<PAGE>
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):
MAY 12, 1998
PARADISE HOLDINGS, INC.
(FORMERLY JAVA CENTRALE, INC.)
------------------------------------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 1-12932 68-0412009
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(STATE OR OTHER (COMMISSION (I.R.S. EMPLOYER
JURISDICTION OF FILE NUMBER) IDENTIFICATION
INCORPORATION) NUMBER)
1610 ARDEN WAY, SUITE 145 SACRAMENTO, CALIFORNIA 95815
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(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (916) 568-2310
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ITEM 5. Other Events
1. LETTER OF INTENT TO ACQUIRE ASSETS OF AXXESS MEDIA, INC.
The Board of Directors of Paradise Holdings, Inc. announced on May 18, 1998
the signing of a conditional letter of intent to purchase the Internet
publications known collectively as the "FinancialWeb" from Axxess, Inc. AXXS
of Altamonte Springs, Florida. The FinancialWeb family of investor sites are
distributed over the Internet and include free real-time quotes; technical
analysis, charting and portfolio analysis; news and market data; fundamental
research; recommendations and analysis from Wall Street; financial humor;
EDGAR filings; investigative reporting; short selling strategies and a site
devoted to the Small Cap market or derive income from banner advertising
sales, syndication of editorial content, licensing of data and technology,
list rentals and sales of premium services.
The transaction is an asset purchase to include those specific assets of
Axxess identified as the "FinancialWeb" family of Internet web sites, which
consists of domain names, technology, hardware, software, trademarks,
clients, customers, etc. Additionally, Paradise shall assume certain
contractual obligations with respect to data and technology providers, and
key programmers and consultants necessary to the operation of the web sites.
The purchase price is to be a combination of cash and stock at closing, along
with additional consideration in stock after one year on an earn-out basis,
tied to increased site traffic and operation of additional web sites
currently in development.
The closing of the transaction is subject to the completion of a due
diligence review by Paradise; the requisite board, shareholder and
governmental approvals if necessary; and the negotiation of an asset purchase
agreement between the parties. The parties to the agreement are contemplating
the closing of the transaction described herein prior to July 31, 1998.
Axxess has agreed not to initiate any discussions or negotiations with any
third parties regarding the sale of the FinancialWeb family of web sites and
the related assets.
2. LETTER OF INTENT TO SELL ASSETS OF PARADISE BAKERY, INC.
The Board of Directors of Paradise Holdings, Inc. announced on May 18,
1998 the signing of a conditional letter of intent to sell its Paradise
Bakery & Cafe retail operations to AFC Enterprises of Atlanta, GA. The sale
includes 15 company cafes, 34 franchised units and a commissary that is a
fulfillment house of proprietary items for use in the restaurants.
The transaction is an asset purchase to include all of the right, title
and interest in the assets of Paradise Bakery, Inc. including the assumption
of only those liabilities under franchise agreements and real estate leases.
The purchase price is to be a combination of cash at closing along with
additional consideration in either stock or cash 24 months after closing on
an earn-out basis tied to store level contributions.
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The conditions to closing the transaction include: (a.) The completion of
a due diligence review by AFC; (b.) AFC and Paradise Holdings obtaining
necessary consents from their Boards and any other necessary third parties
including governmental agencies to include approval of the asset sale by the
shareholders of Paradise; (c.) AFC and Paradise to negotiate and agree to an
asset purchase agreement; (d.) The receipt by Paradise of a fairness opinion
regarding the purchase price for the assets.
The parties have agreed to work towards a closing date of June 30, 1998.
Prior to June 30, 1998 Paradise will not solicit or initiate discussions or
negotiations with any other party regarding a sale of the Paradise Bakery
asset.
ITEM 6. Resignation of Registrant's Directors
RESIGNATION OF CHAIRMAN OF THE BOARD.
Effective as of May 14, 1998, Richard J. Crosby, the Chairman of the
Board, resigned from the Company.
ITEM 7. Financial Statements and Exhibits
c) Exhibits
2.4 Letter of Intent dated May 15, 1998 between Paradise Holdings,
Inc. and Axxess Media, Inc.
2.5 Letter of Intent dated May 12, 1998 between Paradise Holdings,
Inc. and AFC Enterprises.
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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, thereunto duly authorized.
JAVA CENTRALE, INC.
By: /s/ GARY C. NELSON
------------------------------------
Gary C. Nelson
Its President
Date: May 19, 1998
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EXHIBIT 2.4
PARADISE HOLDINGS, INC.
1610 ARDEN WAY, SUITE 145
SACRAMENTO, CA 95815
May 15, 1998
Mr. Kevin A. Lichtman, CEO
Axxess, Inc.
201 Park Place
Altamonte Springs, FL 32701
Dear Mr. Lichtman:
This letter of intent confirms that Paradise Holdings, Inc. ("Paradise")
intends to proceed with the purchase of certain assets owned by Axxess, Inc.
("Axxess") on the following basic terms and conditions:
NON-BINDING UNDERSTANDING.
The following numbered paragraphs reflect the parties' mutual
understanding of the matters discussed in them. They are not to be
interpreted as constituting a complete statement of terms by Paradise or
Axxess, or a legally binding or enforceable commitment with respect to the
matters set forth therein, or to impose on either party an enforceable duty
or obligation to negotiate towards or conclude any such agreement or
commitment.
PURCHASE OF ASSETS. Paradise will acquire from Axxess certain assets of
Axxess as defined in "Exhibit A" hereto (the "Assets"), that are
used in connection with or necessary to the operation of the
"Financial Web" family of Internet web sites; which includes without
limitation all hardware, software, equipment, inventory, trademarks,
trade names, service marks, copyrights, trade secrets, formulas,
programs, code, other intellectual property and goodwill, in each
case free and clear of liens, claims and encumbrances.
PURCHASE PRICE. The total purchase price for the Assets shall be:
a. Seven Hundred Fifty Thousand ($750,000) U.S. Dollars, payable
via wire transfer (to the account designated by Axxess), and
Two Million (2,000,000) Shares of Paradise $.001 par value
Common Stock; and
b. ADDITIONAL PURCHASE PRICE: Paradise will pay Axxess an
additional Two Million (2,000,000) Shares of Paradise $.001 par
value Common Stock (the
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EXHIBIT 2.4
"Earnout") one year after closing. The condition for this
additional purchase price is as follows:
Axxess currently has ten (10) Internet web sites that are in
operation. Axxess' business plan calls for an additional
ten (10) Internet web sites to be operational within
twelve (12) months. Said web sites and their operation
and functionality are specified in "Exhibit B" hereto and
made a part of this Letter of Intent. As a condition
hereof, for the payment of the Additional Purchase Price,
Axxess shall have all twenty (20) Internet web sites
operating and functional within one (1) year after
closing.
Axxess currently receives traffic of approximately Two Million
(2,000,000) page impressions monthly on its "Financial
Web" family of Internet web sites. As a condition hereof,
and in addition to Paragraph 2(b)(i) hereto, in order for
Axxess to receive the payment of the Additional Purchase
Price, Axxess shall have an average daily traffic of Four
Million (4,000,000) page impressions for the thirty (30)
consecutive days after eleven months from closing.
PURCHASE PRICE ADJUSTMENTS. Paradise's proposed purchase price is based
upon certain assumptions, including without limitation, the
assumptions that the quantity and quality of the assets to be owned
will be comparable to or greater than the assets reflected on the
unaudited balance sheet of Axxess dated March 31, 1998. In the
event that any of Paradise's assumptions prove incorrect, Paradise
may require an adjustment to the price.
ASSUMPTION OF LIABILITIES. Paradise shall not assume any liabilities,
debts or obligations of Axxess, other than the obligations arising
after the Closing under agreements and contracts for data, content
and communications, as listed in "Exhibit C" hereto and made a part
of this Letter of Intent.
CONDITIONS TO CLOSING. The Closing of the acquisition is contingent on
the following:
1) DUE DILIGENCE REVIEW. Paradise completing, directly and through
its attorneys, accountants and advisors, a thorough due diligence
review of the Business, and their satisfaction with the results
of the review determined in their sole and absolute discretion;
2) CONSENTS. Paradise and Axxess obtaining any consents of its
Board of Directors and other third parties necessary in
connection with or to close the acquisition;
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EXHIBIT 2.4
3) GOVERNMENT CONSENTS. Paradise and Axxess obtaining necessary
approvals from any governmental authorities, if required.
4) ASSET PURCHASE AGREEMENT. Paradise and Axxess negotiating and
agreeing to an asset purchase agreement described in Paragraph 7
below.
POST CLOSING EVENTS. Paradise, Axxess, its officers will agree to
reasonable limitations on competitive activities, for a period of
two (2) years after the Closing, to protect the business and the
business Concept and the going concern value and goodwill being
purchased by Paradise.
EVENTS AND ACTIVITIES PRIOR TO CLOSING.
1) ACCESS. For Paradise to complete its due diligence review of
Axxess, Axxess shall allow Paradise's representatives, legal
counsel, accountants, advisors and lenders' representatives to
have access to the assets, books and records of Axxess, and to
have access to, and make copies of, the financial statements
and other financial information, contracts, books and records and
all other relevant information pertaining to Axxess. In addition,
upon reasonable notice to Axxess, Paradise shall be entitled to
contact and communicate with the Axxess employees, officers,
representatives, creditors, customers and others having business
relationships with Axxess.
2) PUBLICITY. There shall be no public announcements or comments
with respect to this letter of intent, the Asset Purchase
Agreement (as defined in Paragraph 7 below), or the proposed
transaction, except as mutually agreed upon between Paradise and
Axxess; provided however, that such announcements are required by
law or governmental regulation may be made without mutual
agreement if time or circumstance makes consultation between the
parties impractical, unnecessary or otherwise not feasible and in
such event the party making such announcement shall notify the
other party as soon as is practicable.
3) CONDUCT OF BUSINESS PENDING CLOSING. From the date of acceptance
of this letter of intent by Axxess through the Closing:
1) Axxess shall cause the business to be operated only in the
ordinary course consistent with past practices, including
without limitation operating in accordance with current
budgets, expansion plans, capital expenditure plans and the
like;
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EXHIBIT 2.4
2) Axxess shall not engage in any extraordinary transaction;
3) Axxess shall use every reasonable effort to preserve intact
their businesses, to keep available the service of their
officers and employees and to maintain satisfactory
relationships with suppliers, contractors, customers,
creditors and others having a business relationship with the
business;
4) Axxess shall promptly notify Paradise of any material breach of
or default under any contract to which either of them is a party
and shall consult with Paradise in connection with the actions
to be taken in response to such breach or default;
5) Axxess shall notify Paradise no later than three (3) days after
the occurrence or threatened occurrence of any event having or
tending to have a material adverse effect upon the financial
condition, business prospects, assets, liabilities, or other
customer relationships of the business; and
6) Axxess shall not, without the prior written consent of
Paradise, engage in any transactions involving the exchange of
ownership of any Internet web sites owned by Axxess.
The covenants set forth in this Paragraph 6 shall also be contained in
the Asset Purchase Agreement.
DOCUMENTATION AND ADDITIONAL CLOSING MATTERS. The acquisition of the
business and the related transactions will be effected pursuant to
detailed written contracts, including without limitation an escrow
agreement and an asset acquisition agreement (the "Asset Purchase
Agreement") between Paradise and Axxess.
The parties will negotiate warranties, representations and limitations of
remedies and indemnification obligations to be included in the definitive
agreement.
Axxess shall cause to be delivered a letter of opinion from independent
counsel in form and substance acceptable to Paradise's legal counsel.
CLOSING. We agree to use our best efforts to proceed expeditiously to a
closing to be held on or before July 31, 1998, or such other date as
shall be mutually agreed to by Paradise and Axxess in writing (the
"Closing"). The Closing, unless otherwise agreed upon by Paradise and
Axxess, shall take place in Sacramento, California at the offices of
Paradise Holdings, Inc.
NEGOTIATIONS. After execution of this letter of intent and until the close
of business on
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EXHIBIT 2.4
July 31, 1998, Axxess shall not, directly or indirectly:
1) solicit or initiate discussions, negotiate or engage in
discussions with any other party regarding a sale of all or
substantially all of the business, the formation of a joint
venture or partnership regarding all or any part of the
business, the merger or other business combination of the
business or any other transaction out of the ordinary course of
business of the business (collectively, a "Material
Transaction"); or
2) provide information to any person or entity concerning the
business with respect to a possible Material Transaction. In
the event Axxess should receive any offer or proposal to enter
into a Material Transaction, they will immediately notify
Paradise of the existence of any such offer or proposal, which
notice shall include information as to the identity of the party
making such offer or proposal and the specific terms of such
offer or proposal.
EXPENSES. Each of Paradise and Axxess shall pay its or their own legal,
accounting, investment advisor and other fees and expenses incurred in
connection with the Acquisition.
TERMINATION. The negotiation of the terms and conditions as contemplated
under this letter of intent may be terminated at any time by either party,
in its complete discretion whether or not such party is acting reasonably
or not.
FEES. If Axxess and Paradise execute an Asset Purchase Agreement and the
related documents by July 31, 1998, and such transaction is not
consummated for any reason, and within one (1) year after the execution
of the Asset Purchase Agreement, Axxess shall enter into a letter of
intent or asset purchase agreement for an acquisition with any third
party, involving a transfer, directly or indirectly, of the Business or
of substantially all of the assets of the Business, which acquisition is
subsequently consummated, and provided such acquisition (in light of
the consideration therein, the amount of equity acquired and the amount
of debt outstanding or the purchase price of the assets) implies a
higher value for the business than that implied by this transaction, then
Axxess shall pay to Paradise a fee equal to Two Hundred Fifty Thousand
($250,000) U.S. Dollars.
BINDING EFFECT. It is understood and agreed that neither Paradise or Axxess
will be legally bound by the terms of this letter of intent, other than
Paragraphs 6(b), 6(c), 9, 10, 11 and 12 above, until the Asset Purchase
Agreement is prepared, agreed to, approved by our respective attorneys
and executed.
MISCELLANEOUS. This letter of intent:
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EXHIBIT 2.4
(i) constitutes the entire agreement between the parties as to its
subject matter, and no prior agreement, written or oral, shall
survive the execution of this letter of intent;
(ii) may be executed in one or more counterparts, each of which
shall constitute an original, but all of which shall
constitute but a single document;
(iii) shall be construed and interpreted according to and governed
by the laws of the state of California (excluding conflicts of
law principles);
(iv) may not be assigned by either party without the express written
consent of the other, except for the assignment by Paradise to a
wholly-owned subsidiary; and
(v) may not be waived, modified, altered or amended in any manner
except with the written consent of Paradise and Axxess.
To indicate your agreement to the terms and conditions of this letter of
intent, please sign the enclosed duplicate originals of this letter of intent
and return it to Paradise. We look forward to working with you to a
successful conclusion of the Acquisition. This letter of intent shall expire
and be of no force or effect whatsoever if Paradise shall not have received a
signed copy of this letter of intent from Axxess prior to the close of
business on May 15, 1998.
Very truly yours,
Paradise Holdings, Inc.
By: /s/ GARY C. NELSON
------------------------------------
Gary C. Nelson, President
Read and agreed to this 15th day of May, 1998.
Axxess Inc.
By: /s/ KEVIN A. LICHTMAN
------------------------------------
Kevin A. Lichtman, President
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EXHIBIT 2.5
May 12, 1998
VIA FAX (916) 568-1240
VIA FEDERAL EXPRESS
Gary Nelson, CEO
Paradise Bakery Cafe
1610 Arden Way
Suite 145
Sacramento, Ca 95815
Dear Gary:
This letter of intent confirms the AFC Enterprises, Inc. ("AFC")
intends to proceed with the purchase of the assets owned by Paradise Bakery,
Inc ("Paradise") on the following basic terms and conditions:
1. PURCHASE OF ASSETS. AFC will acquire from Paradise all of the
right, title and interest in the assets of Paradise that are used in
connection with or necessary to the operation of the bakery which
currently consists of a total of fifty-one (51) units, twenty-eight
(28) franchise and twenty-three (23) company units; provided that
company units 111, 112, 314, and 317 will not be part of this
transaction and will prior to closing cease to operate, fully
deidentify and carry no obligation on AFC'S part, thereby reducing
the number of company units to a total of nineteen (19), including
without limitation all furniture, fixtures, equipment, leasehold
improvements, inventory, trademarks, trade names, service marks,
copyrights, trade secrets, formulae, recipes, other intellectual
property, all other tangible and intangible property, cash on hand,
books, records and goodwill (all of the foregoing being sometimes
her in collectively referred to as the "Business"), in each case
free and clear of liens, claims and encumbrances.
2. PURCHASE PRICE. The total purchase price for the Business shall be
FIVE MILLION ($5,000,000) DOLLARS, payable as follows:
(a) The sum of FIVE MILLION ($5,000,000) DOLLARS reduced by the
Escrow Deposit, if applicable, shall be paid via wire transfer (to the
account designated by Sellers) at Closing
(b) ADDITIONAL PURCHASE PRICE: AFC will pay
Paradise an additional TWO MILLION ($2,000,000) in AFC stock
or cash, as requested by Paradise, (the "Earnout") two-years
after closing. The condition for payment of the Earnout is
based on the Paradise division, under our ownership,
contribution $3.0 million in cash flow for the previous
rolling 12 months, excluding all G&A expenses, (existing and
incremental).
(i) For purposes of valuing AFC'S stock, if on the Valuation
Date (as defined in the Asset Purchase Agreement) AFC'S
Stock is traded on a national securities exchange, or in
the
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EXHIBIT 2.5
NASDAQ National Market System or over-the-counter
Market, the value per share of AFC Stock shall be
the Average closing bid price for the five trading
days Immediately preceding the Valuation Date;
otherwise, the Value per share of AFC's stock shall
be determined as Follows:
a) Multiply AFC'S EBITDA (as defined in the Asset Purchase
Agreement) for the thirteen (13) accounting periods
immediately Preceding the Closing Date times nine (9);
b) Subtract from such product the total amount of AFC'S long-term
debt and capital leases as of the Valuation Date;
c) Add to the difference the amount of AFC'S cash and cash
equivalents as of the Valuation Date;
d) Divide the total by the number of shares of AFC'S stock
outstanding as of the Valuation date; and
e) The quotient shall be the value per share of AFC'S stock.
PURCHASE PRICE ADJUSTMENTS. AFC'S proposed purchase price is based upon
certain assumptions, including without limitation, the assumptions that the
quantity and quality of the assets to be owned will be comparable to or
greater than the assets reflected on the unaudited balance sheet of Paradise
dated December, 1997, heretofore delivered to AFC. In the event that any of
AFC assumptions probe incorrect, AFC may require and adjustment to the
purchase price.
3. ASSUMPTION OF LIABILITIES. AFC shall not assume any liabilities,
debts or obligations of Paradise, other than obligations
arising after the Closing under franchise agreements for the
franchised units and real estate leases for company stores then
operating which shall be specifically set for the in the Asset
Purchase Agreement
4. CONDITIONS TO CLOSING. The Closing of the acquisition is
contingent on the following:
(a) DUE DILIGENCE REVIEW. AFC'S completing, directly and
through its attorneys, accountants and advisors, a through
due diligence review of the Business, and their satisfaction
with the results of the review determined in their sole and
absolute discretion.
(b) CONSENTS. AFC and Paradise Holdings, Inc. to obtain
any consents of its Board of Directors and other third
parties necessary in connection with or to close the
acquisition.
(c) GOVERNMENTAL CONSENTS. AFC'S and Sellers' obtaining
necessary approvals from the Justice Department and
Federal Trade Commission, and any state regulatory
bodies, under applicable laws and regulations.
(d) ASSET PURCHASE AGREEMENT. AFC and Paradise Holdings,
Inc. to negotiate and agree to an asset purchase
agreement described in Paragraph 7 below.
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EXHIBIT 2.5
(e) FAIRNESS OPINION. Paradise and/or its parent
company, Java Centrale, Inc. receiving a fairness
opinion regarding the purchase price for the assets
prior to the execution of the Asset Purchase
Agreement.
5. POST CLOSING COVENANTS. Paradise and the Principals will
agree to reasonable limitations on competitive activities,
for a period of ten (10) years after the Closing, to protect
the Business and the Business concept and the going concern
value and goodwill being purchased by AFC.
6. EVENTS AND ACTIVITIES PRIOR TO CLOSING.
(a) ACCESS. For AFC to complete its due diligence review
of Paradise shall allow AFC's representatives, legal
counsel, accountants, advisors and lenders'
representatives to have access to the properties of
Paradise, and to have access to, and make copies of,
the financial statements and other financial information,
contracts, books and records and all other relevant
information pertaining to Paradise. In addition, upon
reasonable notice to Paradise, AFC shall be entitled
to contact and communicate with the Paradise's employees,
officers, representatives, franchisees, creditors,
customers and others having business relationships
with it information obtained by AFC in its due
diligence review.
(b) PUBLICITY. There shall be no public announcements
or comments with respect to this letter of intent,
the Asset Purchase Agreement (as defined in Paragraph
7 below), or the proposed transaction, except as
mutually agreed between the parties impractical,
unnecessary or otherwise not feasible and in such
event the party making such announcement shall notify
the other party as soon as is practicable.
(c) CONDUCT OF BUSINESS PENDING CLOSING. From the
date of acceptance of the letter of intent by Paradise
through the Closing, (i) Paradise shall cause the business to
be operated only in the ordinary cause consistent with past
practices, including without limitation operating in
accordance with current budgets expansion plans, capital
expenditure plans and the like; (ii) Paradise shall not
engage in any extraordinary transaction; (iii) Paradise shall
use every reasonable effort to preserve intact their
businesses, to keep available the services of their officers
and employees and to maintain satisfactory relationships with
suppliers, contractors, customers, franchisees, creditors and
others having a business relationship with the business; (iv)
Paradise shall promptly notify AFC of any material breach of
or default under any contract to which wither of them is a
party and shall consult with AFC in connection with the
actions to be taken in response to such breach or default;
(v) Paradise shall notify AFC no later than three (3) days
after the occurrence or threatened occurrence of any event
having or tending to have a material adverse effect upon the
financial condition, business prospects, assets, liabilities,
or customer relationships of the business; and (vi) Paradise
shall not, without the prior written consent of AFC, engage
in any transactions involving the exchange of ownership of
any units currently operated by Paradise for units currently
operated by another company or under another brand name.
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EXHIBIT 2.5
The covenants set forth in this Paragraph 6 shall also be contained in the
Asset Purchase Agreement.
7. DOCUMENTATION AND ADDITIONAL CLOSING MATTERS. The acquisition of the
business and the related transactions will be effected pursuant to
detailed written contracts, including without limitation the escrow
agreement and an asset acquisition agreement (the "Asset Purchase
Agreement") between AFC and Paradise Holdings, Inc. The Asset Purchase
Agreement will, among other things, (i) contain the usual representations
and warranties customary in transactions of this type; and (ii) contain
standard indemnification and offset provisions. In addition, Paradise
Holdings, Inc. shall cause to be delivered a letter of opinion from
independent counsel in form and substance acceptable to AFC's legal
counsel.
8. CLOSING. We agree to use our best efforts to proceed expeditiously to a
closing to be held on or before June 30, 1998, or such other date as
shall be mutually agreed to by AFC and Paradise in writing (the
"Closing"). The Closing, unless otherwise agreed upon by AFC and Paradise,
shall take place in Atlanta, Georgia at the offices of Cohen Pollock
Merlin Axelrod & Tanenbaum, P.C., counsel to AFC.
9. NEGOTIATIONS. After execution of this letter of intent and until the
close of business on June 30, 1998, Paradise shall not, directly or
indirectly, (i) solicit or initiate discussions, negotiate or engage
in discussions with any other party regarding a sale or all or
substantially all of the business, the formation of a partnership or
joint venture regarding all or any part of the business, the merger or
other business combination of the Business or any other transaction out
of the ordinary course of business of the business (collectively, a
"Material Transaction"); or (ii) provide information to any person or
entity concerning the business with respect to a possible Material
Transaction. In the event Paradise should receive any offer or proposal
to enter into a material Transaction, they will immediately notify AFC
of the existence of any such offer or proposal, which notice shall
include information as to the identity of the party making such offer or
proposal and the specific terms of such offer or proposal.
10. EXPENSES. Each of AFC and Paradise shall pay its or their own legal,
accounting, investment advisor and other fees and expenses incurred in
connection with the Acquisition.
11. TERMINATION. The terms and conditions of this letter of intent may be
terminated at any time by mutual written agreement of AFC and Paradise
or by AFC if the Asset Purchase Agreement shall not have been executed
by June 30, 1998.
12. FEES. If Paradise, principals and AFC execute an Asset Purchase
Agreement and the related documentation by June 30, 1998, and such
transaction is not consummated for any reason other than AFC's failure
to proceed after satisfaction or waiver of the conditions precedent to
AFC's and Paradise's obligation to proceed, and within one year after
the execution of the Asset Purchase Agreement, Sellers and/or Principals
shall enter into a letter of intent or preliminary or asset purchase
agreement for an acquisition with any third party, involving a transfer,
directly or indirectly, of the Business or of substantially all of the
assets of the Business, which acquisition is subsequently consummated,
and provided such acquisition (in light of the consideration therein,
the amount of equity acquired and the amount of debt outstanding or the
purchase price of
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EXHIBIT 2.5
the assets) implies a higher value for the business than that implied by
this transaction, then Sellers and Principals shall pay to AFC a fee
equal to FIVE HUNDRED THOUSAND ($500,000.) DOLLARS.
13. BINDING EFFECT. It is understood and agreed that neither AFC, Sellers
nor the Principals will be legally bound by the terms of this letter,
other than Paragraphs 6(b), 6(c), 9, 10, 11 AND 12 above, until the
Asset Purchase Agreement is prepared, agreed to, approved by our
respective attorneys and executed.
14. MISCELLANEOUS. This letter of intent (i) constitutes the entire
agreement between the parties as to its subject matter, and no prior
agreement, written or oral, shall survive the execution of this letter
of intent; (ii) may be executed in one or more counterparts, each
of which shall constitute an original, but all of which shall constitute
by a single document; (iii) shall be construed and interpreted according
to and governed by the laws of the state of Georgia (excluding conflict
of laws principles); (iv) may not be assigned by either party without
the express written consent of the other, except for the assignment by
AFC to a wholly-owned subsidiary; and (v) may not be waived, modified,
altered or amended in any manner except with the written consent of AFC
and Paradise and the Principals.
To indicate your agreement to the terms and conditions of this letter of
intent, please sign the enclosed duplicate original of this letter and return
it to AFC. This letter of intent shall expire and shall be of no force or
effect whatsoever if AFC shall not have received a signed copy of this letter
of intent from Sellers and the Principals prior to the close of business on
May 12, 1998.
Very truly yours,
AFC Enterprises, Inc.
By: /s/ GREGG A. KAPLAN
----------------------------------------
Gregg A. Kaplan, President
Bakery Cafe Group
And: /s/ KENNETH S. KAPLAN
----------------------------------------
Kenneth S. Kaplan,
Assistant Secretary
Read and agreed to this 12th day of May, 1998.
Paradise Bakery, Inc.
By: /s/ GARY C. NELSON
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Gary C. Nelson, President and CEO
And: /s/ BRADLEY B. LANDIN
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Bradley B. Landin, Sr. VP Operations
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