Document:

Exhibit
10.2

 

ESCROW
AGREEMENT

 

THIS ESCROW
AGREEMENT (the “Agreement”) is entered into as of January 29, 2008,
by and among NexCen Asset Acquisition, LLC, a Delaware limited liability
company (“Buyer”), NexCen Brands, Inc., a Delaware corporation (“Parent”),
Great American Cookie Company Franchising, LLC, a Delaware limited liability
company (“GACCF”), and Great American Manufacturing, LLC, a Delaware
limited liability company (“GAM,” and with GACCF, each individually, a “Seller,”
and collectively, the “Sellers”), and Wilmington Trust Company, as
escrow agent hereunder (the “Escrow Agent”).  Capitalized terms used but not defined herein
shall have the respective meanings assigned to them in the Purchase Agreement
(as defined herein).  The Escrow Agent,
Parent, Buyer and the Sellers are sometimes collectively referred to herein as
the “Parties” and individually as a “Party.”

 

RECITALS

 

WHEREAS, Parent, Buyer, the Sellers, and Mrs. Fields
Famous Brands, LLC (“MFFB”) have entered into that certain Asset Purchase
Agreement, dated as of January 29, 2008 (the “Purchase Agreement”),
pursuant to which the Sellers have agreed to sell, and Buyer has agreed to
purchase, substantially all of the Sellers’ assets;

 

WHEREAS,
pursuant to
Sections 3.3(a) and 3.6 of the Purchase Agreement, a portion of the
Initial Purchase Price is required to be held in escrow after the Closing Date
to secure certain obligations of the Sellers and MFFB; and

 

WHEREAS, in order to fully and exclusively
secure (i) the obligation, if any, of the Sellers for a Purchase Price
Deficit Amount under Section 3.2(f) of the Purchase Agreement (an “Adjustment
Claim”) and (ii) the indemnity and payment obligations of the Sellers
and MFFB under Article XI of the Purchase Agreement (an “Indemnification
Claim”), the Parties to the Purchase Agreement have agreed, pursuant to Section 3.6(a) of
the Purchase Agreement, that Buyer shall cause to be deposited with the Escrow
Agent 1,099,290 shares of common stock of Parent (the “Escrow Shares”)
issued in the names of the Sellers.

 

NOW,
THEREFORE, in
consideration of these promises and the mutual obligations and covenants set
forth herein and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Parties agree as follows:

 

1.             Appointment of Escrow
Agent; Receipt of  Escrow Amount.

 

(a)   Parent, Buyer and the Sellers appoint the
Escrow Agent as their escrow agent for the purposes set forth herein, and the
Escrow Agent hereby accepts such appointment under the terms and conditions set
forth herein.

 

(b)   Following the execution of this Agreement,
Buyer shall deposit, or cause to be deposited, with the Escrow Agent the Escrow
Shares as set forth in the Purchase Agreement. Buyer or Parent shall deliver to
the Escrow Agent the stock powers necessary to carry forth distributions
according to Section 3 of this Agreement.

 

 

(c)   Upon receipt by the Escrow Agent of the
Escrow Shares, the Escrow Agent shall hold such Escrow Shares including (i) any
securities into which the Escrow Shares may be reclassified or converted
(collectively, with the Escrow Shares, the “Aggregate Escrow Shares”)
and (ii) any cash dividends paid on the Aggregate Escrow Shares, and
investment income earned on such dividends (cash amount of such dividends and
investment income, the “Aggregate Dividend
Amount”) and (iii) any cash proceeds from the
sale of the Escrow Shares, and investment income earned on such proceeds (the “Aggregate
Cash Sale Proceeds” and, together with the Aggregate Dividend Amount, the “Aggregate
Cash Amount”) in a separate and distinct account
(the “Escrow Account”), subject to the terms and conditions of this
Agreement.  The Aggregate Cash Amount and
the Aggregate Escrow Shares shall be referred to here as the “Escrow Amount.”

 

(d)   The Escrow Agent shall not distribute or
release the Escrow Amount, except in accordance with the express terms and
conditions of this Agreement.

 

2.             Treatment of Escrow
Property.

 

(a)   Escrow Shares.

 

(i)            Voting.  The Aggregate Escrow Shares deposited and
held in the Escrow Account are subject to a Registration Rights Agreement and a
Voting Agreement.  The Escrow Agent shall
not have any right to vote or consent with respect to the Aggregate Escrow
Shares.

 

(ii)           Dividends.  If Parent declares and distributes dividends
with respect to the Parent Shares during such time as the Aggregate Escrow
Shares are held in the Escrow Account, Parent shall deposit in the Escrow
Account the amount of such dividends allocable to such Aggregate Escrow Shares.  If Parent deposits amounts pursuant to such
dividends in the Escrow Account in accordance with the provisions of this Section 2(a)(ii),
MFFB shall include such dividends in their income for federal, state and local
income tax purposes, provided that Parent timely provide MFFB with copies of
Internal Revenue Service (“IRS”) Forms 1099 on which is reported the
amount of such dividend income.  In
addition, MFFB shall include in income for federal, state and local income tax
purposes any interest earned on such dividends while held in the Escrow
Account, provided that the Escrow Agent shall timely provide MFFB with IRS
Forms 1099, on which is reported such interest income.

 

(iii)          Conversion of Parent Shares.  If the Parent Shares are converted by Parent
through a stock split or a reverse stock split, then the Closing Date Reference
Price shall be adjusted in direct but inverse relation to the stock split (the “Adjusted
Closing Date Reference Price”).  For
example, for illustration purposes only: (A)  if the Parent Shares are
split 2 to 1, then the Adjusted Closing Date Reference Price shall be the
Closing Date Reference Price divided by 2; or (B) if the Parent Shares
undergo a reverse split of 1 to 2, then the Adjusted Closing Date Reference
Price shall be the Closing Date Reference Price multiplied by 2.

 

(iv)          Permitted Sales of Aggregate Escrow Shares.  Beginning on the date that is six (6) months
after the date of this Agreement, the Sellers shall be permitted to sell
Aggregate Escrow Shares as and to the extent permitted by Section 7.8 of
the Purchase 

 

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Agreement (the text of which is attached as Annex
A hereto) provided that the net proceeds from such sales are promptly
deposited with the Escrow Agent to be held as part of the Escrow Amount.  In the event that either Seller determines to
sell any Aggregate Escrow Shares as permitted by Section 7.8 of the
Purchase Agreement, it shall send a written notice to Buyer and the Escrow
Agent advising them as to how many Aggregate Escrow Shares such Seller proposes
to sell and within what period such Seller plans to sell such Aggregate Escrow
Shares (a “Proposed Sale Notice”), it being understood that a Proposed
Sale Notice is a statement of intention on such Seller’s part and not a
commitment by it to effect the proposed sale. 
In order to permit coordination among the parties to this Agreement and
the transfer agent for the Parent Shares, any such Proposed Sale Notice shall
be provided not less than two (2) Business Days before the day on which a
sale order is given for a sale of the Aggregate Escrow Shares covered by the
Proposed Sale Notice (if sold in an open market transaction) or a binding
agreement to sell the Aggregate Escrow Shares covered by the Proposed Sale
Notice is entered into by such Seller. 
In connection with any sales of Aggregate Escrow Shares under this Section 2(a)(iv),
such Seller will promptly provide written notice to Buyer and the Escrow Agent
of the terms of any actual sale order or definitive agreement to sell and the
parties will work together cooperatively in order to permit the timely delivery
by such Seller of the Aggregate Escrow Shares to be sold to the purchaser
thereof and the prompt deposit with the Escrow Agent into the Aggregate Escrow
Amount of the net proceeds of such sale. 
At any given time, the number of the Aggregate Escrow Shares sold under
this Section 2(a)(iv) as a proportion of the total number of
Aggregate Escrow Shares that were held as part of the Escrow Amount at the time
of such sale shall be deemed to be the “Cash Proceeds Percentage”.

 

(v)           Transferability.  Other than as provided in Section 2(a)(iv) and
Section 18, the Sellers may not sell, transfer, assign, pledge or
otherwise dispose of (whether with or without consideration and whether voluntarily
or involuntarily or by operation of law) any interest in the Escrow Amount at
any time that the Aggregate Escrow Shares are held in escrow pursuant to this
Agreement.

 

(vi)          New Certificates.  If fewer than the total number of the
Aggregate Escrow Shares represented by any certificate (or certificates)
representing the Aggregate Escrow Shares are to be distributed to Buyer,
Parent, or the Sellers hereunder, Parent shall deliver a new certificate (or
certificates) representing the number of the Aggregate Escrow Shares not
distributed to the Escrow Agent within ten (10) Business Days after the
Escrow Agent’s surrender of the certificate (or certificates) representing the
distributed Aggregate Escrow Shares.

 

(vii)         Escrow Agent Obligations. Except
as otherwise provided in Section 2(a) hereof, the Escrow Agent’s sole
obligation with respect to any distribution of the Aggregate Escrow Shares to
Buyer or Parent shall be to (i) deliver the certificate (or certificates)
representing such Aggregate Escrow Shares and any related stock powers to
Buyer, Parent or its designated stock transfer agent with appropriate
instructions to Parent to issue a new certificate in the name of the Party or
Parties entitled to such Aggregate Escrow Shares along with proper delivery
instructions and (ii) instruct Parent or its designated stock transfer
agent to issue a new certificate to be returned to the Escrow Agent for any
undistributed Aggregate Escrow Shares. The Escrow Agent shall not be liable for
any error, mistake, delay or failure to act by Buyer, Parent or its designated
stock transfer agent, including without limitation, any error, mistake, delay
or failure in the delivery of the Aggregate Escrow Shares.

 

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(b)   Aggregate Cash Amount.

 

(i)            Permitted Investments.  The Escrow Agent shall invest and reinvest
the Aggregate Cash Amount pursuant to written directions of the Sellers, and in
the absence of such directions, in any or all of the following: (i) short-term
direct obligations of, or obligations fully guaranteed by, the United States of
America or any agency thereof; (ii) certificates of deposit issued by any
bank, trust company or national banking association having total capital and
surplus in excess of $500,000,000 and rated at least AAA by Standard &
Poor’s Rating Group and AAA by Moody’s Investors Services, Inc., to the
maximum extent permitted by law; (iii) commercial paper rated in the
highest grade by Standard & Poor’s Rating Group and/or Moody’s
Investors Service, Inc., in each case having maturities of not more than
thirty (30) days; or (iv) the U.S. Government Portfolio of the Wilmington
family of mutual funds or any other mutual funds for which Escrow Agent or any
affiliate of Escrow Agent may serve as investment advisor or other service
provider (such investment described above in (i) through (iv) being
collectively referred to herein as the “Permitted Investments”).  The parties acknowledge that shares in the
mutual fund described in this Section 2(b)(i)(iv) are not obligations
of Wilmington Trust company, are not deposits and are not insured by the
FDIC.  The Escrow Agent or its affiliate
is compensated by the mutual fund for services rendered in its capacity as
investment advisor, custodian, and/or transfer agent, and such compensation is
both described in detail in the prospectus for this mutual fund, and is in
addition to the compensation paid Wilmington Trust Company in its capacity as
Escrow Agent hereunder.  Investment
earnings shall be credited to the Escrow Account until disbursed in accordance
with this Agreement.  Any loss incurred
from an investment or sale thereof other than losses resulting directly or
indirectly from the gross negligence or willful misconduct of the Escrow Agent,
shall be deducted from the Aggregate Cash Amount of the Escrow Account.  The Escrow Agent shall not be responsible for
any losses on any uninvested cash remaining in the Escrow Account, which may
occur because of bank failure or the Aggregate Cash Amount exceeding the FDIC limits.

 

(ii)           Disposition of Permitted
Investments.  At the time that the
Escrow Agent shall be required to make any payment in connection with the
Escrow Account under this Agreement, the Escrow Agent shall promptly and timely
liquidate the Permitted Investments associated with the Escrow Account
hereunder to the extent necessary to make such payment in accordance with the
terms hereof.

 

3.             Release of Escrow Amount. 
The Escrow Amount shall only be distributed and released as follows:

 

(a)   Adjustment Claims.  If the Sellers fail to satisfy any amount
owed to Buyer in accordance with Section 3.2(g) of the Purchase
Agreement within three (3) Business Days following the Seller’s receipt of
the Purchase Price Deficit Statement in accordance with Section 3.2(f), Buyer
may deliver to the Sellers and the Escrow Agent a notice (the “Adjustment
Draw-Down Notice”) setting forth the amounts claimed due to Buyer from the
Sellers pursuant to Section 3.2(f) of the Purchase Agreement,
together with a written confirmation by the Sellers as to such amount (such
amount herein referred to as the “Cash Shortfall”).  Within three (3) Business Days following
the delivery of the Adjustment Draw-Down Notice, the Escrow Agent shall
transfer an amount equal to the Cash Shortfall to Buyer in accordance with Section 3(c) of
this Agreement.

 

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(b)   Indemnification Claims.

 

(i)            On each occasion on which Parent
determines in good faith that any Buyer Indemnified Party is entitled to
payment of a claim for indemnification against the Sellers or MFFB in
accordance with Article XI of the Purchase Agreement, Parent or Buyer may
deliver to the Sellers, MFFB, and the Escrow Agent a written request for the
payment of such amount (“Draw-Down Request”).  The Draw-Down Request shall set forth the
amount requested and, in reasonable detail, the specific basis (to the extent
known) for the determination of the amount of the claim and why such Buyer
Indemnified Party is entitled to the payment of such amount.

 

(ii)           Within five (5) Business Days
after receipt by the Sellers and the Escrow Agent of any Draw-Down Request, the
Sellers or MFFB may deliver to Parent, Buyer and the Escrow Agent a written
objection to all or any part of the Draw-Down Request (“Objection”).

 

(iii)          If, in connection with any Draw-Down
Request, the Sellers fail to deliver an Objection by the end of the fifth (5th)
Business Day following the receipt by the Sellers of a Draw-Down Request, the
Escrow Agent shall pay to the applicable Buyer Indemnified Party out of the
Escrow Account an amount equal to the amount requested in the Draw-Down
Request, in accordance with Section 3(c) of this Agreement.  Any such payment shall be made on or before
the third (3rd) Business Day following the expiration of such five (5) day
period.

 

(iv)          If the Sellers deliver a timely
Objection with respect to all or any portion of a Draw-Down Request, the Escrow
Agent shall not disburse, and shall continue to hold in the Escrow Account, the
amount requested in the Draw-Down Request or the disputed portion thereof, as
the case may be, pending receipt of either (A) written payment
instructions signed by Parent and the Sellers specifying the agreement of the
Parties as to the action to be taken by the Escrow Agent in respect of such
Draw-Down Request (the “Payment Instructions”) or (B) a notice from
Parent and the Sellers stating that such Draw-Down Request has been submitted
to a court of competent jurisdiction for judgment and that a judgment with
respect to such matters has been rendered (“Judgment Notice”) which is
accompanied by a copy of a final, non-appealable order of such court (“Order”),
pursuant to which such court has determined whether and to what extent the
Buyer Indemnified Party is entitled to the amount requested in the Draw-Down
Request. Upon receipt of Payment Instructions or a Judgment Notice, the Escrow
Agent shall thereafter act in accordance with Section 3(b)(v) or Section 3(b)(vi) below,
as applicable.

 

(v)           If the Escrow Agent receives Payment
Instructions indicating that a Buyer Indemnified Party is entitled to payment
in respect of all or any portion of the applicable Draw-Down Request, the
Escrow Agent shall release from the Escrow Account and deliver to such Buyer
Indemnified Party such amount as is indicated by such Payment Instructions in
accordance with Section 3(c) of this Agreement.  The Escrow Agent shall deliver the amounts
due to the Buyer Indemnified Party on or before the fifth (5th) Business Day
following the date on which the Escrow Agent receives such Payment
Instructions.  If the Payment
Instructions indicate that a Buyer Indemnified Party is not entitled to all or
any portion of the amount claimed

 

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in such Draw-Down Request
(“Discharge Notice”), then the Escrow Agent shall (A) deliver to
the Buyer Indemnified Party that portion, if any, of the amount claimed in the
Draw-Down Request to which such Buyer Indemnified Party is entitled, in
accordance with Section 3(c) of this Agreement, and (B) continue
to hold the remaining amount of such Aggregate Escrow Shares and Aggregate Cash
Amount in the Escrow Account in accordance with the terms of this Agreement.

 

(vi)          If the Escrow Agent receives a
Judgment Notice and an Order with respect to any Draw-Down Request, then the
Escrow Agent shall release from the Escrow Account and deliver to the
applicable Buyer Indemnified Party such amount from the Escrow Account equal to
the amount due such Buyer Indemnified Party, as indicated in such Order in accordance
with Section 3(c) of this Agreement. 
The Escrow Agent shall deliver the amounts due to the Buyer Indemnified
Party on or before the fifth (5th) Business Day following the date on which the
Escrow Agent receives such Order.  If
such Order indicates that the applicable Buyer Indemnified Party is not
entitled to all or any portion of the amount claimed in the Draw-Down Request (“Determination
Discharge”), then the Escrow Agent shall (A) deliver to the Buyer
Indemnified Party that portion, if any, of the amount claimed in the Draw-Down
Request to which such Buyer Indemnified Party is entitled, in accordance with Section 3(c) of
this Agreement, and (B) continue to hold the remaining amount of such
Aggregate Escrow Shares and Aggregate Cash Amount in the Escrow Account in
accordance with the terms of this Agreement.

 

(c)   Payments from the Escrow Fund.  The Escrow
Agent shall pay all amounts due under an Adjustment Draw-Down Notice or
Draw-Down Request, determined according to the terms of Section 3(a) and
Section 3(b) of this Agreement, by releasing to the appropriate Buyer
Indemnified Party a portion of the
Escrow Amount with any of the Aggregate Escrow Shares being so released to be
valued for such purposes at the Adjusted Closing Date Reference Price and the
number of the Aggregate Escrow Shares to be so released to be rounded up to the
nearest whole number.  In the event that
there shall not be any Aggregate Cash Sale Proceeds at the time amounts are due
under an Adjustment Draw-Down Notice or Draw-Down Request, then only Aggregate Escrow Shares shall be released unless the
Escrow Account does not contain sufficient Aggregate Escrow Shares to satisfy
an Adjustment Draw-Down Notice or Draw-Down Request, in which case the Escrow Agent shall release to the appropriate
Buyer Indemnified Party all Aggregate Escrow Shares contained in the Escrow
Account, and shall pay the remaining balance in cash from the Aggregate Dividend Amount.  In the event that there shall be Aggregate
Cash Sale Proceeds at the time amounts are due under an Adjustment Draw-Down
Notice or Draw-Down Request, then both Aggregate Escrow Shares and Aggregate
Cash Sale Proceeds shall be released such that the amount of the Aggregate Cash
Sale Proceeds so released shall represent the Cash Proceeds Percentage of the
total amount released.  If the amount
released pursuant to the immediately preceding sentence is not sufficient to
satisfy an Adjustment Draw-Down Notice or Draw-Down Request, then the Escrow Agent
shall release to the appropriate Buyer Indemnified Party a sufficient amount of
the Aggregate Cash Sale Proceeds or the Aggregate Escrow Shares (whichever
remains) to pay the remaining balance. 
If the amount released pursuant to the two immediately preceding
sentences is not sufficient to satisfy an Adjustment Draw-Down Notice or
Draw-Down Request, then the Escrow Agent shall pay to the appropriate Buyer
Indemnified Party the remaining balance in cash from the Aggregate Dividend
Amount.

 

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(d)   Release of Remaining Aggregate Escrow
Shares.  On the date that is nine (9) months
and one day after the Closing Date (the “Release Date”), the Escrow
Agent shall promptly deliver to the Sellers, as instructed in writing by the
Sellers, the Aggregate Escrow Shares and the Aggregate Cash Amount remaining in
the Escrow Account on the Release Date (the “Disbursement Amount”); provided,
however, that if the Escrow Agent shall have received on or before the
Release Date one or more Draw-Down Requests which have not been paid in
accordance with Section 3(c) as of the Release Date and as to which,
on the Release Date, the Escrow Agent has not received and fully acted upon
Payment Instructions or an Order, nor received a Discharge Notice or a
Determination Discharge (any such Draw-Down Request being referred to as an “Outstanding
Claim”) (it being agreed that to the extent that the precise amount of
Damages with respect to any Outstanding Claim is not known prior to the Release
Date, Buyer shall have the right to send the Sellers and the Escrow Agent on or
before the Release Date a (or an updated) Draw-Down Request with respect to
each Outstanding Claim that provides such Parties notice of such Buyer
Indemnified Party’s good faith estimate of the maximum amount of Damages
resulting from such Outstanding Claim) the Escrow Agent shall retain and
continue to hold in accordance with the terms of this Agreement an amount of
Aggregate Escrow Shares and Aggregate Cash Amount equal to the maximum amount
claimed by such Buyer Indemnified Party under all Outstanding Claims (the “Retained
Amount”).  The Escrow Agent shall
deliver to the Sellers, as instructed by the Sellers such amount equal to the
excess, if any, of the Disbursement Amount less the Retained Amount; and
thereafter the Escrow Agent shall release from the Escrow Account all or
portions of the Retained Amount as and when it receives Payment Instructions,
Orders, Discharge Notices or Determination Discharges, as applicable, related
to the Outstanding Claims.  Following the
Release Date, in the event that the Retained Amount at any time exceeds the
maximum amount (based on the most recent Draw-Down Request for each Outstanding
Claim) of all Outstanding Claims, the Escrow Agent shall deliver according to
the Sellers’ instructions, within five (5) Business Days of the Sellers’
written request for such delivery, such amount equal to such excess.

 

(e)   Joint Written Instructions.  Notwithstanding the foregoing, if at any time
the Escrow Agent shall receive joint written instructions executed by the
Sellers and Buyer (“Joint Written Instructions”) to release all or any
portion of the Escrow Amount, then within five (5) Business Days after
receipt of such Joint Written Instructions, the Escrow Agent shall release the
Aggregate Escrow Shares and the Aggregate Cash Amount in accordance with such
Joint Written Instructions.  The Sellers
and Buyer will cooperate in good faith in executing such Joint Written
Instructions wherever reasonably necessary to ensure distributions of the Escrow
Amount to the Party entitled thereto under the terms of the Purchase Agreement.

 

(f)    Written Statements.  As promptly as practicable following the
delivery of any Escrow Amount from the Escrow Account, the Escrow Agent shall
send a written statement to each of the Sellers and Buyer stating the number of
Aggregate Escrow Shares and the amount of Aggregate Cash Amount so delivered
and the amounts of the Aggregate Escrow Shares and the Aggregate Cash Amount
remaining in the Escrow Account as of such date.

 

4.             Conditions to Escrow. 
The Escrow Agent agrees to hold the Aggregate Escrow Shares and the
Aggregate Cash Amount and to perform its responsibilities in accordance with
the terms and provisions of this Agreement. 
The Parties agree that the Escrow Agent shall not assume any
responsibility for the failure of any of Buyer, Parent, or the Sellers to
perform in 

 

7

 

accordance with the
Purchase Agreement or this Agreemepnt. 
The Escrow Agent’s acceptance of its responsibilities hereunder is
subject to the following terms and conditions which shall govern and control
with respect to the Escrow Agent’s rights, duties and liabilities hereunder:

 

(a)   Documents.  The Escrow Agent shall be fully protected and
shall incur no liability (other than as a result of the Escrow Agent’s gross
negligence or willful misconduct), in relying upon and acting upon any written
certification, notice, instruction, direction, request, waiver, consent,
receipt, communication, paper or other document that the Escrow Agent in good
faith believes to be genuine and duly executed and delivered, and shall have no
duty to inquire into or investigate the validity or accuracy of any thereof.

 

(b)   Liability.  The Escrow Agent shall not be liable for
anything which it may do or refrain from doing in connection herewith, except
for its own gross negligence, bad faith or willful misconduct.  In the event that the Escrow Agent shall in
any instance, after seeking the advice of legal counsel pursuant to Section 4(c) of
this Agreement, in good faith be uncertain as to its duties or rights hereunder
or reasonably believe any ambiguity or uncertainty exists hereunder or in any
notice, instruction, direction, request or other communication, paper or
document received by the Escrow Agent hereunder, it shall be entitled to
refrain from taking any action to which such ambiguity or uncertainty relates
and shall be fully protected and shall not be liable in any way to Buyer,
Parent, the Sellers or any other Person for refraining from taking such action,
and its sole obligation, in addition to those of its duties hereunder as to
which there is no such ambiguity or uncertainty and which are not impacted by
such ambiguity or uncertainty, shall be to keep safe all property held in the
Escrow Account until it shall be directed otherwise in writing by Buyer and the
Sellers or by a final, nonappealable order of a court of competent
jurisdiction; provided, however, in the event that the Escrow
Agent has not received such written direction or court order within 180 days
after requesting the same, it shall have the right to interplead Buyer and the
Sellers in any court of competent jurisdiction and request that such court
determine its rights and duties hereunder.

 

(c)   Legal Counsel.  The Escrow Agent may seek the advice of legal
counsel selected with reasonable care, including in the event of any
conflicting or inconsistent claims or demands being made in connection with the
subject matter of this Agreement or any dispute or question as to the
construction of any of the provisions of this Agreement or its duties
hereunder, and it shall incur no liability and shall be fully protected in
respect of any action taken, omitted or suffered by it in good faith in
accordance with the written advice of such counsel.

 

(d)   Limitation of Duties.  The Escrow Agent shall have no duties except
those which are expressly set forth herein and it shall not be bound by any
agreement of any other Party (whether or not it has any knowledge thereof).  IN NO EVENT SHALL THE ESCROW AGENT BE LIABLE,
DIRECTLY OR INDIRECTLY, FOR ANY SPECIAL, INDIRECT OR CONSEQUENTIAL LOSSES OR
DAMAGES OF ANY KIND WHATSOEVER (INCLUDING BUT NOT LIMITED TO LOST PROFITS),
EVEN IF THE ESCROW AGENT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH LOSSES OR
DAMAGES AND REGARDLESS OF THE FORM OF ACTION.

 

(e)   Resignation or Termination of Escrow Agent.  The Escrow Agent is entitled to resign at any
time by delivering not less than thirty (30) days’ advance written notice of
such

 

8

 

resignation to Buyer,
Parent and the Sellers, which notice shall specify the proposed effective date
of resignation.  Buyer and the Sellers
are entitled to terminate the services of the Escrow Agent at any time by delivering
not less than thirty (30) days’ advance written notice (with such written
notice being signed by Buyer and the Sellers) of such termination to the Escrow
Agent, which notice shall specify the effective date of termination.  Within thirty (30) days after receiving or
delivering the aforesaid notice, as the case may be, Buyer and the Sellers
shall jointly appoint a successor escrow agent. 
The Escrow Agent’s resignation shall not be effective until (i) such
appointment has been made, (ii) the  Aggregate Escrow Shares and the
Aggregate Cash Amount have been delivered to the successor escrow agent, and (iii) the
successor’s acceptance of this Agreement and receipt of the  Aggregate
Escrow Shares and the Aggregate Cash Amount from the successor escrow agent
and copies thereof shall have been sent to Buyer and the Sellers.  The Escrow Agent may petition a court of
competent jurisdiction to appoint a successor escrow agent if Buyer and the
Sellers do not designate one within sixty (60) days of receipt of such
resignation from the Escrow Agent.

 

(f)    Discharge of Escrow Agent.  Upon the delivery of all of the Aggregate
Escrow Shares and the Aggregate Cash Amount pursuant to the terms of Section 3
above or to a successor escrow agent, the Escrow Agent shall thereafter be
discharged from any further obligations hereunder.  The Escrow Agent is hereby authorized, in any
and all events, to comply with and obey any and all final judgments, orders and
decrees of any court of competent jurisdiction which may be filed, entered or
issued, and all final arbitration awards and, if it shall so comply or obey, it
shall not be liable to any other Person by reason of such compliance or
obedience.

 

5.             Indemnification and Fees of the
Escrow Agent.  In consideration of its acceptance of the
appointment as Escrow Agent, Buyer and the Sellers shall each indemnify and
hold the Escrow Agent harmless as to fifty percent (50%) of any loss,
liability, cost or expense incurred without gross negligence, bad faith or
willful misconduct by the Escrow Agent to any Person by reason of its having
accepted the same or in carrying out any of the terms hereof.  Buyer and the Sellers shall each reimburse
the Escrow Agent on request for fifty percent (50%) of its reasonable attorneys’
fees and for other reasonable costs and expenses it incurs in connection with
carrying out its duties hereunder, including such amounts as set forth on the
Escrow Agent Schedule of Fees.  In
consideration of the Escrow Agent’s duties hereunder, the Escrow Agent is
entitled to a fee in an amount set forth on Schedule I (the “Escrow
Fee”), with such fee payable fifty percent (50%) by Buyer and fifty percent
(50%) by the Sellers.  Any amounts
payable by the Sellers under this Section 5 (including any indemnification
obligations, the Escrow Fee and any other fees or expenses) shall be payable
directly by MFFB, on behalf of the Sellers.

 

6.             Notices.  All notices and other communications required or
permitted pursuant to this Agreement shall be in writing and be deemed duly
given when delivered personally (which shall include delivery by Federal
Express or other nationally recognized, reputable overnight courier service
that issues a receipt or other confirmation of delivery) to the Party for whom
such communication is intended, or three (3) Business Days after the date
mailed by certified mail, return receipt requested, postage prepaid, as
follows:

 

9

 

If to the Sellers:

 

Mrs. Fields Famous Brands, LLC

2855 East Cottonwood Parkway, Suite 400

Salt Lake City, UT  84121

Attn:    Michael Ward, EVP and General Counsel

Fax:     (801) 736-5944

 

If to Parent or Buyer:

 

NexCen Brands, Inc.

1330 Avenue of the Americas, 34th Floor

New York, NY  10019

Attn:    Sue J. Nam, General Counsel

Fax:      (212) 247-7132

 

with a copy to:

 

Kirkland & Ellis LLP

655 Fifteenth Street NW

Washington, DC  20005

Attn:    Mark D. Director, Esq.

Fax:     (202) 879-5200

 

If to the Escrow Agent:

 

Wilmington Trust Company

Rodney Square North

1100 N. Market Street

Wilmington, DE  19890

Attention:         David
B. Young, Assistant Vice President

Fax:     (302) 636-4149

 

or to
such other address as such Party shall specify by written notice to the other
Parties. Any notice sent to the Escrow Agent shall also be sent to the other
Parties to this Agreement.

 

7.             Entire Agreement;
Amendments.  This Agreement, together with the Purchase
Agreement, the Registration Rights Agreement and the Voting Agreement, contains
the entire understanding of the Parties with respect to the subject matter
hereof and supersedes any prior understandings or agreements by or among the
Parties, whether written or oral, which may have related to the subject matter
hereof in any way.  This Agreement may be
amended, or any provision of this Agreement may be waived, so long as such
amendment or waiver is set forth in a writing executed by Buyer and the Sellers
(a copy of which shall be promptly provided by Buyer to the Escrow Agent); provided
that if any such amendment or waiver would in any way affect the Escrow Agent’s
obligations or duties under this Agreement, the written consent of the Escrow
Agent shall be required in addition to the written consent of Buyer and the
Sellers.  No course of dealing between or
among the Parties hereto shall be deemed effective to modify, 

 

10

 

amend or discharge any
part of this Agreement or any rights or obligations of any Party under or by
reason of this Agreement.

 

8.             Assigns and Assignment. 
This Agreement and all actions taken hereunder shall inure to the
benefit of and shall be binding upon all of the Parties and upon all of their
respective successors and assigns; provided that (a) no assignment
of the interest of any other Party shall be binding upon the Escrow Agent unless
and until written notice of such assignment shall be filed with and
acknowledged by the Escrow Agent and (b) the Escrow Agent shall not be
permitted to assign its obligations hereunder except as provided in Section 4(e) above
and Section 17 below.

 

9.             No Other Third Party
Beneficiaries.  Other than as provided in Section 18,
nothing herein expressed or implied is intended or shall be construed to confer
upon or to give any Person other than the Escrow Agent, Buyer, the Buyer
Indemnified Parties, and the Sellers and their permitted assigns any rights or
remedies under or by reason of this Agreement.

 

10.          Interpretation. 
The headings in this Agreement are inserted for convenience of reference
only and shall not be a part of or control or affect the meaning hereof.

 

11.          No Waiver. 
No failure or delay by a Party hereto in exercising any right, power or
privilege hereunder shall operate as a waiver thereof, and no single or partial
exercise thereof shall preclude any right of further exercise or the exercise
of any other right, power or privilege. 
The right of Buyer and the Sellers to receive all or any portion of the
Aggregate Escrow Shares or the Aggregate Cash Amount under the circumstances
described in Section 3 above is in addition to, and not in lieu of, any
other remedies that any such Party may have against another Party pursuant to
the Purchase Agreement or in the event of a breach of the Purchase Agreement.

 

12.          Severability. 
The Parties agree that (a) the provisions of this Agreement shall
be severable in the event that for any reason whatsoever the provisions hereof
are invalid, void or otherwise unenforceable, (b) such invalid, void or
otherwise unenforceable provisions shall be automatically replaced by other
provisions which are as similar as possible in terms to such invalid, void or
otherwise unenforceable provisions, but are valid and enforceable, and (c) the
remaining provisions shall remain enforceable to the fullest extent permitted
by law.

 

13.          No Strict Construction. 
The language used in this Agreement shall be deemed to be the language
chosen by the Parties hereto to express their collective mutual intent, and no rule of
strict construction shall be applied against any person.  The term “including” as used herein shall be
by way of example, and shall not be deemed to constitute a limitation of any
term or provision contained herein.  Each
defined term used in this Agreement has a comparable meaning when used in its
plural or singular form.

 

14.          Releases on Non-Business Days. 
In the event that a release from the Escrow Account hereunder is
required to be made on a date that is not a Business Day, such release may be
made on the next succeeding Business Day with the same force and effect as if
made when required.

 

15.          Governing Law; Jurisdiction. 
This Agreement, and the rights of the Parties under this Agreement,
shall be governed by and construed in accordance with the laws of the State of
Delaware.

 

11

 

16.          Counterparts. 
This Agreement may be executed by the Parties individually or in any
combination, in one or more counterparts (including by means of telecopied
signature pages), each of which shall be an original and all of which shall
together constitute one and the same agreement.

 

17.          Successor Escrow Agent Entity. Any banking association or corporation
into which the Escrow Agent may be merged, converted or with which the Escrow
Agent may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Escrow Agent shall be a party, or any
banking association or corporation to which all or substantially all of the
corporate trust or escrow business of the Escrow Agent shall be sold or
otherwise transferred, shall succeed to all the Escrow Agent’s rights,
obligations and immunities hereunder without the execution or filing of any
paper or any further act on the part of any of the Parties, anything herein to
the contrary notwithstanding.

 

18.          Pledge Under the Indenture and
Collateral Agreements.  Notwithstanding any other provision
herein to the contrary, the Parties acknowledge and agree that the Sellers are
assigning their rights under this Agreement as collateral under the Indenture
and the related Collateral Agreements (as defined in the Indenture).

 

[SIGNATURE
PAGE FOLLOWS]

 

12

 

To evidence their
agreement, the Parties have caused this Agreement to be executed on the date
first written above.

 

 

	
   

  	
  NEXCEN ASSET ACQUISITION, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: NexCen Brands, Inc., its Managing Member

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert D’Loren

  	
   

  
	
   

  	
  Title:

  	
  President and Chief
  Executive Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NEXCEN BRANDS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert D’Loren

  	
   

  
	
   

  	
  Title:

  	
  President and
  Chief Executive Officer

  	
   

  

 

Signature Page to Asset Purchase
Agreement

 

 

	
   

  	
  GREAT
  AMERICAN COOKIE COMPANY 

  FRANCHISING, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael Ward

  	
   

  
	
  :

  	
   

  	
  Name

  	
  Michael Ward

  
	
   

  	
   

  	
  Title:

  	
  Executive VP,
  Chief Legal Officer 

  
	
   

  	
   

  	
  and Secretary

  
	
   

  	
   

  
	
   

  	
  GREAT
  AMERICAN MANUFACTURING, 

  LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael Ward

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Michael Ward

  
	
   

  	
   

  	
  Title:

  	
  Executive VP,
  Chief Legal Officer 

  
	
   

  	
   

  	
  and Secretary

  
					

 

Signature Page to Escrow
Agreement

 

 

	
   

  	
  WILMINGTON
  TRUST COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David B.
  Young

  	
   

  
	
   

  	
   

  	
  Name: David
  B. Young

  
	
   

  	
   

  	
  Title:  Assistant
  Vice President

  

 

Signature Page to Escrow Agreement

 

 

Annex A

 

7.8  Restrictions
on Sale of Parent Shares.  During the six
(6) month period following the Closing Date (such period herein referred
to as the “Initial Period”), neither Seller shall, directly or indirectly,
through an “affiliate” or “associate” (as such terms are defined in the General
Rules and Regulations under the Securities Act), or otherwise, offer,
sell, pledge, hypothecate, grant an option for sale, or otherwise dispose of,
or transfer or grant any rights with respect thereto in any manner either
privately or publicly (each, a “Transfer”) any of the Parent Shares or Shares
of the Parent acquired by the Sellers pursuant to a stock split, stock
dividend, reverse stock split, subdivision, combination, reclassification or
similar change in the capital structure of Parent (each an “Adjustment”)
affecting Parent Shares (together with the Parent Shares, “Securities”), or
enter into any agreement or any transaction that has the effect of
transferring, in whole or in part, directly or indirectly, the economic
consequence of ownership of the Securities, whether any such agreement or
transaction is to be settled by delivery of the Securities; provided, however,
that the Sellers may pledge their rights in the Parent Shares in accordance
with the Indenture.  Following the
Initial Period, the restrictions on Transfer provided for in this Section 7.8
shall lapse with respect to 25% of the number of Parent Shares owned by the
Sellers in the aggregate (taking into account and proportionally adjusting for
any Adjustments occurring during such period) and the Sellers may Transfer such
Parent Shares, in open market transactions without restriction.  On the first day of each of the first three
consecutive three month periods following the six month anniversary of the
Closing Date, the restrictions on Transfer provided for in this Section 7.8
shall lapse with respect to 25% of the aggregate number of Parent Shares paid
to the Sellers at Closing, (taking into account and proportionally adjusting
for any Adjustments occurring during such period) and the Sellers may Transfer
such Parent Shares, in open market transactions without restriction, subject to
an effective Registration Statement (as defined in Section 7.9) covering
such Parent Shares or an available exemption from registration.

 

 

Schedule I

 

Escrow Agent Schedule of Fees

 

Note:

 

Subject
to a legal and administrative review of the governing documents and acceptable
indemnification for our fees and expenses from a creditworthy entity.  Out of pocket expenses (including outside
counsel’s fees and expenses in connection with the closing and in connection
with any post-closing matters) are additional and are billed separately within
30 days from closing.  Wilmington Trust
requests that whenever possible, the initial fee and the first year’s Annual
Administration Fee be paid on the closing date by wire transfer per the
following wire transfer instructions: 
Wilmington Trust Company, Wilmington, Delaware; ABA No. 031100092;    for credit to the account of Nexcen/GACCF/GAM
Escrow; Account No.  084584-000; Attn: 
David Young; Ref:  Escrow Agent’s
Fee and Expenses.  Thereafter, the Annual
Administration Fee is due and payable annually in advance on each anniversary
of the closing date. Transaction Fees are due and payable annually in
arrears.  All fees are non- refundable
and will not be prorated in the event of an early termination of the
Trust.  In the event that the transaction
does not close Wilmington Trust reserves the right to be paid its Initial
Fee.  All fees quoted are guaranteed for
a period of 90 days.

 

	
  Annual Administration Fee

  	
   

  	
  $

  	
  3,500.00

  	
   

  

 

Covers
acceptance of appointment as Escrow Agent including complete study of drafts of
Escrow Agreement and all supporting documents in connection therewith, conferences
until final Agreement is agreed upon, execution of final Agreement and
administrative duties in connection with the security provisions of the
Agreement.

 

Transaction Fees

 

	
  A)
  Purchase, sale, withdrawal, maturities calls and puts of domestic securities

  	
   

  	
  $

  	
  15.00

  	
   

  
	
  B)
  Physical delivery of domestic securities

  	
   

  	
  $

  	
  50.00

  	
   

  
	
  C)
  Purchase of Eurodollar certificate of deposit

  	
   

  	
  $

  	
  65.00

  	
   

  
	
  D)
  Principal amortizing securities (per pool/per month)

  	
   

  	
  $

  	
  10.00

  	
   

  
	
  E)
  Check Issuance Fee (per check issued and mailed)

  	
   

  	
  $

  	
  15.00

  	
   

  
	
  F)
  Wire Charge (per transfer)

  	
   

  	
   

  	
   

  
	
  Outgoing**

  	
   

  	
  $

  	
  25.00

  	
   

  
	
  Incoming
  **

  	
   

  	
  $

  	
  10.00

  	
   

  
	
  G)
  For each Form 1099

  	
   

  	
  $

  	
  1.50Exhibit 10.3

  
	
   

  
	
  Execution Copy

  

 

SETTLEMENT AND RELEASE AGREEMENT

 

THIS
SETTLEMENT AND RELEASE AGREEMENT, is dated as of January 29, 2008 (this “Agreement”),
by and among NexCen Brands, Inc., a Delaware corporation (“NexCen”),
Great American Cookie Company Franchising, LLC, a Delaware limited liability
company (“GACCF”), Mrs. Fields Famous Brands, LLC, a Delaware
limited liability company (“MFFB”), Mrs. Fields’ Original Cookies, Inc.,
a Delaware corporation (“MFOC”), each of the Franchisees that is a
signatory hereto and listed as an “Accredited Franchisee” on Schedule I hereto
(each an “Accredited Franchisee,” and collectively, the “Accredited
Franchisees”), each of the other Franchisees that is a signatory hereto and
listed as an “Other Franchisee” on Schedule I hereto (each an “Other
Franchisee,” and collectively, the “Other Franchisees,” and
collectively with the Accredited Franchisees, the “Franchisees”), and
each Franchisee Principal that is signatory hereto and listed on Schedule I
hereto (each a “Franchisee Principal,” and collectively, the “Franchisee
Principals”).  Capitalized terms used
in these recitals without definition shall have the meanings set forth in Section 1
below.

 

WHEREAS, each
of the Franchisees, MFOC, Capricorn Investors II, L.P., a Delaware limited
partnership (“Capricorn”), Great American Cookie Company, Inc., a
Delaware corporation (“GACC”), Cookies USA, Inc., a Delaware corporation (“Cookies
USA”), are parties to or eligible under the terms of certain Settlement
Agreement and Releases each dated June 1998 (the “1998 Settlement
Agreements”), pursuant to which the parties thereto agreed to settle
certain claims and make certain undertakings as set forth therein;

 

WHEREAS, MFFB,
NexCen, NexCen Asset Acquisition, LLC, NexCen Fixed Asset Company, LLC, GACCF,
and Great American Manufacturing, LLC, will enter into an Asset Purchase
Agreement dated as of even date herewith (the “Asset Purchase Agreement”),
pursuant to which, inter alia,
GACCF will sell to NexCen or its Affiliates, and NexCen or its Affiliates will
acquire from GACCF, certain assets owned or used by GACCF in the GAC Franchise,
including the GAC Brands (the “Transaction”);

 

NOW,
THEREFORE, in consideration of the representations, warranties, covenants and
agreements set forth in this Agreement, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto hereby agree as follows:

 

1.             Definitions.  For the purposes of this Agreement, the
following terms and variations thereof have the meanings specified or referred
to in this Section 1:

 

“Affiliate” of any
Person means any Person which, directly or indirectly controls or is controlled
by that Person, or is under common control with that Person.  For the purposes of this definition, “control”
(including, with correlative meaning, the terms “controlled by” and “under
common control with”), as used with respect to any Person, shall mean the
possession, directly or indirectly of the power to direct or cause the
direction of the management and policies of such Person, whether through
ownership of voting securities or by contract or otherwise.

 

“Brands” means the “Great
American Cookies,” “Great American Chocolate Chip Cookie Company,” “MaggieMoo’s,”
“Marble Slab,” “Pretzel Time,” and “Pretzelmaker,” and all other quick service
restaurant franchising brands owned or in use by NexCen, whether such Brand is
owned or used by NexCen prior to, on or after the Closing Date.

 

“Closing” means the
closing of the acquisition by NexCen or its Affiliates of those assets owned or
used by GACCF in the GAC Franchise described in and pursuant to the Asset
Purchase Agreement.

 

“Closing Date” shall
mean the date on which the Closing occurs.

 

 

“Contract” means any
contract, license, sublicense, franchise, permit, mortgage, purchase orders,
indenture, loan agreement, note, lease, sublease, agreement, obligation,
commitment, understanding, instrument or other arrangement or any commitment to
enter into any of the foregoing (in each case, whether written or oral).

 

“Franchise”  means the grant by NexCen or its Affiliate to a Franchisee
or Franchisee Principal of the rights to establish and operate a location using
the Brands or outlet thereof including subfranchise agreements, master
development agreements, area representative agreements, area development
agreements, master franchise agreements, development agreements, license
agreements, and any other similar agreements, together with all ancillary
agreements related thereto.

 

“Franchise Agreements”
means any Contract (and any written or oral amendment or modification thereto)
between NexCen or any of its Affiliates and a Franchisee or Franchisee
Principal, as the case may be, pertaining to and evidencing the grant of a
Franchise.

 

“Franchise Credit”
has the meaning set forth in Section 4(c).

 

“Franchisee Account”
means the account designated by each Franchisee at least three (3) Business
Days prior to the Closing Date.

 

“GAC Brands” means
the “Great American Cookies” and “Great American Chocolate Chip Cookie Company”
brands.

 

“GACC Association”
means the Association of GACC Franchisees, Inc.

 

“GAC Franchise Agreement”
means any Contract (and written or oral amendment or modification thereto)
between GACCF or NexCen or their respective Affiliate, as a party and as the
case may be, and a Franchisee or Franchise Principal, as a counter-party and as
the case may be, pertaining to and evidencing the grant of a GAC Franchise.

 

“GAC Franchise” means
the grant by GACCF or NexCen or their respective Affiliate, as applicable, to a
franchisee of the rights to establish and operate a location using the GAC
Brands or outlet thereof including subfranchise agreements, master development
agreements, area representative agreements, area development agreements, master
franchise agreements, development agreements, license agreements, and any other
similar agreements, together with all ancillary agreements related thereto.

 

“Increased Royalty
Payment” has the meaning set forth in Section 6.

 

“Initial Franchise Fees”
means, in the aggregate, the nonrecurring initial franchise fees payable
pursuant to any Franchise Agreements.

 

“Marks” has the
meaning set forth in Section 5(d).

 

“New Franchise Agreement”
means any Franchise Agreement entered into after the date hereof between NexCen
or its Affiliate and a Franchisee, Franchisee Principal or its designee to open
a new Franchise location.

 

“Payment Date” has
the meaning set forth in Section 6.

 

2

 

“Person” means an
individual, partnership, corporation, business trust, limited liability
company, limited liability partnership, joint stock company, trust,
unincorporated association, joint venture or other entity or a government
authority.

 

“Products” has the
meaning set forth in Section 5(d).

 

“Pro Rata Share”
means, for each Franchisee, the cash amount or number of Warrants, as
applicable, set forth opposite such Franchisee’s name on Schedule I hereto.

 

“Purchaser Representative”
has the meaning set forth in Rule 501(h) of Regulation D
promulgated under the Securities Act.

 

“Release Consideration”  has the meaning set forth in Section 4.

 

“Royalty Payment” for
each Franchisee, means the amount set forth next to such Franchisee’s name on
Schedule I hereto.

 

“Securities Act”
shall mean the Securities Act of 1933, as amended and in effect from time to
time.

 

“Tag-Along Rights”
means the rights of each Franchisee under Section 2 of the 1998 Settlement
Agreements.

 

“Undertakings” has
the meaning set forth in Section 5.

 

“Warrant” means a Stock
Purchase Warrant substantially in the form attached hereto as Exhibit A.

 

2.             Acquisition of Tag-Along Rights.  Immediately prior to and subject to the
completion of the Closing, in connection with the Transaction pursuant to the
Asset Purchase Agreement, MFFB will acquire from each Franchisee, and each
Franchisee will transfer to MFFB, all of such Franchisee’s Tag-Along Rights
(the “Acquired Tag-Along Rights”). 
MFFB shall immediately, upon and subject to the Closing, convey all of
the Acquired Tag-Along Rights to NexCen. 
NexCen will then terminate such Acquired Tag-Along Rights and such
rights will no longer be of any force and effect.

 

3.             Release.

 

(a)           (i) In addition to the
acquisition of the Acquired Tag-Along Rights pursuant to Section 2 of this
Agreement and subject to the Closing occurring, and in consideration of the
Undertakings and payment of the Release Consideration, each Franchisee and each
Franchisee Principal, on behalf of themselves, any predecessor or other past,
current or future direct or indirect investors in or directors, officers and
employees of the Franchisee and each such person’s successors and assigns
(collectively with each Franchisee and the Franchisee Principal, the “Releasor
Group”) hereby agrees, upon the Closing, to release any and all rights,
causes and actions, whether or not known or anticipated, that any member of the
Releasor Group may have, directly or indirectly, against NexCen, Mrs. Fields,
Capricorn, Cookies USA, or GACC and any of their respective past, current or
future direct or indirect investors, lenders, affiliates, directors, officers
or employees or any such person’s successors and assigns (collectively, the “Releasees”)
arising out of or otherwise relating to, directly or indirectly, the 1998
Settlement Agreements, including but not limited to any rights that may be
associated with the Tag-Along Rights that are not otherwise acquired by MFFB
pursuant to Section 2 of this Agreement. 
Each member of the Releasor Group further agrees and acknowledges that,
upon the Closing, the 1998 Settlement Agreements will terminate and be of no
further force and effect and any and all rights of the Releasor Group
thereunder shall be extinguished; and

 

3

 

(ii) In
consideration of the various undertakings reflected in this Agreement, the GACC
Association, on the one hand, and, on the other hand, NexCen, GAACF, MFFB,
MFOC, each Franchisee and Franchisee Principal, and in respect to all such
parties and each of their respective affiliates, successors and assigns, each
of their respective officers, directors, agents, employees and members, do
hereby release and forever discharge any and all rights, claims, causes and
actions, whether or not known or anticipated, which any of them has or may
have, directly or indirectly, against any or all of the rest of them, as of the
Closing Date, arising out of, relating to, or in connection with any matter,
undertaking or transaction described in this Agreement.

 

(b)           The members of the Releasor Group
understand and agree that this Section 3 is a full and final release
applicable to all unknown and unanticipated claims, as well as those known or
disclosed, and in consideration of and as an inducement for the Undertakings
and payment of the Release Consideration, the members of the Releasor Group
hereby expressly waive all rights or benefits which they now have or may in the
future have against any of the Releasees under the provisions of Section 1542
of the California Civil Code, which section provides that “a general release
does not extend to claims which the creditor does not know or suspect to exist
in his favor at the time of executing the release, which if known to him must
have materially affected his settlement with the debtor”, or of provisions of
similar import under the laws of other jurisdictions.

 

4.             Release Consideration.  As consideration for the acquisition of the
Acquired Tag-Along Rights pursuant to Section 2 of this Agreement and the
release provided in Section 3 and subject to the Closing occurring, each
of MFFB or NexCen, as applicable, shall pay each Franchisee the amounts set
forth below (the “Release Consideration”):

 

(a)           Within three (3) Business Days
following the Closing Date, MFFB shall pay to each Franchisee, by wire transfer
of immediately available funds to each applicable Franchisee Account, such
Franchisee’s Pro Rata Share of Six Million Seven Hundred Thousand Dollars
($6,700,000);

 

(b)           Within five (5) Business Days
following the Closing Date, NexCen shall deliver to each Franchisee a Warrant
representing such Franchisee’s Pro Rata Share of Three Hundred Thousand
(300,000) shares of NexCen common stock; provided, that NexCen shall not
be obligated to issue any Warrant to any Person who has not completed an
accredited investor questionnaire; and

 

(c)           Following the Closing Date, NexCen
shall credit each Franchisee who elects to enter into a New Franchise Agreement
with NexCen its Pro Rata Share of One Million Dollars ($1,000,000) towards any
Initial Franchise Fees payable under such New Franchise Agreement, on one or
more New Franchise Agreements, until such Pro Rata Share is exhausted (“Franchise
Credit”), which, if permitted by applicable law, Franchise Credit may be
transferred by such Franchisee, subject to NexCen’s prior written approval,
which shall not be unreasonably refused, conditioned, or delayed if such
transferee meets NexCen’s franchisee criteria applicable to such Franchise; provided,
however, that the Franchise Credit shall not reduce the Initial
Franchise Fee payable under any New Franchise Agreement to less than One
Thousand Dollars ($1,000); provided, further, that the Franchise
Credits shall expire, if not otherwise used, on the two (2) year
anniversary of the Closing Date.

 

5.             NexCen Undertakings.  NexCen hereby agrees, subject to and
following the Closing Date, for the benefit of each Franchisee as follows (each
an “Undertaking,” and collectively, the “Undertakings”):

 

(a)           NexCen will agree to maintain product
and development support and marketing expenses for the Products consistent with
the average level of expenditure in calendar years 2001, 2002, 2003, 2004 and
2005.  Notwithstanding the foregoing, if
marketing fund contributions are lower than average

 

4

 

expenditures
in calendar years 2001, 2002, 2003, 2004 and 2005, and/or the total
number of GACCF units decrease, then marketing expenditures may be adjusted
proportionately.

 

(b)           NexCen will provide the GACC
Association (1) timely notice of any material change proposed by NexCen or
its Affiliates to the GAC Franchise Agreement and (2) the opportunity to
consult with NexCen or its Affiliates, as applicable, regarding such
change.  NexCen or its Affiliate, as
applicable, will consider, in good faith, all comments made by the GACC
Association regarding proposed changes to the GAC Franchise Agreement.

 

(c)           Provided that the GACC Association
continues to represent a majority of the GAC Brands’ franchise stores and its
board of directors is elected through democratic procedures, NexCen or its
Affiliates, as applicable, will (1) recognize the GACC Association, and (2) provide
the GACC Association with notice of all material matters directly affecting the
GAC Franchise and the opportunity to consult with NexCen regarding such
matters.  NexCen will consider, in good
faith, all comments made by the GACC Association regarding such matters.

 

(d)           The parties’ shared intent is to
preserve the “Great American” brand and system as a discrete and competitive
system, whether as stand-alone “Great American” outlets or as co-branded
outlets with one or more other brands approved by NexCen.  Therefore, NexCen or its Affiliate, as
applicable, agrees to maintain the primary GACC products (the “Products”)
and primary marks and designs associated with the GAC Brands (the “Marks”)
for three (3) years following the Closing (the “Brand Maintenance
Period”).  After the Brand
Maintenance Period, NexCen or its Affiliate, as applicable, agrees to maintain
the Products and Marks, unless NexCen or its Affiliate, as applicable, (i) determines
in good faith that changes to the Products and/or the Marks are necessary in
order to satisfy then-current market demands; (ii) proposes to sell or
otherwise transfer, in a single transaction or series of transactions, to an
unaffiliated party all, or substantially all, of the rights related to the GAC
Franchise, including the Products and/or Marks; or (iii) obtains the
approval of any changes to the Products and/or Marks from either (A) the
GACC Association or (B) the owners of a majority of franchised Great
American Cookie outlets; provided, that NexCen and the GACC Association
agree to meet and discuss in good faith any proposed change to the Products
and/or the Marks as set forth in Section 5(d)(i) or Section 5(d)(iii) above;
provided, further, that, after the Brand Maintenance Period,
NexCen or its Affiliate, as applicable, will use their good faith efforts to
provide the GACC Association with ninety (90) days notice prior to any change
to the Products and/or Marks. 
Notwithstanding anything to the contrary, NexCen agrees to meet in good
faith with the Executive Committee of the GACC Association to discuss any
disposition of the GAC Franchise pursuant to Section 5(d)(ii) above; provided,
that each member of the Executive Committee of the GACC Association enter into
a non-disclosure agreement reasonably satisfactory to NexCen prior to any
meetings; provided, further, that NexCen shall not be required to
meet with the Executive Committee of the GACC Association if NexCen is advised
by counsel that such meeting would breach any obligation or applicable law or
other directive to which NexCen is subject.

 

(e)           The
profit margin for the batter facility that will be provided to each Franchisee
by NexCen or its Affiliates for use in the GAC Franchise will remain at forty
percent (40%) or less for the two (2) years following the Closing.  For purposes of the foregoing, it is agreed
that costs taken into account shall consist of only ingredients, utilities,
labor and other direct or indirect costs. 
The compliance of NexCen or its Affiliates, as applicable, with this Section 5(e) will
be subject to verification, upon at least sixty (60) days prior written request
by the GACC Association, by NexCen’s independent auditors in connection with
their annual audit of NexCen’s financial statements.

 

(f)            Notwithstanding anything set forth
in Section 9 of the Warrant, the Company shall use its reasonable good
faith efforts to effect the registration of the Warrant Shares (as defined in
the Warrant)

 

5

 

on the
Registration Statement on Form S-3 that will be filed in connection with
certain shares of NexCen being offered to the sellers under the Asset Purchase
Agreement.

 

6.             Franchisee Undertakings.  Notwithstanding anything set forth in any GAC
Franchise Agreement, each Franchisee agrees that on the tenth day of each month
following the Closing Date (each a “Payment Date”) until the sixtieth
(60th) month following the Closing Date, each Franchisee shall pay
to NexCen or its Affiliates, an increased royalty payment under each GAC
Franchise Agreement (each, an “Increased Royalty Payment”).  The Increased Royalty Payment shall be
payable by each Franchisee on each Payment Date, by electronic funds transfer
which will be drafted by NexCen along with the monthly royalty fee then due,
and the amount due from each Franchisee on each Payment Date shall equal
one-sixtieth (1/60) of such Franchisee’s Royalty Payment received by such
Franchisee.  Notwithstanding anything to
the contrary set forth herein or in any GAC Franchise Agreement, if a
Franchisee ceases to be a party to a GAC Franchise Agreement in effect as of
the date hereof, such Franchisee shall immediately pay NexCen an amount equal
to the difference between (x) such Franchisee’s Royalty Payment in respect
to such GAC Franchise Agreement minus (y) any
Increased Royalty Payments previously made by such Franchisee under this Section 6
in respect to such GAC Franchise Agreement.

 

7.             Franchisee Representations and
Warranties.

 

(a)           Each Franchisee and each Franchisee
Principal hereby represents and warrants that (i) this Agreement has been
approved by all necessary action required to make it a valid and binding
obligation of such Franchisee, such Franchisee Principal and all the other
members of the Releasor Group, as the case may be, (ii) this Agreement is
the valid, binding and legal obligation of such Franchisee, such Franchisee
Principal and all other members of the Releasor Group, as the case may be, (iii) such
Franchisee or Franchisee Principal, as the case may be, is acquiring the
Warrants solely for its own account for investment purposes and not with a view
to the distribution thereof.

 

(b)           Each Franchisee, either alone or
together with its respective Purchaser Representative, has received certain
information, including but not limited to the Settlement and Release Disclosure
Package and Memorandum dated December 13, 2007, concerning NexCen and has
had the opportunity to obtain additional information and ask any questions it
has desired in order to evaluate the merits and risks inherent in receiving the
Warrants.

 

(c)           No Franchisee was offered or sold the
Warrants directly or indirectly, by means of any form of general advertising or
general solicitation, including, but not limited to (i) any advertisement,
article, notice, or other communication published in a newspaper, magazine, or
similar medium of communication or broadcast over television or radio; or (ii) to
the knowledge of such Franchisee, any seminar or meeting whose attendees have
been invited by any general solicitation or general advertising.

 

(d)           Each Franchisee (i) can bear the
economic risk of the investment in the Warrants, including the total loss of
such Franchisee’s investment; (ii) has such knowledge and experience in
business and financial matters as to be capable of evaluating the merits and
risks of an investment in the Warrants; and (iii) understands the
non-liquid nature of an investment in the Warrants.  Each Franchisee acknowledges and understands
that the Warrants are a speculative investment that involve a high degree of
risk and there can be no guarantee of the amount or type of profit, if any, to
be realized as a result of an investment in the Warrants.

 

(e)           Each Franchisee acknowledges that
NexCen is relying on exemptions from the registration requirements of the
Securities Act and afforded by applicable state statutes and regulations.  Each Franchisee understands that the Warrants
will not be registered under the Securities Act or the securities laws of any
state and are subject to restrictions on transfer.

 

6

 

(f)            No Franchisee that is a corporation,
partnership or other entity was organized for the specific purpose of acquiring
the Warrants.

 

(g)           Each Accredited Franchisee represents
and warrants that it is an “accredited investor,” as defined in Regulation D
promulgated under the Securities Act.

 

8.             Purchaser Representative.  Each Other Franchisee hereby represents and
warrants that it has irrevocably designated and appointed the person set forth
opposite such Other Franchisee’s name on Schedule II hereto as its Purchaser
Representative.  Each Other Franchisee
intends to rely on its respective Purchaser Representative to assist the
undersigned in evaluating the risks and merits of an investment in the
Warrants.

 

9.             Miscellaneous.  This Agreement may be executed in one or more
counterparts, may not be changed orally and is made and shall be governed by
and construed in all respects in accordance with the laws of the State of
Delaware, without regard to the principles of conflicts of laws thereof which
might refer such interpretation to the laws of a different state or
jurisdiction.  This Agreement benefits
and binds the parties hereto and, subject to Section 4, their respective
successors and assigns.  Notices
hereunder shall be in writing and addressed to the address indicated below or
to such other address as the intended recipient has specified in writing, and
(assuming actual receipt) are deemed given when delivered in person, one
business day after being sent by telecopier or by overnight express mail
service, or four (4) Business Days after being sent by mail.  All disputes arising in connection with the
interpretation, performance and enforcement of this Agreement shall be resolved
through binding arbitration under the Federal Arbitration Act and conducted by
the American Arbitration Association under its rules for commercial
arbitration, provided that the arbitrator may award reasonable fees and costs
to the prevailing party.  Arbitration
shall take place in the state where the respondent’s principal place of
business is located.  Except as expressly
provided herein to the contrary, each GAC Franchise Agreement shall remain in
full force and effect in accordance with and subject to its respective terms
and conditions.  Nothing in this
Settlement and Release Agreement alters the terms or status of any agreement of
any Great American franchisee who is not party to this Agreement.  The GACC Association is an intended third
party beneficiary of Section 5 of this Agreement.

 

7

 

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

 

	
   

  	
  NEXCEN
  BRANDS, INC.,

  
	
   

  	
  a Delaware
  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert
  D’Loren

  	
   

  
	
   

  	
   

  	
  Name:  Robert
  D’Loren

  
	
   

  	
   

  	
  Title:    President
  and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  GREAT
  AMERICAN COOKIE COMPANY

  FRANCHISING, LLC,

  
	
   

  	
  a Delaware
  limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael
  Ward

  	
   

  
	
   

  	
   

  	
  Name:  Michael
  Ward

  
	
   

  	
   

  	
  Title:    Executive
  Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  MRS.
  FIELDS FAMOUS BRANDS, LLC,

  
	
   

  	
  a Delaware
  limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael
  Ward

  	
   

  
	
   

  	
   

  	
  Name:  Michael
  Ward

  
	
   

  	
   

  	
  Title:    Executive
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MRS.
  FIELDS’ ORIGINAL COOKIES, INC.,

  
	
   

  	
  a Delaware
  corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael
  Ward

  	
   

  
	
   

  	
   

  	
  Name:  Michael
  Ward

  
	
   

  	
   

  	
  Title:    Executive
  Vice President

  
						

 

 

	
   

  	
  BATCHES
  OF COOKIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jeffery
  Bryan

  	
   

  
	
   

  	
   

  	
  Name:  Jeffery
  Bryan

  
	
   

  	
   

  	
  Title:    President

  

 

 

	
   

  	
  D&J
  ALL CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Richard
  Allen

  	
   

  
	
   

  	
   

  	
  Name:  Richard
  Allen

  
	
   

  	
   

  	
  Title:    President

  

 

 

	
   

  	
  DPD
  COOKIES OF ORLANDO, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David P.
  Duvall

  	
   

  
	
   

  	
   

  	
  Name:  David
  P. Duvall

  
	
   

  	
   

  	
  Title:    President

  

 

 

	
   

  	
  WOLFTEAM
  LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Sean
  Faulk

  	
   

  
	
   

  	
   

  	
  Name:  Sean
  Faulk

  
	
   

  	
   

  	
  Title:    Owner

  

 

 

	
   

  	
  GILREATH
  ENTERPRISES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Scott
  Gilreath

  	
   

  
	
   

  	
   

  	
  Name:  Scott
  Gilreath

  
	
   

  	
   

  	
  Title:    Owner/President

  

 

 

	
   

  	
  HALLIE
  COOKIE CO., INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert
  Mulliniks

  	
   

  
	
   

  	
   

  	
  Name:  Robert
  Mulliniks

  
	
   

  	
   

  	
  Title:    V.P.

  

 

 

	
   

  	
  JERMAN
  COOKIE CO., LP

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J.L.
  Jerman II

  	
   

  
	
   

  	
   

  	
  Name:  J.L.
  Jerman II

  
	
   

  	
   

  	
  Title:    CEO

  

 

 

	
   

  	
  J-TEAM,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ D. Craig
  Jones

  	
   

  
	
   

  	
   

  	
  Name:  D.
  Craig Jones

  
	
   

  	
   

  	
  Title:    President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kathy R.
  Jones

  	
   

  
	
   

  	
   

  	
  Name:  Kathy
  R. Jones

  
	
   

  	
   

  	
  Title:    Partner

  

 

 

	
   

  	
  J-TEAM
  AND RUPPS (GENERAL

  PARTNERSHIP)

  
	
   

  	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ D. Craig
  Jones

  	
   

  
	
   

  	
   

  	
  Name:  D.
  Craig Jones

  
	
   

  	
   

  	
  Title:    President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kathy R.
  Jones

  	
   

  
	
   

  	
   

  	
  Name:  Kathy
  R. Jones

  
	
   

  	
   

  	
  Title:    Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Chad A.
  Rupp

  	
   

  
	
   

  	
   

  	
  Name:  Chad
  A. Rupp

  
	
   

  	
   

  	
  Title:    Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Amy J.
  Rupp

  	
   

  
	
   

  	
   

  	
  Name:  Amy
  J. Rupp

  
	
   

  	
   

  	
  Title:    Partner

  

 

 

	
   

  	
  /s/ Ken
  Miller

  	
   

  
	
   

  	
  KEN MILLER

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Nancy
  Miller

  	
   

  
	
   

  	
  NANCY MILLER

  

 

 

	
   

  	
  THE
  COOKIE PLACE, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jeff
  Pizitz

  	
   

  
	
   

  	
   

  	
  Name:  Jeff
  Pizitz

  
	
   

  	
   

  	
  Title:    President

  

 

 

	
   

  	
  TEXAS
  STAR COOKIE CO LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Walter
  Wayne Woods

  	
   

  
	
   

  	
   

  	
  Name:  Texas
  Star Cookie Co. LLC

  
	
   

  	
   

  	
  Title:    Owner/Franchisee

  
					

 

 

	
   

  	
  GARMON
  ENTERPRISES II, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/Paul A.
  Montalvo Jr.

  	
   

  
	
   

  	
   

  	
  Name:  Paul
  A. Montalvo Jr.

  
	
   

  	
   

  	
  Title:    President

  
					

 

 

	
   

  	
  COOKIE
  BAKER PARTNERS, LP

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Herbert
  W. Perlich

  	
   

  
	
   

  	
   

  	
  Name:  Herbert
  W. Perlich

  
	
   

  	
   

  	
  Title:    Franchisees

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Barbara
  A. Perlich

  	
   

  
	
   

  	
   

  	
  Name:  Barbara
  A. Perlich

  
	
   

  	
   

  	
  Title:    Franchisees

  

 

 

	
   

  	
  SAC
  ENTREPRENEURS PARTNERS LTD.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Brian
  Selden

  	
   

  
	
   

  	
   

  	
  Name:  Brian
  Selden

  
	
   

  	
   

  	
  Title:    General
  Partner

  

 

 

	
   

  	
  DOUGH ROLLERS TOO, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jeremy
  Roy

  	
   

  
	
   

  	
   

  	
  Name:  Jeremy
  Roy

  
	
   

  	
   

  	
  Title:    President

  

 

 

	
   

  	
  DOUGH ROLLERS, LTD.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Brian
  Selden

  	
   

  
	
   

  	
   

  	
  Name:  Brian
  Selden

  
	
   

  	
   

  	
  Title:    General
  Partner

  

 

 

	
   

  	
  BATTER UP, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Brian
  Selden

  	
   

  
	
   

  	
   

  	
  Name:  Brian
  Selden

  
	
   

  	
   

  	
  Title:    V.P.

  

 

 

	
   

  	
  ROLLING
  IN DOUGH COOKIE CO.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Katherine Shell

  	
   

  
	
   

  	
   

  	
  Name:  Katherine
  Shell

  
	
   

  	
   

  	
  Title:    Vice
  President

  

 

 

	
   

  	
  HEM
  CHELA CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Bachu
  Solanki

  	
   

  
	
   

  	
   

  	
  Name:  Bachu
  Salanki

  
	
   

  	
   

  	
  Title:    President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Geeta
  Solanki

  	
   

  
	
   

  	
   

  	
  Name:  Geeta
  Salanki

  
	
   

  	
   

  	
  Title:    V.P.

  

 

 

	
   

  	
  MUBARAK
  INVESTMENTS CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Sonney
  Daharani

  	
   

  
	
   

  	
   

  	
  Name:  S.
  Daharani

  
	
   

  	
   

  	
  Title:    President

  

 

 

	
   

  	
  BARAKAH,
  INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Sonney
  Daharani

  	
   

  
	
   

  	
   

  	
  Name:  S.
  Daharani

  
	
   

  	
   

  	
  Title:    President

  

 

 

	
   

  	
  CACTUS
  COOKIES, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael
  J. Solomon

  	
   

  
	
   

  	
   

  	
  Name:  Michael
  J. Solomon

  
	
   

  	
   

  	
  Title:    President

  

 

 

	
   

  	
  WILLS
  COOKIE STORES LTD.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. M.
  Wills

  	
   

  
	
   

  	
   

  	
  Name:  J.
  M. Wills

  
	
   

  	
   

  	
  Title:    President

  

 

 

	
   

  	
  COOKIE
  ASSOCIATES, LTD.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By: Doc &
  Associates, Ltd., its General Partner

  
	
   

  	
   

  
	
   

  	
  By: LJC
  Management, Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Lawrence
  J. Cohen

  	
   

  
	
   

  	
   

  	
  Name:  Lawrence
  J. Cohen

  
	
   

  	
   

  	
  Title:    President

  
					

 

 

SCHEDULE I

TO SETTLEMENT AND RELEASE
AGREEMENT

 

ACCREDITED FRANCHISEES, FRANCHISEE
PRINCIPALS AND PRO RATA SHARE

 

	
  Franchisees

  	
   

  	
  Franchisee

  Principals

  	
   

  	
  Addresses

  	
   

  	
  Cash

  	
   

  	
  Warrants

  	
   

  	
  Franchise

  Credit

  	
   

  	
  Royalty

  Payment

  	
   

  
	
  Gilreath Enterprises, Inc.

  	
   

  	
  Scott Gilreath

  	
   

  	
  7132 Wynlakes Blvd. Montgomery, AL 36117

  	
   

  	
  $

  	
  403,587.95

  	
   

  	
  18,071

  	
   

  	
  $

  	
  60,237.01

  	
   

  	
  $

  	
  102,402.91

  	
   

  
	
  Hallie Cookie Co.,

  Inc.

  	
   

  	
  Parks Hicks

  Robert Mulliniks

  	
   

  	
  2121 Kensington Gates Drive

  Kennesaw, GA 30152

  	
   

  	
  $

  	
  538,472.89

  	
   

  	
  24,111

  	
   

  	
  $

  	
  80,369.09

  	
   

  	
  $

  	
  136,627.45

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Larry Wilburn

  	
   

  	
  1623 Kidd Road Jonesboro, GA 30236

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Jerman Cookie Co.,

  LP

  	
   

  	
  Jay Jerman

  	
   

  	
  100 Crossbrook Trail Chelsea, AL 35043

  	
   

  	
  $

  	
  1,061,956.01

  	
   

  	
  47,550

  	
   

  	
  $

  	
  158,500.90

  	
   

  	
  $

  	
  269,451.52

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  John Jerman

  	
   

  	
  4505 Mill Pond Court Colleyville, TX 76034

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

	
  Franchisees

  	
   

  	
  Franchisee

  Principals

  	
   

  	
  Addresses

  	
   

  	
  Cash

  	
   

  	
  Warrants

  	
   

  	
  Franchise

  Credit

  	
   

  	
  Royalty

  Payment

  	
   

  
	
  The Cookie
  Place, Inc.

  	
   

  	
  Merritt Pizitz Michael Pizitz Richard Pizitz

  	
   

  	
  2140 11th Avenue South Suite 200

  Birmingham, AL 35205

  	
   

  	
  $

  	
  249,042.92

  	
   

  	
  11,151

  	
   

  	
  $

  	
  37,170.59

  	
   

  	
  $

  	
  63,189.99

  	
   

  
	
  Texas Star Cookie Co LLC

  	
   

  	
  Walter Wayne and Deborah Woods

  	
   

  	
  1323 E. Spring Valley Road 

  Richardson, TX 75081

  	
   

  	
  $

  	
  59,185.77

  	
   

  	
  2,650

  	
   

  	
  $

  	
  8,833.70

  	
   

  	
  $

  	
  15,017.28

  	
   

  
	
  Cookie Baker Partners, LP

  	
   

  	
  Herb and Barbara Perlich

  	
   

  	
  8206 Knurled Oak Lane Spring, TX 77379

  	
   

  	
  $

  	
  381,796.42

  	
   

  	
  17,095

  	
   

  	
  $

  	
  56,984.54

  	
   

  	
  $

  	
  96,873.72

  	
   

  
	
  Wills Cookie Stores Ltd.

  	
   

  	
  Jim and Barbara Wills

  	
   

  	
  7615 Yaupon Drive

  Austin, TX 78759-6411

  	
   

  	
  $

  	
  265,504.01

  	
   

  	
  11,888

  	
   

  	
  $

  	
  39,627.46

  	
   

  	
  $

  	
  67,366.69

  	
   

  
	
  Cactus
  Cookies, Inc.

  	
   

  	
  Michael Solomon

  	
   

  	
  7400 Las Vegas Blvd S,

  Suite FC-19

  Las Vegas, NV 89123

  	
   

  	
  $

  	
  364,569.64

  	
   

  	
  16,324

  	
   

  	
  $

  	
  54,413.38

  	
   

  	
  $

  	
  92,502.74

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Allan B. and Shirley F. Solomon

  	
   

  	
  2200 Corporate Blvd. NW

  Suite 310

  Boca Raton, FL 33431

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mubarak Investments Corp.

  	
   

  	
  Sonny Dharani

  	
   

  	
  535 Gavenwood Drive

  Lawrenceville, GA 30044

  	
   

  	
  $

  	
  56,549.52

  	
   

  	
  2,532

  	
   

  	
  $

  	
  8,440.23

  	
   

  	
  $

  	
  14,348.39

  	
   

  
	
  Barakah Inc.

  	
   

  	
  Sonny Dharani

  	
   

  	
  535 Gavenwood Drive

  Lawrenceville, GA 30044

  	
   

  	
  $

  	
  56,549.51

  	
   

  	
  2,532

  	
   

  	
  $

  	
  8,440.22

  	
   

  	
  $

  	
  14,348.38

  	
   

  
	
  Garmon Enterprises II, Inc.

  	
   

  	
  Raul and Sylvia Montalvo

  	
   

  	
  1601 Spicewood Drive

  Weslaco, TX 78596

  	
   

  	
  $

  	
  62,716.62

  	
   

  	
  2,808

  	
   

  	
  $

  	
  9,360.69

  	
   

  	
  $

  	
  15,913.17

  	
   

  
	
  Wolfteam LLC

  	
   

  	
  Sean and Kecia Falk

  	
   

  	
  452 Ruff Drive Monroe, MI 48162

  	
   

  	
  $

  	
  97,074.88

  	
   

  	
  4,347

  	
   

  	
  $

  	
  14,488.79

  	
   

  	
  $

  	
  24,630.94

  	
   

  
	
  Cookie Associates, Ltd.

  	
   

  	
  Doc & Associates, Ltd.

  	
   

  	
  LJC Management, Inc.

  % Lawrence J. Cohen

  1431 Graham Drive

  Suite 218

  Tomball, TX 77375

  	
   

  	
  $

  	
  1,268,314.65

  	
   

  	
  56,791

  	
   

  	
  $

  	
  189,300.69

  	
   

  	
  $

  	
  321,811.18

  	
   

  

 

35

 

	
  Franchisees

  	
   

  	
  Franchisee

  Principals

  	
   

  	
  Addresses

  	
   

  	
  Cash

  	
   

  	
  Warrants

  	
   

  	
  Franchise

  Credit

  	
   

  	
  Royalty

  Payment

  	
   

  
	
   

  	
   

  	
  Rick K. and Heidi L. Strauss

  	
   

  	
  2800 Bradway Street Bloomfield Hills, MI 48301

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  DRE, Inc.

  	
   

  	
  % Dennis Egide

  800 S. Milwaukee Avenue

  Suite 170 Libertyville, IL 60048-3255

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Marvin S. and Sandra M. Rosen

  	
   

  	
  222 Lakeview Avenue

  Suite 800 West Palm Beach, FL 33401

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Paul Mapes

  	
   

  	
  2408 Northeast 27th Avenue

  Ft. Lauderdale, FL 33305

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Merida Associates, Inc.

  	
   

  	
  % Arthur Meyer

  1601 Belvedere Road

  Suite 407 South West Palm Beach, FL 33406

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  WAM Management, Inc.

  	
   

  	
  % William Meyer Profit Sharing Trust 1601 Belvedere
  Road

  Suite 407 South West Palm Beach, FL 33406

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Mariner LLC

  	
   

  	
  % Thomas C. Strauss

  222 Lakeview Avenue Suite 800 West Palm Beach, FL 33401

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

36

 

	
  Franchisees

  	
   

  	
  Franchisee

  Principals

  	
   

  	
  Addresses

  	
   

  	
  Cash

  	
   

  	
  Warrants

  	
   

  	
  Franchise

  Credit

  	
   

  	
  Royalty

  Payment

  	
   

  
	
   

  	
   

  	
  Houston Cookies LLC

  	
   

  	
  % Marvin Rosen

  222 Lakeview Avenue

  Suite 800

  West Palm Beach, FL 33401

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ASAT Partners LLC

  	
   

  	
  % Gail Meyer

  1601 Belvedere Road, Suite 407 South West Palm Beach, FL 33406

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Jerome Mouton

  	
   

  	
  12506 Leyton Court Tomball, TX 77375

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SAC Entrepreneurs Partners Ltd.

  	
   

  	
  SACEP Management LLC

  	
   

  	
  % Bryan Selden 2020 Stonegate Blvd. Tyler, TX 75703

  	
   

  	
  $

  	
  228,721.21

  	
   

  	
  10,241

  	
   

  	
  $

  	
  34,137.49

  	
   

  	
  $

  	
  58,033.74

  	
   

  
	
  Dough Rollers Too, LLC

  	
   

  	
  Bryan Selden

  	
   

  	
  2020 Stonegate Blvd. Tyler, TX 75703

  	
   

  	
  $

  	
  0

  	
   

  	
  0

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Jeremy Roy

  	
   

  	
  18055 Crescent Royale Way

  Humble, TX 77346

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dough Rollers,
  Ltd.

  	
   

  	
  SACEP Management LLC

  	
   

  	
  % Bryan Selden

  2020 Stonegate Blvd. Tyler, TX 75703

  	
   

  	
  $

  	
  693,884.18

  	
   

  	
  31,070

  	
   

  	
  $

  	
  103,564.80

  	
   

  	
  $

  	
  176,060.16

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Jeremy Roy

  	
   

  	
  18055 Crescent Royale Way Humble, TX 77346

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  George Pekema

  	
   

  	
  2119 LaMonte Lane Houston, TX 77018

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hem Chela Corp.

  	
   

  	
  Bachu and Geeta Solanki

  	
   

  	
  146 Marion Place Steubenville, OH 43953

  	
   

  	
  $

  	
  63,569.01

  	
   

  	
  2,846

  	
   

  	
  $

  	
  9,487.91

  	
   

  	
  $

  	
  16,129.45

  	
   

  

 

37

 

OTHER FRANCHISEES,
FRANCHISEE PRINCIPALS AND PRO RATA SHARE

 

	
  Franchisees

  	
   

  	
  Franchisee

  Principals

  	
   

  	
  Addresses

  	
   

  	
  Cash

  	
   

  	
  Warrants

  	
   

  	
  Franchise

  Credit

  	
   

  	
  Royalty

  Payment

  	
   

  
	
  Batches of Cookies, Inc.

  	
   

  	
  Jeffrey Bryan

  	
   

  	
  3650 Cathedral Cove Road

  Jacksonville, FL 32217

  	
   

  	
  $

  	
  54,821.91

  	
   

  	
  2,455

  	
   

  	
  $

  	
  8,182.37

  	
   

  	
  $

  	
  13,910.04

  	
   

  
	
  D&J All Corporation

  	
   

  	
  Richard and Dianna Allen

  	
   

  	
  67 Dalrymple Avenue Pine City, NY 14871

  	
   

  	
  $

  	
  55,833.30

  	
   

  	
  2,500

  	
   

  	
  $

  	
  8,333.33

  	
   

  	
  $

  	
  14,166.66

  	
   

  
	
  DPD Cookies of Orlando, Inc.

  	
   

  	
  David Duvall Robert Duvall

  	
   

  	
  225 Tomoka Trail Longwood, FL 32779

  	
   

  	
  $

  	
  42,859.97

  	
   

  	
  1,919

  	
   

  	
  $

  	
  6,397.01

  	
   

  	
  $

  	
  10,874.92

  	
   

  
	
  J-Team, Inc.

  	
   

  	
  Craig and Kathy Jones

  	
   

  	
  7213 Eaglestone Court Liberty Township, OH 45044

  	
   

  	
  $

  	
  49,238.49

  	
   

  	
  2,205

  	
   

  	
  $

  	
  7,349.03

  	
   

  	
  $

  	
  12,493.35

  	
   

  
	
  J-Team and Rupps (General Partnership)

  	
   

  	
  Craig and Kathy Jones

  	
   

  	
  7213 Eaglestone Court Liberty Township, OH 45044

  	
   

  	
  $

  	
  336,945.71

  	
   

  	
  15,087

  	
   

  	
  $

  	
  50,290.40

  	
   

  	
  $

  	
  85,493.69

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Chad and Amy Rupp

  	
   

  	
  7279 Eaglestone Court Liberty Township, OH 45044

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ken and Nancy Miller

  	
   

  	
  Ken and Nancy Miller

  	
   

  	
  9809 Salisbury Lubbock, TX 79424

  	
   

  	
  $

  	
  75,685.42

  	
   

  	
  3,389

  	
   

  	
  $

  	
  11,296.33

  	
   

  	
  $

  	
  19,203.76

  	
   

  
	
  Batter Up, LLC

  	
   

  	
  Bryan Selden

  	
   

  	
  2020 Stonegate Blvd. Tyler, TX 75703

  	
   

  	
  $

  	
  42,463.01

  	
   

  	
  1,901

  	
   

  	
  $

  	
  6,337.76

  	
   

  	
  $

  	
  10,774.20

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Chuck Schrick

  	
   

  	
  190 Harks Creek Road Trinity, TX 75862

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Rolling in Dough Cookie Co.

  	
   

  	
  Kathryn Shell

  	
   

  	
  2711 Hampton Trail Woodstock, GA 30189

  	
   

  	
  $

  	
  190,657.02

  	
   

  	
  8,537

  	
   

  	
  $

  	
  28,456.27

  	
   

  	
  $

  	
  48,375.66

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Ed Smith

  	
   

  	
  10201 Rainbridge Drive

  Riverview, FL 33569

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

38

 

Schedule II

to Settlement and Release Agreement

 

Purchaser Representatives

 

	
  Franchisees

  	
   

  	
  Purchaser Representatives

  
	
  Batches of Cookies, Inc.

  	
   

  	
  Jeffery M. Jacobs

  One San Jose Place, Suite 25

  Jacksonville, FL 32257

  
	
   

  	
   

  	
   

  
	
  D&J All Corporation

  	
   

  	
  William Cavaluzzi

  124 W. Franklin St.

  Horseheads, NY 14845

  
	
   

  	
   

  	
   

  
	
  DPD Cookies of Orlando, Inc.

  	
   

  	
  Arleigh C. Merrill

  7400 Bay Meadows Way

  Jacksonville, FL 32256

  
	
   

  	
   

  	
   

  
	
  J-Team, Inc.

  	
   

  	
  John P. Nicholson

  139 S. Sunbury Road
 Westerville, OH 43081

  
	
   

  	
   

  	
   

  
	
  J-Team and Rupps (General Partnership)

  	
   

  	
  John P. Nicholson

  139 S. Sunbury Road
 Westerville, OH 43081

  
	
   

  	
   

  	
   

  
	
  Ken and Nancy Miller

  	
   

  	
  Robert O. Goddard

  1204 Mechem Drive, Suite 10

  Ruidoso, NM 88345

  
	
   

  	
   

  	
   

  
	
  Batter Up, LLC

  	
   

  	
  Brian A. Mills

  Orgain, Bell & Tucker, L.L.P.

  470 Orleans, 4th Floor

  Beaumont, TX 77701

  
	
   

  	
   

  	
   

  
	
  Rolling in Dough Cookie Co.

  	
   

  	
  John A. King

  Warren, Averett, Kimbrough & Marino,LLC

  2500 Action Road

  Birmingham, AL 35243

  

 

 

EXHIBIT
A

TO
SETTLEMENT AND RELEASE AGREEMENT

 

FORM
OF WARRANT

 

[Attached]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00135-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00135-of-00352.parquet"}]]