any other covenant or provision unless so
expressed herein.
9.4 Compliance with Laws. Licensee shall conduct its business and
maintain the Restaurant in strict compliance with all applicable laws,
ordinances, regulations, and other requirements of any federal, state, county,
municipal, or other consent for the operation of its business.
9.5 Amendments. Neither this Agreement nor any provision hereof may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which endorsement of the change, waiver,
discharge or termination is sought.
9.6 Binding Effect. This Agreement shall be binding upon the parties,
their permitted successors and assigns.
9.7 Governing Law. This License Agreement shall be governed by the laws
of the State of Florida.
9.8 Litigation. If any party hereto engages in litigation against the
other party hereto, either as plaintiff or as defendant, in order to enforce or
defend any of its rights under this Agreement, and such litigation results in a
final judgment in favor of such party ("Prevailing Party"), then the party
against whom said final judgment is obtained shall reimburse the Prevailing
Party for all direct, indirect or incidental expenses incurred by the
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Prevailing Party in so enforcing or defending its rights hereunder, including,
but not limited to, all attorneys' fees and court costs and other expenses
incurred throughout all negotiations, trials or appeals undertaken in order to
enforce the Prevailing Party's rights hereunder.
9.9 Notices. Any notice required or permitted to be delivered to either
party under the provisions of this Agreement shall be deemed delivered, whether
actually received or not, when deposited in a United States Postal Service
Depository, postage prepaid, registered or certified, return receipt requested,
and addressed to the party at the address set forth below, or such other address
as shall be specified by written notice delivered to the other party:
If to Licensor: Unique Restaurant Concepts, Inc.
1515 South Federal Highway, Suite 211
Boca Raton, Florida 33432
Attention: Dennis Max, President
With a copy to: Ruden, McClosky, Smith,
Schuster & Russell, P.A.
P.O. Box 1900
Fort Lauderdale, Florida 33301
Attention: Michael H. Krul, Esq.
If to Licensee: Unique Weston, Ltd.
c/o Sforza Enterprises, Inc.
330 Clematis Street, Suite 211
West Palm Beach, Florida 33401
Attention: Gerald J. Visconti, Jr.
With a copy to: Gunster, Yoakley, Valdes-Fauli & Stewart, P.A.
777 S. Flagler Drive, Suite 500 East
West Palm Beach, Florida 33401
Attention: Steven J. Serling, Esq.
All notices, demands and requests shall be effective upon being deposited in the
United States mail. However, the time period in which a response to any such
notice, demand or request must be given shall commence to run from the date of
receipt on the return receipt of the notice, demand or request by the addressee
thereof or the date of actual receipt in the case of delivery by other means.
Rejection or other refusal to accept or the inability to deliver because of
changed address of which no notice was given shall be deemed to be receipt of
the notice, demand or request when sent.
9.10 Counterparts. This Agreement may be execute in one or more
counterparts, all of which shall be considered one and the same agreement, and
shall become effective when one or more such counterparts have been signed by
each of the parties and delivered to each of the other parties.
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IN WITNESS WHEREOF, the parties hereto have executed and
delivered this Amended and Restated License Agreement as of the date and year
first above written.
UNIQUE RESTAURANT CONCEPTS,
INC., a Florida corporation
By: /s/ Dennis Max
------------------------------------
Dennis Max, President
UNIQUE WESTON, LTD.
By: Unique Weston, Inc., a Florida
corporation, as General Partner
By: /s/ Gerald J. Visconti, Jr.
-------------------------------------
Gerald J. Visconti, Jr., President
14
EXHIBIT 10.8(1)
---------------
AMENDED AND RESTATED
LICENSE AGREEMENT
THIS AMENDED AND RESTATED LICENSE AGREEMENT ("Agreement") is made and
entered into as of the 5th day of August, 1999, by and between UNIQUE RESTAURANT
CONCEPTS, INC., a Florida corporation ("Licensor"), and MAX'S BEACH GRILL, LTD.,
a Florida limited partnership ("Licensee").
WITNESSETH:
WHEREAS, Licensor and Licensee heretofore entered into that certain
License Agreement dated December 30, 1997 ("Original License Agreement") and now
desire to amend and restate the terms and conditions of their license
arrangement; and
WHEREAS, Licensor is the owner, originator and creator of a restaurant
concept known as "Max's Grille" (the "Restaurant"), which Restaurant utilizes
certain products, recipes, services, procedures, standards, techniques, trade
dress and other proprietary information (collectively, the "System"); and
WHEREAS, Licensor is the sole and exclusive owner of all proprietary
and other property rights and interests in and to the service mark, trade name
and logo: "Max's Grille," including all derivations thereof (the "Name"); and
WHEREAS, it is understood by the parties that Licensor operates
Restaurants in Florida, and may itself establish additional Restaurants and that
the success of Licensor's System will depend largely upon the acceptance and
confidence of the public in the quality and standards of all of Licensor's
establishments; and
WHEREAS, it is also understood by the parties that each Restaurant will
be dependent on each of the others to establish and maintain the good will
necessary for a successful operation, and therefore it is of benefit to, as well
as an obligation of, each licensee to conform strictly to the terms and
conditions of their respective license agreements, all of which are essential
for such purposes; and Licensor must demand and receive rigid compliance and the
maintenance of high, uniform standards of operation in order to insure the
mutual success of all licensees; and
WHEREAS, Licensee is desirous of retaining a license to use the Name
and the System in the operation of a Restaurant at the location hereinafter
identified;
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NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter contained and other valuable consideration, the receipt of which is
hereby acknowledged, it is understood and agreed between the parties hereto as
follows:
ARTICLE I
GRANT OF LICENSE
1.1 The recitals set forth above are hereby incorporated herein by
reference. The Original License Agreement is hereby superseded, in its entirety,
by this Agreement.
1.2 Licensor hereby grants to Licensee a non-exclusive license to use
the Name and the System in the operation of a Restaurant located in the space in
which it is presently located at Beach Place, Fort Lauderdale, Florida
("Licensed Business").
1.3 During the "Term" (as hereinafter defined), Licensor shall not,
within an eight (8) mile radius of the Licensed Business, directly or
indirectly, own, manage, invest in or acquire any economic stake or interest, or
otherwise engage or participate in any manner whatsoever, including, without
limitation, as a partner, shareholder, investor, manager, owner, agent, lender,
borrower, guarantor, broker, independent contractor, consultant, advisor or
otherwise, in any business operating under the Name or the System.
1.4 Licensor covenants and agrees that during the Term, it shall not in
any manner, directly or indirectly, as partner, shareholder, investor, manager,
owner, agent, lender, borrower, guarantor, broker, independent contractor,
consultant, advisor or otherwise, interfere with the business of Licensee by
soliciting, hiring, inducing, attempting to solicit or induce, by combining or
conspiring with, or attempting to do so, or in any other manner influencing any
individuals that are then current employees of Licensee to terminate his or her
position or relationship in order to become an employee for Licensor or its
affiliates. For purposes of the foregoing, Licensor shall not be in violation if
Licensor or its affiliates hire or otherwise engage any person who has not been
employed by Licensee for a period of sixty (60) days prior to such hiring or
engagement.
1.5 Licensee covenants and agrees that during the Term, it shall not in
any manner, directly or indirectly, as partner, shareholder, investor, manager,
owner, agent, lender, borrower, guarantor, broker, independent contractor,
consultant, advisor or otherwise, interfere with the business of Licensor or its
affiliates by soliciting, inducing, attempting to solicit or induce, by
combining or conspiring with, or attempting to do so, or in any other manner
influencing any individuals that are then current employees of Licensor or its
affiliates to terminate his or her position or relationship in order to become
an employee of Licensee or its affiliates. For purposes of the foregoing,
Licensee shall not be in violation if Licensee or its affiliates hire or
otherwise engage any person who has not been employed by Licensor or its
affiliates for a period of sixty (60) days prior to such hiring or engagement.
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1.6 Licensor and Licensee acknowledge, understand and agree that:
(a) The agreements and covenants each of Licensor and Licensee
in Sections 1.3, 1.4 and 1.5 are reasonable and necessary for the protection of
each of such party's legitimate interests and the transactions contemplated by
this Agreement;
(b) Licensee will be irreparably damaged and its substantial
investments in the license granted by this Agreement will be materially impaired
if Licensor were to enter into any activity competing with the business of
Licensee in violation of the terms of this Agreement;
(c) Each of Licensor and Licensee will be irreparably damaged
if either were to solicit the other's employees in violation of the terms of
this Agreement;
(d) The scope and length of the non-compete and
non-solicitation provisions of this Agreement and the geographical restrictions
contained herein are fair and reasonable and not the result of over reaching,
duress or coercion of any kind;
(e) The full, uninhibited and faithful observance of each of
the agreements and covenants contained in Sections 1.3, 1.4 and 1.5 by each of
Licensor and Licensee, as applicable, will not cause the other party any undue
hardship, financial or otherwise; and
(f) Enforcement of each of the covenants contained in Sections
1.3, 1.4 and 1.5 will not impair Licensor's ability, if it so desires, to engage
in the restaurant business outside of the geographical restrictions of this
Agreement on terms fully acceptable to it.
ARTICLE II
TERM OF LICENSE
2.1 The term of this Agreement ("Term") shall commence on the date
hereof and terminate upon thirty (30) days written notice or as hereafter
provided.
2.2 The Term and the License granted hereto shall expire upon the
occurrence of any of the following events:
If Licensee shall dissolve, be adjudicated a bankrupt, becomes
insolvent, or if a receiver or custodian (permanent or temporary) of its
property or any part thereof is appointed by a court of competent authority; if
it makes a general assignment for the benefit of creditors; if a final judgment
remains unsatisfied of record for thirty (30) days or longer (unless a
supersedeas bond is filed) or if execution is levied against Licensee's business
or property, or a suit to foreclose any lien or mortgage against the Licensed
Business is instituted against Licensee and not dismissed within thirty (30)
days; if the Licensed Business ceases operations, which cessation shall be
conclusively deemed to have occurred
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if the Licensed Business fails to be open for business for ten (10) consecutive
business days during which all other businesses in the retail complex in which
the Licensed Business is located are open for business; provided, however, that
in the event the Licensed Business must temporarily suspend operations in order
to undertake emergency repairs or substantial improvements thereto, same shall
not be violation hereof provided that the Licensee has provided advance written
notice to Licensor of its intent to temporarily close the Licensed Business for
such purposes and the Licensor consents thereto, which consent shall not be
unreasonably withheld or delayed.
ARTICLE III
LICENSE FEE
3.1 In consideration for the grant of this license and the rights to
use the Name and the System, Licensee shall pay to Licensor a license fee (the
"License Fee") based on a percentage of Gross Revenue of the Licensed Business.
For purposes of this Agreement, the term "Gross Revenue" shall mean all revenues
actually received by Licensee from the operation of the Licensed Business from
whatever source as determined by generally accepted accounting principles,
including, without limitation, all departments, services and operations, sales
by sub-tenants or concessionaires, telephone revenue (less service and toll
charges payable to third party providers), valet parking and sales and services
in, about and originating from the Licensed Business (excluding only: interest
income; proceeds from the sale of used equipment, furniture and other capital
assets; loan proceeds, capital contributions, condemnation proceeds that are
attributed to property and not lost revenue or income, insurance proceeds that
are attributed to property and not lost revenue or income and such other
credits, allowances and refunds as are customary in the restaurant industry and
treated as reductions in gross revenue under generally accepted accounting
principles, service charges paid by customers to the extent paid to employees of
the Licensed Business as tips and gratuities, the amount of any sales, user
excise taxes, taxes on rent and other similar taxes).
3.2 The License Fee for the Term shall be an amount equal to .75% of
Gross Revenue for the first nine (9) months of the Term and 1.00% of Gross
Revenue for the balance of the Term..
3.3 Licensee shall pay the License Fee to Licensor quarterly, in
arrears, within 15 days after the end of each calendar quarter, commencing with
the quarter ending September 30, 1999. The License Fee payable for the quarter
ending September 30, 1999 and any quarter during which the Term ends, if less
than a full quarter, shall be prorated. The License Fee due with respect any
period immediately prior to expiration of the Term shall be due and payable
within 15 days of the date of expiration. Payment shall be made by wire transfer
of immediately available funds to an account specified by Licensor.
Contemporaneously with payment of the License Fee, Licensee shall deliver to
Licensor a
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detailed statement, signed by an authorized officer of Licensee, setting forth
the amount of the Gross Revenue for the applicable period and the calculation of
the License Fee.
3.4 Licensee agrees that Licensor, its attorneys and accountants shall
have the right to examine, copy and audit the books and records of Licensee
relating to the Licensed Business at any time upon reasonable prior written
notice and during regular business hours in order to verify Gross Revenue. In
the event that within ten (10) days of such notice the parties can not agree
upon the amount of the License Fee in dispute, they shall, within three (3) days
thereafter, select a firm of independent certified public accountants that does
not represent either party who shall determine the amount of the License Fee due
to Licensor in accordance with this Agreement. In the event that Licensor and
Licensee have not agreed upon a firm of accountants within such three (3) day
period, the dispute may thereafter be submitted by either party for resolution
by arbitration by three arbitrators under the auspices of the American
Arbitration Association in Broward County, Florida, which arbitration shall be
conducted in accordance with the laws of the State of Florida and the commercial
arbitration rules of the American Arbitration Association. The agreed upon
accountant or arbitrator(s) (either, the "Arbitrator") shall be requested by
Licensor and Licensee to render a decision within thirty (30) days following
selection of the Arbitrator and the determination of the Arbitrator shall be
final and binding upon Licensor and Licensee. In the event Licensee is
determined to owe additional License Fees to Licensor, the Arbitrator shall
require the payment of interest at the statutory rate from the date such
additional License Fees were due and payable until the date actually paid, which
payment of License Fees and interest must be made by the Licensee no later than
three (3) business days following the determination of the Arbitrator. In
addition, if it is determined that the Licensee underpaid the License Fee with
respect to any license fee payment period by an amount equal to or greater than
two percent (2%), then Licensee shall be obligated to reimburse Licensor for the
costs and expenses of the Arbitrator and the attorneys or accountants that
initially examined the books and records of Licensee with respect to such
quarter on behalf of Licensor; otherwise, the fees and expenses of the
Licensor's audit and the Arbitrator shall be borne by Licensor.
ARTICLE IV
RESTAURANT PREMISES AND NAME
4.1 The Licensed Business was constructed by Licensee in accordance
with general plans, specifications and designs approved in writing by Licensor.
The leasehold improvements, furnishings, fixtures, equipment, bar, interior
layout and design, tableware, menus, accessories and all other tangible assets
located in the Licensed Business and used in the operation thereof are
acceptable to Licensor as exists as of the date hereof. Licensee shall not make
any material changes or alterations or replacements to the premises except as
otherwise approved, in writing, by Licensor and Licensor shall not unreasonably
withhold consent, if such modification is consistent with the System and an
upscale restaurant.
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4.2 Licensee disclaims any right or interest in the creation or
development of the Name or any other of Licensor's service marks and trade names
used in connection with a Restaurant and to the good-will derived therefrom and
acknowledges that Licensor has the sole right to use the Name, such service
marks and trade marks. Licensee will use the Name, such service marks and/or
trade names only in the manner and to the extent specifically permitted in this
Agreement. All advertising, publicity, signs, decorations, furnishings,
equipment or other matter employing in any way whatsoever the Name including,
without limitation, the words "Max's Grille" or "Max's," shall be submitted to
Licensor for its approval, which shall not be unreasonably withheld, prior to
publication or use and shall bear a SM designation and, if requested by
Licensor, a phrase acknowledging Licensor's ownership thereof.
4.3 Licensee shall not in any way do anything to infringe upon, harm or
contest the rights of Licensor in the Name or incorporate the Name in its firm
name or corporate name without having obtained the prior written approval of
Licensor.
4.4 In the event Licensee learns of any claim or infringement of the
Name licensed hereunder, or any claim of unfair competition or other challenge
to Licensee's right to use the System or any service mark or trade name licensed
hereunder (collectively, "Infringement"), Licensee shall promptly notify
Licensor. Licensor shall defend, indemnify and hold Licensee harmless from any
and all Infringement claims, demands, causes of action, damages, costs and
expenses whatsoever (including, but not limited to, reasonable attorneys' fees)
arising from or out of Licensee's use of the Name or System. Licensor shall have
the sole and exclusive right, in its reasonable discretion, at its own cost and
expense and for its own use and benefit, to institute suit or take such other
action as it may deem proper to restrain any such infringement and defend any
other such claim. In the event Licensor reasonably determines not to restrain
any such infringement or not to commence or thereafter not to prosecute any
suit, Licensee shall not have the right to commence any such proceeding. Each of
the parties hereto shall be entitled to be represented in any proceeding
relating to the matters covered by this section in which the other party is
involved, at its own cost and expense. Each party hereto shall fully cooperate
with the other in any such proceeding, provided that it is reimbursed for its
costs and expenses for doing so, not including counsel fees, if any.
4.5 Licensee agrees not to contest, directly or indirectly, Licensor's
rights or interest in and to the service marks, trade names, trade secrets,
methods, procedure and advertising techniques which are part of Licensor's
business. Licensee, moreover, will not contest, directly or indirectly,
Licensor's rights to use or license others to use such service marks, trade
names, trade secrets, methods, procedures and techniques outside the territory
reserved to Licensee. Licensee acknowledges that the recipes, products,
proprietary formulations, technology, know-how and operation of the Licensed
Business is derived from information disclosed by Licensor to Licensee and that
such information is proprietary and confidential and constitutes a trade secret
of Licensor. Licensee shall take all action necessary to, and shall, at all
times, treat all such confidential information as confidential,
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and shall maintain such information as secret, divulging the same only to such
of its employees as must have access to such confidential information in order
to properly operate the Licensed Business. Upon termination hereof for any
reason whatsoever all of Licensee's rights to use such information shall cease.
4.6 Licensee covenants and agrees, as a material inducement to Licensor
granting the license hereunder to Licensee, as follows:
(a) Within fifteen (15) days following the date hereof,
Licensee shall notify, in writing, each vendor that provides goods or services
to the Licensed Business as of the date hereof, and each new vendor within
fifteen (15) days after selection, that the Licensed Business is not owned by
Licensor or any party affiliated with Licensor, but operates only pursuant to a
license, and that such vendor shall have no recourse to Licensor or any of its
affiliates with respect to any business transactions engaged in between such
vendor and the Licensed Business;
(b) Within five (5) days following the date hereof, Licensee
shall notify each employee of the Licensed Business that the Licensed Business
is not owned by Licensor or any affiliate of Licensor, but operates pursuant to
a license from Licensor, and that such employees' payroll and other benefits
shall be payable solely by the Licensed Business, and not by Licensor or any
affiliate of Licensor;
(c) Licensee shall cause Licensor and Unique Restaurant
Concepts, Ltd., and their respective successors and assigns, to be named as
additional insured parties on the comprehensive liability insurance coverage
obtained by Licensee for the Licensed Business and shall deliver to Licensor,
within thirty (30) days of the date hereof and within thirty (30) days following
renewal of each such policy, a certificate of the insurer reflecting such
endorsement in favor of the aforedescribed parties.
(d) Licensee hereby agrees to indemnify and hold Licensor and
its affiliates and their respective shareholders, officers and directors
(collectively, the "Indemnified Parties") harmless from any loss, liability,
claim, damage (including incidental, special and consequential damages), expense
(including costs of investigation and defense and reasonable attorneys' and
paralegal fees) arising, directly or indirectly, from a breach by Licensee of
its obligations under this Agreement or from Licensee's ownership and operation
of the Licensed Business from and after the date hereof. For purposes of this
provision, a "Third Party Claim" shall mean any threatened or actual claim or
investigation, or the commencement of any proceeding made other than by Licensor
based upon an assertion which, if true, would entitle Licensor or any other
Indemnified Party to obtain indemnification from Licensee under this Section
4.6(d). Promptly after receipt by an Indemnified Party of notice of commencement
of any Third Party Claim against it, such Indemnified Party will, if a claim is
to be made against Licensee, give prompt notice to Licensee of such Third Party
Claim, but the failure to give such notice shall not relieve Licensee of any
liability that it may have to an Indemnified Party, except to the extent that
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the Licensee is actually prejudiced by the failure or delay in giving such
notice. Upon receipt of notice of a Third Party Claim, Licensee shall assume the
defense of such Third Party Claim at its own expense and with counsel reasonably
satisfactory to the Indemnified Party provided, however, that Licensee shall not
have the right to assume the defense if it is also a party to the Third Party
Claim and joint representation would be inappropriate based upon potential
conflicts between Licensee and Licensor with respect to same or Licensee is
unable to provide reasonable assurance to the Indemnified Party of its financial
capacity to defend such Third Party Claim and provide indemnification with
respect to same. If the Indemnified Party assumes defense of a Third Party
Claim, same shall be at the expense of Licensee. If Licensee assumes defense of
the Third Party Claim, any Indemnified Party may, at its own expense,
participate in the defense thereof and employ its own counsel for such purpose.
If Licensee assumes defense of a Third Party Claim, no compromise or settlement
of such claim may be effected by Licensee without prior consent of the
Indemnified Party unless there is no finding or admission of any wrongdoing by
Indemnified Party, the sole relief against the Indemnified Party is monetary
damages that are paid in full by Licensee and the Indemnified Party receives and
unconditional release of such Third Party Claim. If notice is given to Licensee
of a Third Party Claim and Licensee does not, within ten (10) days after notice
is given, give notice to the Indemnified Party of its election to assume the
defense of such Third Party Claim, Licensee will be bound by any determination
made in such Third Party Claim or any compromise or settlement effected by the
Indemnified Party. Any other claim for indemnification under this Section 4.6(d)
for any matter not involving a Third Party Claim may be asserted by notice to
Licensee.
ARTICLE V
COMPLIANCE WITH SYSTEM
5.1 Licensee agrees to diligently operate the Licensed Business in
strict compliance with the System and to abide by all recommendations of
Licensor relating to, and changes in, said System.
5.2 Licensee recognizes and acknowledges that the System includes,
without limitation, specified food and beverage items which may be served, and
no others, recipes relating to same, menu design and layout, kitchen operating
procedures, order taking procedures, server training, techniques and uniforms,
use and display of the Name in specified places and such other procedures,
techniques and systems as required to create and maintain an upscale but casual
decor and atmosphere in each of the Restaurants. Licensee agrees to diligently
operate the Licensed Business in strict compliance with the System, as same may
be modified by Licensor, from time to time, and to abide by all recommendations
of Licensor relating to, and changes in, said System. Licensee agrees that,
without the prior written consent of Licensor in each instance, it shall not
modify or alter any aspect of the System now in effect, including, without
limitation, by failing to strictly follow recipes, by changing the uniforms worn
by servers, by adding entertainment (except soft background music) or otherwise
modifying the atmosphere of the Licensed Business. In the event that
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Licensee desires to make any modification whatsoever to the System, it shall
present its request to Licensor in writing and Licensor shall not unreasonably
withhold its consent, if such modification is consistent with the System and an
upscale restaurant.
5.3 Licensor shall promptly furnish to Licensee any new menus, recipes,
procedures, or other System modifications or additions developed by Licensor or
used by any Restaurant not licensed to Licensee or its affiliates or successors
and assigns. Licensor shall cause Dennis Max to consult monthly at a meeting
with Licensee at the Restaurant. A representative of Licensor shall train the
chef of the Licensed Business with respect to any new menu items. The
representative of Licensor shall be John Belleme, as long as he serves as the
Senior Chef for the Restaurants, or any successor to that position. All training
will take place at the Mizner Park Restaurant. Licensor agrees that its failure
to comply with this Section 5.3 shall cause irreparable harm to Licensee and
that the damages suffered by Licensee in such event are impossible to ascertain.
Accordingly, Licensor agrees that for each day following the tenth (10th) day
after written notice from Licensee that Licensor is not in full compliance with
the provisions of Section 5.3, it shall pay Licensee $1,000 as liquidated
damages and not as a penalty, and such amount shall be due and payable by
Licensor daily.
5.4 In order to monitor Licensee's compliance with the covenants
contained in this Article V and elsewhere in this Agreement, Licensee agrees
that during hours of operation of the Licensed Business, Licensor shall have the
right to inspect the premises, including the kitchen, and to interview employees
and independent contractors of the Licensed Business. In furtherance thereof,
Licensee agrees that once each month during the Term, two (2) persons designated
by Licensor may each (at the same time) order for their own consumption on the
premises, food and beverages at the Licensed Business without charge, but not to
exceed $150 per month including server gratuities.
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ARTICLE VI
COVENANTS OF LICENSEE
6.1 Licensee further agrees as follows:
(a) To maintain a high moral standard and atmosphere at
Licensee's Restaurant; to train and supervise its employees in compliance with
all local and state health code and food preparation laws; to properly and in a
sanitary manner prepare all food and beverages and to serve the same in a
wholesome, appetizing and efficient manner; to maintain the Licensed Business in
a clean, safe and orderly manner; to provide efficient, courteous and high
quality service to the public, to the end that the Licensed Business shall help
to create and build good will among the public for Max's Grille restaurants as a
whole, and so that Licensor, Licensee, and each member of said System shall be
benefited, and the public assured uniform, efficient, courteous, high quality
service on a standardized national basis.
(b) To advertise, sell or offer for sale only those items
which are sold by Licensor in its company-owned Restaurants or approved by
Licensor in writing prior to offering the same for sale.
(c) Not to carry on or conduct or permit others to carry on or
conduct any other business activity or operation from the approved premises
other than the operation of the Licensed Business.
ARTICLE VII
ASSIGNMENT
7.1 Licensee shall neither sell, assign, transfer or encumber this
Agreement or any rights or interests therein or thereunder, or offer or permit
any such sale, assignment, transfer or encumbrance to occur by operation of law
or otherwise, without the prior written consent of Licensor in each instance,
provided, however, that Licensor's consent shall not be unreasonably withheld if
the proposed assignee has proven ability to operate a restaurant of similar
caliber as the Licensed Business. For purposes hereof, the term "Assignment"
shall include a sale or transfer, whether in a single transaction or in a series
of transactions, of more than 50% ownership interest in Licensee or a transfer
of control of the corporate general partner of Licensee. Licensee is authorized
to assign this Agreement to Sforza Enterprises, Inc. ("Sforza") and, subject to
Sforza's guarantee of Licensee's obligations hereunder, to any entity controlled
by Sforza. A change in Shareholders of Sforza (or any successor publicly-traded
controlling person of Licensee) shall not be deemed an assignment.
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ARTICLE VIII
TERMINATION
8.1 Upon termination of this Agreement, Licensee's right to use in any
manner the Name or any other of Licensor's marks used by Licensee (or insignia
or slogan used in connection therewith), or any confusingly similar trademark,
service mark, trade name or insignia shall terminate forthwith. Licensee shall
not thereafter directly or indirectly identify itself in any manner as a Max's
Grille or publicly identify itself as a former Max's Grille or use any of
Licensor's trade secrets, signs, symbols, devices, recipes, formulas or other
materials constituting part of the System.
8.2 Upon the termination of this Agreement, the Licensee shall
immediately discontinue the use of all service marks, trade names, signs,
structures, and forms of advertising indicative of Max's Grille, its symbols,
service marks or its menu items; and, so far as the Licensee may lawfully do so,
shall make or cause to be made such removals of or changes in signs, buildings
and structures as the Licensor shall reasonably direct so as to eliminate the
names "Max's Grille" from the premises.
8.3 Licensee shall fully comply with the obligations imposed on it by
Sections 8.1 and 8.2 hereof no later than ten (10) days following termination of
this Agreement provided Licensee pays the License Fee for such ten (10) day
period. Licensee agrees that its failure to do so shall cause irreparable harm
to Licensor and that the damages suffered by Licensor in such event are
impossible to ascertain. Accordingly, Licensee agrees that for each day
following the tenth (10th) day after termination of this Agreement that it is
not in full compliance with the provisions of Sections 8.1 and 8.2, it shall pay
Licensor a license fee of $1,000 for Licensee's continued use of any part of the
Name and the System in violation of this Agreement. Licensee acknowledges that
such violation shall cause irreparable harm to Licensor and the damages suffered
by Licensor in such event are impossible to ascertain and, accordingly the
$1,000 per day license fee is payable to Licensor as liquidated damages, and not
as a penalty, and is due and payable to Licensor daily.
ARTICLE IX
MISCELLANEOUS
9.1 Entire Agreement. The privileges herein granted to Licensee
contemplate the operation of a Restaurant at the licensed location and the
rights herein granted shall not be applied or extended, directly or indirectly,
to any other business or enterprise without the express consent in writing of
Licensor. This Agreement contains the entire agreement of the parties with
respect to the license of the Name, other service marks and System and no
representations, inducements, promises or agreements, oral or otherwise, between
the parties not embodied herein shall be of any force or effect. No failure of
Licensor to exercise any power given it hereunder or to insist upon strict
compliance by Licensee of any obligation hereunder, and no custom or practice of
the parties at variance with the terms hereof shall
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constitute a waiver of Licensor's right to demand exact compliance with the
terms hereof. Waiver by the Licensor of any particular default by the Licensee
shall not affect or impair the Licensor's rights in respect of any subsequent
default of the same or of a different nature, nor shall any default or omission
of the Licensor to exercise any rights arising from such defaults affect or
impair the Licensor's rights as to such default or any subsequent default.
9.2 Force Majeure. Neither Licensor nor Licensee shall be liable to
perform any of its obligations under this Agreement if such failure to perform
is due to strikes, lockouts, stoppages, accidents, transportation delays, war,
government regulations or act of God or other cause beyond the reasonable
control of Licensor or Licensee and the happening of any such cause of delays
shall extend the time of performance by the time occasioned by any such cause of
delay.
9.3 Severability. If any covenant or other provision of this Agreement
is invalid, or incapable of being enforced, by reason of any rule of law or
public policy, all other conditions and provisions of this Agreement shall,
nevertheless, remain in full force and effect, and no covenant or provision
shall be deemed dependent upon any other covenant or provision unless so
expressed herein.
9.4 Compliance with Laws. Licensee shall conduct its business and
maintain the Restaurant in strict compliance with all applicable laws,
ordinances, regulations, and other requirements of any federal, state, county,
municipal, or other consent for the operation of its business.
9.5 Amendments. Neither this Agreement nor any provision hereof may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which endorsement of the change, waiver,
discharge or termination is sought.
9.6 Binding Effect. This Agreement shall be binding upon the parties,
their permitted successors and assigns.
9.7 Governing Law. This License Agreement shall be governed by the laws
of the State of Florida.
9.8 Litigation. If any party hereto engages in litigation against the
other party hereto, either as plaintiff or as defendant, in order to enforce or
defend any of its rights under this Agreement, and such litigation results in a
final judgment in favor of such party ("Prevailing Party"), then the party
against whom said final judgment is obtained shall reimburse the Prevailing
Party for all direct, indirect or incidental expenses incurred by the Prevailing
Party in so enforcing or defending its rights hereunder, including, but not
limited to, all attorneys' fees and court costs and other expenses incurred
throughout all negotiations, trials or appeals undertaken in order to enforce
the Prevailing Party's rights hereunder.
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9.9 Notices. Any notice required or permitted to be delivered to either
party under the provisions of this Agreement shall be deemed delivered, whether
actually received or not, when deposited in a United States Postal Service
Depository, postage prepaid, registered or certified, return receipt requested,
and addressed to the party at the address set forth below, or such other address
as shall be specified by written notice delivered to the other party:
If to Licensor: Unique Restaurant Concepts, Inc.
1515 South Federal Highway, Suite 211
Boca Raton, Florida 33432
Attention: Dennis Max, President
With a copy to: Ruden, McClosky, Smith,
Schuster & Russell, P.A.
P.O. Box 1900
Fort Lauderdale, Florida 33301
Attention: Michael H. Krul, Esq.
If to Licensee: Max's Beach Grill,, Ltd.
c/o Sforza Enterprises, Inc.
330 Clematis Street, Suite 211
West Palm Beach, Florida 33401
Attention: Gerald J. Visconti, Jr.
With a copy to: Gunster, Yoakley, Valdes-Fauli & Stewart, P.A.
777 S. Flagler Drive, Suite 500 East
West Palm Beach, Florida 33401
Attention: Steven J. Serling, Esq.
All notices, demands and requests shall be effective upon being deposited in the
United States mail. However, the time period in which a response to any such
notice, demand or request must be given shall commence to run from the date of
receipt on the return receipt of the notice, demand or request by the addressee
thereof or the date of actual receipt in the case of delivery by other means.
Rejection or other refusal to accept or the inability to deliver because of
changed address of which no notice was given shall be deemed to be receipt of
the notice, demand or request when sent.
9.10 Counterparts. This Agreement may be execute in one or more
counterparts, all of which shall be considered one and the same agreement, and
shall become effective when one or more such counterparts have been signed by
each of the parties and delivered to each of the other parties.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Amended and Restated License Agreement as of the date and year first above
written.
UNIQUE RESTAURANT CONCEPTS,
INC., a Florida corporation
By: /s/ Dennis Max
------------------------------
Dennis Max, President
MAX'S BEACH GRILL, LTD.
By: Max's Beach Grill, Inc., a Florida
corporation, as General Partner
By: /s/ Gerald J. Visconti, Jr.
-----------------------------------
Gerald J. Visconti, Jr., President
14
EXHIBIT 10.9(1)
---------------
MANAGEMENT AGREEMENT TERMINATION
--------------------------------
THIS MANAGEMENT AGREEMENT TERMINATION (the "Agreement") is made and
entered into as of the 5th day of August, 1999, among Unique Restaurant
Concepts, Inc., a Florida corporation ("Manager") and Max's Beach Grill, Ltd., a
Florida limited partnership, Unique Brickell, Ltd., a Florida limited
partnership and Unique Weston, Ltd., a Florida limited partnership (with the
last three entities collectively referred to as the "Partnerships").
PRELIMINARY STATEMENTS:
A. The Partnerships are in the business of owning and operating the
restaurants Max's Beach Place, Max's Grille at Las Olas and Max's Grille at
Weston located in South Florida (the "Restaurants").
B. Manager and the Partnerships entered into that certain Management
Agreement (the "Management Agreement") dated December 30, 1997 pursuant to which
Manager provides management and accounting services to the Restaurants.
C. The General Partners and certain Limited Partners of the
Partnerships are simultaneously herewith selling all of their general and
limited partnership interests in the Partnerships to the majority limited
partner, Sforza Enterprises Inc. ("Sforza"), who expects to operate the
Restaurants directly.
D. Both the Partnerships and Manager now desire to terminate the
Management Agreement.
NOW THEREFORE, in consideration of the mutual covenants and agreements
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Partnerships and Manager agree
as follows:
1. Termination. Anything in the Management Agreement to the contrary
notwithstanding, except as provided in this Agreement, the term of the
Management Agreement shall terminate as of 11:59 p.m. on the date shown above
(the "Termination Date"). After the Termination Date, neither the Partnerships
nor the Manager shall have any rights or obligations under the Management
Agreement other than those rights or obligations that expressly survive
termination. The Manager shall, in addition to the duties and obligations
elsewhere provided in the Management Agreement and in this Agreement, perform
such matters as are necessary to wind up its activities under the Management
Agreement in an orderly manner as provided in Section 4 herein.
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2. Management Transition.
----------------------
(a) Transfer of Accounting and Other Systems. Manager has
transferred and delivered to the Partnerships all books and records associated
with the Restaurants, including bank accounts, payroll records, software data,
and manager's operations manual. Manager has furnished to the Partnerships
financial reports of the Restaurants through June 30, 1999. Not later than July
30, 1999, Manager shall furnish the Partnerships with the preliminary financial
reports of the Restaurants through July 25, 1999, in a form consistent with past
practices.
(b) Transition Assistance. For ten business days from the
Termination Date, Manager will respond within 24 hours by telephone to inquiries
from the Partnerships, to assist with the management transition resulting from
this termination of the Management Agreement. If any inquiry is not answered
within such time, Manager will promptly send a qualified representative to the
West Palm Beach office of Sforza to answer the query. Thereafter, Manager will
use its best efforts to respond promptly to telephone inquiries from the
Partnerships concerning transition matters.
3. Representation by Manager. Manager hereby represents and warrants to
the Partnerships that, to the best of its knowledge, the materials delivered to
the Partnerships pursuant to Section 2(a) herein do not contain any untrue
statement of a material fact or omit any material fact necessary in order to
make the materials not misleading.
4. Miscellaneous.
--------------
(a) Insurance. Within 30 days of the date hereof, the
Partnerships will terminate their present workmen's compensation insurance,
which they now share with affiliates of Manager. The present general liability
insurance, which is shared with affiliates of Manager, will be maintained until
expiration of the term on November 20, 1999. Each Partnership will be
responsible for its pro rata share of premiums of such policies through the date
of termination, including any retroactive premium charges. The parties expect
one or more rebates or dividends on the workmen's compensation policy reflecting
favorable experience over past periods. When any such payments are received,
Manager will promptly refund to each of the Partnerships their pro rata share of
such rebates.
(b) Gift Certificates. The Restaurants have sold to customers
gift certificates valid both at the Restaurants and at restaurants which are
affiliates of Manager. The Partnerships agree to honor such gift certificates,
and Manager agrees promptly to reimburse the Partnerships for any such gift
certificates so honored if the Restaurant did not sell the certificate. Manager
will cause its affiliated restaurants to honor any gift certificates issued
prior to the date hereof by any of the Partnerships, and the Partnership
Restaurant which issued the gift certificate shall promptly reimburse Manager
for the cost thereof.
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5. General Matters.
----------------
(a) Notices. All notices, requests, consents and other
communications required or permitted under this Agreement shall be in writing
(including electronic transmission) and shall be (as elected by the person
giving such notice) hand delivered by messenger or courier service,
electronically transmitted, or mailed (airmail if international) by registered
or certified mail (postage prepaid), return receipt requested, addressed to:
If to any of the Partnerships: With a copy to:
c/o Sforza Enterprises Inc. Gunster, Yoakley, Valdes-Fauli
222 Clematis Street, Suite 202 & Stewart, P.A.
West Palm Beach, Florida 33401 777 S. Flagler Drive, Suite 500 East
Attn.: Jay Visconti, President West Palm Beach, Florida 33401
Telephone: (561) 366-0027 Attn.: Steven J. Serling, Esq.
Telefax: (561) 366-0028 Telephone: (561) 650-0577
Telefax: (561) 655-5677
If to Manager: With a copy to:
Unique Restaurants Concepts, Inc. Ruden, McCloskey, Smith, Schuster
490 East Palmetto Park Road, Suite 110 & Russell, P.A.
Boca Raton, Florida 33432 200 E. Broward Boulevard, 15th Floor
Attn.: Dennis Max, President Ft. Lauderdale, Florida 33302
Telephone: (561) 392-0611 Attn.: Michael H. Krul, Esq.
Telefax: (561) 393-0456 Telephone: (954) 764-6660
Telefax: (954) 764-4996
or to such other address as any party may designate by notice complying with the
terms of this Section. Each such notice shall be deemed delivered (a) on the
date delivered if by personal delivery; (b) on the date of transmission with
confirmed answer back if by electronic transmission; and (c) on the date upon
which the return receipt is signed or delivery is refused or the notice is
designated by the postal authorities as not deliverable, as the case may be, if
mailed.
(b) Amendments. The provisions of this Agreement may not be
amended, supplemented, waived or changed orally, but only by a writing signed by
the party as to whom enforcement of any such amendment, supplement, waiver or
modification is sought and making specific reference to this Agreement.
(c) Jury Waiver. IN ANY CIVIL ACTION, COUNTERCLAIM, OR
PROCEEDING, WHETHER AT LAW OR IN EQUITY, WHICH ARISES OUT OF, CONCERNS, OR
RELATES TO THIS AGREEMENT, ANY AND ALL TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT, THE PERFORMANCE OF THIS AGREEMENT, OR THE RELATIONSHIP CREATED BY
THIS AGREEMENT, WHETHER SOUNDING IN CONTRACT,
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TORT, STRICT LIABILITY, OR OTHERWISE, TRIAL SHALL BE TO A COURT OF COMPETENT
JURISDICTION AND NOT TO A JURY. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY. ANY PARTY MAY FILE AN ORIGINAL COUNTERPART OR A
COPY OF THIS AGREEMENT WITH ANY COURT, AS WRITTEN EVIDENCE OF THE CONSENT OF THE
PARTIES TO THIS AGREEMENT OF THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY. NEITHER
PARTY HAS MADE OR RELIED UPON ANY ORAL REPRESENTATIONS TO OR BY ANY OTHER PARTY
REGARDING THE ENFORCEABILITY OF THIS PROVISION. EACH PARTY HAS READ AND
UNDERSTANDS THE EFFECT OF THIS JURY WAIVER PROVISION.
(d) Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
taken together shall constitute one and the same instrument. Confirmation of
execution by electronic transmission of a facsimile signature page shall be
binding upon any party so confirming.
(e) Headings. The headings contained in this Agreement are for
convenience of reference only, are not to be considered a part of the Agreement
and shall not limit or otherwise affect in any way the meaning or interpretation
of this Agreement.
(f) Governing Law. This Agreement and all transactions
contemplated by this Agreement shall be governed by, and construed and enforced
in accordance with, the internal laws of the State of Florida without regard to
principles of conflicts of laws.
(g) Jurisdiction. The parties acknowledge that a substantial
portion of the negotiations and anticipated performance of this Agreement
occurred or shall occur in Palm Beach County, Florida. Any civil action or legal
proceeding arising out of or relating to this Agreement shall be brought in the
courts of record of the State of Florida in Palm Beach County or the United
States District Court, Southern District of Florida, West Palm Beach Division.
Each party consents to the jurisdiction of such court in any such civil action
or legal proceeding and waives any objection to the laying of venue of any such
civil action or legal proceeding in such court. Service of any court paper may
be effected on such party by mail, as provided in this Agreement, or in such
other manner as may be provided under applicable laws, rules of procedure or
local rules.
(h) Further Assurances. The parties hereby agree from time to
time to execute and deliver such further and other transfers, assignments and
documents and do all matters and things which may be convenient or necessary to
more effectively and completely carry out the intentions of this Agreement.
(i) Benefit. This Agreement shall bind and shall inure to the
benefit of the parties hereto and their respective successors and assigns,
including without limitation, Sforza as successor to the Partnerships.
(j) Third Parties. Nothing in this Agreement is intended to
relieve or discharge the obligation or liability of any third persons to any
party to this Agreement, nor any provisions give any third person any right of
subrogation or action over or against any party to this Agreement.
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(k) Survival. All covenants, agreements, representations and
warranties made in this Agreement, including without limitation Section 4, or
otherwise made in writing by any party pursuant to this Agreement shall survive
the execution and delivery of this Agreement and the consummation of the
transactions contemplated by this Agreement.
(l) Entire Agreement. This Agreement and all exhibits and
schedules attached to this Agreement, if any, represent the entire understanding
and agreement between the parties with respect to the subject matter of this
Agreement, and supersedes all other negotiations, understandings and
representations (if any) made by and between such parties.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date first set forth above.
Unique Restaurant Concepts, Inc.,
a Florida corporation
By: /s/ Dennis Max
----------------------------------
Dennis Max, President
Max's Beach Grill, Ltd.,
a Florida limited partnership
By: Max's Beach Grill, Inc., a Florida
corporation and General Partner
By: /s/ Gerald J. Visconti, Jr.
----------------------------------
Gerald J. Visconti, Jr., President
Unique Brickell, Ltd.,
a Florida limited partnership
By: Unique Brickell, Inc., a Florida
corporation and General Partner
By: /s/ Gerald J. Visconti, Jr.
----------------------------------
Gerald J. Visconti, Jr., President
Unique Weston, Ltd.,
a Florida limited partnership
By: Unique Weston, Inc., a Florida
corporation And General Partner
By: /s/ Gerald J. Visconti, Jr.
----------------------------------
Gerald J. Visconti, Jr., President
6
EXHIBIT 10.22
-------------
AGREEMENT FOR PURCHASE AND SALE
OF PARTNERSHIP INTERESTS
THIS AGREEMENT FOR PURCHASE AND SALE OF PARTNERSHIP INTERESTS (the
"Agreement"), effective as of this 5th day of August, 1999 (the "Effective
Date"), among Unique SEI Holdings, Inc., a Florida corporation ("Holdings"),
Max's Beach Grill, Inc., a Florida corporation, Unique Brickell, Inc., a Florida
corporation, Unique Weston, Inc., a Florida corporation (collectively, the
"General Partners" and collectively, with Holdings, referred to as "Sellers"),
and Sforza Enterprises Inc., a Florida corporation ("Buyer").
WITNESSETH:
-----------
WHEREAS, Holdings is the owner of 48% limited partnership interests and
the General Partners are the owners of a 1% general partnership interest
(collectively, the "Partnership Interests") in each of Max's Beach Grill, Ltd.,
Unique Brickell, Ltd. and Unique Weston, Ltd., limited partnerships organized
under the laws of the State of Florida (the "Partnerships"); and
WHEREAS, Buyer desires to purchase from Sellers, and Sellers desire to
sell to Buyer the Partnership Interests on the terms and subject to the
conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth and other good and valuable consideration, the receipt and
adequacy are hereby acknowledged, the parties hereby agree as follows:
ARTICLE I
---------
Sale and Purchase of the Partnership Interests
----------------------------------------------
and Purchase Price
------------------
1.1 Sale of Partnership Interests. Upon the terms and subject to the
conditions of this Agreement, Sellers hereby sell, assign, transfer, convey and
deliver to Buyer or to wholly-owned subsidiaries of Buyer listed in Section 1.2
below (collectively, "Purchasers"), and Purchasers hereby purchase and acquire
the Partnership Interests, effective as of the date hereof. Sellers have each
executed and delivered to Purchasers, respectively, Assignments of Partnership
Interest, receipt of which is hereby acknowledged.
1.2 Purchase Price and Method of Payment. In consideration for the
purchase by Buyer of the Partnership Interests, Buyer hereby pays to Sellers a
purchase price of One Hundred Sixty Thousand and No/100 Dollars ($160,000.00)
and certain stock options (the "Purchase Price"), as set forth below, the cash
purchase price to be allocated as follows:
1
<PAGE>
<TABLE>
<CAPTION>
Purchasers
----------
<S> <C> <C>
Max's Beach Grill, Ltd.
Limited Partnership Interest $52,333.33 Buyer
General Partnership Interest $1,000.00 Beach Place GP, Inc.
Unique Brickell, Ltd.
Limited Partnership Interest $52,333.33 Buyer
General Partnership Interest $1,000.00 Brickell GP, Inc.
Unique Weston, Ltd.
Limited Partnership Interest $52,333.33 Buyer
General Partnership Interest $1,000.00 Weston GP, Inc.
---------
Total $160,000.00
===========
</TABLE>
(a) Buyer has transmitted to Sellers One Hundred Sixty
Thousand and No/100 Dollars ($160,000.00) by bank wire transfer of immediately
available funds to such bank accounts as have been designated in writing by
Sellers, receipt of which funds is acknowledged by Sellers.
(b) Buyer has granted to Sellers an option to purchase up to
20,000 shares of Buyer's common stock, in the form attached hereto as Exhibit A
(the "Options"). The Options shall be exercisable at $2.50 per share.
1.3 Further Assurances. The parties shall, on request, on or after the
Effective Date, cooperate with each other by furnishing any additional
information, executing and delivering any additional documents and/or
instruments and doing any and all such other things as may be reasonably
required by the parties or their counsel to consummate or otherwise implement
the transactions contemplated by this Agreement or to respond to the
satisfaction of the Sellers to any activity by any federal or state agency,
department or board.
ARTICLE II
Representations and Warranties of Sellers
-----------------------------------------
2.1 Representations and Warranties of Sellers. Sellers represent and
warrant to Buyer as follows:
(a) Due Organization. Each of the Sellers is duly organized
and validly existing as a corporation under the laws of the State of Florida.
The Sellers have all necessary governmental approvals and permits and required
corporate power and lawful authority to own their properties and to conduct the
businesses in which they are currently engaged.
2
<PAGE>
(b) Authorization. The Board of Directors of Holdings and the
shareholders of the General Partners have approved this Agreement and the
transactions contemplated hereby, and have authorized the execution of this
Agreement by its respective officers. This Agreement and the transactions
contemplated hereby have been authorized by all necessary corporate action of
Holdings. Holdings has delivered to Buyer a copy of the approving resolutions of
its shareholders, certified by its Secretary.
(c) Power and Authority. Sellers have the right, power, legal
capacity, and authority to enter into and perform their obligations under this
Agreement and to consummate the transactions contemplated hereby to be
consummated by Sellers. Except as provided in this Agreement, no consent,
approval or authority of any nature, or other action, by any person or entity,
or any agency, bureau or department of any government, is required in connection
with the execution and delivery of this Agreement by any of the Sellers, and the
consummation by any of the Sellers of the transactions provided for herein.
Assuming all appropriate action has been taken by the Board of Directors of each
of the General Partners, as to which Sellers make no representation, this
Agreement constitutes, and each document or instrument to be executed by
Sellers, pursuant to the terms hereof, upon its execution and delivery will have
been duly executed and delivered and will constitute, the valid and legally
binding respective obligations of each of the persons executing each of such
documents and instruments, enforceable in accordance with their respective
terms.
(d) Title to Partnership Interests. Sellers own beneficially
and of record the Partnership Interests, free and clear of all liens, claims,
restrictions and encumbrances whatsoever except those set forth in the
Partnership Agreements and, upon payment by Buyer of the Purchase Price to
Sellers, Buyer will acquire good title to the Partnership Interests, free and
clear of all liens, charges, claims, options, pledges, restrictions and
encumbrances whatsoever except those set forth in the Partnership Agreement.
(e) Accuracy. All information, certificates, documents and
instruments furnished by Sellers to Buyer in connection with this Agreement, or
any other transaction contemplated by this Agreement, are or will be true and
complete in all material respects as of the Effective Date, and neither this
Agreement nor any information, certificate, document or instrument furnished by
Sellers to Buyer in connection with this Agreement, or any other transaction
contemplated by this Agreement, contains or will as of the Effective Date
contain any untrue statement of a material fact or omits or will as of the
Effective Date omit to state a material fact necessary in order to make the
statements included herein or therein not misleading in light of the
circumstances under which they were made.
2.2 Representations and Warranties of General Partners and Holdings.
----------------------------------------------------------------
The General Partners represent and warrant to Buyer as follows, and
Holdings represents and warrants to the best of its knowledge as follows:
3
<PAGE>
(a) Due Organization. Each of the Partnerships is duly
organized and validly existing as a limited partnership under the laws of the
State of Florida. Each Partnership has all necessary governmental approvals and
permits and required power and authority to own its properties and to conduct
the business in which it is currently engaged.
(b) Violations. The execution and delivery of this Agreement
and the consummation of the transactions contemplated by this Agreement, will
not result in or constitute any of the following: (i) a default, breach,
violation, termination, failure of condition, or an event that, with notice or
lapse of time or both, would be a default, breach, violation, termination, or
failure of condition of any provision of the Articles of Incorporation or
By-Laws of any of the Sellers, or any provision of any agreement, instrument, or
arrangement to which any of Sellers is a party, or by which any of their
property (including the Partnership Interests) is bound, except the
Partnerships' leases of their respective restaurant premises and the Max's Beach
Grill, Ltd. equipment lease of April 7, 1997 (the "Leases"); (ii) an event that
would accelerate the maturity of any indebtedness or other obligation of any of
the Partnerships or any of Sellers, other than the Leases; (iii) the creation or
imposition of any lien, pledge, option, security agreement, equity, claim,
charge, encumbrance or other restriction or limitation on any of the Partnership
Interests, or on any of the properties or other interests of any of the
Partnerships or any of the Sellers; or (iv) a violation of any provision of
applicable law, except with respect to any permits or licenses of their
respective restaurants.
(c) Compliance with Law. The Partnerships are each in material
compliance with all applicable statutes, ordinances, administrative
interpretations, rulings and regulations. Without limiting the foregoing, the
Partnerships have all required licenses, permits, certificates and
authorizations needed for the conduct of their business as now being conducted
and copies are attached hereto as Exhibit B. None of the Partnerships have
received any notice, not heretofore complied with, from any governmental
authority that any of its properties, equipment or business procedures or
practices fails to comply with any applicable law or regulation, except that the
restaurant operated by Unique Brickell, Ltd. has been notified by the Department
of Business and Professional Regulation - Division of Alcoholic Beverage &
Tobacco ("AB&T") that the outside walkway being used by Riverwalk customers may
have the effect of destroying the contiguity of the restaurant's outside area in
violation of its alcoholic beverage license, which problem is in the process of
being resolved among AB&T, the landlord and Unique Brickell, Ltd.
(d) Litigation. Except as provided in Section 2.2(c), there
are no actions, suits or proceedings pending, and there are no investigations
pending, or threatened to which any of the Partnerships are or will be a party,
or which relate, directly or indirectly, to the operations, properties,
prospects or condition of the business of the Partnerships, before or by any
federal, state, municipal or other governmental department or commission or
court or arbitrator, except for Houdini v. Max's Beach Grill, Ltd., a slip and
fall case being defended by an insurance carrier. Sellers do not know or have
reasonable grounds to know of any basis for any such action, proceeding or
investigation in the future, other than possible claims by lessors under the
Leases with respect to the transactions provided for herein, the item disclosed
in Section 2.2(c) and any failure of Buyer to obtain necessary approvals for the
transfer of any permits or licenses to Buyer, including approval
4
<PAGE>
from AB&T for transfer of the existing alcoholic beverage license, and routine,
non-material incident reports.
(e) Taxes. All tax returns and reports of the Partnerships
required by law to be filed have been duly filed, and all taxes, assessments,
fees and other governmental charges which are assessable with respect thereto
and due and payable have been paid.
(f) Title to Properties. The Partnerships have good,
marketable and valid title to the properties and assets reflected on the balance
sheet as of May 23, 1999 and all such properties and assets are free and clear
of mortgages, pledges, security interests, liens, charges and other
encumbrances, except liens for current taxes not due and equipment lease
obligations.
ARTICLE III
-----------
Representations and Warranties of Buyer
---------------------------------------
Buyer hereby represents and warrants to Sellers as follows:
3.1 Due Organization. Purchasers are each duly organized and validly
existing as corporations under the laws of the State of Florida.
3.2 Power and Authority. Purchasers have the right, power, legal
capacity and authority to enter into and perform their obligations under this
Agreement, and to consummate the transactions contemplated hereby to be
consummated by Purchasers. No consent, approval or authority of any nature, or
other action, by any person or entity, or any agency, bureau or department or
any government or any subdivision thereof, is required in connection with the
execution and delivery of this Agreement by Purchasers, and the consummation by
Purchasers of the transactions provided for herein. This Agreement constitutes,
and each document or instrument to be executed by Buyer, pursuant to the terms
hereof upon its execution and delivery, will have been duly executed and
delivered and will constitute, the valid and legally binding respective
obligations of the person executing each of such documents and instruments,
enforceable in accordance with its terms. The execution and delivery of this
Agreement by Buyer has been duly authorized by all necessary corporate action of
Purchasers, respectively.
ARTICLE IV
----------
Other Agreements and Releases
-----------------------------
4.1 Other Agreements. Sellers acknowledge that simultaneously with the
closing of this Agreement, Buyer and the Partnerships are entering into
agreements with Unique Restaurant
5
<PAGE>
Concepts, Inc. ("Unique"), an affiliate of certain of Sellers, (a) terminating
the Management Agreement of December 30, 1997 between Unique and the
Partnerships relating to the restaurants owned by the Partnerships, and (b)
amending and restating the License Agreements of December 30, 1997 between
Unique and the Partnerships in part to provide for certain license fees to be
payable to Unique with regard to certain of the restaurants now owned by the
Partnerships.
4.2 Release.
--------
(a) Release by Buyer. As of the Effective Date, the Purchasers
hereby releases the Sellers and all of their shareholders, directors, officers,
agents, affiliates, successors and assigns (collectively, the "Seller Group"),
from all liabilities, actions, causes of actions, claims, counterclaims,
defenses, offsets, charges, obligations and demands whatsoever (whether known or
unknown, direct or indirect, contingent or noncontingent) at law, in equity or
otherwise (collectively, the "Claims"), which the Buyer ever had, now has or may
hereafter have against any members of the Seller Group by reason of any matter,
cause or thing whatsoever arising under with respect to or relating to the
partnership agreements of the Partnerships, except for (i) any provision of such
partnership agreements that expressly survive termination, and (ii) the
provisions of this Agreement.
(b) Release by Sellers. As of the Effective Date, the Sellers
hereby release the Purchasers and the Partnerships and all of their partners,
agents, affiliates, successors and assigns (the "Partnership Group") from all
Claims which the Sellers ever had, now have or may hereafter have against any
member of the Partnership Group by reason of any matter, cause or thing
whatsoever arising under, with respect to or relating to the partnership
agreements of the Partnerships except for (i) any provision of such partnership
agreement that expressly survives termination, and (ii) the provisions of this
Agreement.
4.3 Purchasers' Acknowledgments. Buyer agrees and acknowledges
----------------------------
the following:
(a) Since December 30, 1997, Buyer has appointed the majority
of the members of the Board of Directors of the General Partners that serve as
the sole general partner of each of the Partnerships and, accordingly, Buyer has
been in control of the Partnerships;
(b) As a result of its position as the majority owner of each
of the Partnerships and the party controlling the Board of Directors of each of
the Partnerships, Buyer has had full access to all material transactions
affecting the Partnerships.
(c) Purchasers hereby assume all risk of any defaults under
the Leases as a result of this transaction and any claims by any of the lessors
resulting from same and hereby agree to indemnify and hold harmless the Seller
Group from any such lessor claims including, without limitation, the costs and
expenses of any negotiations prior to litigation, any litigation or appeals
therefrom.
6
<PAGE>
(d) Purchasers understand that the sale of the Partnership
Interests by Sellers is intended to be exempt from registration under the
Securities Act of 1933, as amended (the "Act"), by virtue of the private
placement exemption under the Act. In connection therewith, Purchasers represent
and warrant to Sellers that:
(i) Purchasers are aware that there is substantial
risk in purchasing the Partnership Interests, including risk of Purchasers' loss
of their entire investment therein, and Purchasers have sufficient liquidity and
assets to absorb such loss;
(ii) Purchasers are acquiring the Partnership
Interests for their own account, for investment, and not with a view to resale
or distribution, in whole or in part, in violation of the Act;
(iii) Purchasers have such knowledge and experience
in financial and business matters to be capable of evaluating the merits and
risks of its investment in the Partnership Interests;
(iv) In deciding to acquire the Partnership
Interests, Purchasers have relied solely upon their knowledge of the
Partnerships and their existing businesses and their investigation of same and
Purchasers have not acted upon the basis of any other representations and
warranties; and
(v) Purchasers understand that the Partnership
Interests cannot be sold, transferred or assigned, unless they first are
registered under the Act or an exemption from registration is available (and
then may be sold only in compliance with all applicable state securities laws).
ARTICLE V
---------
Miscellaneous
-------------
5.1 Partnership Agreement. The parties agree that the copies of the
Limited Partnership Agreement of each of the Partnerships and any amendments
thereto, attached hereto as Exhibit C, are true and complete and in effect on
the date hereof.
5.2 Partners. The parties agree that attached hereto as Exhibit D is a
true and correct list of all partners of the Partnerships and the percentage
interest held by each.
5.3 Brokers. Each of the parties represents and warrants that such
party has dealt with no broker or finder in connection with any of the
transactions contemplated by this Agreement, and, insofar as such party knows,
no broker or other person is entitled to any commission or finder's fee in
connection with any of these transactions. The parties each agree to indemnify
and hold harmless one another against any loss, liability, damage, cost, claim
or expense incurred by reason of any
7
<PAGE>
brokerage commission or finder's fee alleged to be payable because of any act,
omission or statement of the indemnifying party.
5.4 Transaction Costs. Each party hereto shall pay all of its
respective costs and expenses (including attorneys' fees and other legal costs
and expenses and accountants' fees and other accounting costs and expenses)
incurred in connection with the formation, execution and delivery of this
Agreement.
5.5 Entire Agreement. This Agreement and all exhibits and schedules
attached to this Agreement, if any, represent the entire understanding and
agreement between the parties with respect to the subject matter of this
Agreement, and supersedes all other negotiations, understandings and
representations (if any) made by and between such parties.
5.6 Tax Liabilities. Sellers shall pay and be responsible for all taxes
with respect to income attributable to the Partnership Interests and its share
of the Partnerships' business and operations in the period ending on the
Effective Date, and all prior years, and pay when due all taxes due and owing
with respect thereto. The parties agree that as of the Effective Date, Buyer is
appointed the tax matters partner of the Partnerships pursuant to Section
6231(a)(7) of the Internal Revenue Code of 1986, as amended, and shall cause to
be prepared all federal and any required state and local income tax returns of
the Partnerships for all periods and subsequent to December 31, 1998 and, in
connection therewith, to make any available or necessary federal income tax
elections. The books of the Partnership shall be closed on the Effective Date
for income tax purposes.
5.7 Amendments. The provisions of this Agreement may not be amended,
supplemented, waived or changed orally, but only by a writing signed by the
party as to whom enforcement of any such amendment, supplement, waiver or
modification is sought and making specific reference to this Agreement.
5.8 Assignments. No party shall assign his or its rights or obligations
under this Agreement without the prior written consent of each other party to
this Agreement.
5.9 Further Assurances. The parties hereby agree from time to time to
execute and deliver such further and other transfers, assignments and documents
and do all matters and things which may be convenient or necessary to more
effectively and completely carry out the intentions of this Agreement.
5.10 Binding Effect. All of the terms and provisions of this Agreement
shall be binding upon, inure to the benefit of, and be enforceable by the
parties and their respective administrators, executors, other legal
representatives, heirs and permitted assigns, whether so expressed or not. Any
rights given or duties imposed upon the estate of a deceased shareholder shall
inure to the benefit of and be binding upon the fiduciary of such decedent's
estate in his fiduciary capacity.
8
<PAGE>
5.11 Headings. The headings contained in this Agreement are for
convenience of reference only, are not to be considered a part of the Agreement
and shall not limit or otherwise affect in any way the meaning or interpretation
of this Agreement.
5.12 Press Release. The disclosure of this transaction shall initially
be made by press release in the form reviewed by the parties. Except as
otherwise required by law, all future disclosure shall be consistent with the
press release and neither party shall make disparaging remarks about the other.
5.13 Severability. If any provision of this Agreement or any other
agreement entered into pursuant to this Agreement is contrary to, prohibited by
or deemed invalid under applicable law or regulation, such provision shall be
inapplicable and deemed omitted to the extent so contrary, prohibited or
invalid, but the remainder of this Agreement shall not be invalidated thereby
and shall be given full force and effect so far as possible. If any provision of
this Agreement may be construed in two or more ways, one of which would render
the provision invalid or otherwise voidable or unenforceable and another of
which would render the provision valid and enforceable, such provision shall
have the meaning which renders it valid and enforceable.
5.14 Waivers. The failure or delay of any party at any time to require
performance by another party of any provision of this Agreement, even if known,
shall not affect the right of such party to require performance of that
provision or to exercise any right, power or remedy under this Agreement. Any
waiver by any party of any breach of any provision of this Agreement should not
be construed as a waiver of any continuing or succeeding breach of such
provision, a waiver of the provision itself, or a waiver of any right, power or
remedy under this Agreement. No notice to or demand on any party in any
circumstance shall, of itself, entitle such party to any other or further notice
or demand in similar or other circumstances.
5.15 Third Parties. Unless expressly stated in this Agreement to the
contrary, nothing in this Agreement, whether express or implied, is intended to
confer any rights or remedies under or by reason of this Agreement on any
persons other than the parties to this Agreement and their respective legal
representatives, successors and permitted assigns. Nothing in this Agreement is
intended to relieve or discharge the obligation or liability of any third
persons to any party to this Agreement, nor shall any provision give any third
persons any right of subrogation or action over or against any party to this
Agreement.
5.16 Remedies Cumulative. Except as otherwise expressly provided in
this Agreement, no remedy in this Agreement conferred upon any party is intended
to be exclusive of any other remedy, and each and every such remedy shall be
cumulative and shall be in addition to every other remedy given under this
Agreement or now or hereafter existing at law or in equity or by statute or
otherwise. No single or partial exercise by any party of any right, power or
remedy under this Agreement shall preclude any other or further exercise
thereof.
9
<PAGE>
5.17 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same instrument. Confirmation of execution
by electronic transmission of a facsimile signature page shall be binding upon
any party so confirming.
5.18 Governing Law. This Agreement and all transactions contemplated by
this Agreement shall be governed by, and construed and enforced in accordance
with, the internal laws of the State of Florida without regard to principles of
conflicts of laws.
5.19 Preparation of Agreement. This Agreement shall not be construed
more strongly against any party regardless of who is responsible for its
preparation. The parties acknowledge each contributed and is equally responsible
for its preparation.
5.20 Survival. All covenants, agreements, representations and
warranties made in this Agreement or otherwise made in writing by any party
pursuant to this Agreement shall survive the execution and delivery of this
Agreement and the consummation of the transactions contemplated by this
Agreement.
10
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
SELLERS:
UNIQUE SEI HOLDINGS, INC.
By: /s/ Dennis Max
-------------------------------
Dennis Max, President
MAX'S BEACH GRILL, INC.
By: /s/ Gerald J. Visconti, Jr.
-------------------------------
Gerald J. Visconti, Jr., President
UNIQUE BRICKELL, INC.
By: /s/ Gerald J. Visconti, Jr.
-------------------------------
Gerald J. Visconti, Jr., President
UNIQUE WESTON, INC.
By: /s/ Gerald J. Visconti, Jr.
-------------------------------
Gerald J. Visconti, Jr., President
BUYER:
SFORZA ENTERPRISES INC.
By: /s/ Gerald J. Visconti, Jr.
-------------------------------
Gerald J. Visconti, Jr., President
11
<PAGE>
EXHIBITS
--------
EXHIBIT A Form of Option to Purchase Common Stock
- ---------
EXHIBIT B Licenses, Permits, Certificates and Authorizations of the
- --------- Partnerships
EXHIBIT C Limited Partnership Agreements
- ---------
EXHIBIT D Partners
- ---------
(Exhibits Omitted)
12
EXHIBIT 10.23
-------------
THIS OPTION AND THE SECURITIES PURCHASABLE UPON EXERCISE OF THIS OPTION HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT") AND MAY NOT BE SOLD, ASSIGNED OR OTHERWISE TRANSFERRED UNLESS THERE IS AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT COVERING SUCH
SECURITIES OR THE COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF THESE
SECURITIES (REASONABLY SATISFACTORY TO THE COMPANY AND ITS COUNSEL), OR AN
OPINION OF THE COMPANY'S COUNSEL, STATING THAT SUCH SALE, ASSIGNMENT OR TRANSFER
IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF THE
SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS.
STOCK OPTION AGREEMENT
----------------------
THIS STOCK OPTION AGREEMENT (this "Agreement") is made and entered into
as of the 5th day of August by and between Sforza Enterprises Inc., a Florida
corporation (the "Company") and Unique SEI Holdings, Inc., a Florida corporation
(the "Holder").
BACKGROUND STATEMENT:
WHEREAS, the Company and the Holder entered into that certain Agreement
for Purchase and Sale of Partnership Interest, dated August 5, 1999 (the
"Purchase Agreement"). As partial consideration thereunder, the Company agreed
to grant the Holder an option to purchase the Company's common stock, $.01 par
value per share (the "Common Stock"), as more particularly set forth herein.
NOW THEREFORE, in consideration of the mutual covenants contained
herein, and other good and valuable consideration, the receipt and adequacy of
which is hereby acknowledged, it is hereby agreed as follows:
1. Grant of Option. Subject to and upon the terms and conditions set
forth in this Agreement, the Company hereby grants to the Holder an option (the
"Option") to purchase up to Twenty Thousand (20,000) shares of the Company's
Common Stock, at an exercise price of Two Dollars and 50/100 ($2.50) per share,
in two blocks of Ten Thousand (10,000) shares, exercisable in accordance with
the terms set forth herein (collectively, the "Shares").
2. Term of Option. The Option shall terminate on August 5, 2002.
3. Exercise of Option. The Holder shall have the right to exercise the
Option only in accordance with the following:
(a) Right to Exercise When Price Equals or Exceeds $5.00 per Share.
The Holder shall have the right to exercise the Option for Ten Thousand (10,000)
of the Shares at any time
1
<PAGE>
within five (5) calender days after the Market Price (as defined in Section 3(c)
below) of the Common Stock equals or exceeds Five Dollars ($5.00) per share for
twenty (20) consecutive trading days.
(b) Right to Exercise When Price Equals or Exceeds $7.00 per
Share. The Holder shall have the right to exercise the Option for Ten Thousand
(10,000) of the Shares at any time within five (5) business days after the
Market Price (as defined in Section 3(c) below) of the Common Stock equals or
exceeds Seven Dollars ($7.00) per share for twenty (20) consecutive trading
days.
(c) Definition of Market Price. For purposes of this Section
3, the term "Market Price" of the Common Stock means the average of the highest
bid and the lowest ask prices reported on the OTC Bulletin Board or other
primary market on which the Common Stock may be traded.
(d) Examples. Assume each weekday is a trading day for the
following examples.
(i) The Market Price of the Common Stock reaches $6.00 per
share from Monday, January 1 through Friday, January 26. The Holder has until
February 2 to exercise the Option for 10,000 of the Shares. On each day from
Monday, January 8 to Friday, February 2, the Market Price reaches $8.00 per
share. The Holder has until February 9 to exercise the Option for the remaining
10,000 of the Shares.
(ii) The Market Price of the Common Stock reaches $6.00
from Monday, January 1 through Friday, January 26, and the Market Price drops to
$4.00 on Monday, January 29. The Holder does not elect to exercise the Option
for 10,000 of the Shares by Friday, February 2. The Holder must wait until the
Market Price equals or exceeds at least $5.00 per share for another twenty (20)
consecutive trading days before the Holder may exercise the Option for 10,000 of
the Shares.
4. Method of Exercising Option. Subject to the terms and conditions of
this Agreement, the Option may be exercised by providing the Company with
payment of the full payment price for the Shares, and the Company shall cause
its transfer agent to deliver a certificate or certificates representing such
Shares as soon as practicable after such payment has been received. The
certificate or certificates for the Shares as to which the Option shall have
been so exercised shall be registered in the name of the Holder or permitted
assignee and shall be delivered to the Holder or permitted assignee. All Shares
that shall be purchased upon the exercise of the Option as provided herein shall
be fully paid and non-assessable. The Holder shall not have the rights of a
shareholder with respect to the Shares covered by the Option hereunder until the
date of issuance of a stock certificate to the Holder for such Shares. The
Holder may only exercise the Option to purchase the Shares in lots of Ten
Thousand (10,000) Shares.
5. Transfer of Option. The Option may not be sold, conveyed, pledged,
hypothecated, or otherwise transferred in any manner by the Holder without the
prior written consent of the Company, except to the extent such is to a person
or entity controlled by or under common control with the Holder or any of the
shareholders of Holder. No such sale, transfer or hypothecation may
2
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occur in any event except in compliance with federal and state securities laws,
as determined to the satisfaction of the Company and its counsel in their
reasonable discretion.
6. Adjustment upon Changes in Capitalization.
------------------------------------------
(a) If all or any portion of the Option shall be exercised
subsequent to any stock split, stock dividend, recapitalization, combination of
shares of the Company, or other similar event occurring after the date hereof,
then the Holder exercising the Option shall receive, for the aggregate price
paid upon the exercise, the aggregate number and class of shares which the
Holder would have received if the Option had been exercised immediately prior to
such stock split, stock dividend, recapitalization, combination of shares or
other similar event. If any adjustment under this Section 6(a) would create a
fractional share of Common Stock or a right to acquire a fractional share of
Common Stock, such fractional share shall be disregarded and the number of
shares subject to the Option shall be the next higher number of shares, rounding
all fractions upward. Whenever there shall be an adjustment pursuant to this
Section 6(a), the Company shall forthwith notify the Holder of such adjustment,
setting forth in reasonable detail the event requiring the adjustment and the
method by which such adjustment was calculated.
(b) If all or any portion of the Option shall be exercised
subsequent to any merger, consolidation, exchange of shares, separation,
reorganization or liquidation of the Company or other similar event occurring
after the date hereof, as a result of which shares of Common Stock shall be
changed into the same or a different number of shares of the same or another
class or classes of securities of the Company or another entity, then the Holder
exercising the Option shall receive, for the aggregate price paid upon such
exercise, the aggregate number and class of shares which the Holder would have
received if the Option had been exercised immediately prior to such merger,
consolidation, exchange of shares, separation, reorganization or liquidation, or
other similar event. If any adjustment under this Section 6(b) would create a
fractional share of Common Stock or a right to acquire a fractional share of
Common Stock, such fractional share shall be disregarded and the number of
shares subject to this Option shall be the next higher number of shares,
rounding all fractions upward. Whenever there shall be an adjustment pursuant to
this Section 6 (b), the Company shall forthwith notify the Holder of such
adjustment, setting forth in reasonable detail the even requiring the adjustment
and the method by which such adjustment was calculated.
7. Securities Law.
---------------
(a) Neither the Company, nor any person acting on its behalf,
has offered or sold the Option or the Shares to the Holder by means of any form
of general solicitation or general advertising, including communications
published in any newspaper, magazine or similar medium.
(b) The Holder is acquiring the Option and will acquire the
Shares for its own account and not on behalf of other persons. The Holder has
not been organized for the specific purpose of acquiring the Option or the
Shares. The Option is being acquired and the Shares will be acquired with the
intent of holding them for investment and without the intent of participating
directly or indirectly in a distribution thereof.
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(c) The Holder has not, in making the investment, utilized a
purchaser representative as that term is defined in Regulation D under the
Securities Act of 1933, as amended (the "Act").
(d) The Holder has such knowledge and experience in financial
and business matters and investing in new, speculative ventures that it is
capable of evaluating the risk of my investment in the Company, and is able to
bear the economic risk of this investment, in that it can afford a complete loss
of the investment or it is able to retain such investment indefinitely.
(e) There has been direct communication between the Holder and
the Company so that the Holder has had the opportunity to ask questions of, and
receive answers from, the Company or any person acting on its behalf concerning
the Company, and has had the opportunity to obtain any additional information
necessary to verify the accuracy of any information furnished to the Holder by
the Company, including the Company's Form 10-K Annual Report for 1998 as filed
with the Securities and Exchange Commission.
(f) The Shares to be purchased upon exercise of this Option
will not be sold without registration under the Act and applicable state
securities law or receipt by the Company of an opinion of counsel reasonably
satisfactory to counsel for the Company that the proposed sale is exempt
thereunder. The Holder consents to a legend being placed on the certificates for
the Shares stating that the Shares have not been registered under such laws and
referring to such restrictions on transferability and sale, and the Holder
consents to a stop order to the Company's transfer agent that such Shares shall
not be transferred on the books of the Company without compliance with such
requirements.
(g) The sale of the Shares to the Holder has not been
registered under the Act and will be sold to the Holder pursuant to Regulation D
thereunder, and that such sale has not been registered with any state securities
regulatory agency; that any transferee may be subject to similar restrictions;
and that, therefore, it is unlikely that the Holder will be able to sell, pledge
or otherwise transfer its Shares and it must continue to bear the economic risk
of the investment for an indefinite period of time.
(i) WHERE SALES ARE MADE TO FIVE OR MORE PERSONS IN FLORIDA,
ANY SUCH SALE MADE TO A FLORIDA PURCHASER PURSUANT TO SECTION 517.061(11) OF THE
FLORIDA STATUTES SHALL BE VOIDABLE BY SUCH PURCHASER WITHIN THE THREE DAY PERIOD
AFTER THE LATER OF (1) THE FIRST TENDER OF CONSIDERATION IS MADE BY SUCH
PURCHASER TO THE COMPANY OR AN AGENT OF THE COMPANY, OR AN ESCROW AGENT, OR (2)
THE AVAILABILITY OF THAT PRIVILEGE IS COMMUNICATED TO SUCH PURCHASER. TO
ACCOMPLISH A VOIDING OF HIS OR HER PURCHASE, IT IS SUFFICIENT FOR A FLORIDA
INVESTOR TO SEND A LETTER OR TELEGRAM TO THE COMPANY WITHIN SUCH THREE DAY
PERIOD, STATING THAT THE INVESTOR IS VOIDING AND RESCINDING THE
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PURCHASE. SHOULD ANY INVESTOR CHOOSE TO VOID HIS OR HER TRANSACTION IN THIS
METHOD, IT IS PRUDENT TO DO SO BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO
INSURE THAT IT IS RECEIVED BY THE COMPANY AND TO EVIDENCE THE DATE OF MAILING OF
SUCH NOTICE.
8. No Obligation to Exercise Option. The grant and acceptance of the
Option hereunder imposes no obligation on the Holder to exercise the Option.
9. Amendments. The provisions of this Agreement may not be amended,
supplemented, waived or changed orally, but only by a writing signed by the
party as to whom enforcement of any such amendment, supplement, waiver or
modification is sought and making specific reference to this Agreement.
10. Further Assurances. The parties hereby agree from time to time to
execute and deliver such further and other transfers, assignments and documents
and do all matters and things which may be convenient or necessary to more
effectively and completely carry out the intentions of this Agreement.
11. Binding Effect. All of the terms and provisions of this Agreement
shall be binding upon, inure to the benefit of, and be enforceable by the
parties and their respective legal representatives, successors and permitted
assigns, whether so expressed or not.
12. Notices. All notices, requests, consents and other communications
required or permitted under this Agreement shall be in writing (including
electronic transmission) and shall be (as elected by the person giving such
notice) hand delivered by messenger or courier service, electronically
transmitted, or mailed (airmail if international) by registered or certified
mail (postage prepaid), return receipt requested, addressed to:
If to the Company: With a copy to:
c/o Sforza Enterprises Inc. Gunster, Yoakley, Valdes-Fauli
222 Clematis Street, Suite 202 & Stewart, P.A.
West Palm Beach, Florida 33401 777 S. Flagler Drive, Suite 500 East
Attn.: Jay Visconti, President West Palm Beach, Florida 33401
Telephone: (561) 366-0027 Attn.: Steven J. Serling, Esq.
Telefax: (561) 366-0028 Telephone: (561) 650-0577
Telefax: (561) 655-5677
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If to Holder: With a copy to:
Unique Restaurants Concepts, Inc. Ruden, McCloskey, Smith, Schuster
490 East Palmetto Park Road, Suite 110 & Russell, P.A.
Boca Raton, Florida 33432 200 E. Broward Boulevard, 15th Floor
Attn.: Dennis R. Max, President Ft. Lauderdale, Florida 33302
Telephone: (561) 392-0611 Attn.: Michael H. Krul, Esq.
Telefax: (561) 393-0456 Telephone: (954) 764-6660
Telefax: (954) 764-4996
or to such other address as any party may designate by notice complying with the
terms of this Section. Each such notice shall be deemed delivered (a) on the
date delivered if by personal delivery; (b) on the date of transmission with
confirmed answer back if by electronic transmission; and (c) on the date upon
which the return receipt is signed or delivery is refused or the notice is
designated by the postal authorities as not deliverable, as the case may be, if
mailed.
13. Headings. The headings contained in this Agreement are for
convenience of reference only, are not to be considered a part of the Agreement
and shall not limit or otherwise affect in any way the meaning or interpretation
of this Agreement.
14. Severability. If any provision of this Agreement or any other
agreement entered into pursuant to this Agreement is contrary to, prohibited by
or deemed invalid under applicable law or regulation, such provision shall be
inapplicable and deemed omitted to the extent so contrary, prohibited or
invalid, but the remainder of this Agreement shall not be invalidated thereby
and shall be given full force and effect so far as possible. If any provision of
this Agreement may be construed in two or more ways, one of which would render
the provision invalid or otherwise voidable or unenforceable and another of
which would render the provision valid and enforceable, such provision shall
have the meaning which renders it valid and enforceable.
15. Survival. All covenants, agreements, representations and warranties
made in this Agreement or otherwise made in writing by any party pursuant to
this Agreement shall survive the execution and delivery of this Agreement and
the consummation of the transactions contemplated by this Agreement.
16. Waivers. The failure or delay of any party at any time to require
performance by another party of any provision of this Agreement, even if known,
shall not affect the right of such party to require performance of that
provision or to exercise any right, power or remedy under this Agreement. Any
waiver by any party of any breach of any provision of this Agreement should not
be construed as a waiver of any continuing or succeeding breach of such
provision, a waiver of the provision itself, or a waiver of any right, power or
remedy under this Agreement. No notice to or demand on any party in any
circumstance shall, of itself, entitle such party to any other or further notice
or demand in similar or other circumstances.
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17. Jurisdiction and Venue. The parties acknowledge that a substantial
portion of the negotiations, anticipated performance and execution of this
Agreement occurred or shall occur in Broward or Palm Beach County, Florida. Any
civil action or legal proceeding arising out of or relating to this Agreement
shall be brought in the courts of record of the State of Florida in Broward or
Palm Beach County or the United States District Court, Southern District of
Florida, Broward or West Palm Beach Division. Each party consents to the
jurisdiction of such court in any such civil action or legal proceeding and
waives any objection to the laying of venue of any such civil action or legal
proceeding in such court. Service of any court paper may be effected on such
party by mail, as provided in this Agreement, or in such other manner as may be
provided under applicable laws, rules of procedure or local rules.
18. Remedies Cumulative. Except as otherwise expressly provided in this
Agreement, no remedy in this Agreement conferred upon any party is intended to
be exclusive of any other remedy, and each and every such remedy shall be
cumulative and shall be in addition to every other remedy given under this
Agreement or now or hereafter existing at law or in equity or by statute or
otherwise. No single or partial exercise by any party of any right, power or
remedy under this Agreement shall preclude any other or further exercise
thereof.
19. Governing Law. This Agreement and all transactions contemplated by
this Agreement shall be governed by, and construed and enforced in accordance
with, the internal laws of the State of Florida without regard to principles of
conflicts of laws.
20. Entire Agreement. This Agreement and all exhibits and schedules
attached to this Agreement, if any, represent the entire understanding and
agreement between the parties with respect to the subject matter of this
Agreement, and supersedes all other negotiations, understandings and
representations (if any) made by and between such parties.
21. Prevailing Party. If any civil action or other legal proceeding is
brought for the enforcement of this Agreement, or because of an alleged dispute,
breach, default or misrepresentation in connection with any provision of this
Agreement, the successful or prevailing party or parties shall be entitled to
recover reasonable attorneys' fees, sales and use taxes, court costs and all
expenses even if not taxable as court costs (including, without limitation, all
such fees, taxes, costs and expenses incident to appellate, bankruptcy and
post-judgment proceedings), incurred in that civil action or legal proceeding,
in addition to any other relief to which such party or parties may be entitled.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
COMPANY:
SFORZA ENTERPRISES INC.
By: /s/ Gerald J. Visconti, Jr
---------------------------------
Gerald J. Visconti, Jr., President
HOLDER:
UNIQUE SEI HOLDINGS, INC.
By: /s/ Dennis Max
---------------------------------
Dennis Max, President
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