Area Development Agreement
Sample Area Development Agreement
Location/Market:
MRDA Ref.:
Entity Name:
Effective Date:
EXHIBIT E
Boston Pizza Restaurants, LP MULTI-RESTAURANT DEVELOPMENT AGREEMENT
TABLE OF CONTENTS ITEM PAGE
I. GRANT......................................................................................................................................2
II. TERM.........................................................................................................................................4
ID. FRANCfflSE AGREEMENT, INITIAL FRANCfflSE FEE, AREA
DEVELOPMENT FEE & INITIAL TRAINING..................................................................4
IV. DEVELOPMENT SCHEDULE...............................................................................................5
V. LOCATION OF RESTAURANTS..........................................................................................S
VI. FRANCfflSE AGREEMENT..................................................................................................S
VII. DEFAULT AND TERMINATION..........................................................................................S
Vm. TRANSFER OF INTEREST....................................................................................................6
IX. FORCE MAJEURE..................................................................................................................9
X. CONFIDENTIALITY.............................................................................................................10
XI. NONCOMPETITION.............................................................................................................10
Xn. ENTIRE AGREEMENT........................................................................................................12
Xm. MONTHLY REPORTS..........................................................................................................12
XIV. INDEPENDENT CONTRACTOR AND INDEMNIFICATION.......................................12
XV. COMPLIANCE WITH APPLICABLE LAWS...................................................................13
XVI. CHANGE IN DEVELOPMENT TERRITORY.......:..........................................................14
XVH. SUCCESSORS AND ASSIGNS.............................................................................................14
XVHI. APPLICABLE LAW..............................................................................................................14
XIX. RECEIPT OF DOCUMENTS................................................................................................15
XX. NOTICE...................................................................................................................................15
XXI. WAIVER OF JURY TRIAL..................................................................................................16
XXII. MODIFICATION BY FRANCHISOR.................................................................................16
XXIH- ACKNOWLEDGEMENTS....................................................................................................16
ATTACHMENTS:
Attachment A: Description of the Development Territory Attachment B: Development Schedule Attachment C: Certificate of Corporate Status Attachment D: Guaranty and Undertaking Attachment E: Principals' Undertaking
1297587-6 i
UFOC - V06
BPR MRDA Insert MRDA Reference EXHIBIT E Boston Pizza Restaurants, LP MULTI-RESTAURANT DEVELOPMENT AGREEMENT
THIS AGREEMENT is made and entered into this Insert Date, Month, Year, (the "Effective Date") by and between Boston Pizza Restaurants, LP, a limited partnership formed under the laws of the State of Delaware, with a business address at 1501 LB J Freeway, Suite 450, Dallas, Texas, 75234 (hereinafter referred to as the "Franchisor") and Insert Name of Multi-Restaurant Developer with its address at Insert Address of Multi-Restaurant Developer (hereinafter referred to as the "MRD").
WITNESSETH:
WHEREAS, the Franchisor holds the exclusive franchise rights for the United States to a proprietary system owned by BP International Rights Holdings Inc. ("BP Holdings"), which has been developed through significant expenditures of time, skill, effort and money (hereinafter the "System") relating to the establishment, development and operation of a Boston's The Gourmet Pizza Restaurant operating under the System and the Proprietary Marks which specializes in the sale of pizza and pasta dishes in a full service casual dining restaurant environment (hereinafter the "Restaurant", which term includes both franchised outlets and outlets owned by Franchisor or its affiliates);
WHEREAS, the System features a distinctive exterior and interior design, decor, color scheme, fixtures and furnishings for the Restaurant, as well as uniform standards, specifications, methods, policies and procedures for store operations, proprietary inventory and management control, training and assistance, and advertising and promotional programs, all of which may be changed, improved upon, and further developed from time to time by Franchisor;
WHEREAS, Franchisor, through its dedicated operations, marketing methods, and merchandising policies, has developed the reputation, public image and good will of its System in the United States and established a firm foundation for its franchised retail operations consisting of the highest standards of training, management, supervision, appearance, services and quality of products;
WHEREAS, the System is identified by means of certain trade names, service marks, trade marks, logos, emblems and indicia of origin, including the mark "Boston's The Gourmet Pizza" and logo, and such other trade names, service marks, and trademarks as are now, and may hereafter be designated for use in connection with the System (the "Proprietary Marks") which Proprietary Marks are owned by BP Holdings;
WHEREAS, BP Holdings has licensed and granted to the Franchisor the exclusive right and license to sub-license and police the use of the System and the Proprietary Marks in the United States;
WHEREAS, the Franchisor continues to develop, expand, use, control and add to the Proprietary Marks and the System for the benefit of and exclusive use by the Franchisor and its franchisees in order to identify for the public the source of the products and services marketed thereunder and to represent the System's high standards of quality and service;
WHEREAS, MRD desires to obtain the exclusive right to develop, construct, manage and operate multiple Boston's The Gourmet Pizza Restaurants under the development schedule described in Attachment B attached hereto (the "Development Schedule") and within the territory described in
1297587-6
UFOC - 3/06
1
[ ) Please initial after reading this page
Attachment A attached hereto (the "Development Territory"), under the System and Proprietary Marks, as well as to receive the training and other assistance provided by Franchisor in connection therewith;
WHEREAS, the MRD hereby acknowledges that it has read this Agreement and the Franchisor's Uniform Franchise Offering Circular, and that it has no knowledge of any representations about the Restaurant or about the Franchisor or its franchising program or policies made by the Franchisor or by its officers, directors, shareholders, employees or agents which are contrary to the statements in the Franchisor's Uniform Franchise Offering Circular or to the terms of this Agreement, and that it understands and accepts the terms, conditions and covenants contained in this Agreement as being reasonably necessary to maintain the Franchisor's high standards of quality and service and the uniformity of those standards at all facilities which operate pursuant to the System and thereby to protect and preserve the goodwill of the System and the Proprietary Marks; and
WHEREAS, MRD understands and acknowledges the importance of Franchisor's uniformly high standards of quality and service and the necessity of operating the Restaurants in strict conformity with Franchisor's quality control standards and specifications.
NOW, THEREFORE, the parties, in consideration of the promises, undertakings and commitments of each party to the other party set forth herein, hereby mutually agree as follows:
I. GRANT.
A. Franchisor hereby grants to MRD and MRD accepts, upon the terms and conditions herein contained, the right and license to develop, construct, operate and manage Insert number of stores(Insert numeric number of stores) Restaurants in strict accordance with the System and under the Proprietary Marks within the Development Territory(s) described in Attachment A. MRD hereby accepts such right and license and agrees to perform all of its obligations in connection therewith as set forth herein. Each Restaurant shall be operated according to the terms of the individual franchise agreement with respect thereto.
B. Provided that MRD at all times remains in full compliance with the terms of this Agreement, including the Development Schedule set forth in Attachment B (the "Development Schedule"), and the franchise agreements for each Restaurant, then Franchisor will not commence operation of, or grant a third party the right to commence operation of, a Restaurant at a physical premises within the Development Territory during the Term of this Agreement. However, the Franchisor reserves the right to commence operation of, or grant a third party the right to commence operation of, "quick express" units within non-captive venues within the Development Territory, after providing MRD with a thirty (30) day right of first refusal. The Franchisor also reserves the right to commence operation of, or grant a third party the right to commence operation of, "quick express" units in any captive venues within or outside the Development Territory, and MRD shall not have any right of first refusal for "quick express" units located within captive venues. For purposes of this Agreement, "captive" venues means locations in which customers will primarily be drawn from an enclosed or limited facility, including, but not limited to, sports facilities and arenas, entertainment facilities, amusement parks, auditoriums, public transportation facilities, military bases and government facilities, college campuses, shopping malls (including food courts), grocery stores and supermarkets, hospitals and any other similar facilities and locations. A "quick express" unit is a Boston's The Gourmet Pizza restaurant operating under the System and the Proprietary Marks which offers a limited menu and/or limited service (rather than full service). Franchisor reserves all rights not expressly granted herein, including without limitation, the right to take the following actions within or outside the Development Territory regardless of proximity to, or competitive impact on, MRD's Restaurants:
1. Commence operation of company-owned Restaurants or license third parties to commence operation of Restaurants providing products or services under marks other than the Proprietary Marks;
1297587-6 UFOC - i/06
2
[ I Please initial after reading this page
2. Notwithstanding any rights of first refusal granted to MRD in this Section I.B., offer and sell food products, including frozen products, under the Proprietary Marks or any other marks, through grocery stores, convenience stores, hotel shops and kiosks, theatres, malls, gas stations or other retail locations, or through mail order or catalogues or on the Internet;
3. Notwithstanding any rights of first refusal granted to MRD in this Section LB., offer or sell food products, including frozen products, under the Proprietary Marks or any other marks at "Special Events" after providing MRD with thirty (30) days notice and a ten (10) day opportunity to participate in the "Special Event" pursuant to terms agreeable to the Franchisor and MRD. "Special Event" means carnivals, fairs, school events, charity functions, community festivals, conventions, business gatherings, private parties and similar events and gatherings that last for no more than 30 consecutive days; and
4. Subject to the right of first refusal granted to MRD in this Section I.B., offer or sell any products or services, under the Proprietary Marks or any other marks, through any other channel of distribution.
The Franchisor may commence operation of company-owned Restaurants or license third parties to commence operation of Restaurants at any site the Franchisor deems appropriate outside of the Development Territory. At the earlier of (1) the originally scheduled opening date of the final unit being developed hereunder, (2) the actual opening of such final unit, or (3) the termination of this Agreement, the MRD will no longer have any territorial exclusivity or protection other than the territory described in the individual franchise agreements.
C. This Agreement is not a franchise agreement. This Agreement does not grant MRD the right to operate a Restaurant, and MRD has no right to use in any manner the Proprietary Marks or System under this Agreement. Each Restaurant must be operated under a separate franchise agreement.
D. The MRD must own one hundred percent (100%) of the equity interest in each Restaurant developed hereunder; provided, however, that one or more third parties approved by Franchisor in accordance with Section VDl hereof may own equity interests in a Restaurant and MRD must at all times maintain ownership of at least a fifty one percent (51%) equity interest in each Restaurant and retain the ability to control the operation of, and all management decisions regarding, each Restaurant developed hereunder. Each of the MRD's general managers is strongly encouraged to own at least a 10% equity interest in the Restaurant that the general manager supervises.
E. Each of MRD's "Controlling Principals" shall jointly and severally guarantee the MRD's performance hereunder and shall bind themselves to the terms of this Agreement by executing the Guaranty and Undertaking attached hereto as Attachment D; provided, however, that the requirements of this Section I.E. shall not apply to an entity publicly-held (listed on a recognized exchange or NASDAQ) as of the date of this Agreement. The term "Controlling Principal" means one or more of MRD's principals who (a) individually or collectively own a Controlling Interest in MRD, or (b) have been designated by Franchisor as Controlling Principals. Except for Controlling Principals who have signed a Guaranty and Undertaking in the form attached hereto as Attachment D, each individual who owns any common stock or other voting equity interests in MRD or has authority to cause MRD to take or omit any action that MRD is required to take or omit in accordance with this Agreement (referred to herein as a "Principal") shall execute the Principals' Undertaking attached hereto as Attachment E. As used herein, "Controlling Interest" means possession, directly or indirectly, of the power to direct or cause the direction, of the management and policies of an entity, whether through ownership of voting securities, by contract or otherwise.
1297587-6 UFOC - 3/06
3 [ I Please initial after reading this page
II. TERM.
Unless sooner terminated pursuant to the provisions of Section VII, the Term of this Agreement shall expire upon the earlier of the original scheduled opening date of the final restaurant or the actual opening date of the final restaurant. The Franchisor, in its sole discretion, may permit MRD to renew this Agreement for an additional term; provided that, without limiting the foregoing, the MRD has not defaulted in its obligations under this Agreement or any other agreement with the Franchisor, and the parties agree in writing to an extension of the Development Schedule. The initial term of this Agreement and any renewal term(s) shall be referred to collectively as the "Term" throughout this Agreement.
in. FRANCHISE AGREEMENT, INITIAL FRANCHISE FEE, AREA DEVELOPMENT FEE & INITIAL TRAINING.
A. Upon the execution of this Agreement, the MRD shall pay to the Franchisor the following: (i) forty-thousand dollars ($40,000.) as a credit against the Initial Franchise Fee for the first Restaurant to be developed hereunder, and (ii) twenty thousand dollars ($20,000.) multiplied by the remaining number of Restaurants to be developed under this Agreement. The balance ($20,000.) is due upon the execution of each remaining franchise agreement, All amounts collected shall be deemed fully earned immediately upon receipt and shall be non-refundable.
B. As soon as MRD locates a site within the Development Territory that it believes is suitable for construction of a Restaurant, MRD shall submit to Franchisor such information about the proposed location including, without limitation, lease terms, land acquisition terms, demographic criteria and preliminary site plans showing building orientation, pad size, parking layout and certain other information, as Franchisor may require from time to time. If MRD proposes that another entity will operate the Restaurant, MRD must also submit information to Franchisor regarding the proposed operating entity. Franchisor reserves the right to request as much additional information regarding the site and the proposed operating entity as it deems necessary, in its sole discretion, and MRD agrees to provide such information immediately upon request.
C. If the Franchisor accepts the site location per Section IIIA.l above, it will give its written acceptance to the MRD to proceed with architectural drawings and final site plans, containing such information as Franchisor requires. The acceptance of the site location shall not constitute final approval of the site for the Restaurant, or of the entity proposed as franchisee. Upon receipt of the site location approval, MRD should make an offer to secure the site via purchase or lease, which offer must be contingent upon final approval by Franchisor of the site and of the proposed franchisee entity.
D. If the Franchisor provides final site approval and approves the proposed franchisee entity for a Restaurant, Franchisor and MRD (or its affiliate) shall enter into an individual franchise agreement for such Restaurant within 30 days of the final site approval, which agreement shall be in the form of the Franchisor's then-current form of franchise agreement. The terms of the individual franchise agreement will govern the development, build-out and opening of the of the Restaurant. The development time frame will be governed by this Agreement.
E. The terms of the franchise agreement notwithstanding, the Franchisor shall provide the MRD with the Franchisor's then-current initial training program and on-site opening assistance for only the first three (3) Restaurants to be developed hereunder or in combination with the related MRDA'S. Thereafter, the Franchisor shall provide only the initial training program, and then only for the manager of each additional Restaurant, and will not provide on-site assistance. Instead, the MRD shall, after the opening of its first Restaurant, begin assembly of its own store opening assistance team, and said team must be fully trained and in place prior to the opening of the fourth Restaurant hereunder, or in combination with the related MRDA's After the opening of the third Restaurant, the MRD's store opening team must provide the on-site opening assistance as stipulated by the Franchisor and continue to provide said
1297587-6
UFOC - 3/06
4
[ ] Please initial after reading this page
assistance for each and every Restaurant to be opened by the MRD under this Agreement or any future Multi-Restaurant Development Agreements.
IV. DEVELOPMENT SCHEDULE.
MRD shall secure sites, construct, open and continuously operate the Restaurants in accordance with the System and the Development Schedule. In the event that MRD opens and operates a greater number of Restaurants than is required to comply with the current period of the Development Schedule, the requirements of the succeeding period(s) shall be deemed to have been satisfied to the extent of such excess number of Restaurants. MRD will be permitted to open Restaurants in excess of the number of Restaurants set forth in the Development Schedule subject to the prior written approval of Franchisor if, in the Franchisor's sole discretion, the Franchisor determines that the Development Territory could support additional Restaurants.
V. LOCATION OF RESTAURANTS.
The location of each Restaurant shall be selected by the MRD, within the Development Territory, subject to Franchisor's prior approval as set forth in Section III hereof, which approval shall take into account all relevant demographic information then available to the Franchisor. The establishment of any proposed site by MRD prior to approval of Franchisor shall be the sole risk and responsibility of MRD and shall not obligate Franchisor in any way to approve the same. The approval of a proposed site by Franchisor does not in any way constitute a warranty or representation by Franchisor as to the suitability of such site for location of a Restaurant.
VI. FRANCHISE AGREEMENT.
Within 30 days following receipt of Franchisor's written site approval, the MRD will execute the individual franchise agreement and pay in full the remaining balance of the Initial Franchise Fee. Under no circumstances shall the MDR commence construction on, or open any Restaurant until, among other things, the entire Initial Franchise Fee for said Restaurant has been paid in full and the individual franchise agreement for such Restaurant has been executed by both the franchisee operating pursuant to this MRDA and the Franchisor.
VH. DEFAULT AND TERMINATION.
A. The MRD shall be deemed to be in material default ("Material Default") and the Franchisor may, at its option, terminate this Agreement and all rights granted hereunder, without affording the MRD any opportunity to cure the default, effective immediately upon receipt of notice from the Franchisor to the MRD, upon the occurrence of any of the following events:
1. If the MRD fails to comply with any obligation under this Agreement including its obligations under the Development Schedule;
2. If any individual Franchise Agreement is terminated or if the MRD fails to comply with any of its obligations under the individual Franchise Agreements;
3. If the MRD or any of its owners attempt to effect any transfer in violation of the terms of this Agreement or any other agreement between Franchisor and MRD;
4. If the MRD becomes insolvent or makes a general assignment for the benefit of creditors, or if a petition in bankruptcy is filed by the MRD or such a petition is filed against and consented to by the MRD, or if the MRD is adjudicated bankrupt, or if a bill in equity or other proceeding for the appointment of a receiver of the MRD or other custodian for the MRD's business or assets is filed and consented to by the MRD, or if a receiver or other custodian (permanent or temporary) of the MRD's business or assets is appointed by any court of competent jurisdiction, or if proceedings for a conference
1297587-6 UEQC - 3/06
5
[ ] Please initial after reading this page
with a committee of creditors under any state, federal or foreign law should be instituted by or against the MRD, or if a final judgment remains unsatisfied or of record for thirty (30) days or longer (unless appropriate bond is filed), or if execution is levied against the MRD's property, or suit to foreclose any lien or mortgage against the premises or equipment is instituted against the MRD and not dismissed within thirty (30) days, or if any substantial real or personal property of the MRD shall be sold after levy thereupon by any sheriff, marshal or constable;
5. If the MRD has made any material misrepresentation or omission in this Agreement or any other agreement to which the MRD and the Franchisor are parties;
6. If a judgment or a consent decree against the MRD, or any of its officers, directors, shareholders or partners is entered in any case or proceeding involving allegations or fraud, racketeering, unfair or improper trade practices or similar claim which is likely to have an adverse effect on the System, or the Proprietary Marks, the goodwill associated therewith or the Franchisor's interest therein;
7. If the MRD fails to comply with any of the covenants contained in Section X hereof;
8. If the MRD or any shareholder, member, partner, or other person controlling more than five percent (5%) of MRD's stock, membership interest or partnership interest, by act or omission, permits or commits tortious conduct or a violation of any applicable law, ordinance, rule or governmental regulation (including, but not limited to, any applicable employment law (e.g., harassment, discrimination, retaliation, equal employment, treatment of disabled persons, child labor or wages and hour law)) constituting a felony, or constituting a misdemeanor, lesser criminal offense or a violation of law which in Franchisor's sole judgment has, or is likely to have, an adverse effect upon the System, the Proprietary Marks, or the goodwill associated therewith; or
9. If, contrary to Section X hereof, the MRD or any of its officers, directors, shareholders, managers, members, or partners discloses or divulges the contents of the Manuals or any other trade secrets or Confidential Information provided to the MRD by the Franchisor.
B. Upon such default, Franchisor shall have the right, at its option, and in its sole discretion, to do any or all of the following:
1. terminate this Agreement; or
2. amend this Agreement to:
(i) terminate the territorial exclusivity granted to MRD;
(ii) reduce the size of the MRD's Development Territory or the number of units MRD may develop in the Development Territory; or
(iii) accelerate the Development Schedule on immediate written notice.
C. Upon termination or expiration of this Agreement, Franchisor shall immediately have the right to open and operate, or license others to open and operate, Restaurants within the Development Territory.
VIII. TRANSFER OF INTEREST.
A. Transfer by Franchisor. The Franchisor shall have the right to assign this Agreement, and all of its rights and privileges hereunder, to any person, firm, corporation or other entity provided that, with respect to any assignment resulting in the subsequent performance by the assignee of the functions of the Franchisor: (i) the assignee shall, at the time of such assignment, be capable of performing the obligations of the Franchisor hereunder, as determined by Franchisor in its sole discretion,
1297587-6
UFOC - 3/06
6 I ) Please initial after reading this page
and (ii) the assignee shall expressly assume and agree to perform such obligations and Franchisor shall thereby be released from any and all further liability to MRD.
Specifically, and without limitation to the foregoing, the MRD expressly affirms and agrees that the Franchisor may sell all or a portion of its assets, its rights to the Proprietary Marks and the System outright to a third party, including a direct competitor of Franchisor; may go public; may engage in a private placement of some or all of its securities; may merge, acquire other corporations or other legal entities, or be acquired by another corporation or other legal entity; may undertake a refinancing, recapitalization, leveraged buy-out or other economic or financial restructuring; and, with regard to any or all of the above sales, assignments and dispositions, the MRD expressly and specifically waives any claims, demands or damages arising from or related to the loss of said Proprietary Marks (or any variation thereof) and/or the loss of association with or identification of "Boston Pizza Restaurants, LP" as the Franchisor hereunder.
Nothing contained in this Agreement shall require the Franchisor to remain in the restaurant business or to offer the same products and services, whether or not bearing the Franchisor's Proprietary Marks, in the event that the Franchisor exercises its rights hereunder to assign its rights in this Agreement.
B. Transfer by MRD.
1. MRD and the Principals acknowledge that the integrity of the Restaurants and the stability of the System depend on the business qualifications, financial capabilities, honesty and integrity of Franchisor's developers and franchisees. MRD and the Principals further acknowledge that Franchisor's lack of opportunity to evaluate and approve each potential franchisee's and developer's qualifications and the terms of each proposed Transfer could irreparably damage the System. Consequently, MRD and the Principals agree not to effectuate a Transfer, except as expressly permitted herein, and in any such case, without Franchisor's prior written consent. Any Transfer or attempted Transfer lacking Franchisor's prior written consent or that otherwise violates the restrictions in this Section VIII will be null and void and of no effect against Franchisor and will constitute a material breach of this Agreement for which the Franchisor may then immediately terminate this Agreement pursuant to Section VILA.
As used herein, "Transfer" means the voluntary, involuntary, direct or indirect sale, assignment, transfer, license, sublicense, sublease, collateral assignment, grant of a security, collateral or conditional interest, inter-vivos transfer, testamentary disposition or other disposition of:
(a) this Agreement or any Franchise Agreement or any interest in or right under this Agreement or a Franchise Agreement, including (i) any transfer in, or as a result of, a divorce, insolvency, dissolution proceeding or otherwise by operation of law; (ii) any transfer upon MRD's death or the death of any of MRD's Principals by will, declaration of or transfer in trust or under the laws of intestate succession; or (iii) any foreclosure upon such Restaurant(s) or the transfer, surrender or loss by MRD of possession, control or management of such Restaurant(s); and/or
(b) any direct or indirect Ownership Interest in MRD or revenues or income of one or more Restaurants operated by MRD, including (i) any transfer, redemption or issuance of a legal or beneficial Ownership Interest in MRD or any legal entity that has a Controlling Interest (as defined in Section I.E.) in MRD or of any interest convertible to or exchangeable for a legal or beneficial Ownership Interest in MRD or any legal entity that has a Controlling Interest in MRD; (ii) any merger or consolidation between MRD or any legal entity that has a Controlling Interest in MRD and another legal entity, whether or not MRD is the surviving legal entity; (iii) any transfer in, or as a result of, a divorce, insolvency, dissolution proceeding or otherwise by operation of law; (iv) any transfer upon MRD's death or the death of any of MRD's Principals by will, declaration of or transfer in trust or under the laws of intestate succession; or (v) any foreclosure upon one or more Restaurants operated by MRD or the transfer, surrender or loss by MRD of possession, control or management of one or more Restaurants operated by MRD.
1297587-6 7 [ ) Please initial after reading this page
nFrtr-vofi
As used herein, "Ownership Interest" means any direct or indirect, legal or beneficial ownership interest of any type, including but not limited to (1) in relation to a corporation, the ownership of shares in the corporation; (2) in relation to a partnership, the ownership of a general partner or limited partnership interest; (3) in relation to a limited liability company, the ownership of a membership interest; or (4) in relation to a trust, the ownership of the beneficial interest of such trust.
Notwithstanding the foregoing, Franchisor's prior written consent shall not be required for a Transfer of less than a five percent (5%) interest in a publicly-held corporation or for a Transfer to a wholly-owned subsidiary corporation of the MRD formed expressly for that purpose. For such purposes, and under this Agreement in general, a publicly held corporation is a "Reporting Company" as defined by the Securities Exchange Act of 1934. The MRD must notify the Franchisor in writing at least sixty (60) days prior to the date of the intended Transfer. Any purported Transfer, by operation of law or otherwise, not having the written consent of the Franchisor shall be null and void and shall constitute a material breach of this Agreement.
2. Franchisor's consent to a Transfer is subject to any or all of the following conditions:
(a) All of the MRD's accrued monetary obligations and all other outstanding obligations to the Franchisor, its affiliates and suppliers must be fully paid and satisfied;
(b) The MRD must not be in default of any provision of this Agreement or any of its franchise agreements, any amendments thereof or successors thereto, or any other agreement between the MRD and the Franchisor, its subsidiaries or affiliates;
(c) Subject to any restrictions under applicable franchise registration and disclosure laws, the MRD and each of its affiliates, shareholders, members, partners, officers and directors must execute a general release, under seal, the consideration for which shall be the approval of the Transfer, in a form satisfactory to the Franchisor, of any and all claims against the Franchisor and its affiliates, officers, directors, shareholders (or other interest holders, as applicable) and employees, in their corporate and individual capacities, including, without limitation, claims arising under federal, state and local laws, rules and ordinances;
(d) The transferee must enter into a written assignment, under seal and in a form satisfactory to the Franchisor, assuming and agreeing to discharge all of the MRD's obligations under this Agreement and the relevant franchise agreements and, if deemed necessary by the Franchisor, the transferee's principals, individually, shall guarantee the performance of all such obligations in writing in a form satisfactory to the Franchisor;
(e) The transferee must demonstrate to the Franchisor's satisfaction that the transferee meets the Franchisor's educational, managerial and business standards; possesses a good moral character, business reputation and credit rating; has the aptitude and ability to operate the Restaurant (as may be evidenced by prior related experience or otherwise); meets at least the same managerial, financial and other criteria required of new MRDs and shall have sufficient equity capital, as determined by Franchisor in Franchisor's sole discretion, to operate the Restaurants;
(f) At the Franchisor's option, the transferee must execute (and at the Franchisor's request, shall cause all interested parties to execute), for a term ending on the expiration date of the franchise agreement(s) and with such renewal term as may be provided by the franchise agreement(s), the standard form of franchise agreement then being offered to new MRDs and such other ancillary agreements as the Franchisor may require for the Restaurants, which agreements shall supersede the franchise agreements between the MRD and the Franchisor in all respects and the terms of which agreements may differ from the terms of the franchise agreements, including, without limitation, the implementation of other fees and different royalty rates;
1297587-6 8 ( ] Please initial after reading this page
UFOC - 3/06
(g) The MRD and the principals must remain liable for all direct and indirect obligations to the Franchisor in connection with the Restaurants up until the latter of: (1) the Franchisor's written approval of the Transfer, or (2) the effective date of Transfer, and will continue to remain responsible for their obligations of nondisclosure, noncompetition and indemnification as provided in the franchise agreements and guaranties, and shall execute any and all instruments reasonably requested by the Franchisor to further evidence such liability; and
(h) MRD or its approved transferee shall pay to Franchisor, at the time of said Transfer, a transfer fee equal to twenty-five percent (25%) of the then current Initial Franchise Fee for each Restaurant to be transferred to cover the Franchisor's administrative and other expenses in connection with the Proposed Transfer.
3. If MRD or its principals shall at any time determine to sell, Transfer or otherwise dispose of all or part of the rights under this Agreement or an ownership interest in MRD, and MRD or its principals shall obtain a bona fide, executed written offer from a responsible and fully disclosed purchaser, MRD shall notify the Franchisor in writing of each such offer, and Franchisor has the right and option, exercisable within a period of thirty (30) days from the date of delivery of such offer, by written notice to MRD or its owners, to purchase the rights under this Agreement or such ownership interest for the price and on the terms and conditions contained in said purchaser's offer. If the Franchisor does not exercise its right of first refusal, MRD or its principals may complete the sale of MRD or such ownership interest, subject to Franchisor's approval of the purchaser and all other conditions set forth in this Section VIII.B; provided that if such sale is not completed within one hundred twenty (120) days after delivery of such offer to Franchisor, Franchisor shall again have the right of first refusal herein provided. In the event that the MRD wishes to publicly offer its shares in any partnership or corporation which has an ownership interest in the MRD, said public offering shall be subject to the approval of the Franchisor, such approval to not be unreasonably withheld.
C. Entity Ownership. Each shareholder, member or partner of the corporation, limited liability company or partnership which is granted the rights to serve as the MRD hereunder shall be a party to a shareholders agreement, operating agreement, or partnership agreement which shall provide, inter alia, that upon any dissolution of the corporation, limited liability company, or partnership, or upon any divorce decree among the parties who are also shareholders, members, or partners that ownership of the shares, membership interest, or partnership interest shall be transferred to the shareholder, member, or partner for agreed upon consideration, which has primary responsibility for sales and marketing activities, typically the President, following any such dissolution or decree. The form and content of the shareholders agreement must be approved by the Franchisor prior to execution. MRD's failure to comply with this Section VIII.C. shall constitute a material default of this Agreement.
D. Security Interest. MRD may grant a security interest in this Agreement or the business operations conducted pursuant to this Agreement to the limited extent permitted by Section 9-408 of the Uniform Commercial Code. Any such security interest may only attach to an mterest in the proceeds of the business operations conducted pursuant to this Agreement and may not under any circumstances entitle or permit the secured party to take possession of or operate any Restaurant or to transfer MRD's interest in this Agreement or any Restaurant without Franchisor's express prior consent. The grant of a security interest in a manner consistent with this Section VIII.D. will not be subject to the prohibition in Sections VIII.B. 1 and VIII.B.2. Except as expressly set forth in this Section VIII.D., the MRD shall grant no security interest in itself, this Agreement, the business operations conducted pursuant to this Agreement or in any of MRD's assets.
IX. FORCE MAJEURE.
In the event that MRD is unable to comply with the Development Schedule as a result of hurricane, tornado, typhoon, flooding, lightning, blizzard and other unusually severe weather, earthquake, avalanche, volcanic eruption, fire, riot, insurrection, war, terrorist attack, explosion, unavoidable calamity
1297587-6 9 1 ) Please initial after reading this page
UFOC - 3/06
or other act of God or similar events beyond its control (a "Force Majeure"), and upon notice to Franchisor, the Development Schedule and this Agreement shall be extended for a corresponding period, not to exceed ninety (90) days or as otherwise extended by the Franchisor in writing.
X. CONFIDENTIALITY.
A. Nothing contained in this Agreement shall be construed to require Franchisor to divulge to MRD any trade secrets, techniques, methods or processes except the material contained in Franchisor's manuals and training materials, and then only pursuant to the terms, conditions and restrictions contained in the applicable franchise agreement. MRD and the Principals acknowledge that their knowledge of Franchisor's know-how, processes, techniques, information and other proprietary data are derived entirely from information disclosed by Franchisor and that such information is proprietary, confidential and a trade secret of Franchisor. MRD and the Principals agree to adhere fully and strictly to the confidentiality of such information and to exercise the highest degree of diligence in safeguarding Franchisor's trade secrets during and after the Term of this Agreement. MRD and the Principals shall divulge such material only to MRD's employees and agents and only to the extent necessary to permit the efficient operation of the Restaurants. It is expressly agreed that the ownership of all such items and property is and shall remain vested solely in Franchisor.
B. The MRD and the Principals agree that all terms of this Agreement shall remain confidential and shall not make any public announcement, issue any press release or publicity, make any confirmation of statements made by third parties concerning the terms of this Agreement, or make any other disclosures other than the existence of this Agreement without the prior written consent of the Franchisor unless compelled by law or ordered to do so by a court of competent jurisdiction. It is agreed and understood that MRD and the Principals may disclose the terms of this Agreement to their professional advisors and lenders. Franchisor shall be free to make such disclosure of the terms of this Agreement as it determines, in its sole discretion, to be in the best interest of Franchisor or the System.
XI. NONCOMPETITION.
A. MRD and the Principals have heretofore specifically acknowledged that, pursuant to this Agreement, MRD and the Principals will receive valuable specialized Confidential Information and information regarding the business of Franchisor, and its System. MRD and the Principals covenant that during the Term of this Agreement and subject to the post-term provisions contained herein, except as otherwise approved in writing by Franchisor, MRD and the Principals shall not, either directly or indirectly, for themselves or through, on behalf of or in conjunction with any person, persons, partners or corporations:
1. divert or attempt to divert any business or customer of the Restaurants to any competitor, by direct or indirect inducement or otherwise, or do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with Franchisor's Proprietary Marks or the System;
2. employ or seek to employ any person who is at that time employed by Franchisor or by MRD or any other MRD or franchisee of Franchisor, or otherwise directly or indirectly induce such person to leave his or her employment; or
3. own, maintain, engage in, be employed by, advise, assist, invest in, franchise, make loans to or have any interest in any business which is the same as or substantially similar to a Restaurant and which is located within the Development Territory or within fifty (50) miles of the Development Territory or within a radius of ten (10) miles of any Restaurant which is in existence or under construction.
1297587-6
UFOC-3/06
10
( ) Please initial after reading this page
B. MRD and the Principals covenant that, except as otherwise approved in writing by Franchisor, MRD and the Principals shall not, for a continuous uninterrupted period commencing upon the expiration or termination of this Agreement, regardless of the cause for termination, and continuing for two (2) years thereafter (or in the case of a Principal who has executed Attachment D or Attachment E to this Agreement, for a continuous uninterrupted period commencing upon the date on which such individual ceases to be a Principal and continuing for two (2) years thereafter), either directly or indirectly, for themselves or through, on behalf of or in conjunction with any person, persons, partnership or corporation, own, maintain, engage in, be employed by, advise, assist, invest in, franchise, make loans to, or have any interest in any business which is the same as or substantially similar to the Restaurant and which is located within the Development Territory or within fifty (50) miles of the Development Territory or within a radius often (10) miles from the location of any Restaurant outside the Development Territory which is in existence or under construction on the date of expiration or termination of this Agreement.
C. Sections XI.A. and XI.B. shall not apply to ownership by MRD or the Principals of less than a five percent (5%) beneficial interest in the outstanding equity securities of any publicly-held corporation.
D. The parties and the Principals agree that each of the foregoing covenants shall be construed as independent of any other covenant or provision of this Agreement. If any or all portions of the covenants in this Section XI is held unreasonable or unenforceable by a court or agency having valid jurisdiction in an unappealed final decision to which Franchisor is a party, MRD and the Principals expressly agree to be bound by any lesser covenant subsumed within the terms of such covenant that imposes the maximum duty permitted by law, as if the resulting covenant were separately stated in and made a part of this Section XL
E. MRD and the Principals understand and acknowledge that Franchisor shall have the right, in its sole discretion, to reduce the scope of any covenant set forth in Sections XI.A. and XI.B. in this Agreement, or any portion thereof, without MRD's or the Principals consent, effective immediately upon receipt by MRD or the Principals, as applicable, of written notice thereof, and MRD and the Principals agree that they shall forthwith comply with any covenant as so modified, which shall be fully enforceable.
F. MRD and the Principals expressly agree that the existence of any claims it may have against Franchisor, whether or not arising from this Agreement, shall not constitute a defense to the enforcement by Franchisor of the covenants in this Section XI. MRD and the Principals, as applicable, agree to pay all costs and expenses (including reasonable attorneys' fees) incurred by Franchisor in connection with the enforcement of this Section XI provided Franchisor prevails in any or all of its claims against MRD or the Principals, as applicable.
G. MRD and the Principals acknowledge that MRD's or the Principals' violation of the terms of this Section XI would result in irreparable injury to Franchisor for which no adequate remedy at law may be available, and MRD and the Principals accordingly consent to the issuance of an injunction by any court of competent jurisdiction having jurisdiction over this Agreement prohibiting any conduct by MRD or the Principals, as applicable, in violation of the terms of this Section XI.
H. At Franchisor's request, MRD shall require and obtain execution of covenants similar to those set forth in this Section XI (including covenants applicable upon the termination of a person's relationship with MRD) from any or all of the following persons: (a) all directors and managers of the Restaurant; (b) all officers, directors and holders of a beneficial interest of five percent (5%) or more of the securities of MRD and of any corporation directly or indirectly controlling MRD if MRD is a corporation; and (c) the members or general partners and any limited partners (including any corporation, and the officers, directors and holders of a beneficial interest of five percent (5%) or more of the securities of any corporation which controls, directly or indirectly, any general or limited partner) if MRD is a limited liability company or partnership. All covenants required by this Section XI shall be in forms satisfactory to Franchisor, including, without limitation, specific identification of Franchisor as a third
1297587-6 11 [ | Please initial after reading this page
UFOC - 3/06
party beneficiary of such covenants with the independent right to enforce them. Failure by MRD to obtain execution of a covenant required by this Section XI shall constitute a default under Section VII hereunder.
XII. ENTIRE AGREEMENT.
This Agreement constitutes the entire understanding of the parties with respect to the development of the Development Territory, and shall not be modified except by a written agreement signed by the parties hereto. Where this Agreement and any franchise agreement between the parties conflict with respect to initial training, the amount or payment terms of Initial Franchise Fees or equity interests held by the franchisee or operating partners and unit managers, the terms of this Agreement shall govern. Under no circumstances do the parties intend that this Agreement be interpreted in such a way as to grant MRD any rights to grant sub-franchises in the Development Territory.
XIIL MONTHLY REPORTS.
MRD agrees that it shall provide to Franchisor a monthly report of its activities and progress in developing and establishing Restaurants as provided herein. The monthly reports shall be submitted no later than the fifth (5th) day following the end of the preceding month during the Term of this Agreement.
XIV. INDEPENDENT CONTRACTOR, INDEMNIFICATION AND BUSINESS JUDGMENT.
A. It is acknowledged and agreed that MRD and Franchisor are independent contractors and nothing contained herein shall be construed as constituting MRD as the agent, partner or legal representative of Franchisor for any purpose whatsoever. MRD shall enter into contracts for the development of the Development Territory contemplated by this Agreement at its sole risk and expense and shall be solely responsible for the direction, control and management of its agents and employees. MRD acknowledges that it does not have authority to incur any obligations, responsibilities or liabilities on behalf of Franchisor, or to bind Franchisor by any representations or warranties, and agrees not to hold itself out as having such authority.
B. It is understood and agreed that nothing in this Agreement authorizes the MRD to make any contract, agreement, warranty, or representation on the Franchisor's behalf, or to incur any debt or other obligation in the Franchisor's name, and that the Franchisor shall in no event assume liability for or be deemed liable hereunder as a result of any such action or by reason of any act or omission of the MRD in the MRD's conduct of the business contemplated hereby or any claim or judgment arising there from against the Franchisor. The MRD and the Principals agree at all times to defend at their own cost, and to indemnify and hold harmless to the fullest extent permitted by law, the Franchisor, its partners (including without limitation BPR GP, Inc. ("BPR GP") and Boston Pizza Restaurants (U.S.A.), Inc. ("BP USA") and any other limited partners) its subsidiaries, and other entities owned by it, its affiliates (including without limitation all entities and persons owned by or owning, directly or indirectly, an interest in Franchisor, BPR GP and/or BP USA), BP Holdings, successors, assigns and designees of any such entity, officers, directors, employees, agents, contractors, and other entities and persons providing services for or otherwise acting on behalf of the Franchisor (including, without limitation, the Franchisor's affiliates in any capacity or role), and the respective directors, officers, employees, agents, shareholders, members, managers, partners, designees, and representatives of each (the Franchisor and all of such others referred to herein collectively as "Indemnitees") from all damages, losses, expenses (including without limitation reasonable attorneys fees), actions, suits, proceedings, claims, demands, investigations, or formal or informal inquiries (regardless of whether same is reduced to judgment) or any settlement thereof which arises out of or is based upon or related to any of the following: (a) the MRD's alleged infringement or any other violation or any other alleged violation of any patent, trademark or copyright or other proprietary right owned or controlled by third parties; (b) the MRD's alleged violation or breach of any contract, federal, state or local law, regulation, ruling, standard or directive of any industry standard; (c) libel, slander or any other form of defamation by the MRD; (d) the MRD's alleged violation or breach of
1297587-6
12
j ] Please initial after reading this page
any warranty, representation, agreement or obligation in this Agreement; (e) any acts, errors or omissions of the MRD or any of its agents, servants, employees, contractors, partners, proprietors, affiliates, or representatives; (f) latent or other defects in any Restaurant contemplated hereby, whether or not discoverable by the Franchisor or the MRD; (g) the inaccuracy, lack of authenticity or nondisclosure of any information by any customer of any Restaurant contemplated hereby; (h) any services or products provided by the MRD at, from or related to the operation at any Restaurant contemplated hereby; (i) any services or products provided by any affiliated or nonaffiliated participating entity; (j) any action by any customer of any Restaurant contemplated hereby; and, (k) ANY DAMAGE TO THE PROPERTY OF THE FRANCHISEE OR THE FRANCHISOR, THEIR AGENTS OR EMPLOYEES, OR ANY THIRD PERSON, FIRM, CORPORATION OR OTHER LEGAL ENTITY, WHETHER OR NOT SUCH LOSSES, CLAIMS, COSTS, EXPENSES, DAMAGES, OR LIABILITIES WERE ACTUALLY OR ALLEGEDLY CAUSED WHOLLY OR IN PART THROUGH THE ACTIVE OR PASSIVE NEGLIGENCE OF THE FRANCHISOR OR ANY OF ITS AGENTS OR EMPLOYEES, OR RESULTED FROM ANY STRICT LIABILITY IMPOSED ON THE FRANCHISOR OR ANY OF ITS AGENTS OR EMPLOYEES. Each Indemnitee shall be a third party beneficiary of this Section XVIII.A. and, as such, shall be able to enforce this indemnification against the MRD.
_____ [Please initial to acknowledge that you have read and understand this Section XIV.B.]
C. Notwithstanding any contrary provisions contained in this Agreement, Franchisor and
MRD acknowledge and agree that (a) this Agreement (and the relationship of the parties which arises from this Agreement) grants Franchisor the discretion to make decisions, take actions and/or refrain from taking actions not inconsistent with MRD's explicit rights and obligations hereunder that may affect favorably or adversely MRD's interests; (b) Franchisor will use its business judgment in exercising such discretion based on its assessment of its own interests and balancing those interests against the interests of the owners of Restaurants generally (including Franchisor and its affiliates and other franchisees and developers), and specifically without considering MRD's individual interests or the individual interests of any other particular franchisee; (c) Franchisor will have no liability to MRD for the exercise of its discretion in this manner; and (d) even if Franchisor has numerous motives for a particular action or decision, so long as at least one motive is a reasonable business justification no trier of fact in any legal action shall substitute its judgment for Franchisor's judgment so exercised, and such action or decision will not be subject to challenge for abuse of discretion. IF FRANCHISOR TAKES ANY ACTION OR CHOOSES NOT TO TAKE ANY ACTION IN ITS DISCRETION WITH REGARD TO ANY MATTER RELATED TO THIS AGREEMENT AND SUCH ACTION OR INACTION IS CHALLENGED FOR ANY REASON, THE PARTIES EXPRESSLY DIRECT THE TRIER OF FACT THAT FRANCHISOR'S RELIANCE ON A BUSINESS REASON IN THE EXERCISE OF ITS DISCRETION IS TO BE VIEWED AS A REASONABLE AND PROPER EXERCISE OF ITS DISCRETION, WITHOUT REGARD TO WHETHER OTHER REASONS FOR ITS DECISION MAY EXIST AND WITHOUT REGARD TO WHETHER THE TRIER OF FACT WOULD INDEPENDENTLY ACCORD THE SAME WEIGHT TO THE BUSINESS REASON.
XV. COMPLIANCE WITH APPLICABLE LAWS.
MRD shall develop all Restaurants in the Development Territory in accordance and compliance with all applicable federal, state and local statutes, laws, including liquor laws, ordinances and regulations and agrees to promptly pay all financial obligations incurred in connection therewith.
MRD and the Principals represent and warrant to Franchisor that neither MRD, nor any Principal, nor any of their respective affiliates is identified, either by name or an alias, pseudonym or nickname, on the lists of "Specially Designated Nationals" or "Blocked Persons" maintained by the U.S. Treasury Department's Office of Foreign Assets Control (texts currently avai lable at www.treas.gov/offices/enforcement/ofac/). Further, MRD and the Principals represent and warrant that neither it nor any Principal or affiliate referred to above has violated, and agrees not to violate, any law
1297587-6 13 [J Please initial after reading this page
prohibiting corrupt business practices, money laundering or the aid or support of persons or entities who conspire to commit acts of terror against any person, entity or government, including acts prohibited by the U.S. Patriot Act (text currently available at hr3162.html). U.S. Executive Order 13224 (text currently available at
3224.pdf). or any similar law. The foregoing constitute continuing representations and warranties, and MRD and the Principals shall immediately notify Franchisor in writing of the occurrence of any event or the development of any circumstance that might render any of the foregoing representations and warranties false, inaccurate or misleading.
XVI. CHANGE IN DEVELOPMENT TERRITORY.
The parties acknowledge that the development of the Development Territory as anticipated hereunder has been determined according to the needs of the MRD's targeted market in the Development Territory, as determined by Franchisor, as of the date of execution of this Agreement. The MRD understands that, if there is an increased public demand for the products and services offered by Franchisor due to an increase in the number of individuals or corporations in the Development Territory, Franchisor will expect the MRD to establish additional Restaurants within the Development Territory. While the Franchisor will not require the MRD to establish such additional Restaurants, the Franchisor will strongly encourage MRD to do so. Any additional Restaurant shall be governed by the Franchisor's then-current form of individual franchise agreement.
XVII. SUCCESSORS AND ASSIGNS.
This Agreement shall be binding upon and inure to the benefit of each of the parties hereto and their heirs, successors, assigns and personal representatives.
XVin. APPLICABLE LAW.
A. Governing Law. This Agreement takes effect upon its acceptance and execution by the Franchisor. Except to the extent governed by the United States Trademark Act of 1946 (Lanham Act, 15 U.S.C. §§1051 et. segX this Agreement shall for all purposes be governed by and interpreted and enforced in accordance with the Internal laws of the state of Texas, except that its choice of law and conflict of law rules shall not apply.
B. Jurisdiction and Venue. The parties hereto mutually agree that the U.S. District Court for the Northern District of Texas, or if such court lacks jurisdiction, the state courts located in Dallas County, Texas, shall be the venue and exclusive forum in which to adjudicate any case or controversy arising from or relating to this Agreement and any guarantees hereof, undertakings hereunder provided and relationship established thereby, however, with respect to any action which includes injunctive relief or other extraordinary relief, Franchisor may bring such action in any court of competent jurisdiction. The parties irrevocably submit to the jurisdiction of such courts and waive any objections to either the jurisdiction of or venue in such courts. The parties mutually agree that personal jurisdiction may be effected by service of process and that when so made shall be as if served personally. This Agreement was executed and accepted at Franchisor's place of business in Dallas County, Texas. The parties anticipate that the performance of certain of MRD's obligations arising under this Agreement, including the payment of certain monies due Franchisor, will occur in Dallas County, Texas.
C. Remedy. No right or remedy conferred upon or reserved by the Franchisor or the MRD by this Agreement is intended and it shall not be deemed to be exclusive of any other right or remedy provided or permitted herein, by law or at equity, but each right or remedy shall be cumulative of every other right or remedy.
1297587-6 14 | ] Please initial after reading this page
D. Injunctive Relief. Nothing herein contained shall bar the Franchisor's right to obtain injunctive relief against threatened conduct that will cause it loss or damage under the usual equity rules, including the applicable rules for obtaining restraining orders and preliminary injunctions.
E. Except with respect to MRD's and each Principal's obligation to indemnify Franchisor pursuant to the terms of this Agreement and claims Franchisor brings for MRD's unauthorized use of the Proprietary Marks or unauthorized use or disclosure of any of Franchisor's trade secrets, the parties waive to the fullest extent permitted by law any right to or claim for any punitive, exemplary, special and consequential damages against the other and agree that, in the event of a dispute between the parties, the parties making a claim will be limited to equitable relief and to recovery of any direct or general damages it sustains; provided, however that Franchisor shall have the right to recover lost profits and any applicable liquidated damages in the event of termination of this Agreement.
____ [Please initial to acknowledge that you have read and understand this Section XVIH.E.]
F. Except for claims arising from MRD's nonpayment or underpayment of amounts MRD owes Franchisor pursuant to this Agreement, or claims related to MRD's unauthorized use of the Proprietary Marks, any and all claims arising out of or relating to this Agreement or the relationship created hereby will be barred unless a judicial proceeding is commenced within two years from the date on which the party asserting such claims knew or should have known of the facts giving rise to such claims. Notwithstanding the foregoing, with respect to any claims arising out of or in connection with an event of Force Majeure, the two year limit on claims provided for in this section shall be extended for a period equal to the extended performance period resulting from the event of Force Majeure, provided that such period shall not exceed 90 days.
XIX. RECEIPT OF DOCUMENTS.
MRD acknowledges receipt of the Uniform Franchise Offering Circular, franchise agreement, financial statements and other contracts for the Restaurant at least ten (10) business days prior to execution hereof or payment of any monies.
XX. NOTICE.
Whenever this Agreement requires notice, it shall be in writing and shall be personally delivered, or sent by registered or certified mail, return receipt requested, or dispatched by overnight delivery envelope, or transmitted by facsimile or sent by other electronic means if the sender can verify receipt. Notices shall be sent to the addresses set forth below, unless written notice is given of a change of address.
All notices to MRD shall be conclusively deemed to have been received by MRD upon the delivery or attempted delivery of such notice to MRD's address listed herein, or such changed address.
Notices to the Franchisor: Boston Pizza Restaurants, LP
1505 LB J Freeway Suite 250 Dallas, Texas, 75234
With a copy to: Corporate Counsel
Boston Pizza Restaurants, LP 5500 Parkwood Way Richmond, B.C. V6V 2M4
1297587-6
UFOC - 3/06
15
I ] Please initial after reading this page
Notices to MRP: Insert Address
Insert Address Insert Address
XXI. WAIVER OF JURY TRIAL.
THE PARTIES IRREVOCABLY WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM, WHETHER AT LAW OR IN EQUITY, BROUGHT BY EITHER PARTY RELATING TO THE RELATIONSHIP BETWEEN THE PARTIES OR ARISING UNDER OR IN ANY WAY CONNECTED WITH THIS AGREEMENT OR ANY RIGHT OR REMEDY HEREUNDER.
_____ [Please initial to acknowledge that you have read and understand this Section XXI.]
XXII. MODIFICATION BY FRANCHISOR.
Franchisor may modify and update its Manuals, the Proprietary Marks and the System unilaterally under any conditions and to any extent which Franchisor, in the exercise of its sole discretion, deems necessary to meet competition, protect trademarks or trade name, improve the quality of the products or services provided through the Restaurants and MRJD shall exclusively incur the costs of any such change in the Restaurant or the System which has been caused by such modification. In the event that any improvement or addition to the Manuals, the System or the Proprietary Marks is developed by MRD, then MRD agrees to grant to Franchisor an irrevocable, world-wide, exclusive, royalty free license, with the right to sub-license such improvement or addition.
XXin. ACKNOWLEDGEMENTS.
A. MRD acknowledges and recognizes that different terms and conditions, including different fee structures, may pertain to different area development agreements and franchise agreements offered in the past, contemporaneously herewith, or in the future, and that Franchisor does not represent that all area development agreements or franchise agreements are or will be identical.
B. MRD acknowledges that it is not, nor is it intended to be, a third party beneficiary of this Agreement or any other agreement to which Franchisor is a party.
C. MRD represents to Franchisor that it has the business acumen, corporate authority, and financial wherewithal to enter into this Agreement and to perform all of its obligations hereunder and furthermore that the execution of this Agreement is not in contravention of any other written or oral obligation of the MRD.
D. MRD acknowledges that it received from Franchisor this Agreement with all blanks filled in at least five (5) business days prior to the execution of this Agreement.
E. MRD acknowledges and accepts the following:
THE SUCCESS OF THE MRD IN MANAGING AND OPERATING MULTIPLE FRANCHISES IS SPECULATIVE AND WILL DEPEND ON MANY FACTORS INCLUDING, TO A LARGE EXTENT, MRD'S INDEPENDENT BUSINESS ABILITY. MRD HAS BEEN GIVEN THE OPPORTUNITY AND BEEN ENCOURAGED TO OBTAIN INDEPENDENT ADVICE FROM LEGAL AND OTHER PROFESSIONALS PRIOR TO ENTERING INTO THIS AGREEMENT. THIS OFFERING IS NOT A SECURITY AS THAT TERM IS DEFINED UNDER APPLICABLE FEDERAL AND STATE SECURITIES LAWS. THE OBLIGATION TO TRAIN, MANAGE, PAY, RECRUIT AND SUPERVISE EMPLOYEES OF THE RESTAURANT RESTS SOLELY WITH MRD. MRD HAS
1297587-6 16 [ ] Please initial after reading this page
1 [For - 3A)6
NOT RELIED ON ANY WARRANTY OR REPRESENTATION, EXPRESSED OR IMPLIED, AS TO THE POTENTIAL SUCCESS OR PROJECTED INCOME OF THE BUSINESS VENTURE CONTEMPLATED HEREBY. NO REPRESENTATIONS OR PROMISES HAVE BEEN MADE BY FRANCHISOR TO INDUCE MRD TO ENTER INTO THIS AGREEMENT EXCEPT AS SPECIFICALLY INCLUDED HEREIN. FRANCHISOR HAS NOT MADE ANY
REPRESENTATION, WARRANTY OR GUARANTY, EXPRESS OR IMPLIED, AS TO THE POTENTIAL REVENUES, PROFITS OR SERVICES OF THE BUSINESS VENTURE TO MRD AND CANNOT, EXCEPT UNDER THE TERMS OF THIS AGREEMENT, EXERCISE CONTROL OVER MRD'S BUSINESS. MRD ACKNOWLEDGES AND AGREES THAT IT HAS NO KNOWLEDGE OF ANY REPRESENTATION MADE BY FRANCHISOR OR ITS REPRESENTATIVES OF ANY INFORMATION THAT IS CONTRARY TO THE TERMS CONTAINED HEREIN.
[The remainder of this page has been intentionally left blank]
1297587-6 17 [ 1 Please initial after reading this page
UFOC-3/D6
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Agreement on the day and year written below.
WITNESS:
BOSTON PIZZA RESTAURANTS, LP a Delaware limited partnership
By: Authorized Signatory
Date:
By: Authorized Signatory
Date:
WITNESS:
MRD:
By: Insert Name of Multi-Restaurant Developer Title: Insert Title of Multi-Restaurant Developer
Date:
1297587-6
UFOC-3/06
Please initial after reading this page
ATTACHMENT A DESCRIPTION OF THE DEVELOPMENT TERRITORY
Insert description of the Territory
1297587-6 A-l | ] Please initial after reading this page
ATTACHMENT B
DEVELOPMENT SCHEDULE
|
Loc.# |
BPR Site Approval |
Commence Construction |
Open Restaurant |
I Please initial after reading this page
ATTACHMENT C
BPR STORE #_ MULTI-RESTAURANT DEVELOPMENT AGREEMENT
CERTIFICATE OF CORPORATE STATUS
for _________________________________(the "MDR")
I CERTIFY THAT I am the corporate attorney for the "MDR" and that the corporate records of the "MDR" reveal the following facts:
Director/Manager Officer Office Held
Insert Name Insert Name Insert Office
Insert Name Insert Name Insert Office
The shareholders/members of the MRD are as follows:
# of Shares-/% of Shareholders/Members Class and Kind Held Membership Interest
Insert Name Insert Share Class and Kind Insert Number Held
Insert Name Insert Share Class and Kind Insert Number Held
The shareholders/members shown above own, both legally and beneficially, all shares/ membership interests issued and outstanding. Attached are true copies of the Register of Shareholders, Directors and Officers for the MRD. If any shares, membership, or partnership interests are owned legally and beneficially by another incorporated entity, a limited liability company, or another legal entity then the principals of that entity are also detailed above and a true copy of the Register of Shareholders/Members is attached.
The MRD was formed as a Insert type of entity in the state of Insert state on Insert date of incorporation, as shown on the attached document issued by the appropriate agency in the MRD's jurisdiction. The MRD is, on the date hereof, in good standing with respect to the filing of annual reports in its jurisdiction.
DATED at_______________, this______day of_______________________________,_____.
Attorney (to stamp name and address below)
1297587-6 C-l
UFOC - 3/06
MRD#: ATTACHMENT D MULTI-RESTAURANT DEVELOPMENT AGREEMENT GUARANTY AND UNDERTAKING
In consideration of, and as an inducement to, the execution of that certain Multi-Restaurant Development Agreement, and any revisions, modifications, addenda and amendments thereto, (hereinafter collectively the "Agreement") dated Insert Date, Month, Year, by and between Boston Pizza Restaurants, LP, a limited partnership formed under the laws of the State of Delaware, (hereinafter the "Franchisor") and Insert Name of Area Developer (hereinafter the "MRD"), each of the undersigned Guarantors agrees as follows:
1. Without limiting any of MRD's obligations under the Agreement, Guarantor, individually and collectively with all other Agreement guarantors: (a) makes all of the covenants, representations, warranties and agreements of a Principal (as defined in the Agreement), including, but not limited to, those set forth in Sections X (Confidentiality), XI (Non-competition), VIE (Transfer of Interest), and XIV (regarding indemnification) of the Agreement and is obligated to perform thereunder; and (b) represents that each and every representation of MRD made in connection with the Agreement is true, correct and complete in all respects as of the time given and as of the time of the undersigned's execution of this Guaranty and Undertaking.
2. The Guarantor does hereby unconditionally guaranty the full, prompt and complete performance of the MRD under the terms, covenants and conditions of the Agreement, including without limitation, compliance with all confidentiality requirements, protection and preservation of confidential information, compliance with all non-compete provisions, compliance with the terms of any and all other agreements executed by MRD in order to open and operate a Restaurant, and the complete and prompt payment of all indebtedness to the Franchisor under the Agreement. The word "indebtedness" is used herein in its most comprehensive sense and includes without limitation any and all advances, debts, obligations and liabilities of the MRD, now or hereafter incurred, either voluntarily or involuntarily, and whether due or not due, absolute or contingent, liquidated or unliquidated, determined or undetermined, or whether recovery thereof may be now or hereafter barred by any statute of limitation or is otherwise unenforceable.
3. The obligations of the Guarantor are independent of the obligations of the MRD and a separate action or actions may be brought and prosecuted against the Guarantor, whether or not actions are brought against the MRD or whether the MRD is joined in any such action.
4. The Franchisor shall not be obligated to inquire into the power or authority of the MRD or its partners or the officers, directors, agents, members or managers acting or purporting to act on the MRD's behalf and any obligation or indebtedness made or created in reliance upon the exercise of such power and authority shall be guaranteed hereunder. Where the Guarantor is a corporation or partnership it shall be conclusively presumed that the Guarantor and the partners, agents, officers and directors acting on their behalf have the express authority to bind such corporations
1297587-6 D-l J J Please initial after reading this page
UFOC-3/06
or partnerships and that such corporations or partnerships have the express power to act as the Guarantor pursuant to this Guaranty and Undertaking and that such action directly promotes the business and is in the interest of such corporations or partnerships.
5. The Franchisor, its successors and assigns, may from time to time, without notice to the undersigned: (a) resort to the undersigned for payment of any of the indebtedness, whether or not it or its successors have resorted to any property securing any of the indebtedness or proceeded against any other of the undersigned or any party primarily or secondarily liable on any of the indebtedness; (b) release or compromise any indebtedness of any of the undersigned hereunder or any indebtedness of any party or parties primarily or secondarily liable on any of the indebtedness; (c) extend, renew or credit any of the indebtedness for any period (whether or not longer than the original period); (d) alter, amend or exchange any of the indebtedness; or (e) give any other form of indulgence, whether under the Agreement or otherwise.
6. The undersigned further waive presentment, demand, notice of dishonor, protest, nonpayment and all other notices whatsoever, including without limitation: notice of acceptance hereof; notice of all contracts and commitments; notice of the existence or creation of any liabilities under the Agreement and of the amount and terms thereof; and notice of all defaults, disputes or controversies between the MRD and the Franchisor resulting from the Agreement or otherwise, and the settlement, compromise or adjustment thereof.
7. This Guaranty and Undertaking shall be enforceable by and against the respective administrators, executors, successors and assigns of the Guarantor and the death of any Guarantor shall not terminate the liability of such Guarantor or limit the liability of other Guarantors hereunder.
8. Section XVIII (Applicable Law) is hereby incorporated into this Guaranty and Undertaking by reference.
IN WITNESS WHEREOF, the undersigned has executed this Guaranty and Undertaking under seal effective as of the Insert Day day of Insert Month, Insert Year.
Signature
Insert Name
Insert Home Address
Insert Home Address
Telephone E-Mail
Date:____ __^__^_____
1297587-6 UFOC - 3/06
D-2
[ ) Please initial after reading this page
ATTACHMENT E
MRD#:
PRINCIPALS' UNDERTAKING
In consideration of, and as an inducement to, the execution of that certain Multi-Restaurant Development Agreement, and any revisions, modifications and amendments thereto, (hereinafter collectively the "Agreement") dated the Insert Day day of Insert Month, Insert Year by and between Boston Pizza Restaurants, LP, a Delaware limited partnership (hereinafter the "Franchisor") and Insert Name of Franchisee (hereinafter the "MRD"), the undersigned Insert Name of Principal (the "Principal") agrees as follows:
1. Each of the undersigned acknowledges and agrees as follows:
(a) Each has read the terms and conditions of the Agreement and acknowledges that the execution of this Principals1 Undertaking is in partial consideration for, and a condition to, the granting of the development rights, and that Franchisor would not have granted the development rights without the execution of this Principals' Undertaking and the undertakings by each of the undersigned;
(b) Each is included in the term "Principal" as defined in the Agreement; and
(c) Without limiting any of MRD's obligations under the Agreement, Principal, individually and collectively with all other Principals: (i) makes all of the covenants, representations, warranties and agreements of a Principal (as defined in the Agreement), including, but not limited to, those set forth in Sections X (Confidentiality), XI (Non-competition), VIII (Transfer of Interest), and XIV (regarding indemnification) of the Agreement and is obligated to perform thereunder; and (ii) represents that each and every representation of MRD made in connection with the Agreement is true, correct and complete in all respects as of the time given and as of the time of the undersigned's execution of this Principals' Undertaking.
2. The obligations of the Principals are independent of the obligations of the MRD and a separate action or actions may be brought and prosecuted against the Principal, whether or not actions are brought against the MRD or whether the MRD is joined in any such action.
3. This Principals' Undertaking shall be enforceable by and against the respective administrators, executors, successors and assigns of the Principal and the death of any Principal shall not terminate the liability of such Principal or limit the liability of other Principals hereunder.
IN WITNESS WHEREOF, the undersigned has executed this Principals' Undertaking under seal effective as of the Insert Day day of Insert Month, Insert Year.
Signature
Insert Name
Insert Home Address
Insert Home Address
Telephone E-Mail
Date:
1297587-6 E-l { } Please initial after reading this page
UFOC - 3/06
AMENDMENT TO BOSTON PIZZA RESTAURANTS, LP
MULTI-RESTAURANT DEVELOPMENT AGREEMENT
FOR THE STATE OF CALIFORNIA
The Boston Pizza Restaurants, LP Multi-Restaurant Development Agreement between ("Developer" or "You") and Boston Pizza Restaurants, LP ("Franchisor")
dated____________________(the "Agreement") shall be amended by the addition of the following
language, which shall be considered an integral part of the Agreement (the "Amendment"):
CALIFORNIA LAW MODIFICATIONS
1. The California Department of Corporations requires that certain provisions contained in franchise documents be amended to be consistent with California law, including the California Franchise Investment Law, CAL. CORPORATIONS CODE Section 31000 et seg., and the California Franchise Relations Act, CAL. BUS. & PROF. CODE Section 20000 et seg. To the extent that the Agreement contains provisions that are inconsistent with the following, such provisions are hereby amended:
a. California Business and Professions Code Sections 20000 through 20043 provide rights to You concerning nonrenewal and termination of the Agreement. The Federal Bankruptcy Code also provides rights to You concerning termination of the Agreement upon certain bankruptcy-related events. To the extent the Agreement contains a provision that is inconsistent with these laws, these laws will control.
b. If the Developer is required in the Agreement to execute a release of claims, such release shall exclude claims arising under the California Franchise Investment Law and the California Franchise Relations Act.
c. If the Agreement requires payment of liquidated damages that is inconsistent with California Civil Code Section 1671, the liquidated damage clause may be unenforceable.
d. If the Agreement contains a covenant not to compete which extends beyond the expiration or termination of the Agreement, the covenant may be unenforceable under California law.
e. If the Agreement requires litigation, arbitration or mediation to be conducted in a forum other than the State of California, the requirement may be unenforceable under California law.
f. If the Agreement requires that it be governed by a state's law, other than the State of California, such requirement may be unenforceable.
2. Each provision of this Amendment shall be effective only to the extent that the jurisdictional requirements of the California law applicable to the provision are met independent of this Amendment. This Amendment shall have no force or effect if such jurisdictional requirements are not met.
3. As to any state law described in this Amendment that declares void or unenforceable any provision contained in the Multi-Restaurant Development Agreement, Franchisor reserves the right to challenge the enforceability of the state law by, among other things, bringing an appropriate legal action or by raising the claim in a legal action or arbitration that you have initiated.
1297587-6
UFOC ~ 3/M
IN WITNESS WHEREOF, the parties hereto have fully executed, sealed and delivered this Amendment to the Franchise Agreement on this____day of_______________________,_______.
WITNESS:
BOSTON PIZZA RESTAURANTS, LP
a Delaware limited partnership
By: Authorized Signatory
1297587-6 UFOC - J/06
Date:
By: Authorized Signatory
Date:
WITNESS:
DEVELOPER:
By: .
Title:
Date:
AMENDMENT TO BOSTON PIZZA RESTAURANTS, LP
MULTI-RESTAURANT DEVELOPMENT AGREEMENT
FOR THE STATE OF ILLINOIS
The Boston Pizza Restaurants, LP Multi-Restaurant Development Agreement between ___________________("Developer" or "You") and Boston Pizza Restaurants, LP ("Franchisor")
dated____________________(the "Agreement") shall be amended by the addition of the following
language, which shall be considered an integral part of the Agreement (the "Amendment"):
ILLINOIS LAW MODIFICATIONS
1. The Illinois Attorney General's Office requires that certain provisions contained in franchise documents be amended to be consistent with Illinois law, including the Franchise Disclosure Act of 1987, 111. Comp. Stat. ch. 815 para. 705/1 - 705/44 (1994). To the extent that this Agreement contains provisions that are inconsistent with the following, such provisions are hereby amended:
a. 815 ILCS 705/19 and 705/20 provide rights to You concerning nonrenewal and termination of this Agreement. If this Agreement contains a provision that is inconsistent with the Act, the Act will control.
b. If the Developer is required in this Agreement to execute a release of claims or to acknowledge facts that would negate or remove from judicial review any statement, misrepresentation or action that would violate the Act, or a rule of order under the Act, such release shall exclude claims arising under the Illinois Franchise Disclosure Act, and such acknowledgments shall be void with respect to claims under the Act and are hereby deleted.
c. If this Agreement requires litigation to be conducted in a forum other than the State of Illinois, the requirement is void under the Illinois Franchise Disclosure Act.
d. If this Agreement requires that it be governed by a state's law, other than the State of Illinois, to the extent that such law conflicts with the Illinois Franchise
' Disclosure Act, the Act will control.
e. The 8th recital of this Agreement is deleted in its entirety.
f. Section III.B. of this Agreement is amended by adding the following:
Pursuant to a requirement of the Illinois Attorney General, and until written authorization is given by the Illinois Attorney General, the franchise fees paid by Illinois franchisees to Franchisor will be deposited into an escrow account and held in escrow until such time as Franchisor has met its initial obligations to its franchisee and the Restaurant is open and operating.
g. Section XXIII of this Agreement is amended to state that the representations made in the Offering Circular are not excluded from that on which You may rely.
2. Each provision of this Amendment shall be effective only to the extent that the jurisdictional requirements of the Illinois Franchise Disclosure Act, with respect to each such provision, are met independent of this Amendment. This Amendment shall have no force or effect if such jurisdictional requirements are not met.
1297587-6
UFOC-3/06
3. As to any state law described in this Amendment that declares void or unenforceable any
provision contained in the Multi-Restaurant Development Agreement, Franchisor reserves the right to challenge the enforceability of the state law by, among other things, bringing an appropriate legal action or by raising the claim in a legal action or arbitration that you have initiated.
IN WITNESS WHEREOF, the parties hereto have fully executed, sealed and delivered this Amendment to the Franchise Agreement on this____day of_______________________,_______.
BOSTON PIZZA RESTAURANTS, LP
WITNESS: a Delaware limited partnership
By: Authorized Signatory
Date:
By: Authorized Signatory
Date:
WITNESS: DEVELOPER:
By: _
Title:
Date:
1297587-6
UFOC-3/06
AMENDMENT TO BOSTON PIZZA RESTAURANTS, LP
MULTI-RESTAURANT DEVELOPMENT AGREEMENT
FOR THE STATE OF MARYLAND
The Boston Pizza Restaurants, LP Multi-Restaurant Development Agreement between ___________________("Developer" or "You") and Boston Pizza Restaurants, LP ("Franchisor")
dated____________________(the "Agreement") shall be amended by the addition of the following
language, which shall be considered an integral part of the Agreement (the "Amendment"):
MARYLAND LAW MODIFICATIONS
1. The Maryland Securities Division requires that certain provisions contained in franchise documents be amended to be consistent with Maryland law, including the Maryland Franchise Registration and Disclosure Law, Md. Code Ann., Bus. Reg. §§ 14-201 - 14-233 (1998 Repl. Vol. & Supp. 2002). To the extent that this Agreement contains provisions that are inconsistent with the following, such provisions are hereby amended:
a. The Developer is required in this Agreement to execute a release of claims as a condition to transfer and renew the franchise. Such release shall exclude claims arising under the Maryland Franchise Registration and Disclosure Law, and such release shall be void with respect to claims under the Law.
b. This Agreement requires you to assent to a release of claims, estoppel or waiver of liability, to acknowledge facts that would negate or remove from judicial review any statement, misrepresentation or action that would violate the Act or a rule or order under the Act in order to purchase the franchise. Such release, estoppel or waiver shall exclude claims arising under the Maryland Franchise Registration and Disclosure Law, and such acknowledgments shall be void with respect to claims under the Law.
c. The Maryland Franchise Registration and Disclosure Law provides that Developer must bring any claims under the Law within 3 years from the grant of the franchise, which period will apply for claims under such Law.
d. If this Agreement requires litigation to be conducted in a forum other than the State of Maryland, the requirement shall not be interpreted to limit any rights you may have under Sec. 14-216 (c)(25) of the Maryland Franchise Registration and Disclosure Law to bring suit in the state of Maryland.
e. Section HI of this Agreement is revised to provide that the State of Maryland has required Franchisor to post a surety bond to secure performance of its initial obligations to Developer.
2. Each provision of this Amendment shall be effective only to the extent that the jurisdictional requirements of the Maryland Franchise Registration and Disclosure Law, with respect to each such provision, are met independent of this Amendment. This Amendment shall have no force or effect if such jurisdictional requirements are not met.
1297587-6
UFOC - 3/06
IN WITNESS WHEREOF, the parties Amendment to the Franchise Agreement on this _
WITNESS:
WITNESS:
1297587-6
i icrxr _ t/ft*
hereto have fully executed, sealed and delivered this ___day of_______________________,_______.
BOSTON PIZZA RESTAURANTS, LP a Delaware limited partnership
By: Authorized Signatory
Date:
By: Authorized Signatory
Date:
DEVELOPER:
By: _ Title: Date:
AMENDMENT TO BOSTON PIZZA RESTAURANTS, LP
MULTI-RESTAURANT DEVELOPMENT AGREEMENT
FOR THE STATE OF MINNESOTA
The Boston Pizza Restaurants, LP Multi-Restaurant Development Agreement between ___________________("Developer" or "You") and Boston Pizza Restaurants, LP ("Franchisor")
dated ____________________(the "Agreement") shall be amended by the addition of the following
language, which shall be considered an integral part of the Agreement (the "Amendment"):
MINNESOTA LAW MODIFICATIONS
1. The Commissioner of Commerce for the State of Minnesota requires that certain
provisions contained in franchise documents be amended to be consistent with Minnesota Franchise Act, Minn. Stat. Section 80.01 et sea,., and of the Rules and Regulations promulgated under the Act (collectively the "Franchise Act"). To the extent that the Agreement contains provisions that are inconsistent with the following, such provisions are hereby amended:
a. The Minnesota Department of Commerce requires that Franchisor indemnify Minnesota franchisees against liability to third parties resulting from claims that the franchisees* use of the Intellectual Properties infringes trademark rights of the third party. If the Agreement contains a provision that is inconsistent with the Franchise Act, the provisions of the Agreement shall be superseded by the Act's requirements and shall have no force or effect.
b. Franchise Act, Sec. 80C.14, Subd. 4., requires, except in certain specified cases, that a franchisee be given written notice of a franchisor's intention not to renew 180 days prior to expiration of the franchise and that the franchisee be given sufficient opportunity to operate the franchise in order to enable the franchisee the opportunity to recover the fair market value of the franchise as a going concern. If the Agreement contains a provision that is inconsistent with such requirement of the Franchise Act, the provisions of the Agreement shall be superseded by the Act's requirements and shall have no force or effect.
c. Franchise Act, Sec. 80C.14, Subd. 3., requires, except in certain specified cases that a franchisee be given 90 days notice of termination (with 60 days to cure). If the Agreement contains a provision that is inconsistent with such requirement of the Franchise Act, the provisions of the Agreement shall be superseded by the Act's requirements and shall have no force or effect.
d. If the Agreement requires Developer to execute a release of claims or to acknowledge facts that would negate or remove from judicial review any statement, misrepresentation or action that would violate the Franchise Act, such release shall exclude claims arising under the Franchise Act, and such acknowledgments shall be void with respect to claims under the Act.
e. If the Agreement requires that it be governed by a state's law, other than the State of Minnesota or arbitration or mediation, those provisions shall not in any way abrogate or reduce any rights of Developer as provided for in the Franchise Act, including the right to submit matters to the jurisdiction of the courts of Minnesota.
f. To the extent Minnesota Rule 2860.4400J. prohibits a franchisor from requiring You to consent to the Franchisor obtaining injunctive relief, the Agreement is
1297587-6
UFOC - 3/06
hereby revised to reflect that Franchisor may seek injunctive relief and that whether any bond will be necessary will be determine by the court.
g. Section 80C. 17 of the Act provides that no action may be commenced pursuant to
that section more than three years after the cause of action accrues. No provision in the Agreement shall not be construed to limit the time period for You to bring a claim under the Act.
2. Each provision of this Agreement shall be effective only to the extent that the jurisdictional requirements of the Minnesota law applicable to the provision are met independent of this Amendment. This Amendment shall have no force or effect if such jurisdictional requirements are not met.
3. As to any state law described in this Amendment that declares void or unenforceable any provision contained in the Multi-Restaurant Development Agreement, Franchisor reserves the right to challenge the enforceability of the state law by, among other things, bringing an appropriate legal action or by raising the claim in a legal action or arbitration that you have initiated.
IN WITNESS WHEREOF, the parties hereto have fully executed, sealed and delivered this Amendment to the Franchise Agreement on this____day of_______________________,_______.
BOSTON PIZZA RESTAURANTS, LP WITNESS: a Delaware limited partnership
By: Authorized Signatory
Date:
By: Authorized Signatory
Date: WITNESS: DEVELOPER:
By: . Title: Date:
1297587-6
UFOC-3/06
AMENDMENT TO BOSTON PIZZA RESTAURANTS, LP
MULTI-RESTAURANT DEVELOPMENT AGREEMENT
FOR THE STATE OF NEW YORK
The Boston Pizza Restaurants, LP Multi-Restaurant Development Agreement between ___________________("Developer" or "You") and Boston Pizza Restaurants, LP ("Franchisor")
dated ____________________(the "Agreement") shall be amended by the addition of the following
language, which shall be considered an integral part of the Agreement (the "Amendment"):
NEW YORK LAW MODIFICATIONS
1. The New York Department of Law requires that certain provisions contained in franchise documents be amended to be consistent with New York law, including the General Business Law, Article 33, Sections 680 through 695 (1989). To the extent that the Agreement contains provisions that are inconsistent with the following, such provisions are hereby amended:
a. If Developer is required in the Agreement to execute a release of claims or to acknowledge facts that would negate or remove from judicial review any statement, misrepresentation or action that would violate the General Business Law, regulation, rule or order under the Law, such release shall exclude claims arising under the New York General Business Law, Article 33, Section 680 through 695 and the regulations promulgated thereunder, and such acknowledgments shall be void. It is the intent of this provision that non-waiver provisions of Sections 687.4 and 687.5 of the General Business Law be satisfied.
b. If the Agreement requires that it be governed by a state's law, other than the State of New York, the choice of law provision shall not be considered to waive any rights conferred upon the Licensee under the New York General Business Law, Article 33, Sections 680 through 695.
2. Each provision of this Amendment shall be effective only to the extent that the jurisdictional requirements of the New York General Business Law, with respect to each such provision, are met independent of this Amendment. This Amendment shall have no force or effect if such jurisdictional requirements are not met.
3. As to any state law described in this Amendment that declares void or unenforceable any provision contained in the Multi-Restaurant Development Agreement, Franchisor reserves the right to challenge the enforceability of the state law by, among other things, bringing an appropriate legal action or by raising the claim in a legal action or arbitration that you have initiated.
[REMAINDER OF PAGE LEFT BLANK INTENTIONALLY]
1297587-6 UFOC-JrtW
IN WITNESS WHEREOF, the parties hereto have fully executed, sealed and delivered this Amendment to the Agreement on this_____day of________________________,_________.
WITNESS:
BOSTON PIZZA RESTAURANTS, LP a Delaware limited partnership
By: Authorized Signatory
Date:
By: Authorized Signatory
Date:
WITNESS:
DEVELOPER:
1297587-6 UFOC - 3/06
By: _
Title:
Date:
AMENDMENT TO BOSTON PIZZA RESTAURANTS, LP
MULTI-RESTAURANT DEVELOPMENT AGREEMENT
FOR THE STATE OF NORTH DAKOTA
The Boston Pizza Restaurants, LP Multi-Restaurant Development Agreement between ___________________("Developer" or "You") and Boston Pizza Restaurants, LP ("Franchisor")
dated____________________(the "Agreement") shall be amended by the addition of the following
language, which shall be considered an integral part of the Agreement (the "Amendment"):
NORTH DAKOTA LAW MODIFICATIONS
1. The North Dakota Securities Commissioner requires that certain provisions contained in
franchise documents be amended to be consistent with North Dakota law, including the North Dakota Franchise Investment Law, North Dakota Century Code Annotated Chapter 51-19, Sections 51-19-01 through 51-19-17 (1993). To the extent that the Agreement contains provisions that are inconsistent with the following, such provisions are hereby amended:
a. If Developer is required in the Agreement to execute a release of claims or to acknowledge facts that would negate or remove from judicial review any statement, misrepresentation or action that would violate the Law, or a rule or order under the Law, such release shall exclude claims arising under the North Dakota Franchise Investment Law, and such acknowledgments shall be void with respect to claims under the Law.
b. Covenants not to compete during the term of and upon termination or expiration of the Agreement are enforceable only under certain conditions according to North Dakota Law. If the Agreement contains a covenant not to compete which is inconsistent with North Dakota Law, the covenant may be unenforceable.
c. If the Agreement requires litigation to be conducted in a forum other than the State of North Dakota, the requirement is void with respect to claims under the North Dakota Franchise Investment Law.
d. If the Agreement requires that it be governed by a state's law, other than the State of North Dakota, to the extent that such law conflicts with the North Dakota Franchise Investment Law, the North Dakota Franchise Investment Law will control.
e. If the Agreement requires mediation or arbitration to be conducted in a forum other than the State of North Dakota, the requirement may be unenforceable under the North Dakota Franchise Investment Law. Arbitration involving a franchise purchased in the State of North Dakota must be held either in a location mutually agreed upon prior to the arbitration or if the parties cannot agree on a location, the location will be determined by the arbitrator.
f. If the Agreement requires payment of a termination penalty, the requirement may be unenforceable under the North Dakota Franchise Investment Law.
2. Each provision of this Amendment shall be effective only to the extent that the
jurisdictional requirements of the North Dakota Franchise Investment Law, with respect to each such provision, are met independent of this Amendment. This Amendment shall have no force or effect if such jurisdictional requirements are not met.
1297587-6
UFOC-3/06
3. As to any state law described in this Amendment that declares void or unenforceable any
provision contained in the Multi-Restaurant Development Agreement, Franchisor reserves the right to challenge the enforceability of the state law by, among other things, bringing an appropriate legal action or by raising the claim in a legal action or arbitration that you have initiated.
IN WITNESS WHEREOF, the parties hereto have fully executed, sealed and delivered this Amendment to the Franchise Agreement on this____day of_______________________,_______.
BOSTON PIZZA RESTAURANTS, LP WITNESS: a Delaware limited partnership
By: Authorized Signatory
Date:
By: Authorized Signatory
Date:
WITNESS: DEVELOPER:
By: .
Title:
Date:
1297587-6 UFOC-l/06
AMENDMENT TO BOSTON PIZZA RESTAURANTS, LP
MULTI-RESTAURANT DEVELOPMENT AGREEMENT
FOR THE STATE OF RHODE ISLAND
The Boston Pizza Restaurants, LP Multi-Restaurant Development Agreement between ___________________("Developer" or "You") and Boston Pizza Restaurants, LP ("Franchisor")
dated ____________________(the "Agreement") shali be amended by the addition of the following
language, which shall be considered an integral part of the Agreement (the "Amendment"):
RHODE ISLAND LAW MODIFICATIONS
1. The Rhode Island Securities Division requires that certain provisions contained in franchise documents be amended to be consistent with Rhode Island law, including the Franchise Investment Act, R.I. Gen. Law. ch. 395 Sec. 19-28.1-1 -19-28.1-34. To the extent that this Agreement contains provisions that are inconsistent with the following, such provisions are hereby amended:
a. If this Agreement requires litigation to be conducted in a forum other than the State of Rhode Island, the requirement is void under Rhode Island Franchise Investment Act Sec. 19-28.1-14.
b. If this Agreement requires that it be governed by a state's law, other than the State of Rhode Island, to the extent that such law conflicts with Rhode Island Franchise Investment Act it is void under Sec. 19-28.1-14.
c. If Developer is required in this Agreement to execute a release of claims or to acknowledge facts that would negate or remove from judicial review any statement, misrepresentation or action that would violate the Act, or a rule or order under the Act, such release shall exclude claims arising under the Rhode Island Franchise Investment Act, and such acknowledgments shall be void with respect to claims under the Act.
2. Each provision of this Amendment shall be effective only to the extent that the jurisdictional requirements of the Rhode Island Franchise Investment Act, with respect to each such provision, are met independent of this Amendment. This Amendment shall have no force or effect if such jurisdictional requirements are not met.
3. As to any state law described in this Amendment that declares void or unenforceable any provision contained in the Multi-Restaurant Development Agreement, Franchisor reserves the right to challenge the enforceability of the state law by, among other things, bringing an appropriate legal action or by raising the claim in a legal action or arbitration that you have initiated.
[REMAINDER OF PAGE LEFT BLANK INTENTIONALLY]
1297587-6
UFOC - 3'06
IN WITNESS WHEREOF, the parties hereto have fully executed, sealed and delivered this Amendment to the Franchise Agreement on this____day of_______________________,_______.
WITNESS:
BOSTON PIZZA RESTAURANTS, LP
a Delaware limited partnership
By: Authorized Signatory
Date:
By: Authorized Signatory
Date:
WITNESS:
DEVELOPER:
1297587-6
i icru- _ 1/n*
By: _
Title:
Date:
AMENDMENT TO BOSTON PIZZA RESTAURANTS, LP
MULTI-RESTAURANT DEVELOPMENT AGREEMENT
FOR THE STATE OF WASHINGTON
The Boston Pizza Restaurants, LP Multi-Restaurant Development Agreement between ___________________("Developer" or "You") and Boston Pizza Restaurants, LP ("Franchisor")
dated ____________________(the "Agreement") shall be amended by the addition of the following
language, which shall be considered an integral part of the Agreement (the "Amendment"):
WASHINGTON LAW MODIFICATIONS
1. The Director of the Washington Department of Financial Institutions requires that certain provisions contained in franchise documents be amended to be consistent with Washington law, including the Washington Franchise Investment Protection Act, WA Rev. Code §§ 19.100.010 to 19.100.940 (1991). To the extent that the Agreement contains provisions that are inconsistent with the following, such provisions are hereby amended:
a. Washington Franchise Investment Protection Act provides rights to You concerning nonrenewal and termination of the Agreement. If the Agreement contains a provision that is inconsistent with the Act, the Act will control.
b. If Developer is required in the Agreement to execute a release of claims, such release shall exclude claims arising under the Washington Franchise Investment Protection Act; except when the release is executed under a negotiated settlement after the Agreement is in effect and where the parties are represented by independent counsel. If there are provisions in the Agreement that unreasonably restrict or limit the statute of limitations period for claims brought under the Act, or other rights or remedies under the Act, those provisions may be unenforceable.
c. If the Agreement requires litigation, arbitration or mediation to be conducted in a forum other than the State of Washington, the requirement may be unenforceable under Washington law. Arbitration involving a franchise purchased in the State of Washington, must either be held in the State of Washington or in a place mutually agreed upon at the time of the arbitration, or as determined by the arbitrator.
d. If the Agreement requires that it be governed by a state's law, other than the State of Washington, and there is a conflict between the law and the Washington Franchise Investment Protection Act, the Washington Franchise Investment Protection Act will control.
2. Each provision of this Amendment shall be effective only to the extent that the jurisdictional requirements of the Washington law applicable to the provision are met independent of this Amendment. This Amendment shall have no force or effect if such jurisdictional requirements are not met.
3. As to any state law described in this Amendment that declares void or unenforceable any provision contained in the Multi-Restaurant Development Agreement, Franchisor reserves the right to challenge the enforceability of the state law by, among other things, bringing an appropriate legal action or by raising the claim in a legal action or arbitration that you have initiated.
1297587-6
UFOC-3/06
IN WITNESS WHEREOF, the parties hereto have fully executed, sealed and delivered this Amendment to the Agreement on this______day of______________________,_______.
WITNESS:
BOSTON PIZZA RESTAURANTS, LP a Delaware limited partnership
By: Authorized Signatory
Date:
By: Authorized Signatory
Date:
WITNESS:
DEVELOPER:
1297587-6 UFOC-3/06
By:_
Title:
Date: