Document:

Unassociated Document

    Exhibit
      10.2

    

    

    
      	 	August 28,
              2006

    

     

    Dr.
      Mario
      Procopio

    Chief
      Executive Officer

    SaVi
      Media Group, Inc.

    2530
      South Birch, Suite A

    Santa
      Ana, CA 92707

    

    Re:    Financial
      Advisory Services Engagement

    

    Dear
      Dr.
      Procopio:

    1.    Retention
      and Services.
      This
      letter agreement (the “Agreement”) con firms that Savi Media Group, Inc. (“Savi”
or the “Company”) has engaged Herrera Partners, LP (“HPLP”) to provide financial
      advisory assistance. As part of the financial advisory services noted herein,
      HPLP will assist SaVi by (i) providing contract CFO services by Phil Scott,
      which will include reviewing the financial accounting, policies and procedures,
      and preparing SEC filings to include 10-Q’s and 10-K’s, and (ii) assist in
      raising additional debt or equity capital as requested for the growth of Savi,
      and (iii) the option to assume the accounting services currently being
      outsourced after 30 or 60 days. 

    

    2.    Scope
      of the Engagement.
      For
      purposes of this engagement, HPLP will provide the services of Phil Scott to
      serve as the Chief Financial Officer of Savi. Mr. Scott will provide the
      standard services of a contract CFO to include overseeing the accounting
      services, financial statement preparation, SEC filings including 10-Q’s and
      10-K’s, financial analysis, projections, banking and strategic analysis. HPLP
      will also assist Savi, through working with legal counsel to prepare
      registration statements and other required filings. In addition, Savi agrees
      to
      engage HPLP on an exclusive basis for a term of two years to assist in all
      future equity and debt raises. HPLP will assist in the capital raising activity
      by assisting in the preparation of business plans and presentations, meeting
      with prospective investors including hedge funds and private sources of capital,
      assisting in preparing private placement documents, and assisting in negotiating
      and completing term sheets and security purchase agreements. Finally, after
      a
      period of 30 days or more, if HPLP determines that the current outsource
      arrangement by Savi for accounting services is inadequate, in HPLP’s sole
      opinion, HPLP may assume a contract to provide the accounting services, upon
      the
      terms and conditions, outlined below.

     

    3.    Information
      on Savi.
      In
      connection with the engagement activities hereunder, Savi will furnish HPLP
      with
      material and information regarding their respective business and financial
      condition (all such information so furnished being the “Information”) and with
      any other documents required to reasonably complete the engagement services
      noted herein. The parties recognize and confirm that HPLP: (a) will use and
      rely
      solely on the Information, and on information available from generally
      recognized public sources in performing the services contemplated by this
      Agreement without having independently verified the same; (b) is authorized
      as
      SaVi’s exclusive financial advisor in connection with the matters contem plated
      herein; (c) does not assume responsibility for the accuracy or completeness
      of
      the Information, (d) will not appraise or otherwise value the liabilities of
      SaVi; and (e) retains the right to continue to perform due diligence on Savi
      during the course of the engagement or any services provided
      thereafter.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Savi
      Media Group

    August
      28, 2006

     

    4.    Work
      Product.
      It is
      expressly understood that any and all Information provided by Savi or developed
      by HPLP is confidential and Savi’s proprietary property. HPLP warrants that it
      will maintain the confidentiality of this engagement, the work product derived
      therefrom and the Information provided herein. It is agreed that the use of
      any
      work product developed by HPLP is for Savi’s use exclusively and may not be
      released in
      part
      without
      HPLP’s prior written approval. Notwithstanding anything herein to the contrary
      it is expressly understood that any work product, spreadsheets, models or other
      data developed by HPLP and provided to SaVi as part of the engagement services
      herein can only be utilized by Savi for its internal use and any commercial
      application for external use by Savi is expressly prohibited. 

     

    5.    Compensation.
      SaVi
      agrees to pay to HPLP for the contract CFO services to be rendered by HPLP
      $7,000 per month for up to twenty hours of services. Payment shall be made
      in
      the amount of $4,000 in cash and $3,000 either
      in cash or
      in
      registered stock, due on the 15th
      of each
      month. The stock will be subject to a bleed out agreement with a make-whole
      provision. The initial $4,000 cash payment shall be paid upon the execution
      of
      this Agreement. Additionally, Savi agrees to compensate HPLP at the rate of
      $350
      per hour for any additional professional services rendered beyond twenty hours
      per month including preparing for or providing (i) presentations to Savi’s board
      of directors, (ii) responding to SEC or other regulatory comments or requests,
      (iii) deposition or regulatory testimony, (iv) meetings or discussions with
      employees, financial advisors, investors or other interested parties.
In
      addition, Savi agrees to award HPLP two-million warrants at a strike price
      of
      $0.01 with a five-year term.
      Contract
      CFO services will be provided on a month to month basis running from the
      15th
      of each
      month, with a 90 day termination required by either party, except in the case
      of
      non-payment by Savi in which HPLP may terminate immediately.

    

    Savi
      agrees to pay to HPLP for capital raising activities to be rendered hereunder
      by
      HPLP an hourly rate of $350 per hour, but
      only after commissioned and approved by a Board vote.
      In
      addition, with the closing of the financing we would be commissioned at 5%
      of
      all equity and 3% of all debt plus the same percentage on warrant coverage.
      

    

    Savi
      agrees to pay to HPLP for accounting services, if HPLP determines that it is
      necessary to bring the accounting services in-house, an initial rate of $3,000
      per month.
      This
      rate will be reviewed regularly to determine if the rate is appropriate given
      the level of activity as the company grows.

    

    Savi
      will
      reimburse HPLP for all out-of-pocket expenses associated with the contract
      CFO
      services and the capital raising activities. This
      amount may be negotiated before any expenses are
      incurred.

     

    6.    Representations
      and Warranties.
      Savi
      represents and warrants to HPLP that (a) this Agreement has been duly
      authorized, exe cuted and delivered by Savi and constitutes a legal, valid
      and
      binding agreement of and enforceable against Savi in accordance with its terms,
      (b) the Information will not, when delivered, contain any untrue statement
      of a
      material fact or omit to state a material fact necessary to make the statements
      therein, in light of the circumstances under which they were made, not
      misleading, and (c) will execute additional agreements as required,
      (including
      but not limited to a bleed out and make-whole agreement for payment in
      registered stock,
      a
      warrant agreement, an accounting outsource agreement, a capital raising
      agreement, etc.), to document the basic terms outlined in this engagement
      letter. SaVi shall advise HPLP promptly of the occurrence of any event or any
      other change which results in the Information containing any untrue statement
      of
      a material fact or omitting to state any material fact necessary to make the
      statements contained therein, in light of the circumstances under which they
      were made, not misleading.

     

    7.    Indemnity;
      Limitation of Liability.
      Since
      HPLP will be acting on behalf of Savi in connec tion with the matters
      contemplated by the Agreement, and as part of the consideration for the
      engagement of HPLP and Phil Scott to furnish its services pursuant to such
      Agreement, Savi individually and collectively expressly agree to indemnify
      and
      hold harmless HPLP and its affiliates and their respective officers, directors,
      partners, counsel, employees and agents (HPLP and each such other person being
      referred to as an “Indemnified Person”), to the fullest extent lawful, from and
      against all claims, liabilities, losses, damages and expenses (or actions in
      respect thereof), as incurred, related to or arising out of or in connection
      with (i) actions taken or omitted to be taken by Savi individually and
      collectively, their affiliates, employees or agents, (ii) actions taken or
      omitted to be taken by any Indemnified Person (including acts or omissions
      constituting ordinary negligence) pursuant to the terms of, or in connection
      with services rendered pursuant to, the Agreement or any matter contemplated
      thereby or any Indemnified Person’s role in connection therewith, provided,
      however, that Savi individually and collectively shall not be responsible for
      any losses, claims, damages, liabilities or expenses of any Indemnified Person
      to the extent, and only to the extent, that it is finally judicially determined
      that they resulted solely from actions taken or omitted to be taken by such
      Indemnified Person in bad faith or to be due solely to such Indemnified Person’s
      gross negligence, and/or (iii) any untrue statement or alleged untrue statement
      of a material fact contained in any of the Information, or in any amendment
      or
      supplement thereto, or arising out of or based upon any omission or alleged
      omission of a material fact required to be stated therein or necessary to make
      the statements therein not misleading. Savi individually and collectively shall
      not and shall cause their affiliates and their respective directors, officers,
      employees, shareholders and agents not to, initiate any action or pro ceeding
      against HPLP or any other Indemnified Person in connection with this engagement
      unless such action or proceeding is based solely upon the bad faith or gross
      negli gence of HPLP or any such Indemnified Person. The parties hereto agree
      that HPLP and the Indemnified Persons shall not, and shall not be deemed to,
      owe
      any fiduciary duties to Savi individually and collectively under this Agreement
      or otherwise, except for the duties as specifically set forth
      herein.

     

    
      
        
        

      

      
        Page
          2

        
          

        

      

      
        
        

      

    

     

    
      Savi
        Media Group

      August
        28, 2006

    

     

    8.    Notices.
      Notice
      given pursuant to any of the provisions of this Agreement shall be in writing
      and shall be mailed or delivered (a) if to Savi, at their offices located at
      2530 South Birch, Suite A, Santa Ana, CA, 92707 and (b) if to HPLP, at its
      offices located at 600 Jefferson, Suite 1080, Houston, TX 77002. Notices by
      regular mail are expressly acceptable and shall be effective upon
      receipt.

    9.    Construction
      and Choice of Law.
      This
      Agreement incorporates the entire understanding of the parties and supersedes
      all previous oral and/or written agreements relating to the subject matter
      hereof, should they exist. This Agreement and any issue arising out of or
      relating to the parties’ relationship hereunder shall be governed by, and
      construed in accordance with, the laws of Harris County, the State of Texas,
      without regard to principles of conflicts of law.

    

    10.    Binding
      Arbitration.
      Upon
      the demand of either party, any dispute, controversy or claim arising out of
      or
      relating to this Agreement, or the breach, termination or invalidity thereof,
      or
      that arises out of the relationship of the parties shall be resolved by
      mandatory binding arbitration in Houston, Texas. If despite demand, an action
      is
      commenced or prosecuted in any court, the party demanding arbitration may bring
      any action in any court of competent jurisdiction to compel arbitration of
      such
      matters. Any party who fails or refuses to submit to binding arbitration
      following lawful demand shall bear all costs and expenses incurred by the
      opposing party in compelling arbitration of such matter. All matters submitted
      to arbitration shall be resolved by binding arbitration administered by the
      American Arbitration Association (herein referred to as “AAA”), in Houston,
      Texas, in accordance with the Commercial Arbitration Rules of the AAA, the
      Federal Arbitration Act (Title 9 of the United States Code), and, to the extent
      that the foregoing are inapplicable, unenforceable, or invalid, the laws of
      Harris County, the State of Texas. Any arbitrator selected must be a practicing
      attorney, a member of the State Bar of Texas, and must be experienced and
      knowledgeable in the substantive laws applicable to the dispute in question.
      The
      substantive laws of Harris County, the State of Texas shall govern any such
      arbitration. The parties will agree to a single arbitrator to resolve their
      dispute or AAA shall appoint an independent, third party neutral within 30
      days
      of being requested by either party to decide all matters. The parties expressly
      agree to waive any and all appeal or other legal rights with respect to any
      decision reached by arbitration hereunder

    

    
      
        
        

      

      
        Page
          3

        
          

        

      

      
        
        

      

    

     

    
      Savi
        Media Group

      August
        28, 2006

    

     

    11.    Miscellaneous. This
      Agreement constitutes the entire agreement between the parties concerning this
      Agreement and any subject matter herein, and may not be amended, modified,
      or
      waived except in writing signed by the parties. This Agreement shall inure
      only
      to the benefit of the parties hereto and their successors and permitted assigns,
      and may not be assigned by either party without the other party’s prior written
      consent. Should any clause or portion of this Agreement be deemed invalid,
      void,
      or otherwise unenforceable, the remainder of this Agreement shall remain in
      full
      force and effect as written. This Agreement may be signed in multiple
      counterparts, each of which taken together shall constitute one and the same
      instrument. Facsimile signatures shall have the effect of delivered originals.
      

    

    Please
      sign and return an original and one copy of this letter to the undersigned
      to
      indicate your acceptance of the terms set forth herein, affirming that HPLP
      has
      received the $4,000 retainer and this letter shall note your express acceptance
      shall constitute a valid and binding Agreement between SaVi and HPLP as of
      the
      date above.

     

    
      	 	 	 
	 	
              Sincerely,

              Herrera
                Partners, LP

            
	 
 	 
 	 
 
	 	By   
                 	/s/ PHIL
              SCOTT
	 	
              

              Name:
                Phil Scott

              Title:
                Managing Director

            
	 	 

    

     

    
    

    

    Accepted
      and Agreed on this the 29th day of August 2006:

    
      	
              Savi
                Media Group, Inc.

               

              By:    
                 /s/
                MARIO
                PROCOPIO                                                      
                

              Dr.
                Mario Procopio

              Title:
                Chief Executive Officer

            

    

     

    
      
        
        

      

      
        Page
          4Unassociated Document

    

     

    AGREEMENT
      FOR PURCHASE AND SALE OF ASSETS

     

    among

     

    HOTEL
      RESTAURANT PROPERTIES, INC.,

     

    HOTEL
      RESTAURANT PROPERTIES II, INC.,

     

    HOTEL
      RESTAURANT PROPERTIES II MANAGEMENT, INC.,

     

    KEITH
      WOLFF

     

    and

     

    ADAM
      KELLER,

     

    as
      Sellers,

     

    and

     

    GRILL
      CONCEPTS, INC.

     

    and
      

     

    GRILL
      CONCEPTS MANAGEMENT, INC.,

     

    as
      Purchasers

     

    Effective
      as of June 30, 2006

     

    

     

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

    AGREEMENT
      FOR PURCHASE AND SALE OF ASSETS

     

    THIS
      AGREEMENT FOR PURCHASE AND SALE OF ASSETS (this “Agreement”)
      is
      executed on this 1st day of September 2006 (the “Execution
      Date”),
      but
      made with effect as of the 30th
      day of
      June 2006 (the “Effective
      Date”),
      by
      and among Hotel
      Restaurant Properties, Inc., a California corporation (“HRP”),
      Hotel
      Restaurant Properties II, Inc., a California corporation (“HRP II”),
      Hotel
      Restaurant Properties II Management, Inc., a California corporation
      (“HRP
      Management”),
      Keith
      Wolff, an individual (“Wolff”),
      Adam
      Keller, an individual (“Keller”
and,
      together with HRP, HRP II, HRP Management and Wolff, “Sellers”),
      Grill
      Concepts, Inc., a Delaware corporation (“GCI”),
      and
      Grill Concepts Management, Inc., a California corporation (“GCM”
and,
      together with GCI, “Purchasers”).

     

    RECITALS

     

    WHEREAS,
      Sellers are engaged in the business of obtaining, and have the exclusive right
      to obtain, new locations for certain restaurants operated by Purchasers (the
      “Daily
      Grill Restaurants”)
      in
      hotels (the “Business”)
      pursuant to, and subject to the terms and conditions set forth in, the Agreement
      dated as of August 27, 1998 between GCI and HRP (the “Original
      Agreement”),
      as
      amended by (i) the Letter Agreement dated as of August 10 [sic], 1998
      between GCI and HRP (the “1998
      Amendment”),
      (ii) the Letter Agreement dated as of May 11, 1999 among Wolff, Keller
      and GCI (the “1999
      Amendment”),
      (iii) the Amendment to Agreement dated as of July 25, 2001 among HRP,
      HRP II and GCI (the “2001
      Amendment”),
      (iv) the Amendment to Agreement dated as of November 10, 2002 among
      HRP, HRP II and GCI (the “Houston
      Amendment”),
      (v) the Amendment to Agreement dated as of November 11, 2002 among
      HRP, HRP II and GCI (the “San
      Francisco Amendment”),
      and
      (vi) the Amendment to Agreement dated as of June 29, 2003 among HRP,
      HRP II and GCI (the “2003
      Amendment”)
      (the
      Original Agreement as amended by the amendments referred to in clauses (i)
      through (vi) are referred to collectively as the “HRP
      Agreement”);

     

    WHEREAS,
      in accordance the terms of the HRP Agreement, Purchasers and/or their
      affiliates, on the one hand, and Sellers, on the other hand, have entered into
      certain license, lease and/or management agreements (collectively, the
“Hotel
      Agreements”)
      which
      provide for the current operation of Daily Grill Restaurants in hotels located
      in each of the following locations: (i) Skokie, Illinois, (ii) San
      Francisco, California, (iii) Houston, Texas, (iv) Portland, Oregon,
      (v) Washington, D.C., (vi) Burbank, California and (vii) Long
      Beach, California;

     

    WHEREAS,
      Sellers and Purchasers desire that Sellers sell to Purchasers, and Purchasers
      purchase from Sellers, all of Sellers’ rights, title and interest in and to
      certain of the Hotel Agreements and certain other assets of Sellers related
      to
      the Business; and

     

    WHEREAS,
      in connection with the foregoing, Purchasers and Sellers desire to amend the
      HRP
      Agreement and to enter into certain agreements with respect thereto, as more
      fully set forth herein.

     

    NOW,
      THEREFORE, in consideration of the premises and the mutual covenants contained
      herein, the parties hereto hereby mutually covenant and agree as
      follows:

     

    
      
         

      

      
        -1-

        
          

        

      

      
         

      

    

    

     

     

    ARTICLE
      I.

     

    PURCHASE
      AND SALE OF ASSETS;

    ASSUMPTION
      OF ASSUMED LIABILITIES

     

    1.1 Purchase
      and Sale of Assets.
      Subject to the terms and conditions set forth herein, at the Closing (as
      hereinafter defined), Sellers agree to sell to Purchasers, and Purchasers agree
      to purchase from Sellers, free and clear of any and all liens, mortgages,
      charges, security interests, claims, restrictions, easements and encumbrances
      of
      any kind or nature whatsoever (collectively, “Liens”)
      (other
      than the Assumed Liabilities), all of Sellers’ right, title and interest in and
      to the following assets of Sellers used or usable in connection with the
      Business (collectively, the “Assets”).
      Sellers shall retain, and Purchasers shall have no right or interest in or
      to,
      any of the Excluded Assets (as hereinafter defined).

     

    (a) that
      certain Daily Grill Restaurant Management Agreement, dated as of July 30,
      1998, among CapStar Georgetown Company, L.L.C., a Delaware limited liability
      company, HRP and GCI (the “Georgetown
      Management Agreement”);

     

    (b) that
      certain Daily Grill Restaurant Management Agreement, dated as of
      February 5, 2001, among Handlery Hotel, Inc., a California corporation, HRP
      Management and GCM (the “SF
      Management Agreement”);

     

    (c) that
      certain Daily Grill Restaurant Management Agreement, dated as of June 13,
      2002, among Post Oak Westin Hotel Company, HRP Management and GCM (the
      “Houston
      Management Agreement”);

     

    (d) that
      certain Daily Grill Restaurant Management Agreement, dated as of May 13,
      2003, among Portland Hotel, LLC, an Oregon limited liability company, HRP
      Management and GCM (the “Portland
      Management Agreement”
and,
      together with the Georgetown Management Agreement, the SF Management Agreement
      and the Houston Management Agreement, the “Purchased
      Agreements”);

     

    (e) all
      of
      the issued and outstanding capital stock of Daily Grill Houston Beverage, Inc.,
      a Texas corporation (“Beverage
      Co.”);

     

    (f) all
      accounts receivable, notes receivable and other rights to the payment of money
      relating to the Purchased Agreements which accrue after the Effective Date,
      whether or not evidenced by a writing or reflected on the balance sheet of
      Sellers;

     

    (g) copies
      of
      all records and books of account relating to the Business;

     

    (h) all
      goodwill associated with the Business; and

     

    (i) all
      other
      tangible and intangible property used in the operation of the Business (other
      than as set forth in Section 1.2
      below)
      not specifically listed above, whether now existing or hereafter
      acquired.

     

    
      
         

      

      
        -2-

        
          

        

      

      
         

      

    

    

     

    1.2 Excluded
      Assets.
      Except
      as otherwise expressly provided herein, the Assets shall not include, and Seller
      shall retain ownership of, the following assets of the Business (collectively,
      the “Excluded
      Assets”):

     

    (a) The
      HRP
      Agreement, as amended by Section 1.7
      and,
      once applicable, Section 1.10
      hereof.

     

    (b) The
      Daily
      Grill Hotel Management Agreement dated as of May 13, 1998 between SCH
      Burbank, LLC (“SCH”)
      and
      HRP (the “Burbank
      Management Agreement”);

     

    (c) The
      Daily
      Grill Restaurant Management Agreement dated as of August 12, 2004 among HRP
      Management, GCM and LBTWC Real Estate Partners LLC, a Delaware limited liability
      company (“LBTWC”), and subsequently assigned by LBTWC to Merritt Hospitality,
      LLC, a Delaware limited liability company (the “Long
      Beach Management Agreement”);
      

     

    (d) The
      License Agreement dated as of October 4, 2000 between HRP II, GCI and
      Hilton Hotel Corporation (“Hilton”),
      as
      assigned by Hilton to PHF Skokie LLC, a Delaware limited liability company
      (“PHF”),
      on
      December __ [sic], 2005 (the “Skokie
      Management Agreement”
and,
      together with the Burbank Management Agreement and the Long Beach Management
      Agreement, the “Continuing
      Agreements”);
      and

     

    (e) All
      rights to the payment of monies relating to the Continuing Agreements pursuant
      to and in accordance with the HRP Agreement, as amended by Section 1.7
      and,
      once applicable, Section 1.10
      hereof.

     

    1.3 Limited
      Assumption of Liabilities.
      On the
      terms and subject to the conditions set forth herein, at the Closing, Purchasers
      shall assume, and agree to pay, perform and discharge in due course, those
      liabilities and obligations of Sellers with respect to the Purchased Agreements,
      but in each case only to the extent that such obligations under the Purchased
      Agreements accrue and relate to periods beginning on or after the Closing Date
      (as hereinafter defined) (such obligations, the “Assumed
      Liabilities”).
      Except for the Assumed Liabilities, Purchasers shall not assume or have any
      responsibility for any debt, liability, obligation or commitment of any nature,
      whether now or hereafter existing, absolute, contingent or otherwise, known
      or
      unknown, relating to Sellers, the Assets or the Business, including, without
      limitation, the following liabilities and obligations, all of which shall be
      retained by Sellers: (i) any liability of Sellers for any federal, state or
      local taxes with respect to the Assets or the Business for any period prior
      to
      the Closing Date; (ii) any liability of Sellers to third parties resulting
      from the negotiation of this Agreement and the consummation of the transactions
      contemplated hereby; (iii) any liability of Sellers or any shareholder of
      any Seller to any other Seller or shareholder of any Seller, including, without
      limitation any Damages, Actions or Third-Party Claims (as such terms are
      hereinafter defined) (“Shareholder
      Liabilities”);
      (iv) any liability of Sellers with respect to the Continuing Agreements;
      and (v) any
      liability of Sellers with respect to the Assets
      or
      the Business to the extent such liabilities accrue or relate to a period prior
      to the Closing Date (collectively, the “Excluded
      Liabilities”).
      Nothing in this Section 1.3
      is
      intended to or shall have any effect whatsoever on Purchasers’ obligations under
      any of the Hotel Agreements or the HRP Agreement, and the term “Excluded
      Liabilities”
shall
      refer only to liabilities which would otherwise have been Sellers’ obligations
      in accordance with the Hotel Agreements and the HRP Agreement.

     

    
      
         

      

      
        -3-

        
          

        

      

      
         

      

    

    

     

    1.4 Houston
      Liquor License.
      Sellers
      shall execute (and shall each use his or its commercially reasonable efforts
      to
      cause any necessary third parties to execute) any and all instruments and take
      any and all other actions necessary to cause the transfer of the issued and
      outstanding capital stock of Beverage Co. from HRP Management to GCM with effect
      on, or as promptly as practicable after, the Closing, including without
      limitation executing the Stock Purchase Agreement in the form attached hereto
      as
Exhibit 1.4
      (the
“Beverage
      Co. Purchase Agreement”)
      on the
      Execution Date. The costs associated with notifying the Texas Alcohol &
Beverage Commission with respect to the foregoing transfer as it applies to
      the
      liquor license maintained by Beverage Co. shall be borne by
      Purchasers.

     

    1.5 Purchase
      Price.
      Subject
      to the terms and conditions of this Agreement, the aggregate purchase price
      to
      be paid by Purchasers to Sellers for the Assets shall be Two Million Seven
      Hundred Seventy One Thousand One Hundred Thirty Three Dollars ($2,771,133)
      (the
“Purchase
      Price”).
      The
      Purchase Price shall be payable in United States Dollars by wire transfer of
      immediately available funds to the account or accounts designated by Sellers
      on
Schedule 1.5.

     

    1.6 Purchase
      Price Allocation.
      The
      Purchase Price shall be allocated among the Assets as set forth in Schedule 1.6.
      Such
      allocation shall be adopted for all purposes related to the sale of the Assets
      hereunder, and Sellers and Purchasers agree not to file any tax return or
      otherwise take a position for tax purposes, or otherwise, inconsistent with
      this
      allocation. Sellers and Purchasers further agree to file Internal Revenue
      Service Form 8594 consistent with the foregoing allocation and in
      accordance with Section 1060 of the Code.

     

    1.7 Amendment
      of HRP Agreement
      on
      Effective Date.
      Sellers
      and Purchasers agree that, effective as of the Effective Date, and
      notwithstanding anything to the contrary in the HRP Agreement, the HRP Agreement
      is hereby amended to delete Section 8.1, the second sentence of
      Section 8.2, Section 8.3, Article 10 and Section 13.1(d) of
      the Original Agreement. Further, subject to Section 1.8
      hereof,
      each Seller hereby waives and relinquishes any and all rights to participate
      in
      any arrangements, including, without limitation, all rights to be paid any
      fees
      or other compensation, relating to the operation of a Grill or a Daily Grill
      restaurant in any hotel property pursuant to any management, lease or license
      agreement executed on or after March 29, 2006 by Purchasers or their
      affiliates. Each Seller acknowledges that GCM has entered into (i) a Daily
      Grill Restaurant Management Agreement dated as of March 29, 2006 with
      Senate Hotel Partners Memphis, L.P. (the “Memphis
      Management Agreement”);
      and
      (ii) a Daily Grill Restaurant Management Agreement dated as of
      June 27, 2006 with Seattle Union Street Associates, a Washington general
      partnership (as amended by the Addendum thereto dated June 27, 2006, the
“Seattle
      Management Agreement”
and,
      together with the Memphis Management Agreement, the “Waived
      Agreements”).
      Subject to Section 1.8
      hereof,
      each Seller hereby waives any and all rights and claims under the HRP Agreement
      to participate as a party in either of the Waived Agreements and further waives
      any and all rights under the HRP Agreement to receive any compensation in
      respect of or pursuant to either of the Waived Agreements.

     

    
      
         

      

      
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    1.8 Reinstatement.
      Notwithstanding anything to the contrary set forth in Section 1.7
      or
      elsewhere in this Agreement, in the event the Closing has not occurred on or
      prior to the Outside Date and this Agreement is terminated in accordance with
      Section 7.1:

     

    (i) The
      amendments to the HRP Agreement set forth in Section 1.7
      shall be
      terminated and of no further force or effect, and the HRP Agreement shall be
      reinstated to read as if such amendments were never effected;

     

    (ii) Sellers’
      rights to receive amounts pursuant to the HRP Agreement in respect of any
      arrangements entered into on or after March 29, 2006 by Purchasers or their
      affiliates relating to the operation of a Grill or a Daily Grill Restaurant
      in
      any hotel property pursuant to any management, lease or license arrangement
      shall be reinstated, including, without limitation, Sellers’ rights to receive
      amounts in respect of the Waived Agreements; and

     

    (iii) Amounts
      payable to Sellers in accordance with the HRP Agreement for the period from
      March 29, 2006 until the date of termination of this Agreement (the
“Termination
      Date”)
      with
      respect to the Waived Agreements and with respect to any arrangements entered
      into on or after March 29, 2006 by Purchasers or their affiliates relating
      to
      the operation of a Grill or a Daily Grill Restaurant in any hotel property
      pursuant to any management, lease or license arrangement shall be calculated
      and
      paid to Sellers in accordance with the HRP Agreement within forty five (45)
      business days after the Termination Date. 

     

    1.9 Continuing
      Agreements.

     

    (a) Each
      Seller acknowledges and agrees that Purchasers operate the Managed Outlets
      (as
      defined in the HRP Agreement) which are the subject of the Continuing Agreements
      and that Purchasers shall continue to perform under the Continuing Agreements
      in
      the ordinary course consistent with past practice except with respect to the
      termination of the Long Beach Management Agreement and the Skokie Management
      Agreement (collectively, the “Terminated
      Agreements”)
      as
      reflected in Section 1.9(c).
      Notwithstanding anything to the contrary herein, after the Closing, no Seller
      shall have any rights under the Continuing Agreements other than the right
      to
      receive the amounts payable to Sellers in respect thereof in accordance with
      the
      HRP Agreement.

     

    
      
         

      

      
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    (b) Sellers
      shall (i) execute (and shall use their commercially reasonable efforts to
      cause any necessary third parties to execute) any and all instruments and take
      any and all other action necessary to cause the amounts payable under the
      Burbank Management Agreement and the Skokie Management Agreement to be delivered
      directly to Purchasers from SCH and PHF, respectively, for dissemination in
      accordance with the HRP Agreement, (ii) transfer to Purchasers copies of
      any and all books of account and other records (including, without limitation,
      financial and accounting records) necessary to enable Purchasers to comply
      with
      the record-keeping requirements set forth in any Continuing Agreements, and
      (iii) reasonably cooperate with Purchasers in their assumption of
      accounting oversight with respect to the Continuing Agreements.
      Purchasers shall provide Sellers with monthly distribution calculations and
      reports and all relevant data and information used to determine such
      distribution calculations.

     

    (c) Each
      Seller acknowledges that Purchasers have informed Sellers of Purchasers’ intent
      to close the Managed Outlets in Long Beach, California and in Skokie, Illinois
      and to terminate the Terminated Agreements. Sellers confirm that Sellers do
      not
      object to such intended closures and terminations and hereby waive and
      relinquish any and all rights Sellers may have (if any), to require Purchasers
      to continue to operate such Managed Outlets pursuant to the Terminated
      Agreements or the HRP Agreement.

     

    1.10 Amendment
      of HRP Agreement
      at
      Closing.
      Each
      Seller acknowledges and agrees that effective as of the Closing Date, the HRP
      Agreement shall be amended as follows:

     

    (a) Section 7
      and the first and third sentences of Section 8.2 of the Original Agreement
      shall be deleted and of no further force or effect.

     

    (b) In
      accordance with the 1998 Amendment, for purposes of computing the Net Income
      After Manager Loan Payback, there
      shall be no concept of “Owner Tax Deficiency” since Sellers shall thereafter
      only be taxed on actual cash distributions to them pursuant to the Continuing
      Agreements, except as it applies to the Burbank Management Agreement.
      Accordingly, Section 3.4 and all other references to Owner Tax Deficiency,
      except as it and they apply to the Burbank Management Agreement, shall be
      deleted from the HRP Agreement.

     

    (c) Sections
      2 through 5 of the 1999 Amendment shall be terminated and of no further force
      or
      effect.

     

    (d) The
      Houston Amendment, the San Francisco Amendment and the 2003 Amendment shall
      be
      terminated and of no further force or effect.

     

    (e) Sections 3,
      6 and 7 of the 2001 Amendment shall be deleted and have no further force or
      effect.

    

     

     

    ARTICLE
      II.

     

    THE
      CLOSING

     

    2.1 Closing.
      The
      consummation of the transactions contemplated by this Agreement (the
“Closing”)
      shall
      occur on the date (the “Closing
      Date”)
      which
      is the earlier of (i) June 30, 2007 (the “Outside
      Date”)
      and
      (ii) that date which is mutually acceptable to the parties which is no more
      than ten (10) days after the date on which the “Income Stream Payments”
equal or exceed the “Differential” (as such terms are defined in Section 2.4);
      provided
      that, in
      each case, all of the other conditions to Closing have been satisfied or waived
      by the party or parties for whose benefit the condition exists.

     

    2.2 Conditions
      of Purchasers.
      Notwithstanding any other provision of this Agreement, the obligations of
      Purchasers to consummate the transactions contemplated by this Agreement shall
      be subject to the satisfaction, at or prior to the Closing, of each of the
      following conditions precedent, and if Purchasers terminate this Agreement
      prior
      to the Closing because any such condition is not so satisfied on or prior to
      the
      Outside Date, Purchasers shall have no liability hereunder except as otherwise
      set forth in Article VII:

     

    
      
         

      

      
        -6-

        
          

        

      

      
         

      

    

    (a) There
      shall not have been instituted or pending or threatened any Action (as
      hereinafter defined) by or before any court, arbitrator or governmental agency
      challenging Purchasers’ acquisition or Sellers’ sale of the Assets or the
      Business or otherwise seeking to restrain, prohibit or invalidate the
      consummation of the transactions contemplated hereby or seeking damages in
      connection therewith;

     

    (b) The
      representations and warranties of Sellers in this Agreement shall be true and
      correct on and as of the Closing Date with the same effect as if made on the
      Closing Date and Sellers shall have complied with all covenants and agreements
      and satisfied all conditions to be performed or satisfied by Sellers on or
      prior
      to the Closing Date; 

     

    (c) Any
      approval, consent or waiting period required by any governmental agency or
      authority necessary or material to the consummation of the transactions
      contemplated hereby shall have been obtained or expired, including, without
      limitation, any consents required from the Texas Alcoholic Beverage Commission
      in connection with the sale of the outstanding capital stock of Beverage Co.
      to
      Purchasers and of the California Department of Alcoholic Beverage Control in
      connection with the termination of HRP as a licensee under the San Francisco
      liquor license in connection with the SF Management Agreement;

     

    (d) All
      necessary consents, assignments, approvals and authorizations from third parties
      or other persons, including, without limitation consents of the third parties
      to
      the Purchased Agreements, necessary for the consummation of the transactions
      contemplated hereby, shall have been obtained;

     

    (e) All
      Liens
      on any of the Assets shall have been released;

     

    (f) Sellers
      shall deliver to Purchasers each of the following:

     

    (i) one
      or
      more stock certificates representing all of the issued and outstanding capital
      stock of Beverage Co., together with an executed stock power and assignment
      related thereto

    

     

    (ii) an
      executed Assignment and Assumption Agreement, substantially in the form attached
      hereto as Exhibit 2.2(f)(ii)
      with
      respect to the transfer of the Purchased Agreements;

     

    (iii) a
      separate Consent to Assignment and Assumption (each, a “Consent”),
      substantially in the form attached hereto as Exhibit 2.2(f)(iii),
      with
      respect to each of the Purchased Agreements, in each case executed by the
      applicable Seller and the third party to such Purchased Agreement; provided,
      however,
      that
      each Seller agrees to consummate the transactions contemplated hereby and
      execute a Consent in a form which does not include the release contained in
      Section C thereof if required by the third party to such Purchased Agreement;
      and

     

    
      
         

      

      
        -7-

        
          

        

      

      
         

      

    

    (iv) evidence
      of Sellers’ compliance with the matters contemplated by Section 1.9(b)
      above;

     

    (g) Sellers
      shall have executed and delivered to Purchasers a Bill of Sale substantially
      in
      the form attached as Exhibit 2.2(g));

     

    (h) Sellers
      (excluding Keller) shall have executed and delivered to Purchasers a
      Non-Competition Agreement substantially in the form attached hereto as
Exhibit 2.2(h);

     

    (i) Sellers
      shall have executed and delivered to Purchasers the Beverage Co. Purchase
      Agreement substantially in the form attached hereto as Exhibit 1.4;
      and

     

    (j) Sellers
      shall have executed a Release substantially in the form attached hereto as
      Exhibit 2.2(j).

     

    2.3 Conditions
      of Sellers.
      Notwithstanding any other provision of this Agreement, the obligations of
      Sellers to consummate the transactions contemplated by this Agreement shall
      be
      subject to the satisfaction, at or prior to the Closing, of each of the
      following conditions precedent, and if Sellers terminate this Agreement prior
      to
      the Closing because any such condition is not so satisfied on or prior to the
      Outside Date, Sellers shall have no liability hereunder except as set forth
      in
Article VII:

     

    (a) There
      shall not have been instituted or pending or threatened any Action by or before
      any court, arbitrator or governmental agency challenging Purchasers’ acquisition
      or Sellers’ sale of the Assets or the Business or otherwise seeking to restrain,
      prohibit or invalidate the consummation of the transactions contemplated hereby
      or seeking damages in connection therewith;

     

    (b) The
      representations and warranties of Purchasers in this Agreement shall be true
      and
      correct on and as of the Closing Date with the same effect as if made on the
      Closing Date, and Purchasers shall have complied with all covenants and
      agreements and satisfied all conditions to be performed or satisfied by
      Purchasers on or prior to the Closing Date; 

     

    (c) Any
      approval, consent or waiting period required by any governmental agency or
      authority necessary or material to the consummation of the transactions
      contemplated hereby shall have been obtained or expired, including, without
      limitation, any consents required of the Texas Alcoholic Beverage Commission
      in
      connection with the sale of the outstanding capital stock of Beverage Co. to
      Purchasers and of the California Department of Alcoholic Beverage Control in
      connection with the termination of HRP as a licensee under the San Francisco
      liquor license in connection with the SF Management Agreement;

     

    (d) All
      necessary consents, assignments, approvals and authorizations from third parties
      or other persons, including, without limitation consents of the third parties
      to
      the Purchased Agreements, necessary for the consummation of the transaction
      contemplated hereby, shall have been obtained;

     

    
      
         

      

      
        -8-

        
          

        

      

      
         

      

    

    (e) Purchasers
      shall execute and deliver to Sellers each of the following:

     

    (i) an
      Assignment and Assumption Agreement, substantially in the form attached hereto
      as Exhibit 2.2(f)(ii),
      with
      respect to the transfer of the Purchased Agreements;

     

    (ii) a
      separate Consent, substantially in the form attached hereto as Exhibit 2.2(f)(iii),
      with
      respect to each of the Purchased Agreements, executed by the applicable
      Purchaser; provided,
      however,
      that
      each Purchaser agrees to consummate the transactions contemplated hereby and
      execute each Consent in a form which does not include the release contained
      in
      Section C thereof if required by the third party to such Purchased
      Agreement;

     

    (iii) a
      Non-Competition Agreement, substantially in the form attached hereto as
Exhibit 2.2(h);
      and

     

    (iv) a
      Release, substantially in the form attached hereto as Exhibit 2.2(j);
      and

     

    (f) Purchasers
      shall deliver the Purchase Price as set forth in Section 1.5
      to
      Sellers.

     

    2.4 Payment
      Amount.
      Sellers
      and Purchasers have agreed that the Closing shall not occur prior to the Outside
      Date unless Sellers have received, in the aggregate, an amount equal to Two
      Hundred Ninety Four Thousand One Hundred Fifty One Dollars ($294,151) (the
      “Additional
      Payment Amount”)
      from
      payments under the Purchased Agreements during the period from and after the
      Effective Date of this Agreement through the Closing (such payments are
      hereinafter referred to collectively as the “Income
      Stream Payments”).
      If
      the Income Stream Payments have not equaled the Additional Payment Amount prior
      to the Outside Date, so long as the other conditions to Closing have been
      satisfied or waived by the parties for whose benefit the condition was made,
      the
      Closing shall occur on the Outside Date and the Purchase Price shall be
      increased by an amount equal to the remainder obtained when the aggregate amount
      of the Income Stream Payments received by Sellers is subtracted from the
      Additional Payment Amount. Further, and notwithstanding anything to the contrary
      set forth in this Agreement, in no event shall the Income Stream Payments made
      to Sellers exceed, in the aggregate, the amount of the Additional Payment
      Amount. Accordingly, once the Income Stream Payments collectively equal the
      Additional Payment Amount, no further payments shall be made to Sellers under
      the Purchased Agreement and the parties hereto shall act in good faith to
      achieve the Closing as soon as possible thereafter.

     

    2.5 Closing
      Costs and Expenses.
      Except
      as otherwise provided in this Agreement, Purchasers and Sellers shall each
      pay
      their respective legal and accounting fees, costs and expenses incurred in
      connection with this Agreement, the consummation of the transactions
      contemplated hereby and the negotiation and execution of the documents and
      instruments contemplated hereby. Except as set forth in Section 1.4,
      Purchasers shall pay seventy-five percent (75%) and Sellers shall pay
      twenty-five percent (25%) of any sales taxes, documentary transfer fees and
      taxes and any other recordation and/or filing charges and fees incurred in
      connection with the transactions contemplated hereunder. If applicable,
      Purchasers and Sellers shall reimburse the other party for each party’s
      respective share of the costs referenced in this Section 2.5
      previously advanced by the other party as of the Closing.

     

    
      
         

      

      
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    2.6 Proration
      of Expenses.
      The
      parties shall prorate as of 12:01 A.M. on the Effective Date all operating
      expenses attributable to the Assets that are capable of proration on a per
      diem
      basis; provided, that, between the Effective Date and the Closing Date, the
      Purchaser shall (i) be responsible for all operating expenses attributable
      to
      the Assets and (ii) receive all income (other than Income Stream Payments)
      attributable to the Assets.
      In the
      event that Purchasers pay any fees, charges or taxes which they are not required
      to pay hereunder, Sellers agree to promptly reimburse Purchasers in the amount
      of such fees, charges or taxes paid by Purchasers. In the event that any Seller
      pays any fees, charges or taxes which it is not required to pay hereunder,
      Purchasers agree to promptly reimburse such Seller in the amount of such fees,
      charges or taxes paid by such Seller. In the event that any Seller receives
      any
      income which they are not entitled to receive hereunder, such Seller agrees
      to
      promptly pay Purchasers in the amount of such income received by such Seller.
      The prorations to be made hereunder shall be effected by the parties hereto
      through an appropriate adjustment in the Purchase Price.

     

     

    ARTICLE
      III.

     

    REPRESENTATIONS
      AND WARRANTIES OF SELLER

     

    As
      an
      inducement to Purchasers to enter into this Agreement and to consummate the
      transactions contemplated hereby, Sellers hereby represent and warrant to
      Purchasers as follows:

     

    3.1 Organization
      and Authority; Capitalization.

     

    (a) Each
      of
      HRP, HRP II and HRP Management (collectively, the “HRP
      Entities”)
      (i) is a corporation duly organized, validly existing and in good standing
      under the laws of the State of California and (ii) has full corporate power
      and authority to own and lease its respective assets and to carry on its
      business as now being conducted. Each of the HRP Entities has full corporate
      power and authority to execute, deliver and carry out all the terms and
      provisions of this Agreement, to consummate the transactions contemplated hereby
      and to perform their respective obligations under this Agreement.

     

    (b) Wolff
      and
      Keller are the sole shareholders of HRP; Wolff is the sole shareholder of
      HRP II; HRP II is the sole shareholder of HRP Management; and HRP
      Management is the sole shareholder of Beverage Co. There are no outstanding
      shares of capital stock or any options, warrants or other rights convertible
      into, or exercisable or exchangeable for, directly or indirectly, or otherwise
      entitling any natural person, corporation, business trust, association,
      partnership, limited liability company, joint venture, governmental entity
      or
      any other entity (each, a “Person”)
      to
      acquire, directly or indirectly, any shares of the capital stock of Beverage
      Co., and there are no existing rights, calls, or commitments of any character
      relating to, and no Person has any right of first refusal, pre-emptive right,
      subscription right or similar right with respect to any shares of the capital
      stock of Beverage Co.

     

    
      
         

      

      
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    3.2 Absence
      of Conflicts.
      Except
      as set forth in Schedule 3.2,
      neither
      the execution and delivery of this Agreement by Sellers, the compliance by
      Sellers with the terms and conditions hereof nor the consummation by Sellers
      of
      the transactions contemplated hereby will (a) conflict with any of the
      terms, conditions or provisions of the articles of incorporation, bylaws or
      other organizational documents of any HRP Entity, (b) to the Knowledge of
      Sellers, violate any provision of, or require any consent, authorization or
      approval under, any law or administrative regulation or any judicial,
      administrative or arbitration order, award, judgment, writ, injunction or decree
      applicable to Sellers, Beverage Co., the Assets or the Business, or any
      governmental permit or license issued to Sellers or Beverage Co.,
      (c) violate or be in conflict with, result in a breach of or constitute
      (with or without notice or lapse of time or both) a default under, or accelerate
      or permit the acceleration of the performance required by, or require any
      consent, authorization or approval (other than those required to be obtained
      which have been duly obtained by Sellers) under, any Hotel Agreement, or any
      other indenture, Lien, lease, agreement or instrument to which any Seller is
      a
      party or by which any Seller or the Assets are bound, or (d) result in the
      creation of any Lien upon any of the Assets. As used herein, “Knowledge”
with
      respect to Sellers means the actual knowledge of Wolff and Keller.

     

    3.3 Power
      and
      Authority.

     

    (a) Each
      Seller has taken all necessary action to authorize such Seller’s execution,
      delivery and performance of this Agreement and the consummation of the
      transactions contemplated hereby.

     

    (b) This
      Agreement, the other agreements between the parties referred to herein and
      each
      instrument and certificate delivered by Sellers pursuant hereto, constitutes
      the
      legal, valid and binding obligation of Sellers, enforceable against each Seller
      in accordance with its respective terms, except as such obligations and
      enforceability are limited by bankruptcy, insolvency and other similar laws
      of
      general application affecting the enforcement of creditors’ rights and by
      equitable principles.

     

    (c) Except
      as
      set forth on Schedule 3.3,
      no
      Seller is subject to any restriction of any kind or character which prohibits
      such Seller from entering into this Agreement or would prevent or impede its
      performance of or compliance with all or any part of this Agreement or the
      consummation of the transactions contemplated hereby.

     

    3.4 Title
      to Property; Liens.

     

    (a) Each
      of
      the HRP Entities has good, marketable, indefeasible and valid title to all
      of
      its respective Assets, free and clear of all Liens.

     

    (b) There
      are
      no leases or licenses pursuant to which any Seller leases or licenses from
      others real or personal property in connection with the Business.

     

    (c) There
      are
      no existing agreements pursuant to which any Person has an option to acquire
      any
      interest in any of the Assets.

     

    3.5 Litigation.
      Except
      as set forth on Schedule 3.5
      hereto,
      there is no suit, claim, action, arbitration or other legal, administrative
      or
      governmental investigation or proceeding (whether federal, state, local or
      foreign) (each, an “Action”)
      served
      and pending or, to the Knowledge of Sellers, threatened, against Sellers, the
      Business, or the Assets. Except as set forth on Schedule 3.5,
      to the
      Knowledge of Sellers, no Seller is in default with respect to any order, writ,
      judgment, injunction, decree, determination or award of any court or of any
      governmental agency or instrumentality (whether federal, state, local or
      foreign).

     

    
      
         

      

      
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    3.6 Income
      and Other Taxes.
      No
      Seller has any liabilities for any Taxes for any taxable period ending prior
      to
      the Closing Date. Except for Taxes prorated under Section 2.5
      hereof
      which will be paid in accordance with such Section, each Seller shall pay all
      Taxes due in respect of the Business for periods ending prior to the Closing
      Date when due. For purpose of this Agreement, the term “Taxes”
means
      any federal, state, local, or foreign income, payroll, franchise, property,
      sales, excise or other tax, tariff, duty, assessment or governmental charge
      of
      any nature whatsoever, including any interest, penalty or addition thereon
      or
      thereto, imposed, assessed, charged or levied by any governmental authority.
      

     

    3.7 No
      Undisclosed Liabilities.
      Except
      as set forth on Schedule 3.7
      hereto,
      no HRP Entity has any material liabilities, whether accrued, absolute,
      contingent or otherwise, whether due or to become due and whether the amounts
      thereof are readily ascertainable or not, or any unrealized or anticipated
      losses from any commitments of a contractual nature, including Taxes, with
      respect to or based upon the transactions or events occurring prior to the
      Closing Date. No HRP Entity employs, or during the preceding five (5) year
      period has employed, any Person in an employment or consultancy
      capacity.

     

    3.8 Permits,
      Licenses, Etc.
      Each
      HRP
      Entity possesses, and each is operating in compliance with, all zoning and
      other
      franchises, licenses, permits (including conditional use and other similar
      permits), certificates, authorizations, rights and other approvals of
      governmental bodies, agencies and instrumentalities thereof necessary to conduct
      the Business as currently conducted (the “Permits”).
      Schedule 3.8
      hereto
      contains a true and complete list of all Permits. Each Permit has been lawfully
      and validly issued, and no proceeding is pending or, to the Knowledge of
      Sellers, threatened, involving the revocation, suspension or limitation of
      any
      Permit. The consummation of the transactions contemplated by this Agreement
      will
      not result in the revocation, suspension or limitation of any Permit and, except
      as set forth in Schedule 3.8,
      no
      Permit will require the consent of its issuing authority to, or as a result
      of,
      the consummation of the transactions contemplated hereby.

     

    3.9 Consents

     

    .
      All
      consents, authorizations and approvals of any court, arbitrator or any other
      Person that are required to be obtained by Sellers in connection with the
      consummation of the transactions contemplated by this Agreement or that are
      necessary in connection with the Business as currently conducted, or for which
      the failure to obtain the same would have, individually or in the aggregate,
      a
      material adverse effect on any Seller or the financial condition, properties
      or
      operations of the Business, or on any Seller’s ability to consummate the
      transactions contemplated herein, have been obtained by Sellers, except as
      described in Schedule 3.9
      hereto.

     

    3.10 Contracts.
      Except
      for the Purchased Agreements, the Continuing Agreements and the HRP Agreement,
      there is no contract, agreement, lease, permit, commitment, arrangement or
      other
      instrument to which any Seller is a party which is necessary to conduct the
      Business as presently conducted, or that otherwise affects the Business in
      any
      material way. There has not been any default in any obligation to be performed
      by any Seller or, to the Knowledge of Sellers, any third party, under any
      Purchased Agreement, and no Seller has waived any right thereunder or with
      respect thereto. Each of the Purchased Agreements is in full force and effect
      and has not been modified by the parties thereto through any agreement,
      understanding or course of conduct. No Seller has received any notice from
      any
      party to any of the Purchased Agreements or the Continuing Agreements (other
      than Purchasers) of such party’s intent to terminate, amend or declare a default
      under any of such agreements.

     

    
      
         

      

      
        -12-

        
          

        

      

      
         

      

    

    3.11 Compliance
      with Law

     

    .
      The
      Business has not been conducted and is not being conducted, and no Seller is
      or
      has been, in violation of, nor received any notice of any alleged violation
      of,
      or any citation for noncompliance with, any applicable federal, state or local
      statute, law, rule, regulation, ordinance, permit, order, decree of, or other
      lawful obligation imposed by, any court or governmental authority or
      instrumentality. Each Seller has made all required registrations and filings
      with all applicable federal, state and local government authorities relating
      to
      the Business as currently conducted. All such registrations, filings and
      submissions were in compliance in all material respects with all legal
      requirements and other requirements when filed, and no material deficiencies
      have been asserted by any applicable governmental entities with respect to
      such
      registrations, filings or submissions.

     

    3.12 Financial
      Records.
      The
      books of account and financial and accounting records that are maintained by
      Sellers with respect to the operations or financial performance of any Daily
      Grill Restaurant which is the subject of a Hotel Agreement (the “Financial
      Records”)
      (a) present fairly in all material respects the financial condition of each
      Daily Grill Restaurant which is the subject of such Financial Records as of
      the
      dates indicated therein and the results of operations and changes in financial
      position of such Daily Grill Restaurants for the periods specified therein,
      and
      (b) have been prepared in conformity with generally accepted accounting
      principles applied on a consistent basis during the periods covered thereby,
      have been derived from the accounting records of Sellers, and represent only
      actual, bona fide transactions. Sellers have delivered true, correct and
      complete copies of the Financial Records to Purchasers prior to the date hereof.
      

     

    3.13 Absence
      of Certain Changes.
      Since
      December 31, 2005, there has been no material adverse change in the
      Business or financial condition, assets, or operations of any HRP
      Entity.

     

    3.14 Affiliations.
      Except
      as set forth on Schedule 3.14,
      no
      Seller and no shareholder, officer, director, employee or affiliate of any
      Seller or any associate or affiliate of such Persons has, directly or
      indirectly, a beneficial interest in any contract or agreement to which any
      Seller is a party or by which any Assets or the Business are bound or
      affected.

     

    3.15 Brokers’
      Fees.
      No
      broker, finder or similar agent (“Broker”)
      has
      been employed by or on behalf of Sellers in connection with this Agreement
      or
      the transactions contemplated hereby, and no Seller has entered into any
      agreement or understanding of any kind with any person or entity for the payment
      of any brokerage commission, finder’s fee or any similar compensation in
      connection with this Agreement or the transactions contemplated
      hereby.

     

    
      
         

      

      
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    3.16 Disclosure.
      No
      representation or warranty of Sellers in this Agreement and no information
      contained in any Schedule delivered by Sellers pursuant to this Agreement
      contains any untrue statement of a material fact or omits to state a material
      fact required to make the statements herein or therein not
      misleading.

     

     

    ARTICLE
      IV.

     

    REPRESENTATIONS
      AND WARRANTIES OF PURCHASERS

     

    Purchasers
      hereby represent and warrant to Sellers as follows:

     

    4.1 Organization
      and Good Standing.
      GCI is
      a corporation duly organized, validly existing and in good standing under the
      laws of the State of Delaware. GCM is a corporation duly organized, validly
      existing and in good standing under the laws of the State of California. Each
      Purchaser has full corporate power and authority to (i) execute, deliver
      and carry out all the terms and provisions of this Agreement, to consummate
      the
      transactions contemplated hereby and to perform its obligations under this
      Agreement, and (ii) own and lease its assets and real property and to carry
      on its business as now conducted.

     

    4.2 Absence
      of Conflicts.
      Neither
      the execution and delivery of this Agreement by Purchasers, the compliance
      by
      Purchasers with the terms and conditions hereof nor the consummation by
      Purchasers of the transactions contemplated hereby will (a) conflict with
      any of the terms, conditions or provisions of the certificate of incorporation,
      bylaws or other charter documents of any Purchaser, (b) to the Knowledge of
      Purchasers, violate any provision of, or require any consent, authorization
      or
      approval under, any law or administrative regulation or any judicial,
      administrative or arbitration order, award, judgment, writ, injunction or decree
      applicable to, or any governmental permit or license issued to, Purchasers,
      or
      (c) violate or be in conflict with or result in a breach of or constitute
      (with or without notice or lapse of time or both) a default under, or accelerate
      or permit the acceleration of the performance required by, or require any
      consent, authorization or approval (other than those required to be obtained
      which have been duly obtained by Purchaser) under, any indenture, Lien, lease,
      agreement or instrument to which any Purchaser is a party or by which it is
      bound, except, in the case of clauses (b) and (c), those violations
      which would not have a material adverse effect on Purchasers, or on Purchasers’
ability to consummate the transactions contemplated herein. As used herein,
      “Knowledge”
with
      respect to Purchasers means the actual knowledge of Michael Weinstock, Robert
      Spivak and Philip Gay.

     

    4.3 Corporate
      Power and Authority.

     

    (a) Each
      Purchaser has taken all necessary corporate action to authorize the execution,
      delivery and performance of this Agreement and the consummation of the
      transactions contemplated hereby.

     

    (b) This
      Agreement, each of the other agreements between the parties referred to herein
      and each instrument and certificate delivered by any Purchaser pursuant hereto,
      constitutes the legal, valid and binding obligation of such Purchaser,
      enforceable against such Purchaser in accordance with its respective terms,
      except as such obligations and enforceability are limited by bankruptcy,
      insolvency and other similar laws of general application affecting the
      enforcement of creditors’ rights and by equitable principles.

     

    
      
         

      

      
        -14-

        
          

        

      

      
         

      

    

    

     

    (c) No
      Purchaser is subject to any restriction of any kind or character which prevents
      such Purchaser from entering into this Agreement or would prevent or impede
      its
      performance of or compliance with all or any part of the Agreement, or the
      consummation of the transactions contemplated hereby.

     

    4.4 Consents

     

    .
      All
      consents, authorizations and approvals of any court, arbitrator or any other
      Person that are required to be obtained by Purchasers in connection with the
      payment of the Purchase Price to Sellers or the consummation of the transactions
      contemplated by this Agreement shall have been obtained by Purchasers on or
      prior to the Closing Date.

     

    4.5 Brokers’
      Fees

     

    .
      No
      Broker has been employed by or on behalf of Purchasers in connection with this
      Agreement or the transactions contemplated hereby, and Purchasers have not
      entered into any agreement or understanding of any kind with any person or
      entity for the payment of any brokerage commission, finder’s fee or any similar
      compensation in connection with this Agreement or the transactions contemplated
      hereby.

     

     

    ARTICLE
      V.

     

    CONDUCT
      OF SELLERS PENDING CLOSING

     

    During
      the period commencing on the Execution Date and ending on the Closing Date,
      Sellers agree (except as expressly contemplated by this Agreement or to the
      extent that Purchasers shall otherwise consent in writing) that:

     

    5.1 Good
      Standing.
      Sellers
      shall remain in good standing in their states and jurisdictions of organization
      and qualification.

     

    5.2 Ordinary
      Course.
      Sellers
      shall use their best efforts to preserve intact their current business
      organization and to maintain their books, records and accounts in accordance
      with GAAP applied on a basis consistent with past practice. 

     

    5.3 Indebtedness.
      Sellers
      shall not incur any indebtedness and shall pay all indebtedness with respect
      to
      the Assets incurred by Sellers such that there are no liabilities with respect
      to the Assets as of the Closing Date other than the Assumed Liabilities. Sellers
      shall cause all holders of Liens with respect to any of the Assets to release
      their Liens prior to or upon the Closing.

     

     

    5.4 Compliance
      with Legal Requirements.
      Sellers
      shall comply promptly with all requirements that applicable law may impose
      upon
      them and their operations and with respect to the transactions contemplated
      by
      this Agreement, and shall cooperate promptly with, and furnish information
      to,
      Purchasers in connection with any such requirements imposed upon Purchasers,
      or
      upon any of their affiliates, in connection therewith or herewith.

     

    
      
         

      

      
        -15-

        
          

        

      

      
         

      

    

    5.5 Disposition
      of Assets.
      Sellers
      shall not sell, transfer, license, lease or otherwise dispose of, or suffer
      or
      cause the encumbrance by any Lien upon any of the Assets, tangible or
      intangible, or any interest therein.

     

    5.6 Modification
      or Breach of Agreements; New Agreements.
      Sellers
      shall not terminate or modify, or commit or cause or suffer to be committed
      any
      act that will result in any breach or violation of any term of or (with or
      without notice or passage of time, or both) constitute a default under or
      otherwise give any Person a basis for nonperformance under, any of the Purchased
      Agreements or the Continuing Agreements. Sellers shall meet all of their
      contractual obligations under the Purchased Agreements and the Continuing
      Agreements.

     

    5.7 Inconsistent
      Action.
      Sellers
      shall not take any action that would cause any of their representations or
      warranties in this Agreement to be untrue, incorrect, incomplete or
      misleading.

     

     

    ARTICLE
      VI.

     

    CONDUCT
      OF PURCHASERS PENDING CLOSING

     

    During
      the period commencing on the Execution Date and ending on the Closing Date,
      Purchasers agree (except as expressly contemplated by this Agreement or to
      the
      extent that Sellers shall otherwise consent in writing) that:

     

    6.1 Good
      Standing.
      Purchasers shall remain in good standing in their states and jurisdictions
      of
      organization and qualification.

     

    6.2 Ordinary
      Course.
      Purchasers shall use their best efforts to preserve intact their current
      business organization and to maintain their books, records and accounts in
      accordance with GAAP applied on a basis consistent with past
      practice.

     

    6.3 Compliance
      with Legal Requirements.
      Purchasers shall comply promptly with all requirements that applicable law
      may
      impose upon them and their operations and with respect to the transactions
      contemplated by this Agreement, and shall cooperate promptly with, and furnish
      information to, Sellers in connection with any such requirements imposed upon
      Sellers, or upon any of their affiliates, in connection therewith or
      herewith.

     

    6.4 Modification
      or Breach of Agreements; New Agreements.
      Except
      in connection with the termination of the Terminated Agreements: (i) Purchasers
      shall not terminate or modify, or commit, or cause or suffer to be committed,
      any act that will result in any breach or violation of any term of or (with
      or
      without notice or passage of time, or both) constitute a default under or
      otherwise give any Person a basis for nonperformance under, any of the Purchased
      Agreements or the Continuing Agreements; and (ii) Purchasers shall meet all
      of
      their contractual obligations under the Purchased Agreements and the Continuing
      Agreements.

     

    
      
         

      

      
        -16-

        
          

        

      

      
         

      

    

    6.5 Inconsistent
      Action.
      Purchasers shall not take any action that would cause any of its representations
      or warranties in this Agreement to be untrue, incorrect, incomplete or
      misleading.

     

     

    ARTICLE
      VII.

     

    TERMINATION

     

    7.1 Termination.
      This
      Agreement may be terminated as set forth below by written notice from the
      terminating party, delivered in accordance with Section 8.5
      hereof,
      specifying the reason therefor:

     

    (a) by
      mutual
      agreement of the parties hereto;

     

    (b) by
      Purchasers if (i) any condition precedent to the Closing set forth in
Section 2.2
      hereof
      has not been satisfied or waived on or before the Outside Date or (ii) the
      Closing has not occurred on or before the Outside Date for any reason other
      than
      a material default by Purchasers in their obligations hereunder;
      and

     

    (c) by
      Sellers if (i) any condition precedent to the Closing set forth in
Section 2.3
      has not
      been satisfied or waived on or before the Outside Date, or (ii) the Closing
      has not occurred on or before the Outside Date for any reason other than a
      material default by Sellers in their obligations hereunder.

     

    7.2 Effect.

     

    (a) In
      the
      event of termination of this Agreement (i) as provided in Section 7.1(a),
      or
      (ii) by Purchasers or Sellers as provided in Section 7.1(b)
      or
7.1(c)
      for any
      reason other than the default of the other party or the failure of the other
      party to satisfy a condition to Closing required to be satisfied by such party,
      then this Agreement shall forthwith become void and there shall be no liability
      hereunder on the part of any party hereto, or any officer, director, employee,
      agent or representative of any party hereto or any person who controls a party
      hereto within the meaning of the Securities Act of 1933, as amended (the
“Securities
      Act”),
      except that the agreements with respect to expenses and publicity contained
      in
Sections
      2.5
      and
8.7,
      respectively, shall survive the termination of this Agreement.

     

    (b) In
      the
      event of any breach or default by Sellers under the terms of this Agreement,
      Purchasers shall have the right to terminate this Agreement and/or exercise
      any
      other remedy available to it at law or in equity, including, but not limited
      to,
      specific performance, and any termination (or lack of termination) shall be
      without prejudice to such other remedies.

     

    (c) In
      the
      event of any breach or default by Purchasers under the terms of this Agreement,
      Sellers shall have the right to terminate this Agreement and/or exercise any
      other remedy available to it at law or in equity, including, but not limited
      to,
      specific performance, and any termination (or lack of termination) shall be
      without prejudice to such other remedies.

     

    
      
         

      

      
        -17-

        
          

        

      

      
         

      

    

    7.3 Amendment
      and Waiver.
      This
      Agreement may be amended at any time only by a written instrument executed
      by
      Purchasers and Sellers. Any amendment effected pursuant to this Section 7.3
      shall be
      binding upon the parties hereto. Compliance with or performance under any term,
      provision or condition of this Agreement may only be waived in writing by
      Purchasers, if the waiver of the term, provision or condition of this Agreement
      is sought against Purchasers, or by Sellers, if the waiver of the term,
      provision or condition of this Agreement is sought against Sellers.

     

     

    ARTICLE
      VIII.

     

    GENERAL
      PROVISIONS

     

    8.1 Survival
      of Representations and Warranties.
      The
      representations and warranties, of the parties hereto contained in this
      Agreement or in any writing delivered pursuant to the provisions of this
      Agreement or on the Closing Date shall survive any examination by or on behalf
      of any party hereto and shall survive the Closing Date and the consummation
      of
      the transactions contemplated hereby for a period of two (2) years;
provided,
      however,
      that
      the representations and warranties set forth in Sections 3.1,
      3.3,
      3.4,
      4.1
      and
4.3
      shall
      survive the Closing Date and shall continue in full force and effect without
      limit as to time.

     

    8.2 Indemnification.

     

    (a) Sellers
      hereby covenant and agree to defend, indemnify and save and hold harmless
      Purchasers, together with Purchasers’ respective subsidiaries, affiliates,
      officers, directors, members, employees, shareholders, attorneys and
      representatives and each Person who controls any Purchaser within the meaning
      of
      the Securities Act, from and against any loss, cost, expense, liability, claim
      or legal damages (including, without limitation, reasonable fees and
      disbursements of counsel and accountants and other costs and expenses incident
      to any actual or threatened Action and all costs of investigation)
      (collectively, the “Damages”)
      arising out of or resulting from: (i) any inaccuracy in or breach of any
      representation, warranty, covenant or agreement made by any Seller in this
      Agreement or in any Schedule or Exhibit delivered by any Seller pursuant to
      this
      Agreement; (ii) the failure of any Seller to perform or observe fully any
      covenant, agreement or condition required to be performed or observed by such
      Seller pursuant to this Agreement or any Schedule or Exhibit delivered by any
      Seller pursuant to this Agreement; (iii) the Excluded Liabilities,
      including, without limitation the Shareholder Liabilities; (iv) any claims
      of third parties claiming compensation, commissions or expenses for services
      as
      a Broker or finder based upon obligations incurred by any Seller; or
      (v) any actual or threatened Action arising out of or resulting from any
      Seller’s acts or omissions in connection with or pursuant to any Purchased
      Agreement or Continuing Agreement. 

     

    (b) Purchasers
      covenant and agree to indemnify and save and hold harmless Sellers, together
      with Sellers’ respective officers, employees, directors, members, employees,
      shareholders, attorneys and representatives and each Person who controls any
      Seller within the meaning of the Securities Act, from and against any Damages
      arising out of or resulting from: (i) any inaccuracy in or breach of any
      representation, warranty, covenant or agreement made by any Purchaser in this
      Agreement or in any Exhibit delivered by any Purchaser pursuant to this
      Agreement; (ii) the failure of any Purchaser to perform or observe fully
      any covenant, agreement or condition required to be performed or observed by
      such Purchaser pursuant to this Agreement or any Exhibit delivered by any
      Purchaser pursuant to this Agreement; (iii) the Assumed Liabilities;
      (iv) any claims of third parties claiming compensation, commissions or
      expenses for services as a Broker or finder based upon obligations incurred
      by
      any Purchaser; or (v) any actual or threatened Action arising out of or
      resulting from any Purchaser’s acts or omissions in connection with or pursuant
      to any Purchased Agreement or Continuing Agreement. 

     

    
      
         

      

      
        -18-

        
          

        

      

      
         

      

    

    

     

    (c) In
      the
      event that any indemnified party is made a defendant in or party to any Action
      instituted by any third party for Damages (any such third party action, suit,
      proceeding or claim being referred to as a “Third-Party
      Claim”),
      the
      indemnified party (referred to in this clause (c)
      as the
“notifying party”) shall give notice thereof as soon as practicable and in any
      event within thirty (30) days after the indemnified party receives notice
      thereof (but, in all events, at least twenty (20) business days prior to
      the date that an answer to such Third-Party Claim is due to be filed). The
      failure to give such notice shall not affect whether an indemnifying party
      is
      liable to provide indemnification hereunder unless such failure has resulted
      in
      the loss of material, substantive rights with respect to the indemnifying
      party’s ability to defend such Third-Party Claim, and then only to the extent of
      such loss. The indemnifying party may contest and defend such Third-Party Claim
      so long as the indemnifying party: (i) diligently contests and defends such
      Third-Party Claim, and (ii) acknowledges in writing that it is obligated to
      provide indemnification with respect to such Third-Party Claim. Notice of the
      intention so to contest and defend shall be given by the indemnifying party
      to
      the notifying party within twenty (20) business days after the notifying
      party delivers notice of a Third-Party Claim (but, in all events, at least
      ten (10) business days prior to the date that an answer to such Third-Party
      Claim is due to be filed). Such contest and defense shall be conducted by
      reputable attorneys employed by the indemnifying party and approved by the
      indemnified party (which approval will not be unreasonably withheld or delayed).
      The notifying party shall be entitled, at its own cost and expense (which
      expense shall not constitute Damages unless the notifying party reasonably
      determines that the indemnifying party is not adequately representing or,
      because of a conflict of interest, may not adequately represent, the interests
      of the indemnified parties, and has provided the indemnifying party with timely
      notice of such determination, and then only to the extent that such expenses
      are
      reasonable), to participate in such contest and defense and to be represented
      by
      attorneys of its or their own choosing. If the notifying party elects to
      participate in such defense, the notifying party will cooperate with the
      indemnifying party in the conduct of such defense. Neither the notifying party
      nor the indemnifying party may concede, settle or compromise any Third-Party
      Claim without the consent of the other party, which consent will not be
      unreasonably withheld or delayed in light of all factors of importance to such
      party. Notwithstanding the foregoing, if the indemnifying party fails to
      acknowledge in writing its obligation to provide indemnification in respect
      of
      such Third-Party Claim, to assume the defense thereof with counsel reasonably
      satisfactory to the notifying party or to diligently contest and defend such
      Third-Party Claim, then the notifying party alone shall be entitled to contest,
      defend and settle such Third-Party Claim in the first instance (in which case,
      all expenses incurred in connection therewith shall constitute Damages) and,
      only if the notifying party chooses not to contest, defend or settle such
      Third-Party Claim, shall the indemnifying party then have the right to contest
      and defend (but not settle) such Third-Party Claim.

     

    
      
         

      

      
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    (d) In
      the
      event any indemnified party shall have a claim against any indemnifying party
      that does not involve a Third-Party Claim (an “Indemnification
      Claim”),
      the
      indemnified party shall deliver a written notice of such Indemnification Claim
      (a “Claims
      Notice”)
      to the
      indemnifying party with reasonable promptness. The Claims Notice shall set
      forth
      with reasonable specificity the amount claimed and the underlying facts
      supporting such Indemnification Claim and enclose any relevant material
      documentation in the indemnified party’s possession, such as petitions or
      subpoenas received by the indemnified party. The failure to deliver such Claims
      Notice shall not affect whether an indemnifying party is liable for
      reimbursement unless such failure has resulted in the loss of material,
      substantive rights with respect to the indemnifying party’s ability to defend
      such Indemnification Claim, and then only to the extent of such
      loss

     

    (e) The
      indemnifying party shall have fifteen (15) days from receipt of any Claims
      Notice to accept or dispute such Indemnification Claim. In the event that an
      indemnifying party elects to dispute such Indemnification Claim, the
      indemnifying party shall deliver a written notice to the indemnified party
      within such fifteen (15) day period which sets forth in reasonable detail the
      indemnifying party’s grounds for disputing such Indemnification Claim (such
      notice, a “Dispute
      Notice”).
      If
      the indemnifying party notifies the indemnified party that it does not intend
      to
      dispute the Indemnification Claim described in the Claims Notice or fails to
      deliver a Dispute Notice to the indemnified party within fifteen (15) days
      after receipt of such Claims Notice, the Damages in the amount specified in
      the
      Claims Notice will be conclusively deemed a liability of the indemnifying party
      and the indemnifying party shall pay the amount of such Damages to the
      indemnified party on demand.

     

    (f) If
      any
      indemnified party is entitled to receive any amount from any indemnifying party
      pursuant to this Section 8.2,
      including, without limitation, Damages (an “Indemnification
      Payment”),
      the
      indemnifying parties shall remit such amount to the indemnified party within
      ten (10) days after the indemnified party makes written demand therefore (a
“Demand”).
      The
      indemnifying party shall have fifteen (15) days from receipt of any Demand
      to
      accept or dispute such Demand. In the event that an indemnifying party elects
      to
      dispute a Demand (provided that to the extent such Demand relates to an
      Indemnification Claim, such party had previously delivered a Dispute Notice
      with
      respect thereto), the indemnifying party shall deliver a written notice to
      the
      indemnified party setting forth in reasonable detail the indemnifying party’s
      grounds for disputing the Demand (such notice, a “Demand
      Dispute”).
      If
      the indemnifying party notifies the indemnified party that it does not intend
      to
      dispute the Demand or fails to properly deliver a Demand Dispute to the
      indemnified party within fifteen (15) days after receipt of the Demand, the
      amount set forth in the Demand will be conclusively deemed a liability of the
      indemnifying party. If Sellers or Purchasers properly deliver a Dispute Notice
      and/or Demand Dispute within the time periods specified above, the parties
      shall
      attempt to resolve such dispute in good faith for a period of sixty (60)
      days. If, at the end of such period, the parties have not resolved the dispute,
      either party may seek relief from a court of competent jurisdiction in Los
      Angeles County
      notwithstanding the mediation provisions set forth in Section 8.8
      below.

     

    (g) The
      foregoing indemnification provisions are in addition to, and not in derogation
      of, any statutory, equitable or common law remedy, including, without
      limitation, injunctive relief and specific performance, each party may have
      for
      the breach of any representation, warranty, covenant or agreement set forth
      in
      this Agreement or in any other agreement entered into by the parties pursuant
      hereto or the enforcement thereof.

     

    
      
         

      

      
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    8.3 Goodwill
      Reduction Indemnification

     

    (a) In
      the
      event that there is a Goodwill Reduction Event (as defined below), Purchasers
      covenant and agree to indemnify Sellers by making the Indemnity Payments to
      Sellers specified in Section 8.3(d)
      within
      thirty (30) days following the Final Determination (as defined in Section 8.3(b)).

     

    (b) A
      “Goodwill
      Reduction Event”
shall
      mean any Final Determination which results in a reduction of the amount of
      the
      Purchase Price allocated to goodwill when compared with the allocations set
      forth on Schedule 1.6
      hereof.
      For purposes of the foregoing, a “Final
      Determination”
means
      the earliest to occur of (i) the date on which the applicable statute of
      limitations for raising an issue regarding a federal income tax matter with
      respect to Sellers has expired, (ii) the date on which a decision,
      judgment, decree or other order has been issued by any court of competent
      jurisdiction, which decision, judgment, decree or other order has become final
      (i.e., all allowable appeals requested by the parties to the action have been
      exhausted), (iii) the date on which a concession, settlement or compromise
      of
      the Proposed Tax Adjustment reached in accordance with Section 8.3(c)
      has been
      fully executed by all parties, or (iv) the date on which the time for
      instituting a claim for refund has expired or, if a claim was filed, the time
      for instituting suit with respect thereto has expired.

     

    (c) Each
      party to this Agreement shall promptly notify the other parties in writing
      and
      in any event within ten (10) days after its receipt of notice of any
      communication from any taxing authority regarding an audit or assessment or
      any
      other event that could give rise to a Goodwill Reduction Event and/or any
      proposed adjustment arising therefrom (a “Proposed
      Tax Adjustment”).
      Purchasers may elect to contest and defend such Proposed Tax Adjustment so
      long
      as Purchasers: (i) diligently contest and defend such Proposed Tax
      Adjustment, and (ii) acknowledge in writing that they are obligated to
      indemnify Sellers from any Goodwill Reduction Event. Purchasers shall give
      Sellers notice of the intention to contest and defend the Proposed Tax
      Adjustment within twenty (20) days after the notifying party delivers
      notice of a Proposed Tax Adjustment (but, in all events, at least ten (10)
      business days prior to the date that an answer to such Proposed Tax Adjustment
      is due to be filed). Upon receipt of such notice, Sellers shall appoint
      Purchasers as attorneys in fact to represent Sellers in connection with the
      Proposed Tax Adjustment. Purchasers shall have the right to concede, settle
      or
      compromise the Proposed Tax Adjustment at any time during the proceedings
      provided that Purchasers give Sellers ten (10) business days advance
      written notice of such intention and tender payment in full of the amounts
      owed
      pursuant to Section 8.3(d).
      Sellers
      shall be entitled, at their own cost and expense, to participate in such contest
      and defense and to be represented by attorneys of its or their own choosing
      and
      to participate in any meetings, hearings or proceedings, provided that such
      costs shall not be included in the Indemnity Payments. If Sellers elect to
      participate in such defense, Sellers will cooperate with Purchasers in the
      conduct of such defense. Sellers and Purchasers acknowledge that the Proposed
      Tax Adjustment may be included as part of a broader audit of Sellers and that
      there may be one or more other proposed tax adjustments (the “Other
      Proposed Tax Adjustments”).
      In
      such case, Sellers shall be required, at their own cost and expense, to
      participate in such contest and defense with respect to the Other Proposed
      Tax
      Adjustments. Sellers shall have the right to concede, settle or compromise
      the
      Other Proposed Tax Adjustments at any time during the proceedings provided
      that
      Sellers give Purchasers ten (10) business days advance written notice of
      such intention. Notwithstanding the foregoing, if Purchasers fail to acknowledge
      in writing their obligation to provide indemnification in respect of such
      Proposed Tax Adjustment, to assume the defense thereof with counsel reasonably
      satisfactory to Sellers or to diligently contest and defend such Proposed Tax
      Adjustment, then Sellers alone shall be entitled to contest, defend and settle
      such Proposed Tax Adjustment in the first instance in which case, all expenses
      incurred in connection therewith shall be included in the Indemnity
      Payments.

     

    
      
         

      

      
        -21-

        
          

        

      

      
         

      

    

    

     

    (d) The
      payments required by Section 8.3(a)
      (the
“Indemnity
      Payments”)
      shall
      be the sum of the following amounts: (i) (x) the net difference in the
      federal and state income tax liability of Sellers for the Purchase Price, taking
      into account the deductibility of the state income tax for purposes of
      calculating the federal income taxes, resulting from the Goodwill Reduction
      Event, plus (y) any and all interest and penalties imposed on Sellers with
      respect to the Goodwill Reduction Event, plus (z) Sellers’ expenses
      specified in the last sentence of Section 8.3(c);
      and
      (ii) an amount sufficient to pay any federal and state income tax liability
      owed by Sellers as a result of the receipt of the amounts specified in
      clause (i) hereof and this clause (ii) (a fully grossed-up tax
      indemnity) assuming the maximum combined state and federal tax rate
      on
      such
      payments and taking into account the deductibility of state income tax on
      federal tax returns for purposes of such calculation. 

     

    8.4 Complete
      Agreement.
      This
      Agreement, including the Exhibits and Schedules hereto, constitutes the entire
      agreement and supersedes all other prior and contemporaneous agreements and
      undertakings, both written and oral, between the parties hereto with regard
      to
      the subject matter hereof. This Agreement (a) is not intended to confer
      upon any Person any rights or remedies hereunder or with respect to the subject
      matter hereof except as specifically provided in this Agreement; and
      (b) may be executed in two or more counterparts, each of which shall be
      deemed to be an original, but all of which counterparts shall together
      constitute a single agreement. Facsimile signatures shall be fully binding
      and
      effective for all purposes as if they were original signatures.

     

    8.5 Further
      Action.
      Sellers
      hereby agree that, from time to time after the Closing, at Purchasers’ request
      and without further consideration, Sellers shall execute and deliver such other
      instruments of conveyance, assignment and transfer and take such other actions
      as Purchasers reasonably may require to more effectively convey, transfer to and
      invest in Purchasers, and to put Purchasers in possession of, all of the Assets.
      Each Seller irrevocably appoints Purchasers as his or its attorneys-in-fact
      to
      execute and deliver such instruments necessary or convenient to convey, transfer
      to and invest title in Purchasers, and to put Purchasers in possession of,
      all
      of the Assets.

     

    8.6 Notices. 
      All
      notices, requests, demands and other communications under this Agreement shall
      be in writing and shall be deemed to have been received five business days
      after
      having been deposited in the United States mail and enclosed in a registered
      or
      certified post-paid envelope; at the open of business on the next succeeding
      business day after having been sent by overnight courier; when scanned by
      telegraphic communications equipment of the sending party on a business day,
      or
      otherwise at the open of business on the next succeeding business day; or when
      personally delivered on a business day or otherwise at the open of business
      on
      the next succeeding business day; and, in each case, addressed to the respective
      parties at the addresses stated below, or to such other changed addresses that
      the parties may have fixed by notice in accordance herewith.

     

    
      
         

      

      
        -22-

        
          

        

      

      
         

      

    

    
      	 	
              If
                to Sellers:

            	
              Hotel
                Restaurant Properties, Inc.

            
	 	 	
              Hotel
                Restaurant Properties II, Inc.

            
	 	 	
              Hotel
                Restaurant Properties II Management, Inc.

            
	 	 	
              11828
                La Grange Avenue

            
	 	 	
              Los
                Angeles, CA 90025

            
	 	 	
              Attn:
                Keith Wolff

            
	 	 	
              Telephone:
                (310) 966-2367

            
	 	 	
              Facsimile:
                (603) 720-8057

            
	 	 	
               

              Keith
                Wolff

            
	 	 	
              11828
                La Grange Avenue

            
	 	 	
              Los
                Angeles, CA 90025

            
	 	 	
              Telephone:
                (310) 966-2367

            
	 	 	
              Facsimile:
                (603) 720-8057

            
	 	 	
               

              and

               

            
	 	 	
              Adam
                Keller

            
	 	 	
              11828
                La Grange Avenue

            
	 	 	
              Los
                Angeles, CA 90025

            
	 	 	
              Telephone:
                (858) 583-4480

            
	 	 	
              Facsimile:
                (858) 777-5379

               

            

    

    
      	 	
              with
                a copy to:

            	
              Greenberg
                Glusker Fields Claman & Machtinger LLP

            
	 	 	
              1900
                Avenue of the Stars, 21st
                Floor

            
	 	 	
              Los
                Angeles, CA 90067

            
	 	 	
              Attn:
                C. Bruce Levine

            
	 	 	
              Telephone:
                (310) 201-7440

            
	 	 	
              Facsimile:
                (310) 201-2340

               

            
	 	
              If
                to Purchasers:

            	
              Grill
                Concepts, Inc.

            
	 	 	
              Grill
                Concepts Management, Inc.

            
	 	 	
              11661
                San Vicente Boulevard, Suite 404

            
	 	 	
              Los
                Angeles, CA 90049

            
	 	 	
              Attn:
                Philip Gay 

            
	 	 	
              Telephone:
                (310) 820-5559

            
	 	 	
              Facsimile:
                (310) 820-6530

            

    

     

    
      
         

      

      
        -23-

        
          

        

      

      
         

      

    

    
      	 	
              with
                a copy to:

            	
              Pillsbury
                Winthrop Shaw Pitman LLP

            
	 	 	
              725
                South Figueroa Street, Suite 2800 

            
	 	 	
              Los
                Angeles, California 90071-5406 

            
	 	 	
              Attn:
                Anna M. Graves, Esq. 

            
	 	 	
              Telephone:
                (213) 488-7164

            
	 	 	
              Facsimile:
                (213) 226-4017

            

    

     

    8.7 Publicity
      Without
      the prior consent of the other party, no party shall, and each party shall
      cause
      its directors, officers, shareholders, members, employees, representatives
      and
      agents not to, make any public statement or press release with respect to the
      transactions contemplated by this Agreement or otherwise disclose to any Person
      the existence, terms, content or effect of this Agreement; provided, however,
      that if a disclosure is required by law or regulation, the party required to
      make such disclosure shall be permitted to make such disclosure but shall make
      a
      good faith effort to consult with the other party hereto before making such
      disclosure; and provided further, however, that Sellers consent to the
      disclosure and filing of this Agreement and its Exhibits by GCI with the
      Securities and Exchange Commission pursuant to the Securities Exchange Act
      of
      1934 and the rules and regulations promulgated thereunder.

     

    8.8 Mediation.
      In the event that any dispute relating to or arising out of this Agreement,
      or
      any document delivered in connection herewith (“Dispute”), cannot be settled or
      compromised within twenty (20) days of receipt of the subject claim, the
      Dispute shall be submitted to mediation on an expedited basis in Los Angeles,
      California, administered by JAMS, or its successor, in accordance with the
      JAMS
      rules and procedures then in effect. Either party may commence mediation by
      providing to JAMS and the other party a written request for mediation, setting
      forth the subject of the Dispute and the relief requested, with the expectation
      that the first mediation shall occur within thirty (30) days of such
      written request. Purchasers and Sellers will cooperate with JAMS and with one
      another in selecting a neutral mediator from the JAMS panel of neutrals and
      in
      scheduling the mediation proceedings. The mediator must be a retired judge
      or an
      attorney licensed to practice law in Los Angeles, California and experienced
      with the subject matter of the Dispute. If the parties are unable to select
      the
      mediator, JAMS shall designate the mediator. Purchasers and Sellers covenant
      that they will participate in the mediation in good faith and that they will
      share equally in the costs of the mediator and related JAMS administrative
      costs. All offers, promises, conduct and statements, whether oral or written,
      made in the course of the mediation by any of the parties, their agents,
      employees, experts and attorneys, and by the mediator and any JAMS employees,
      are confidential, privileged and inadmissible for any purpose, including
      impeachment, in any arbitration, litigation or other proceeding involving the
      parties, provided that evidence that is otherwise admissible or discoverable
      shall not be rendered inadmissible or non-discoverable as a result of its use
      in
      the mediation. Either party may seek equitable relief in the Superior Court
      situated in Los Angeles, California prior to the mediation to preserve the
      status quo pending the completion of that process. In the event it is necessary,
      any party may file a motion in such Superior Court to compel the other party
      to
      participate in the mediation and the prevailing party shall be awarded its
      costs
      and expenses, including reasonable attorneys’ fees in connection with such
      motion. If the Dispute is not resolved within ten (10) days after the first
      mediation session, either party may (i) give written notice to JAMS and the
      other party that the mediation is terminated and (ii) commence a court
      action.

     

    
      
         

      

      
        -24-

        
          

        

      

      
         

      

    

    

     

    8.9 Attorneys’
      Fees.
      If any litigation or arbitration shall ensue between the parties concerning
      the
      interpretation of or performance under this Agreement, the prevailing party
      shall recover from the nonprevailing party or parties its reasonable attorneys’
and other fees as fixed by the court or the arbitrator, as the case may
      be.

     

    8.10 Construction
      of Agreement
      Any
      captions to, or headings of, the paragraphs of this Agreement are solely for
      the
      convenience of the parties hereto, are not a part of this Agreement, and shall
      not be used for the interpretation of this Agreement. Where the context so
      requires, words used in any gender shall be deemed to include other genders,
      and
      the singular number shall include the plural and vice versa. The Recitals
      appearing at the beginning of this Agreement, and the Exhibits and Schedules
      attached hereto, are hereby incorporated into and are deemed to constitute
      a
      part of the operative text of this Agreement. Each party hereto and such party’s
      counsel have had the full opportunity to review and comment upon, and have
      reviewed and commented upon, this Agreement, and any rule of construction to
      the
      effect that ambiguities are to be resolved against the drafting party shall
      not
      apply in the interpretation of this Agreement or any Exhibits or Schedules
      attached hereto.

     

    8.11 Severability
      Each
      provision of this Agreement shall be interpreted in such manner as to be
      effective and valid under applicable law but if any provision of this Agreement
      shall be prohibited by or invalid under applicable law, such provision shall
      be
      ineffective only to the extent of such prohibition or invalidity, without
      invalidating the remainder of such provision or the remaining provisions of
      this
      Agreement.

     

    8.12 Assignment;
      Successors and Assigns
      Neither
      party may assign its rights hereunder without the other party’s prior written
      consent, which consent shall not be unreasonably withheld; provided,
      however,
      that
      any Purchaser may assign its rights hereunder without Seller’s consent to any
      affiliate of any Purchaser. Subject to the foregoing, this Agreement shall
      be
      binding upon and inure to the benefit of the parties hereto and their respective
      successors and assigns. Any purported assignment in violation of this
Section 8.12
      shall be
      void and of no effect.

     

    8.13 Time
      of Essence.
      Time is
      of the essence of each and every term, condition, obligation, and provision
      hereof. All references herein to a particular time of day shall be deemed to
      refer to Pacific Daylight Time.

     

    8.14 No
      Obligations to Third Parties.
      Except
      as otherwise expressly provided herein, the execution and delivery of this
      Agreement shall not be deemed to confer any rights upon, nor obligate any of
      the
      parties hereto to, any person or entity other than the parties
      hereto.

     

    8.15 Governing
      Law.
      This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of California, without reference to any principles or statutes of
      conflicts of laws.

     

    

     

    

     

    
      
         

      

      
        -25-

        
          

        

      

      
         

        
        

      

    

    IN
      WITNESS WHEREOF, each of the parties hereto has executed this Agreement, or
      has
      caused this Agreement to be executed on its behalf by a representative duly
      authorized, all as of the Effective Date.

    

    
      	 	
              “PURCHASERS”

            
	 	 
	 	
              GRILL
                CONCEPTS, INC., a Delaware corporation 

            
	 	 
	 	
              By:____________________________________

            
	 	
              Philip
                Gay, President and

            
	 	
              Chief
                Executive Officer

            
	 	 
	 	
              GRILL
                CONCEPTS MANAGEMENT, INC., 

            
	 	
              a
                California corporation 

            
	 	 
	 	
              By:
                ____________________________________

            
	 	
              Philip
                Gay, President and 

            
	 	
              Chief
                Executive Officer

            
	 	 
	 	
              “SELLERS”

            
	 	 
	 	
              HOTEL
                RESTAURANT PROPERTIES, INC.,

            
	 	
              a
                California corporation

            
	 	 
	 	
              By:
                ____________________________________

            
	 	
              Keith
                Wolff, President

            
	 	 
	 	
              HOTEL
                RESTAURANT PROPERTIES II, INC.,

            
	 	
              a
                California corporation

            
	 	 
	 	
              By:
                ____________________________________

            
	 	
              Keith
                Wolff, President

            
	 	
               

            
	 	 
	 	
              HOTEL
                RESTAURANT PROPERTIES II MANAGEMENT, INC., a California
                corporation

            
	 	 
	 	
              By:
                ____________________________________

            
	 	
              Keith
                Wolff, President

            
	 	 
	 	 
	 	
              __________________________________________

            
	 	
              KEITH
                WOLFF, an individual

            
	 	 
	 	
              __________________________________________

            
	 	
              ADAM
                KELLER, an individual

            

    

    

    
      
         

      

      
        S-1

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