Exhibit
10.3


Execution Copy


TRANSITION
SERVICES AGREEMENT


This TRANSITION SERVICES AGREEMENT (this “Agreement”) dated as of
August 7, 2007  (the
“Effective Date”), is made and entered into by and between Mrs. Fields
Famous Brands, LLC, a limited liability corporation formed under the laws of
Delaware and the parent company of the Sellers (“MFFB”) and NexCen Asset
Acquisition, LLC, a limited liability corporation formed under the laws of  Delaware (“Purchaser”).  MFFB and Purchaser may each be referred to herein
individually as a “Party”, and collectively as the “Parties.”


RECITALS


WHEREAS, pursuant to that certain Asset Purchase Agreement,
dated as of even date herewith (the “Purchase Agreement”), by and among,
inter alia, Purchaser, MFFB,
Pretzel Time Franchising, LLC, a limited liability corporation formed under the
laws of Delaware (“Pretzel Time”), Pretzelmaker Franchising, LLC, a
limited liability corporation formed under the laws of Delaware (“Pretzelmaker”,
and collectively with Pretzel Time the “Sellers”), Purchaser and/or its
Affiliates are acquiring certain assets of the Sellers related to the “Pretzel
Time” and “Pretzelmaker” brand franchising businesses (the “Businesses”);
and


WHEREAS, in connection with the foregoing, and as
contemplated by the Purchase Agreement, MFFB has agreed to provide certain
services to, or as directed by, Purchaser following the Closing; and


NOW THEREFORE, in consideration of the mutual covenants
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Parties agree as follows:


ARTICLE
I

DEFINITIONS


Each capitalized term used herein without definition shall have the
meaning ascribed to it in the Purchase Agreement.


ARTICLE
II

REPRESENTATIONS AND WARRANTIES


2.1           Representations and Warranties of MFFB.  MFFB makes the following representations and
warranties to Purchaser, each of which is true and correct on the Effective
Date:


(a)           MFFB is a limited
liability company duly formed and in good standing under the Laws of the State
of  Delaware, and has all requisite
limited liability company power and authority to enter into and perform this
Agreement and to carry out the transactions contemplated herein.


(b)           MFFB has, or will use
good faith efforts to obtain, all consents pursuant to applicable regulations
and under existing licenses or contracts with third parties to enter into and
perform this Agreement and to carry out the transactions contemplated herein.


(c)           MFFB’s execution,
delivery and performance of this Agreement has been duly authorized by, and is
in accordance with, its certificate of formation and operating agreement; this
Agreement has been duly executed and delivered for it by the signatory so
authorized; and this Agreement













constitutes its legal, valid,
and binding obligation, enforceable against MFFB in accordance with the terms
hereof, except as such enforceability may be limited by applicable bankruptcy
laws, or by general principles of equity (regardless of whether such
enforcement is considered in equity or at law).


2.2           Representations and Warranties of
Purchaser.  Purchaser makes the
following representations and warranties to MFFB, each of which is true and
correct on the Effective Date:


(a)           Purchaser is a limited
liability company duly incorporated and in good standing under the Laws of the
State of  Delaware.


(b)           Purchaser has all
requisite limited liability  power
and authority to enter into and perform this Agreement and to carry out the
transactions contemplated herein.


(c)           Purchaser’s execution,
delivery and performance of this Agreement have been duly authorized by, and
are in accordance with, its certificate of formation and operating agreement;
this Agreement has been duly executed and delivered for it by the signatory so
authorized; and this Agreement constitutes its legal, valid, and binding
obligation, enforceable against it in accordance with the terms hereof, except
as such enforceability may be limited by applicable bankruptcy laws, or by
general principles of equity (regardless of whether such enforcement is
considered in equity or at law).


ARTICLE
III

PROVISION OF SERVICES


3.1           Services.


(a)           MFFB shall provide, or
cause to  be provided, the services set
forth on Exhibit A to this Agreement (individually, a “Service”
and collectively, the “Services”) to Purchaser, or to an Affiliate of
Purchaser, as Purchaser may direct, in accordance with the terms and conditions
of this Agreement, including without limitation the terms and conditions set
forth on Exhibit A, during the Term (as defined below).  In the event of any inconsistency between the
terms and conditions of this Agreement and the terms and conditions of any
exhibit hereto, the terms and conditions of this Agreement shall govern, except
as otherwise specifically provided herein.


(b)           MFFB hereby covenants,
agrees, and warrants:  (i) that the
Services to be provided by MFFB shall be performed in a good and workmanlike
manner, (ii) that the Services and any reports or advice provided by MFFB with
respect to the Services shall comply in all material respects with all
applicable Legal Requirements, and (iii) that the Services shall comply in all
material respects with GAAP, if applicable.


3.2           Service Fees and Expenses.


(a)           In consideration for
the Services provided to Purchaser by MFFB hereunder and in accordance
herewith, Purchaser shall pay, or cause to be paid, to MFFB the monthly fee set
forth in Exhibit B (the “Service Fee”). In addition, Purchaser shall
reimburse, or cause to be reimbursed to, MFFB for all reasonable out-of-pocket expenses
MFFB incurs in the performance or provision of the Services hereunder (“Expenses”)
as set forth on Exhibit A; provided, however, that MFFB shall
obtain Purchaser’s prior written approval before incurring any out-of-pocket
expenses exceeding $5,000 in the aggregate. 
In addition, Purchaser shall reimburse MFFB, in accordance with Exhibit
C, for any retention payments made by MFFB to retain a employee listed on
Exhibit C who will provide the Services; provided, that MFFB shall
obtain the Purchaser’s prior written approval before agreeing to pay any
additional amounts other than set forth on Exhibit C; provided, further,
that Purchaser’s obligations to reimburse the amounts



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set forth on Exhibit C shall be
contingent upon such employees staying to the earlier of (i) the termination of
this Agreement, (ii) ninety (90) days after the date hereof, and (iii) a date
mutually agreed upon by the Parties.


(b)           During the Term,
Purchaser shall pay MFFB on the 15th of each month, including August 15, 2007, for
the Services Fee that is due for the Services performed during the month on
which such payment date falls.  In
addition, MFFB shall deliver to Purchaser an invoice setting forth in
reasonable detail any  Expenses (“Expense
Invoice”) incurred in connection with the Services provided to Purchaser or
its Affiliates by MFFB hereunder and in accordance herewith for each calendar
month during the Term.  Purchaser shall
pay, or cause to be paid, to MFFB all amounts due under the Expense Invoice
promptly upon, but in no event later than, the date which is thirty (30) days
following Purchaser’s receipt of the Expense Invoice; provided, however,
that in the event Purchaser has a good faith objection to any portion of such
Expense Invoice, as set forth in a notice to MFFB containing reasonable detail
as to the basis for Purchaser’s objection (an “Objection Notice”),
Purchaser shall pay that portion of such invoice to which it does not object
and upon the resolution of the dispute relating to the portion of the invoice
to which Purchaser has objected, pay any other amounts due and owing to MFFB in
accordance with such resolution.


ARTICLE
IV

TERM; TERMINATION


4.1           Term. 
This Agreement shall commence on the Effective Date and continue for a
term of three (3) months (the “Initial Term”), unless this Agreement is
earlier terminated as provided below. 
Purchaser may renew this Agreement for two (2) successive thirty (30)
day periods upon thirty (30) days prior written notice to MFFB (the “Renewal
Term,” and with the Initial Term, the “Term”).


4.2           Early Termination for Cause.  Either Party (the “Non-Defaulting Party”)
may terminate this Agreement at any time and pursue all rights and remedies
available to it at law, in equity or otherwise if any of the following shall
occur with respect to the other Party (the “Defaulting Party”):


(a)           any representation or
warranty of the Defaulting Party set forth in this Agreement was false or
misleading in any material respect when made;


(b)           the Defaulting Party
fails to pay any obligation hereunder when due and such failure continues for
five (5) Business Days after receipt of notice of such failure from the
Non-Defaulting Party;


(c)           the Defaulting Party
fails to perform any material obligation hereunder (other than payment
obligations) and such failure continues for at least ten (10) Business Days
after receipt of notice of such failure from the Non-Defaulting Party; or


(d)           (i) the Defaulting
Party shall commence any case, proceeding or other action (A)  under any
existing or future Law, relating to bankruptcy, insolvency, reorganization or
relief of debtors, seeking to have an order for relief entered with respect to
it, or seeking to adjudicate it a bankrupt or insolvent, or seeking
reorganization, arrangement, adjustment, winding-up, liquidation, dissolution,
composition or other relief with respect to it or its debts, or
(B) seeking appointment of a receiver, trustee, custodian, conservator or
other similar official for it or for all or any substantial part of its assets,
or the Defaulting Party shall make a general assignment for the benefit of its
creditors; or (ii) there shall be commenced against the Defaulting Party
any case, proceeding or other action of a nature referred to in clause (i)
above which (A) results in the entry of an order for relief or any such
adjudication or appointment or (B) remains undismissed, undischarged or
unbonded for a period of sixty (60) days; or



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(iii) there shall be
commenced against the Defaulting Party any case, proceeding or other action
seeking issuance of a warrant or attachment, execution, distraint or similar
process against all or any substantial part of its assets which results in the
entry of an order for any such relief and which shall not have been vacated,
discharged, or stayed or bonded pending appeal within sixty (60) days from the
entry thereof; or (iv) the Defaulting Party shall take any action in
furtherance of, or indicating its consent to, approval of or acquiescence in,
any of the acts set forth in clause (i), (ii) or (iii) above.


4.3           Early Termination for Convenience.  This Agreement may be terminated at any time
by mutual written agreement of the Parties.


ARTICLE
V

INDEMNIFICATION AND LIABILITY


5.1           Indemnification by Purchaser.  Except as provided in Section 5.3,
Purchaser shall indemnify and hold MFFB, 
each of its Affiliates, and the respective officers, directors,
employees, agents, sub-agents and contractors of each (each a “Seller
Indemnitee”), harmless against any losses, damages, costs, liabilities or
expenses (including, without limitation, reasonable counsel fees and expenses)
arising in connection with any claim, action, demand, suit or cause of action
which is brought by any third party, including any employee not indemnified
directly hereunder (a “Claim”), to the extent resulting from (i) the breach of a representation or warranty of Purchaser
set forth in Section 2.2 or (ii) any act done or
suffered by MFFB, its Affiliates, employees or contractors in connection with
their performance under this Agreement in reliance upon and in accordance with
any request, instruction or order given or executed by any of the operating
representatives of Purchaser, or any of its Affiliates having responsibility
for monitoring or supervising the performance of Services.  In the event of any demand for any
indemnification under this Section 5.1, Purchaser shall have the
right, in its sole discretion and at its sole cost and expense, to undertake
and direct the defense of the affected Seller Indemnitee with respect to such
matters.  In the event MFFB or one of its
Affiliates is served or presented with a Claim, MFFB or such Affiliate, as
applicable, shall provide Purchaser with prompt written notice thereof,
provided that MFFB’s or its Affiliate’s, as the case may be, failure or delay
in providing such notice shall not affect Purchaser’s indemnity obligation
hereunder except to the extent Purchaser’s ability to defend or settle a Claim
is materially impaired thereby.  The
obligations under this Section 5.1 shall survive the termination or
expiration of this Agreement.


5.2           Indemnification by MFFB.  Except as provided in Section 5.3,
MFFB shall indemnify and hold Purchaser, each of its Affiliates, and the
respective officers, directors, employees, agents, sub-agents and contractors
of each (each a “Purchaser Indemnitee”), harmless against any losses,
damages, costs, liabilities or expenses (including, without limitation,
reasonable counsel fees and expenses) arising in connection with any Claim to
the extent resulting from (i) the breach of a
representation or warranty of MFFB as set forth in Section 2.1, or (ii) the breach of a covenant of MFFB as set
forth in Section 3.1, or (iii) the gross negligence
of MFFB, its Affiliates, employees or contractors in the performance of
Services hereunder.  In the event of any
demand for any indemnification under this Section 5.2, MFFB shall
have the right, in its sole discretion and at its sole cost and expense, to
undertake and direct the defense of the affected Purchaser Indemnitee with
respect to such matters.  In the event
Purchaser or one of its Affiliates is served or presented with a Claim,
Purchaser or such Affiliate, as applicable, shall provide MFFB with prompt
written notice thereof, provided that Purchaser’s or its Affiliates, as the
case may be, failure or delay in providing such notice shall not affect MFFB’s
indemnity obligation hereunder except to the extent MFFB’s ability to defend or
settle a Claim is materially impaired thereby. 
The obligations under this Section 5.2 shall survive the
termination or expiration of this Agreement.



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5.3           CONSEQUENTIAL DAMAGES.  NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO
THE CONTRARY, NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY IN CONTRACT,
TORT, STRICT LIABILITY, WARRANTY OR OTHERWISE, FOR ANY SPECIAL, INCIDENTAL,
PUNITIVE, INDIRECT OR CONSEQUENTIAL DAMAGES.


ARTICLE
VI

GENERAL PROVISIONS


6.1           Force Majeure.  In the event of an act of God, order or
restraint of a Government Authority, war (declared or undeclared) or warlike
conditions, act of terrorism, blockade, revolution, strike, lockout, civil
commotion, fire, flood, storm, epidemic or any other occurrence beyond a Party’s
reasonable control, such Party shall promptly notify the other Party thereof
and, so long as such condition shall persist, such Party shall not be liable
for the delay in performance of, or the failure to perform, its obligations
(other than obligations for payment of amounts due hereunder) under this
Agreement caused directly or indirectly thereby.


6.2           Sellers as Independent Contractors.  The
Parties agree that MFFB shall perform the Services hereunder in the capacity of
an independent contractor.  Nothing in
this Agreement shall be construed to mean or imply that MFFB is a partner,
joint venturer, agent or representative of, or otherwise associated with,
Purchaser or its Affiliates.  Neither
Purchaser nor MFFB  shall
represent to others, nor shall either
take any action from which others could reasonably infer, that one Party is a partner,
joint venturer, agent or representative of, or otherwise associated with, the other Party.


6.3           Notices.  All notices and requests in connection with
this Agreement shall be given or made upon the respective Parties in writing
and shall be deemed to have been duly given if delivered, telecopied or mailed
by certified mail, return receipt requested, first-class postage prepaid, to
the Parties at the following addresses:



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If to MFFB, to:


Mrs.
Fields Famous Brands, LLC

2855 East Cottonwood Parkway, Suite 400

Salt Lake City, UT 84121

Attention:  Michael Ward, EVP and General
Counsel

Facsimile:       (801) 736-5944


If to Purchaser, to:


NexCen Franchise
Management, Inc.


1330 Avenue of the
Americas, 34th Floor


New York, NY  10019


Attention:       David
Meister, CFO


Facsimile:       (212)
247-7131


and


Kirkland & Ellis LLP


655 15th Street, N.W.


Washington, DC  20005


Attention:       Mark
D. Director, Esq.


Facsimile:       (202)
879-5200


All notices and other
communications required or permitted under this Agreement that are addressed as
provided in this Section 6.3 will, if delivered personally, be deemed
given upon delivery; will, if delivered by telecopy, be deemed delivered when
confirmed; and will, if delivered by mail in the manner described above, be
deemed given on the third Business Day after the day it is deposited in a regular
depositary of the United States mail. 
Any Party from time to time may change its address for the purposes of
notices to that Party by giving a similar notice specifying a new address, but
no such notice will be deemed to have been given until it is actually received
by the Party sought to be charged with the contents thereof.


6.4           Choice of Law.  This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York, including
Sections 5-1401 and 5-1402 of the New York General Obligations Law.


6.5           Validity.  In case any provision in this Agreement shall
found by a court of competent jurisdiction to be invalid, illegal or
unenforceable, such provision shall be construed and enforced as if it had been
more narrowly drawn so as not to be invalid, illegal or unenforceable, or
removed from the Agreement, and the validity and enforceability of the
remaining provisions of this Agreement shall not in any way be affected or
impaired thereby.


6.6           Waiver and Remedies.  Any term or condition of this Agreement may
be waived at any time by the Party that is entitled to the benefit
thereof.  Such waiver must be set forth
in a written instrument duly executed by such Party.  A waiver on one occasion will not be deemed
to be a waiver of the same or any other breach on a future occasion.  All remedies, either under this Agreement, or
by law or otherwise afforded, will be cumulative and not alternative.  The failure of either Party to exercise in
any respect any right provided for herein shall not be deemed a waiver of such
right or of any other right hereunder.



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6.7           Return of Information.  Upon completion of the Services, or upon
request by either Party, the Party to which any proprietary or confidential
information (“Proprietary Information”) has been disclosed to or
otherwise received or obtained (the “Transferee”) shall deliver over to
the requesting Party (the “Transferor”) all Proprietary Information
embodied in tangible form and material by the Transferee, including all copies
of documents, data, software, programs and things, including all recordings on
magnetic, optical and other media, and all listings, comprising or embodying
Proprietary Information and shall not take or retain any copies thereof.  Notwithstanding the foregoing, the Transferee
shall be entitled to retain one (1) copy of any Proprietary Information for
archival reasons only.


6.8           Successors and Assigns.  This Agreement shall be binding upon the
Parties hereto and their respective successors and permitted assigns and shall
inure to the benefit of the Parties hereto and their respective successors and
permitted assigns.  Neither Party may
assign its rights or delegate its obligations hereunder without the prior
written consent of the other Party, which consent shall not be reasonably
withheld.  Nothing herein shall preclude
either Party from assigning this Agreement to an entity that succeeds to all or
substantially all of the assets or business of the assigning Party, provided
that the succeeding entity agrees to be bound by the terms hereof either in
writing or by operation of law.


6.9           Amendments.  This Agreement may be modified or amended
only by a written instrument duly executed by each of the Parties.


6.10         Entire Agreement.  This Agreement supersedes all prior discussions
and agreements between the Parties with respect to the subject matter of this
Agreement, and this Agreement contains the sole and entire agreement between
the Parties with respect to the subject matter hereof.


6.11         Counterparts.  This Agreement may be executed simultaneously
in any number of counterparts, each of which will be deemed an original, but
all of which will constitute one and the same instrument.  Signatures of the Parties transmitted by
facsimile shall be deemed to be their original signatures for all purposes.


6.12         Headings, Gender. etc.  The headings used in this Agreement have been
inserted for convenience and do not constitute matter to be construed or
interpreted in connection with this Agreement. 
Unless the context of this Agreement otherwise requires, (a) words
of any gender are deemed to include other genders, (b) words using the
singular or plural number also include the plural or singular number,
respectively, (c) the terms “hereof,” “herein,” “hereby,” “hereto,” and
derivative or similar words refer to this entire Agreement, and (d) the
term “Section” refers to the specified Section of this Agreement.


[Signature
page follows]



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IN WITNESS WHEREOF, the Parties
have executed this Agreement as of the date first written above.


	
  

  	
  NEXCEN ASSET ACQUISITION, LLC

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  NexCen Brands, Inc., its Managing

  	
   

  	
   

  
	
   

  	
   

  	
  Member

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert D’Loren

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Robert D’Loren

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  	
   

  	
   

  



 


Transition Services Agreement











 


	
  

  	
  MRS. FIELDS FAMOUS BRANDS, LLC

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael Ward

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Michael Ward

  
	
   

  	
   

  	
  Title:

  	
  EVP,General Counsel and Secretary

  
						



 


Transition Services Agreement















EXHIBIT A


Transition Services Agreement


I.   Description of Services


A.                   Services to be
provided by MFFB


	
  Service

  
	
  1.    Transitioning the data and IT systems from
  Sellers to Purchaser

  
	
   

  
	
  2.    Reporting of franchisee sales through
  MFFB’s current system until Purchaser implements its own system

  
	
   

  
	
  3.    EFT process for sales reported into MFFB’s
  current system until Purchaser implements its own system. EFT funds from the
  Businesses shall be transferred from franchisees directly to Purchaer’s bank
  accounts until Purchaser can set up its own EFT system

  
	
   

  
	
  4.    Reimbursement to Purchaser of any vendor
  rebates, royalties, or other revenues arising on or after the Closing Date
  collected by MFFB or a Subsidiary or Affiliate relating to the Businesses by
  wire on a monthly basis

  
	
   

  
	
  5.    Transitioning of marketing campaigns and
  materials from Sellers to Purchaser

  
	
   

  
	
  6.    Transitioning franchise support services
  from Seller to Purchaser

  
	
   

  
	
  7.    Transitioning vendors

  
	
   

  
	
  8.    Transitioning bank accounts

  
	
   

  
	
  9.    Transitioning royalty collection
  procedures, directing any wrongly transferred funds or checks from
  franchisees following the Closing date to Purchaser

  
	
   

  
	
  10.  Gift card programs

  
	
   

  
	
  11.  Customer complaint hotline / customer
  service (“Navigator”) – transitioning to Purchaser; provided, that
  Purchaser is not acquiring any portion of the Navigator software

  
	
   

  
	
  12.  Training of new franchisees until
  Purchaser’s training facility is built

  
	
   

  
	
  13.  Transitioning development procedures and
  franchisees in various stages of development

  
	
   

  
	
  14.  Construction – transitioning any locations
  under construction to Purchaser’s construction team

  



 


Transition
Services Agreement











II.            Further Assurances


Scope of Other Support Services.  Pursuant to Section 13.4 of the Purchase
Agreement, “Further Assurances”, each Party covenants that it will “take such
actions as may be reasonably requested” by the other party to further the “intent
and purposes” of the transaction. 
Accordingly, and subject to the last sentence of this Section II, MFFB
agrees (on behalf of Sellers) to provide to Purchaser from time to time
additional reasonable transition services upon a reasonable good faith request
by the Purchaser for such reasonable transition services.  Such transition services may consist of any
or all of the following services: management, legal, litigation support, tax,
human resources, information technology, insurance, treasury, and other
services. In the event that Purchaser requests from MFFB additional transition
services that materially increase the costs to MFFB of providing the Services
under this Agreement, the Parties will enter into good faith negotiations to
amend this Agreement for the purpose of setting out the specific services
requested and the specific labor rates for said services.


Transition
Services Agreement















EXHIBIT B


Service Fees for Transition Services Agreement


Initial Term Monthly Fee for Services.  During the Initial Term, Purchaser shall pay,
or cause to be paid, to MFFB, according to Article III of this Agreement, the
following monthly fees, in consideration for the services listed on Exhibit A
hereto:


·                  $50,000 for the
first month of Services, from August 7, 2007, through September 7, 2007;


·                  $25,000 for the
second month of Services, from September 8, 2007, through October 7, 2007; and,


·                  $15,000 for the
third month of Services, from October 8, 2007, through November 7, 2007.


Renewal Term Monthly Fee for Services.  The Service Fee for any Renewal Term pursuant
to Section 4.1 hereof shall be a fixed monthly fee, which shall be mutually
agreed  to by the parties before the
commencement of the Renewal Term.


Transition
Services Agreement















EXHIBIT C


Retention Costs For Employees 


ATTACHED


 


Transition
Services Agreement