Document:

Exhibit 10.4

 

Execution Copy

 

TRANSITION SERVICES
AGREEMENT

 

This
TRANSITION SERVICES AGREEMENT (this “Agreement”) dated as of January 29, 2008  (the “Effective Date”), is made
and entered into by and between Mrs. Fields Famous Brands, LLC, a Delaware
limited liability company and the parent of the Sellers (as defined below) (“MFFB”)
and NexCen Asset Acquisition, LLC, a Delaware limited liability company (“NexCen
Asset Acquisition” or “Purchaser”). 
MFFB and Purchaser may each be referred to herein individually as a “Party,”
and collectively as the “Parties.”

 

RECITALS

 

WHEREAS, pursuant to that certain Asset Purchase Agreement,
dated as of even date herewith (the “Purchase Agreement”), by and among
NexCen Brands, Inc., a Delaware corporation,  Purchaser 
(the “Buyer”), MFFB, Great American Cookie Company Franchising,
LLC, a Delaware limited liability company (“GACCF”), Great American
Manufacturing, LLC, a Delaware limited liability company (“GAM,” and
collectively with GACCF the “Sellers”), the Buyer and/or its Affiliates
are acquiring certain assets of GACCF related to the “Great American Cookie”
brand franchising business (“GAC Franchise Business”) and of GAM related
to the “Great American Cookie” dough manufacturing and supply business (the “GAC
Manufacturing Business”);

 

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

 

WHEREAS, this
Agreement governs the Services (as defined below) that MFFB has agreed to
provide to Purchaser in relation to the GAC Franchise Business.

 

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

 

ARTICLE I

DEFINITIONS

 

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

 

ARTICLE II

REPRESENTATIONS AND WARRANTIES

 

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

 

(a)           MFFB is a limited liability
company duly formed and in good standing under the laws of the State of  Delaware, and has all requisite limited
liability company power

 

 

and authority to enter into
and perform this Agreement and to carry out the transactions contemplated
herein.

 

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

 

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

 

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

 

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

 

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

 

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

 

ARTICLE III

PROVISION OF SERVICES

 

3.1                   Services.

 

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

 

(b)           MFFB hereby covenants,
agrees, and warrants:  (i) that the
Services to be provided by MFFB shall be performed in a good and workmanlike
manner, (ii) that the Services 

 

2

 

and any reports or advice
provided by MFFB with respect to the Services shall comply in all material
respects with all applicable Legal Requirements, and (iii) that the
Services shall comply in all material respects with GAAP, if applicable.

 

3.2                   Service Fees
and Expenses.

 

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

 

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

 

ARTICLE IV

TERM; TERMINATION

 

4.1                   Term.  This Agreement shall commence on the
Effective Date and continue for a term of forty five (45) days (the “ Term”),
unless this Agreement is earlier terminated as provided below.

 

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

 

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

 

3

 

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

 

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

 

(d)           (i) the Defaulting
Party shall commence any case, proceeding or other action (A)  under any
existing or future Law, relating to bankruptcy, insolvency, reorganization or
relief of debtors, seeking to have an order for relief entered with respect to
it, or seeking to adjudicate it a bankrupt or insolvent, or seeking
reorganization, arrangement, adjustment, winding-up, liquidation, dissolution,
composition or other relief with respect to it or its debts, or (B) seeking
appointment of a receiver, trustee, custodian, conservator or other similar
official for it or for all or any substantial part of its assets, or the
Defaulting Party shall make a general assignment for the benefit of its
creditors; or (ii) there shall be commenced against the Defaulting Party
any case, proceeding or other action of a nature referred to in clause (i) above
which (A) results in the entry of an order for relief or any such
adjudication or appointment or (B) remains undismissed, undischarged or
unbonded for a period of sixty (60) days; or (iii) there shall be
commenced against the Defaulting Party any case, proceeding or other action
seeking issuance of a warrant or attachment, execution, distraint or similar
process against all or any substantial part of its assets which results in the
entry of an order for any such relief and which shall not have been vacated,
discharged, or stayed or bonded pending appeal within sixty (60) days from the
entry thereof; or (iv) the Defaulting Party shall take any action in furtherance
of, or indicating its consent to, approval of or acquiescence in, any of the
acts set forth in clause (i), (ii) or (iii) above.

 

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

 

4.4                   Effect of
Termination.

 

(a)   Obligations
Under the Purchase Agreement.  Notwithstanding anything to the contrary set
forth herein, upon the termination of this Agreement, MFFB shall continue to be
bound by the Purchase Agreement and shall provide reasonable services as
necessary to enforce the Purchaser’s rights under the Purchase Agreement
including the remittance of any monies received by MFFB or either of the
Sellers that is the property of the Purchaser.

 

(b)   Reimbursement
of Service Fees. 
If Purchaser, as the Non-Defaulting Party, terminates this Agreement
pursuant to Section 4.2, MFFB will reimburse Purchaser a portion of the
Service Fee equal to the product of (x) the Service Fee multiplied by (y) a
fraction, the numerator of which is the actual number of days elapsed from the
Effective Date until the termination date and the denominator of which is
forty-five (45) days.

 

4

 

ARTICLE V

INDEMNIFICATION AND LIABILITY

 

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

 

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

 

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

 

5

 

ARTICLE VI

GENERAL PROVISIONS

 

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

 

6.2                   Sellers as
Independent Contractors.  The Parties agree that MFFB shall
perform the Services hereunder in the capacity of an independent
contractor.  Nothing in this Agreement
shall be construed to mean or imply that MFFB is a partner, joint venturer,
agent or representative of, or otherwise associated with, Purchaser or its
Affiliates.  Purchaser nor MFFB  shall represent to others,
nor shall either take any action
from which others could reasonably infer, that one Party is a partner, joint
venturer, agent or representative of, or otherwise associated with, the other Party.

 

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

 

6

 

	
  If to MFFB, to:

  	
   

  
	
   

  	
   

  
	
  Mrs. Fields
  Famous Brands, LLC

  	
   

  
	
  2855 East
  Cottonwood Parkway, Suite 400

  
	
  Salt Lake
  City, UT 84121

  	
   

  
	
  Attention:  Michael Ward, EVP and General Counsel

  
	
  Facsimile:

  	
  (801)
  736-5944

  	
   

  
	
   

  	
   

  
	
  If to Purchaser,
  to:

  	
   

  
	
   

  	
   

  
	
  NexCen
  Franchise Management, Inc.

  	
   

  
	
  1330 Avenue
  of the Americas, 34th Floor

  	
   

  
	
  New York, NY
  10019

  	
   

  
	
  Attention:

  	
  Sue J. Nam,
  General Counsel

  
	
  Facsimile:

  	
  (212)
  247-7132

  	
   

  
	
   

  	
   

  
	
  and

  	
   

  
	
   

  	
   

  
	
  Kirkland &
  Ellis LLP

  	
   

  
	
  655 15th
  Street, N.W.

  	
   

  
	
  Washington,
  DC 20005

  	
   

  
	
  Attention:

  	
  Mark D.
  Director, Esq.

  	
   

  
	
  Facsimile:

  	
  (202)
  879-5200

  	
   

  

 

 

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

 

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

 

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

 

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

 

7

 

The failure of either Party
to exercise in any respect any right provided for herein shall not be deemed a
waiver of such right or of any other right hereunder.

 

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

 

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

 

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

 

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

 

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

 

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

 

[SIGNATURE PAGE FOLLOWS]

 

8

 

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

 

 

	
   

  	
  NEXCEN
  ASSET ACQUISITION, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  NexCen Brands, Inc., its Managing Member

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert
  D’Loren

  	
   

  
	
   

  	
  Title:

  	
  President
  and Chief Executive

  	
   

  
	
   

  	
   

  	
  Officer

  	
   

  

 

Signature Page to Transition Services
Agreement

 

 

	
   

  	
  MRS. FIELDS FAMOUS BRANDS, LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael Ward

  	
   

  
	
   

  	
  Title:

  	
  Executive Vice President, Chief

  	
   

  
	
   

  	
   

  	
  Legal Officer and Secretary

  	
   

  

 

Signature Page to Asset Purchase Agreement

 

 

EXHIBIT A

 

I.                                         Transition Services Agreement - Description of Services

 

A.            Services to be provided by MFFB

 

	
  Service

  
	
  1.

  	
   

  	
  Transitioning the data and IT systems from
  Sellers to Purchaser

  
	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  Reporting of
  franchisee sales through MFFB’s current system until the earlier of
  (i) the termination of this Agreement, or (ii) as requested by
  Purchaser to move the reporting of sales to its systems.

  
	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  EFT process
  for sales reported into MFFB’s current system. EFT funds from the Businesses
  shall be transferred from franchisees directly to Purchaser’s bank accounts
  once MFFB has recouped current accounts receivable pursuant to
  Section 3.7 of the Asset Purchase Agreement

  
	
   

  	
   

  	
   

  
	
  4.

  	
   

  	
  Reimbursement
  to Purchaser of any vendor rebates, royalties, or other revenues arising on
  or after the Closing date collected by MFFB or a Subsidiary or Affiliate
  relating to the Businesses by wire within five business days of receipt. Such
  monies collected by MFFB that are the property of the Purchaser shall be held
  in trust by MFFB until such time as they are remitted to Purchaser.

  
	
   

  	
   

  	
   

  
	
  5.

  	
   

  	
  Transitioning
  of marketing campaigns and materials from Sellers to Purchaser

  
	
   

  	
   

  	
   

  
	
  6.

  	
   

  	
  Transitioning
  franchise support services from Seller to Purchaser

  
	
   

  	
   

  	
   

  
	
  7.

  	
   

  	
  Transitioning
  vendors for both the franchisees and the factory

  
	
   

  	
   

  	
   

  
	
  9.

  	
   

  	
  Transitioning
  royalty collection procedures, directing any wrongly transferred funds or
  checks from franchisees following the Closing date to Purchaser within five
  business days of receipt by MFFB.

  
	
   

  	
   

  	
   

  
	
  10.

  	
   

  	
  Transitioning
  any gift card programs that relate to Great American Cookie from MFFB to
  Purchaser [note: are there any gift card programs?]

  
	
   

  	
   

  	
   

  
	
  11.

  	
   

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

  
	
   

  	
   

  	
   

  
	
  12.

  	
   

  	
  Training of
  new franchisees

  
	
   

  	
   

  	
   

  
	
  13.

  	
   

  	
  Transitioning
  development procedures and franchisees in various stages of development

  
	
   

  	
   

  	
   

  
	
  14.

  	
   

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

  

 

 

EXHIBIT B

 

Service Fees for Transition Services Agreement

 

Purchaser shall pay, by wire
transfer, within 5 days of the Effective Date $112,500 dollars.

 

 

EXHIBIT C

 

Retention Costs For EmployeesExhibit 10.5

 

Execution Copy

 

VOTING AGREEMENT

 

This VOTING AGREEMENT (the “Agreement”), dated as of January 29,
2008, is entered into by and among NexCen Brands, Inc., a Delaware
corporation (the “Company”), Great American Cookie Company Franchising,
LLC, a Delaware limited liability company (“GACCF”), and Great American
Manufacturing, LLC, a Delaware limited liability company (“GAM,” and
collectively with GACCF, the “Holders”).

 

WHEREAS, the Company, NexCen Asset Acquisition, LLC, a Delaware limited
liability company (“Buyer”), Mrs. Fields’ Famous Brands, LLC, a
Delaware limited liability company, and the Holders have entered into that
certain Asset Purchase Agreement, dated as of January 29, 2008 (the “Purchase
Agreement”), pursuant to which Buyer has agreed to acquire certain of the
assets that relate to the operation of GACCF and GAM;

 

WHEREAS, pursuant to the terms of the Purchase Agreement, the Holders
will be issued and will receive 1,099,290 shares of common stock, par value
$0.01 per share, of the Company (“Company Shares”) representing the
Indemnity Escrow Amount upon release therefrom; and

 

WHEREAS, on the terms and conditions set forth in the Purchase
Agreement, the Holders desire and agree to be bound by the restrictions on
transfer, and to vote all Company Shares issued to them pursuant to the terms
of the Purchase Agreement as set forth herein.

 

NOW, THEREFORE, in consideration of the promises contained herein and
for other good and valuable consideration, the receipt, sufficiency and
adequacy of which is hereby acknowledged, the parties hereto agree as follows
(with all capitalized terms used and not otherwise defined herein having their
respective meanings as set forth in the Purchase Agreement):

 

1.             Agreement to Vote Shares; Irrevocable
Proxy.  Each Holder hereby appoints such person as
the Board of Directors of the Company may appoint after the date of this
Agreement (the “Proxy Holder”) its proxy and attorney-in-fact, with full
power of substitution and resubstitution, to vote or act by written consent
during the term of this Agreement with respect to the Company Shares and any
New Shares (as defined below) (collectively, the “Shares”).  Holders shall take such further action or
execute such other instruments as may be necessary to effectuate the intent of
this proxy and limited power of attorney. 
The proxy and limited power of attorney granted hereunder by Holders
shall be irrevocable during the term of this Agreement, shall be deemed to be
coupled with an interest sufficient in law to support an irrevocable proxy and
shall revoke any and all prior proxies granted by Holder with respect to the
matters contemplated hereunder.  The
power of attorney granted by Holders herein is a limited durable power of attorney
and shall survive the bankruptcy, death or incapacity of the Holders.  The proxy and limited power of attorney
granted hereunder shall terminate upon the termination of this Agreement.  All parties hereto acknowledge and agree that
the Proxy Holder shall, and the Holders hereby irrevocably consent to, vote all
Shares owned by them in favor of matters recommended or approved by the Board
of Directors of the Company, or, if such matters are neither recommended nor
approved by the Board of Directors of the Company, then at the direction of the
Board of Directors of the Company, in respect of all matters for which
stockholder approval is sought or required. 
Notwithstanding anything to the contrary, the

 

 

provisions of this Section 1 shall not apply with
respect to any Shares that have been validly Transferred (as hereinafter
defined) by any of the Holders (or its permitted transferees or successors in
interest) to a third party in compliance with Section 3 hereof.

 

2.             No Voting Trusts or Other Arrangements. 
Each of the Holders agrees that he will not, and will not permit any
entity under his or its control to, grant any proxies with respect to the
Shares or subject any of the Shares to any arrangement with respect to the
voting of the Shares other than this Agreement.

 

3.             Transfer and Encumbrance.

 

(a)           Each of the
Holders represents and warrants that (i) the Company Shares are free and
clear of all liens, claims, charges, security interests or other encumbrances,
other than those that may be created by the Purchase Agreement, the Escrow
Agreement, the Indenture, the Collateral Agreements (as defined in the
Indenture), and this Agreement, (ii) there are no options, warrants or
other rights, agreements, arrangements or commitments of any character to which
the Holders are a party relating to the pledge, disposition or voting of the
Shares, and there are no voting trusts or voting agreements with respect to the
Shares, other than this Agreement and applicable trust agreements for estate
planning purposes, including but not limited to charitable remainder trusts, (iii) each
of the Holders has full power and authority to enter into, execute and deliver
this Agreement and to perform fully the Holders’ obligations hereunder and (iv) this
Agreement constitutes the legal, valid and binding obligation of the Holders in
accordance with its terms.

 

(b)           On or after the
date hereof and during the term of this Agreement, except to the extent
permitted by Section 7.8 of the Purchase Agreement, each of the Holders
shall not, and shall not agree to, (i) sell, transfer, hypothecate,
negotiate, pledge, assign, encumber, grant any option, warrant or other right
to purchase, or otherwise dispose of, or (ii) enter into any swap or any
other agreement or any transaction that transfers, in whole or in part,
directly or indirectly, the economic consequence of ownership of ((i) and (ii) collectively,
“Transfer”) any Company Shares, except (x) to one or more partners
or members of each of the Holders or to an affiliated corporation under common
control with either of the Holders (but then only if, as a precondition to such
transfer, the transferee agrees in a writing, reasonably satisfactory in form
and substance to the Company and the Proxy Holder, to be bound by the terms of
this Agreement and each of the Holders (as applicable) has delivered to the
Company an opinion of counsel in form and substance satisfactory to the Company
and its counsel, to the effect that no registration of the Shares under the
Securities Act is required), subject further to the restrictions set forth in
the Escrow Agreement or (y) to the Company, in the case of the Escrow
Amount being transferred pursuant to the Escrow Agreement and Purchase
Agreement.

 

4.             New Shares.  Each of the
Holders agrees that all Shares received as a result of any stock splits, stock
dividends or reclassifications of Company Shares (all such Shares collectively,
“New Shares”), shall be subject to the terms of this Agreement to the
same extent as if they constituted Company Shares as of the date hereof.

 

5.             Specific Performance. 
Each party hereto acknowledges that it will be difficult to measure in
money the damage to the other party if a party hereto fails to comply with any
of the

 

2

 

obligations imposed by this Agreement in the event of
any such failure, the other party will not have an adequate remedy at law or
damages.  Accordingly, each party hereto
agrees that injunctive relief or other equitable remedy, in addition to
remedies at law or damages, is the appropriate remedy for any such failure and
will not oppose the granting of such relief on the basis that the other party
has an adequate remedy at law.  Each
party hereto agrees that it will not seek, and agrees to waive any requirement
for, the securing or posting of a bond in connection with any other party’s
seeking or obtaining such equitable relief.

 

6.             Entire Agreement. 
This Agreement supersedes all prior agreements, written or oral, among
the parties hereto with respect to the subject matter hereof and contains the entire
agreement among the parties with respect to the subject matter hereof.  This Agreement may not be amended or
supplemented, and no provisions hereof may be modified or waived, except by an
instrument in writing signed by all the parties hereto.  No waiver of any provisions hereof by any
party shall be deemed a waiver of any other provision hereof by any such party,
nor shall any such waiver be deemed a continuing waiver of any provision hereof
by such party.

 

7.             Notices.  All notices
hereunder shall be in writing and shall be deemed given when delivered
personally, upon receipt of a transmission confirmation if sent by facsimile or
like transmission, email or on the next business day when sent by Federal
Express, Express Mail or other reputable overnight courier service to the
parties at the following addresses (or at such other address for a party as
shall be specified by like notice):

 

If to the Company or the Proxy Holder:

 

	
  NexCen Brands, Inc.

  	
   

  
	
  1330 Avenue of the Americas

  	
   

  
	
  34th Floor

  	
   

  
	
  New
  York, NY 10019

  	
   

  
	
  Attention:

  	
  Sue
  J. Nam, General Counsel

  
	
  Fax:

  	
  (212)
  247-7132

  
			

 

With a copy (which shall not constitute notice to the
Company) to:

 

	
  Kirkland &
  Ellis LLP

  	
   

  
	
  655
  15th Street, N.W.

  	
   

  
	
  Washington,
  DC 20005

  	
   

  
	
  Attention:

  	
  Mark
  D. Director, Esq.

  
	
  Fax:

  	
  202-879-5200

  
			

 

If to the Holders, to the address or facsimile number or email address
set forth for each of the Holders on Schedule I hereto.

 

8.             Miscellaneous.

 

(a)           In addition to
other legends that are required, either by agreement or by federal or state
securities laws, each certificate representing any of the Shares shall be
marked by the Company with a legend substantially in the following form:

 

3

 

“THE SALE, TRANSFER,
HYPOTHECATION, NEGOTIATION, PLEDGE, ASSIGNMENT, ENCUMBRANCE, GRANT OF ANY
OPTION, WARRANT OR OTHER RIGHT TO PURCHASE, OR OTHER DISPOSITION (COLLECTIVELY,
“TRANSFER”) OF THE SHARES EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO
RESTRICTIONS AND A GRANT OF PROXY PURSUANT TO THAT CERTAIN VOTING AGREEMENT BY
AND BETWEEN NEXCEN BRANDS, INC. AND THE HOLDERS NAMED THEREIN, DATED AS OF JANUARY
29, 2008 (THE “VOTING AGREEMENT”), COPIES OF EACH OF WHICH MAY BE
OBTAINED FROM THE SECRETARY OF NEXCEN BRANDS, INC. NO TRANSFER OF THE SHARES MAY BE
MADE UNLESS SPECIFIC CONDITIONS OF THE VOTING AGREEMENT ARE SATISFIED.”

 

(b)           THIS AGREEMENT SHALL BE DEEMED TO BE MADE IN AND IN ALL RESPECTS SHALL BE
INTERPRETED, CONSTRUED AND GOVERNED BY AND IN ACCORDANCE WITH THE LAWS OF THE
STATE OF DELAWARE WITHOUT REGARD TO THE CONFLICT OF LAW PRINCIPLES THEREOF.  The parties hereby irrevocably submit to the
exclusive jurisdiction of the courts of the State of Delaware and the federal
courts of the United States of America, in each case sitting in Delaware,
solely in respect of the interpretation and enforcement of the provisions of
this Agreement and in respect of the transactions contemplated hereby, and
hereby waive, and agree not to assert, as a defense in any action, suit or
proceeding for the interpretation or enforcement hereof or of any such
document, that it is not subject thereto or that such action, suit or
proceeding may not be brought or is not maintainable in said courts or that the
venue thereof may not be appropriate or that this Agreement may not be enforced
in or by such courts, and the parties hereto irrevocably agree that all claims
with respect to such action or proceeding shall be heard and determined in such
a Delaware State or federal court.  The
parties hereby consent to and grant any such court jurisdiction over the person
of such parties and over the subject matter of such dispute and agree that
mailing of process or other papers in connection with any such action or
proceeding in the manner provided in Section 7 or in such other manner as
may be permitted by law shall be valid and sufficient service thereof.

 

(c)           EACH PARTY
ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS
AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE
EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH
PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR
INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT.  EACH
PARTY CERTIFIES AND ACKNOWLEDGES THAT (i) NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER, (ii) EACH PARTY UNDERSTANDS AND HAS CONSIDERED THE
IMPLICATIONS OF THIS WAIVER, AND (iii) EACH PARTY MAKES THIS WAIVER
VOLUNTARILY.

 

(d)           If any
provision of this Agreement or the application of such provision to any person
or circumstances shall be held invalid or unenforceable by a court of competent
jurisdiction, such provision or application shall be unenforceable only to the
extent of such

 

4

 

invalidity or unenforceability, and the remainder of
the provision held invalid or unenforceable and the application of such
provision to persons or circumstances, other than the party as to which it is
held invalid, and the remainder of this Agreement, shall not be affected.

(e)           This Agreement
may be executed in one or more counterparts (including by facsimile), each of
which shall be deemed to be an original but all of which together shall
constitute one and the same instrument.

 

(f)            This Agreement
shall terminate automatically upon the sale, transfer or other disposition of
all Company Shares held by the Holders to persons or entities that are not
Affiliates, in compliance with Section 3(b) hereof.  For purposes hereof, the term “Affiliate”
shall mean any other person or entity who directly, or indirectly through one
or more intermediaries, is in control of, is controlled by, or is under common
control with, such Holder.  For purposes
of this definition, control of an entity means the power, directly or
indirectly, to direct or cause the direction of the management and policies of
such entity whether by contract, securities ownership or otherwise; and the
terms “controlling” and “controlled” shall have the respective meanings
correlative to the foregoing.

(g)           Each party
hereto shall execute and deliver such additional documents as may be necessary
or desirable to effect the transactions contemplated by this Agreement.

 

(h)           No party to
this Agreement may assign any of its rights or obligations under this Agreement
without the prior written consent of the other party hereto. Any assignment
contrary to the provisions of this Section 8(h) shall be null and
void.

 

[SIGNATURE PAGE FOLLOWS]

 

5

 

IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Voting Agreement as of the date first written above.

	
   

  	
  NEXCEN BRANDS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert D’Loren

  
	
   

  	
   

  	
  Name:

  	
  Robert D’Loren

  
	
   

  	
   

  	
  Title:

  	
  President and Chief Executive 

  Officer

  

 

Signature Page to Voting Agreement

 

 

	
   

  	
  HOLDERS:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  GREAT AMERICAN COOKIE COMPANY 

  FRANCHISING, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Michael Ward

  
	
   

  	
   

  	
  Name:

  	
  Michael
  Ward

  
	
   

  	
   

  	
  Title:

  	
  Executive
  Vice President

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  GREAT AMERICAN MANUFACTURING, 

  LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Michael Ward

  
	
   

  	
   

  	
  Name:

  	
  Michael
  Ward

  
	
   

  	
   

  	
  Title:

  	
  Executive
  Vice President

  
					

 

 

SCHEDULE I

 

	
  Name
  of Holder

  	
  Address
  for Notices Pursuant to Section 7

  
	
   

  	
   

  
	
  Great
  American Cookie Company Franchising, LLC

  	
  2855
  East Cottonwood Parkway 

  Suite 400 

  Salt Lake City, UT 84121 

  Fax: (801) 736-5944

  
	
   

  	
   

  
	
  Great
  American Manufacturing, LLC

  	
  2855
  East Cottonwood Parkway 

  Suite 400 

  Salt Lake City, UT 84121 

  Fax: (801) 736-5944

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