LICENSE AGREEMENT
LICENSE AGREEMENT (the "Agreement"), dated as of October 9, 2000,
between RICH PRODUCTS MANUFACTURING CORPORATION, a Delaware corporation d/b/a
Xxx Xxxxxxx Desserts, with its principal office located at 0000 Xxxxxxx Xxxxxx,
Xxxxxxx, Xxx Xxxx ("Licensee"), and STARBAKE, INC., a Delaware corporation, with
an office located at Xxx Xxxxxx Xxxxx, Xxxxxxxx, XX 00000, ("Starbake") a wholly
owned subsidiary of Paramark Enterprises, Inc., a Delaware corporation with its
principal office located at Xxx Xxxxxx Xxxxx, Xxxxxxxx, Xxx Xxxxxx 00000
("Paramark"). Paramark and Starbake are hereinafter collectively referred to as
"Licensor".
R E C I T A L S
A. Simultaneously herewith, Licensor and Licensee have entered into an
Asset Purchase Agreement (the "Purchase Agreement"), a copy of which Purchase
Agreement is annexed hereto and incorporated by reference as EXHIBIT A;
B. Pursuant to the Purchase Agreement, Licensor, as Seller, is selling
and conveying, and Licensee, as Buyer, is purchasing and accepting conveyance
of, certain Assets related to the operation of a commercial bakery Business by
Licensor at 0000 Xxxxxxxxxx Xxxxx, Xx Xxxxx, Xxxxxxxxxx;
C. The Purchase Agreement contemplates a Closing on the Assets
subsequent hereto, however Licensee desires to assume operational control of the
Assets simultaneously herewith, and Licensor is willing to grant such control,
all subject to the terms of this Agreement and the Purchase Agreement;
NOW, THEREFORE, in consideration of the representations and warranties
made herein, and of the mutual benefits to be derived hereby, and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. INCORPORATION OF RECITALS. The Recitals set forth hereinabove are
incorporated into and made a part of this Agreement.
2. CAPITALIZED TERMS. All capitalized terms used but not defined in this
Agreement shall have the same meaning as respectively ascribed to them in the
Purchase Agreement.
3. CONFLICT. In the event of any conflict between the terms of this Agreement
and the terms of the Purchase Agreement, the terms of this Agreement shall be
deemed controlling as if same had amended the Purchase Agreement.
4. LICENSE. Licensor hereby grants Licensee an exclusive license (the "License")
pursuant to which Licensee will, simultaneously with the execution herewith:
a. Assume control of the Assets and the Business as if a Closing had occurred
under the Purchase Agreement;
b. Accept all indicia of beneficial, but not legal, title in all of the
Assets;
c. Have sole control and responsibility for all income and expenses related to
the Assets and the Business for transactions arising in respect to the
Assets and the Business after the date of this Agreement;
d. Assume full legal liability for the Assumed Liabilities as of the date of
this Agreement and make payments therefor to Licensor not less than ten
(10) days before the respective due dates for such payments unless Licensor
directs Licensee in writing to make any such payments directly to the
respective lessors and/or vendors;
e. Promptly take such action as is necessary to insure the Business in
compliance with the requirements set forth in the Lease and name on said
insurance the lessor on the Lease and the Licensor as additional insureds.
An insurance certificate evidencing the foregoing must be delivered to
Licensor within forty eight (48) hours of the execution of this License
Agreement.
5. LICENSE FEE. Licensee shall pay Licensor a monthly license fee of Four
Thousand Dollars ($4,000.00)(representing a per diem of $133.34) for the period
from the date of this Agreement until the Closing, or the termination of this
License as more specifically set forth hereinbelow. Licensee shall prepay the
license fee through December 31, 2000 simultaneously herewith. To the extent
that a Closing occurs prior to December 31, 2000, or this Agreement is
terminated, then any unearned license fee shall be, as the case may be, either
(a) credited against the cash portion of the Purchase Price at Closing or (b) if
the Agreement is terminated, then refunded to Licensee by certified check or
wire transfer to accounts designated by Licensee within five (5) days of the
date of such termination. To the extent that the Closing may occur after
December 31, 2000, the Licensee shall continue to pay the monthly license fee on
January 1, 2001 and the first of each and every month thereafter up to the date
of the Closing or the termination of this Agreement.
6. REPRESENTATIONS AND WARRANTIES. All of Licensor's representations and
warranties set forth in the Purchase Agreement, except as to those relating to
corporate status and authority, shall be deemed to have been made simultaneously
herewith and, subject to Section 7.2 of the Purchase Agreement shall have no
applicability for any periods subsequent to the date of this Agreement.
7. COVENANTS OF SELLER. None of Seller's covenants set forth in Article IV of
the Purchase Agreement shall be effective after the date hereof except as to
those covenants set forth in Sections 4.1.2 through 4.1.8 and 4.3.2 through
4.3.6.
8. INDEMNIFICATION. Licensor's and Licensee's respective indemnity obligations
set forth in Article VI of the Purchase Agreement are modified so that the words
"Closing" and "Closing Date" therein is replaced by the words "the date of the
License Agreement".
9. LICENSE AGREEMENT TERMINATION. The License Agreement shall terminate upon the
earlier of the following:
a. Closing under the Purchase Agreement;
b. Termination of the Purchase Agreement pursuant to the respective rights to
terminate granted therein, including without limitation, termination by
Licensor in the event Paramark is unable to obtain the consent of its
shareholders to the transaction contemplated by the Purchase Agreement as
required by applicable law and the rules and regulations of the Securities
and Exchange Commission.
In such event, this Agreement shall be terminated and Buyer shall be obligated
to re-convey the Assets to Seller, all as more particularly set forth
hereinbelow.
10. PROCEDURE IN THE EVENT OF TERMINATION OF THE LICENSE AGREEMENT. If Licensee
shall receive written notice (the "Termination Notice") from Licensor, or
Licensor's counsel, that the Purchase Agreement is being terminated pursuant to
Section 9(b) hereinabove then each and all of the following shall occur or shall
be deemed to have occurred:
a. All right, title and interest to the Assets shall be deemed to have been
automatically re-conveyed to Licensor simultaneously with the Termination
Notice and Licensor shall immediately reassume possession of the Assets and
the Business;
b. Licensor and Licensee shall make immediate arrangements for the Licensor's
repurchase from Licensee of any applicable inventory related to the
Business, as then existing, as mutually agreed; and
c. Licensee shall fully cooperate with Licensor in effectuating the intent of
this Section 10 so that Licensor may reassume control of the Assets and the
Business as same was held by Licensor prior to the License Agreement
subject to transactions entered into by Licensee in the ordinary course of
business after the date of this Agreement.
11. SEVERABILITY. If any provision of this Agreement, including any phrase,
sentence, clause, section or subsection is inoperative or unenforceable for any
reason, such circumstances shall not have the effect of rendering the provision
in question inoperative or unenforceable in any other case or circumstance, or
of rendering any other provision or provisions herein contained invalid,
inoperative, or unenforceable to any extent whatsoever.
12. NOTICES. All notices, and other communications required or permitted to be
given under this Agreement shall be in writing and shall be deemed to have been
duly given if (a) delivered personally, (b) mailed by first-class, registered or
certified mail, return receipt requested, postage prepaid, or (c) sent by
next-day or overnight mail or delivery or (d) sent by telecopy.
(i) If to Licensee:
Rich Products Manufacturing Corporation
0000 Xxxxxxx Xxxxxx
Xxxxxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. Xxxxxxxxxx, Xx.
(ii) If to Licensor:
Starbake, Inc.
c/o Paramark Enterprises, Inc.
Xxx Xxxxxx Xxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxx X. Xxxxxxxx, President
With a copy to:
Xxxx Xxxxxx, Esq.
000-00 Xxxxx Xxxxxxxx
Xxx Xxxxxx Xxxxx, Xxx Xxxx 00000
or, in each case, at such other address as may be specified in writing to the
other parties hereto. All such notices and other communications shall be deemed
to have been received (w)if by personal delivery on the day after such delivery,
(x) if by certified or registered mail, on the seventh business day after the
mailing thereof, (y) if by next-day or overnight mail or delivery, on the day
delivered, (z) if by telecopy, on the next day following the day on which such
telecopy was sent.
13. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement and
supersedes all prior agreements and understandings, both written and oral,
between the parties with respect to the subject matter hereof.
14. COUNTERPARTS. This Agreement may be executed in several counterparts, each
of which shall be deemed an original and all of which shall together constitute
one and the same instrument.
15. GOVERNING LAW, ETC. This Agreement shall be governed in all respects,
including as to validity, interpretation and effect, by the law of the State of
California, all as more specifically set forth in the Purchase Agreement.
16. BINDING EFFECT. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective heirs, successors and
permitted assigns.
17. ASSIGNMENT. This Agreement shall not be assignable or otherwise transferable
by any party hereto without the prior written consent of the other party hereto.
18. AMENDMENT; WAIVERS, ETC. No amendment, modification or discharge of this
Agreement, and no waiver hereunder, shall be valid or binding unless set forth
in writing and duly executed by the party against whom enforcement of the
amendment, modification, discharge or waiver is sought.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first above written.
LICENSEE:
RICH PRODUCTS MANUFACTURING CORP.
By_______________________________
Title______________________________
LICENSOR:
STARBAKE, INC.
By: __________________
LICENSOR:
PARAMARK ENTERPRISES, INC.
By: __________________
