Document:

exv10w3

Exhibit 10.3

KAHALA FRANCHISE CORP.

ROCKY MOUNTAIN CHOCOLATE FACTORY, INC.

MASTER LICENSE AGREEMENT

 

TABLE OF CONTENTS

	 	 	 	 	 
	1. DEFINITIONS
	 	 	1	 
	1.1 AD
	 	 	1	 
	1.2 Affiliate
	 	 	2	 
	1.3 Amendment
	 	 	2	 
	1.4 Co-Branded Store
	 	 	2	 
	1.5 Cold Stone
	 	 	2	 
	1.6 Cold Stone Business
	 	 	2	 
	1.7 Cold Stone Franchisee
	 	 	2	 
	1.8 Cold Stone Operating Manual
	 	 	2	 
	1.9 Cold Stone System
	 	 	2	 
	1.10 Commencement Date
	 	 	2	 
	1.11 Confidential Information
	 	 	3	 
	1.12 Converted Store
	 	 	3	 
	1.13 Dispute
	 	 	3	 
	1.14 Dispute Resolution Committee
	 	 	3	 
	1.15 Equipment
	 	 	3	 
	1.16 Franchise Agreement
	 	 	3	 
	1.17 Greenfield Store
	 	 	3	 
	1.18 Information
	 	 	3	 
	1.19 Intellectual Property Rights
	 	 	3	 
	1.20 Inventory
	 	 	4	 
	1.21 Joint Operating Manual
	 	 	4	 
	1.22 Marks
	 	 	4	 
	1.23 Offending Portion
	 	 	4	 
	1.24 Operational Support
	 	 	4	 
	1.25 Premises
	 	 	4	 
	1.26 Premises Specifications
	 	 	4	 
	1.27 RDO
	 	 	4	 
	1.28 RMCF
	 	 	4	 
	1.29 RMCF Business
	 	 	5	 
	1.30 RMCF Operating Manual
	 	 	5	 
	1.31 RMCF System
	 	 	5	 
	1.32 Sales Report
	 	 	5	 
	1.33 Services
	 	 	5	 
	1.34 System
	 	 	5	 
	1.35 Term
	 	 	5	 
	1.36 Transfer
	 	 	5	 
	1.37 UFDD
	 	 	5	 
	2. TERM AND RIGHTS GRANTED
	 	 	6	 
	2.1 Grant
	 	 	6	 
	2.2 License to Use Marks
	 	 	6	 
	2.3 Amendment to Franchise Agreement
	 	 	6	 
	2.4 Term
	 	 	7	 
	3. CO-BRANDED STORES
	 	 	7	 
	3.1 Grant of Rights for Co-Branded Stores
	 	 	7	 
	3.2 Approval of Locations for Co-Branded Stores
	 	 	7	 
	3.3 Greenfield Stores
	 	 	7	 

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	3.4 Development of Premises
	 	 	8	 
	3.5 Equipment and Inventory
	 	 	8	 
	3.6 Obligations
	 	 	9	 
	3.7 Employees and Contractors
	 	 	9	 
	4. TRAINING AND GUIDANCE
	 	 	9	 
	4.1 Training
	 	 	9	 
	4.2 Operating Assistance
	 	 	10	 
	5. SYSTEM STANDARDS
	 	 	10	 
	5.1 Operational Oversight
	 	 	10	 
	5.2 Approval of Vendors and Suppliers
	 	 	11	 
	5.3 Compliance with System and Conflict of Systems
	 	 	11	 
	5.4 Conflict of Products
	 	 	11	 
	5.5 Confidentiality
	 	 	12	 
	5.6 Non-competition
	 	 	13	 
	6. ADVERTISING
	 	 	14	 
	6.1 Advertising and Marketing Materials Prepared by Cold Stone
	 	 	14	 
	6.2 Advertising and Marketing by Cold Stone Franchisees
	 	 	14	 
	6.3 Promotions Conflict
	 	 	14	 
	7. ROYALTY PAYMENTS; SALES REPORTS
	 	 	14	 
	7.1 Royalties
	 	 	14	 
	7.2 Franchise Fees
	 	 	15	 
	7.3 Royalty Relief
	 	 	15	 
	7.4 Transfer of Funds
	 	 	15	 
	7.5 Amounts Exclusive of Taxes
	 	 	15	 
	7.6 Currency
	 	 	15	 
	7.7 Sales Reports
	 	 	16	 
	7.8 Sharing of Sales
	 	 	16	 
	7.9 Indemnification for Sharing of Sales
	 	 	16	 
	8. TRANSFER
	 	 	17	 
	8.1 Master License Agreement
	 	 	17	 
	8.2 Co-Branded Store
	 	 	17	 
	9. DEFAULT AND TERMINATION
	 	 	17	 
	9.1 Events of Default
	 	 	17	 
	10. DISPUTE RESOLUTION
	 	 	18	 
	10.1 Store Level Operational Dispute Resolution Process
	 	 	18	 
	11. REPRESENTATIONS AND WARRANTIES
	 	 	19	 
	11.1 Cold Stone Representations, Warranties and Covenants
	 	 	19	 
	11.2 RMCF Representations, Warranties and Covenants
	 	 	20	 
	11.3 Survival of Representations, Warranties and Covenants
	 	 	21	 
	11.4 Limited Warranties
	 	 	21	 
	12 MISCELLANEOUS
	 	 	22	 
	12.1 Legal Relationship
	 	 	22	 
	12.2 Indemnification
	 	 	22	 
	12.3 Limitation of Liability
	 	 	22	 
	12.4 Waiver and Severability
	 	 	22	 
	12.5 Force Majeure
	 	 	23	 
	12.6 Binding Effect
	 	 	23	 
	12.7 Applicable Law
	 	 	23	 

iii

 

	 	 	 	 	 
	12.8 Insurance
	 	 	23	 
	12.9 Reasonable Cooperation and Assistance
	 	 	24	 
	12.10 Survival
	 	 	24	 
	12.11 Notice
	 	 	24	 
	12.12 Entire Agreement
	 	 	25	 
	12.13 Test Stores
	 	 	25	 
	12.14 Receipt of Disclosure
	 	 	25	 
	12.15 Joint and Several
	 	 	26	 
	12.16 Limited Right of Set-Off
	 	 	26	 
	12.17 Counterparts
	 	 	26	 
	12.18 Legal Counsel
	 	 	26	 
	12.19 Remedies Cumulative
	 	 	26	 
	12.20 Amendment and Supplement
	 	 	26	 
	12.21 Execution of Agreement
	 	 	26	 
	12.22 Time of Essence
	 	 	26	 

EXHIBITS:

Schedule A: -List of Pre-Approved locations for Co-Branded Stores

Schedule B: -Amendment to Cols Stone Franchise Agreement

Schedule C: -Sales Report

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MASTER LICENSE AGREEMENT 

This Agreement dated the 17th of August, 2009.

BETWEEN:

ROCKY MOUNTAIN CHOCOLATE FACTORY, INC.

(hereafter “RMCF”)

- a n d -

KAHALA FRANCHISE CORP.

(hereafter “Cold Stone”)

          WHEREAS, RMCF franchises gourmet chocolate and confections stores and manufactures an
extensive line of premium chocolates and other confectionery products under the Rocky Mountain
Chocolate Factory E: name and associated trademarks and service marks; and

          WHEREAS, Cold Stone owns, operates and has developed a system for the sale of ice cream,
frozen yogurt, cakes, pies, smoothies, shakes, specialty beverage products and other frozen dessert
products under the Cold Stone Creamery® name and associated trademarks and service marks; and

          WHEREAS, Cold Stone and RMCF are desirous of co-branding together to permit Cold Stone stores
to be developed or modified to offer the RMCF brand and RMCF has agreed to license its respective
trademarks as more particularly described in this Agreement.

          NOW, THEREFORE, in consideration of the foregoing and for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. DEFINITIONS

          
Except as otherwise provided herein, the following terms shall have the meanings set forth
below:

     1.1 AD

     “AD” means a Cold Stone Area Developer

1

 

     1.2 Affiliate

     “Affiliate” means any corporation, company or entity that controls, is controlled by or is
under common control with either Cold Stone or RMCF, as the context indicates.

     1.3 Amendment

     “Amendment” means that certain amendment to the Franchise Agreement executed by a Cold Stone
Franchisee in order to offer the Services and operate a RMCF Business at the Premises. The form
Amendment to a Cold Stone Franchisee’s Franchise Agreement is attached hereto as Schedule
B.

     1.4 Co-Branded Store

     “Co-Branded Store” means a combined RMCF/Cold Stone store open for business to the public and
may be either a Converted Store or a Greenfield Store.

     1.5 Cold Stone

     “Cold Stone” means Kahala Franchise Corp., a Delaware corporation.

     1.6 Cold Stone Business

     “Cold Stone Business” means the business operated by Cold Stone (or its duly authorized
affiliate, franchisee, licensee or sublicensee) at the Premises within which the RMCF Business is
to be operated by Cold Stone or a Cold Stone Franchisee.

     1.7 Cold Stone Franchisee

     “Cold Stone Franchisee” means a franchisee who has entered into a franchise agreement with
Cold Stone, and an Amendment pursuant to which the franchisee was granted the right to operate a
Co-Branded Store at the Premises. Cold Stone Franchisee may include, without limitation, Cold Stone
or its respective Affiliates, acting as the owner/operator or licensee of a Co-Branded Store.

     1.8 Cold Stone Operating Manual

     “Cold Stone Operating Manual” means the Operating Manual utilized by Cold Stone in the
capacity as Franchisor, as amended from time to time, provided to each Cold Stone Franchisee as
part of their operation of the Cold Stone Business.

     1.9 Cold Stone System

     “Cold Stone System” is the system developed by Cold Stone, or its affiliate, for the sale of
ice cream, frozen yogurt, cakes, pies, smoothies, shakes, specialty beverage products and other
frozen dessert products under the Cold Stone Creamery® name and associated trademarks and service
marks.

     1.10 Commencement Date

     “Commencement Date” means the date upon which both parties have executed this Agreement.

2

 

     1.11 Confidential Information

     “Confidential Information” shall have the meaning set forth in Section 5.5.3.

     1.12 Converted Store.

     “Converted Store” means a store which was initially opened as a Cold Stone store, but which is
subsequently renovated pursuant to the terms of this Agreement to sell the RMCF Products and which
following such conversion may also be referred to herein as a Co-Branded Store.

     1.13 Dispute

     “Dispute” means any dispute or question that arises during the term of this Agreement between
the parties concerning the manner in which to resolve a perceived operational default by a Cold
Stone Franchisee.

     1.14 Dispute Resolution Committee

     “Dispute Resolution Committee” means Cold Stone’s Chief Operating Officer or such other senior
operations manager of Cold Stone designated by Cold Stone from time to time to serve in such
capacity and RMCF’s Chief Operating Officer or such other senior operations manager of RMCF
designated by RMCF from time to time to serve in such capacity.

     1.15 Equipment

     “Equipment” means the System standard fixtures, furnishings, equipment, smallwares and signage
required to commence operation of the RMCF Business.

     1.16 Franchise Agreement

     “Franchise Agreement” means that certain franchise agreement between Cold Stone and a Cold
Stone Franchisee regarding the operation of the Cold Stone Business at the Premises.

     1.17 Greenfield Store.

     “Greenfield Store” means a store which pursuant to the terms of this Agreement is developed
and constructed to include both RMCF and Cold Stone products and which opens and operates as a
Co-Branded Store from its first date of operation.

     1.18 Information

     “Information” shall have the meaning set forth in Section 5.5.3.

     1.19 Intellectual Property Rights

     “Intellectual Property Rights” means: (a) any and all proprietary rights provided under: (1)
patent law; (2) copyright law; (3) trade-mark law; (4) design patent or industrial design law; and
(5) any other statutory provision or common law principle applicable to this Agreement, including
trade secret law, which may provide a right in either ideas, formulae, algorithms, concepts,
inventions or know-how generally, or the expression or use of such ideas, formulae, algorithms,
concepts, inventions or know-how; and (b) any and all applications, registrations, licenses,
sublicenses, agreements or any other evidence of a right in any of the foregoing.

3

 

     1.20 Inventory

     “Inventory” means any and all ongoing inventory required to offer and sell the Services in
accordance with the RMCF Operating Manual as may be adapted by the consent of both parties for
particular Premises.

     1.21 Joint Operating Manual

     “Joint Operating Manual” means all books, bulletins, notices, correspondence, training
sessions, video or audio tapes, computer media, web casts, online training modules or other
materials jointly prepared by or on behalf of Cold Stone and RMCF jointly for use by the Cold Stone
Franchisees, setting out information, advice, standards, requirements, procedures, instructions or
policies relating to the offering, sale and performance of the Services. Until such Joint Operating
Manual is created, Cold Stone Franchisees shall be required to operate the RMCF Business pursuant
to the guidelines set forth in the RMCF Operating Manual.

     1.22 Marks

     “Marks” means the trade-marks, trade names, design marks, service marks, designs, logos,
and/or brand names, domain names, and other intellectual property, adopted by RMCF or Cold Stone in
connection with their respective Systems. For purposes of this Agreement, Cold Stone’s Marks shall
include those Marks listed in its current Franchise Disclosure Document, which are incorporated
herein by reference, as such list may be amended from time to time. RMCF’s Marks shall include
those Marks listed in its current Franchise Disclosure Document, which are incorporated herein by
reference, as such list may be amended from time to time.

     1.23 Offending Portion

     “Offending Portion” shall have the meaning set forth in Section 12.4.

     1.24 Operational Support

     “Operational Support” means collectively the AD, RDO and any RMCF personnel providing training
and operational support to the Cold Stone Franchisee.

     1.25 Premises

     “Premises” means the premises within which the Co-Branded Store is located.

     1.26 Premises Specifications

     “Premises Specifications” shall have the meaning set forth in Section 3.4.

     1.27 RDO

     “RDO” means a Cold Stone Regional Director of Operations.

     1.28 RMCF

     “RMCF” means Rocky Mountain Chocolate Factory, Inc., a Colorado corporation.

4

 

     1.29 RMCF Business

     “RMCF Business” means the business operated at the Premises by Cold Stone, or its duly
authorized affiliate, franchisee, licensee, or sublicensee, pursuant to the RMCF System, the
Amendment and in accordance with the terms of this Agreement.

     1.30 RMCF Operating Manual

     “RMCF Operating Manual” means the Operating Manual utilized by RMCF and as amended from time
to time, provided to each Cold Stone Franchisee as part of their operation of the RMCF Business or
until such time as the Joint Operating Manual has been prepared and approved for use by Cold Stone
Franchisees.

     1.31 RMCF System

     “RMCF System” means the system developed by RMCF, or its affiliate, for the sale of gourmet
chocolate and confections and other products under the Rocky Mountain Chocolate Factory® name and
associated trademarks and service marks and RMCF’ s proprietary methods of doing business.

     1.32 Sales Report

     “Sales Report” shall have the meaning set forth in Section 7.7.

     1.33 Services

     “Services” means the RMCF program of services and products to be offered from the Premises, as
mutually agreed upon by the parties and will include such chocolate, confections, foods,
merchandise, supplies, and other items sold, handled, used or otherwise offered by the RMCF
Business, as agreed upon between the parties and as permitted by the Joint Operating Manual (if
applicable).

     1.34 System

     “System” means either the Cold Stone System or the RMCF System, as the case may be.

     1.35 Term

     “Term” shall have the meaning set forth in Section 2.4.

     1.36 Transfer

     “Transfer” shall have the meaning set forth in Section 8.1

     1.37 UFDD

     “UFDD” shall mean the current standard franchise disclosure document prepared in accordance
with the Federal Trade Commission rules regulating the offer and sale of franchises and used by the
respective parties or their Affiliates to offer franchises.

5

 

2. TERM AND RIGHTS GRANTED

     2.1 Grant

          2.1.1 Subject to terms of this Agreement, RMCF grants to Cold Stone, and its affiliates, the
non-exclusive right during the Term, and in accordance with the terms of this Agreement, the RMCF
Operating Manual (as amended from time to time) and the Joint Operating Manual (as applicable) to
operate the RMCF Business and offer the Services or to allow its Cold Stone Franchisees to do the
same, using each of their Systems and Marks. Both parties hereby acknowledge and agree that the
grant herein is site specific, non-exclusive, solely for use at the Premises, and that no territory
or other protected area is provided to either party or the Cold Stone Franchisees by this
Agreement. Cold Stone represents to RMCF that it has full power and authority to bind Cold Stone
Creamery, Inc., which as of the Commencement Date of this Agreement may be a party to certain
Franchise Agreements, as if it were a named party herein.

     2.2 License to Use Marks

          2.2.1 RMCF grants to Cold Stone an irrevocable (subject to the termination provisions
contained in this Agreement) non-exclusive, non-transferable (save in accordance with the
provisions of Section 8 of this Agreement) license to use the Marks, in accordance with the terms
of this Agreement, the RMCF Operating Manual (as amended from time to time), and the Joint
Operating Manual (as applicable), solely in connection with the sale and performance of the
Services. Subject to this limited license, neither party shall have any right, title or interest in
the Marks of the other party. Neither party may use the Marks of the other party in any manner
calculated to represent that it is the owner of the Marks of the party. Neither party will, during
the Term nor at any time thereafter, dispute or contest the validity or enforceability of the Marks
of the other party, attempt any registration thereof, worldwide, or attempt to dilute the value of
any goodwill attaching to the Marks of the other party. Any goodwill associated with the Marks
shall belong exclusively to the party that is the owner of the Marks. This grant includes the right
of Cold Stone to sublicense or otherwise grant to its respective authorized Cold Stone Franchisee
(and only to such person or entity) the rights under this Agreement to operate the RMCF Business at
the Premises included in and subject to the sublicense, provided that each party complies with all
applicable laws and further provided that RMCF has first approved the form of Amendment to the
Franchise Agreement to be executed between Cold Stone and a Cold Stone Franchisee, and has
otherwise provided the requisite approvals for the Co-Branded Store.

     2.3 Amendment to Franchise Agreement

          2.3.1. The parties hereto acknowledge that it is not intended that RMCF shall be a franchisor
with respect to a Cold Stone Franchisee. It is the expectation of the parties that old Stone shall,
pursuant to its Franchise Agreement with its Cold Stone Franchisee, sublicense the RMCF Business
and enforce the standards of the RMCF Business directly with its Cold Stone Franchisee. In order to
implement such agreement, the parties shall cooperate from time to time to amend the form of
amendment to franchise agreement that Cold Stone will use with its Cold Stone Franchisees, a copy
of the initial Amendment is attached hereto as Schedule B. The parties further understand
that in no event shall the Cold Stone Franchisee receive any rights, license or permission to
operate the RMCF Business for a period greater than the lesser of (i) the remaining term of the
Cold Stone Franchisee’s term under their Franchise Agreement plus renewals or (ii) the Term of this
Agreement, without the express written consent of RMCF. In the event a Co-Branded Store is operated
by either party, or by an Affiliate of either party, no Amendment will be required but the
Co-Branded

6

 

Store will be operated in accordance with the terms of this Agreement, the RMCF Operating
Manual (as amended from time to time) and the. Joint Operating Manual (as applicable).

     2.4 Term

          2.4.1. The Term of this Agreement will commence on the Commencement Date and continue until
the date upon which the last Co-Branded Store ceases to be open for business pursuant to the
provisions of the Amendment.

3. CO-BRANDED STORES

     3.1 Grant of Rights for Co-Branded Stores

     Cold Stone shall offer the rights to execute the Amendment and develop or convert to a
Co-Branded Store, to the Cold Stone Franchisees whose locations are listed on Schedule A,
attached to this Agreement, and to prospective Cold Stone Franchisees through inclusion of
informational disclosures regarding the RMCF Business, together with the Amendment, in its Cold
Stone UFDD, which shall be prepared and used in a manner consistent with Cold Stone’s
representations, warranties and covenants contained in Section 11.1.7.

     3.2 Approval of Locations for Co-Branded Stores

     The parties agree that only locations that have been approved by both parties may be converted
by Cold Stone to a Co-Branded Store or developed as a Greenfield Store. Attached to this Agreement
as Schedule A is a preliminary list of locations approved by the parties for development or
conversion to Co-Branded Stores as of the Commencement Date. Additional locations may be designated
and approved for development of or conversion to Co-Branded Stores by agreement of the parties
evidenced in writing. Cold Stone will promptly forward to RMCF a copy of the Franchise Agreement
and the Amendment upon full execution of the Amendment, together with such type of information
regarding the Cold Stone Franchisee, the Co-Branded Store location and such additional information
regarding development of the Co- Branded Store as the parties may from time to time agree upon.
Cold Stone may at its sole discretion remove a location from Schedule A, or withdraw its
approval to convert, at any time prior to the execution of an Amendment by Cold Stone and the Cold
Stone Franchisee., RMCF may at its sole discretion remove a location from Schedule A, or
withdraw its appioval to develop or convert, at any time prior to Cold Stone commencing the
development or conversion of the location to a Co-Branded Store, as the case may be.

     3.3 Greenfield Stores.

     Either party may propose a brand new location for a new or existing Franchisee to develop a
Co-Branded Store. The parties agree that only franchisees and locations that have been approved by
both parties may be opened as a Co-Branded Store; and upon such approval, such franchisee and
location shall fall under the terms and conditions of this Agreement. Cold Stone will be the host
Franchisor for all of the Greenfield Stores opened under this Agreement.

7

 

Section 7.2.2 below sets forth the initial franchise fees applicable to any Greenfield Stores
opened under this Agreement.

     3.4 Development of Premises

          3.4.1. Cold Stone will ensure that the Cold Stone Franchisee constructs and equips the
Premises in accordance with the timetable or schedule specified by, and in conformity with the RMCF
System standard layout plans, specifications, design criteria and drawings (“Premises
Specifications”) that RMCF will provide. If the final Premises Specifications differ from the RMCF
System standard Premises Specifications, then the final Premises Specifications shall be forwarded
to RMCF for its prior approval before construction commences. RMCF’ s approval of construction and
development of the Premises will be required before the commencement of the RMCF Business. All cost
of plans and specifications and all costs and expenses pertaining to the construction and equipping
of the Premises will be borne exclusively by the Cold Stone Franchisee. Each party will work
together to provide consultation or advice to the Cold Stone Franchisee in constructing and
equipping the Premises. Cold Stone acknowledges that the Inventory, Equipment and development
obligations as provided herein are necessary to properly sell and perform the Services. Cold Stone
will ensure that its Cold Stone Franchisee uses the Premises in the operation of the Cold Stone
Business and the RMCF Business only and for no other purpose without the prior written consent of
RMCF at any time.

     3.5 Equipment and Inventory

          3.5.1. Equipment. Cold Stone agrees that it will purchase or otherwise acquire, or require the
Cold Stone Franchisee to purchase or otherwise acquire, from vendors designated or otherwise
approved by RMCF, or from RMCF, the Equipment needed to add the RMCF Business to the Cold Stone
Franchisee’s Premises or to develop and equip a Greenfield Store, and for a price in accordance
with RMCF’s standard pricing practices.

          3.5.2. Inventory. Cold Stone agrees that throughout the Term it shall cause the Cold Stone
Franchisee to purchase from RMCF or its authorized supplier(s) (as the case may be) the required
Inventory. (This material has been omitted pursuant to a request for confidential treatment and
such material has been filed separately with the Commission.) A Cold Stone Franchisee is under no
obligation to accept resale prices as may be suggested by RMCF and the Cold Stone Franchisee may
offer the Services and sell the Inventory at any lower price it chooses. However, Cold Stone will
use its best efforts to ensure that the Cold Stone Franchisee does not exceed the maximum suggested
resale prices specified by the RMCF System. Cold Stone acknowledges that Inventory pricing may be
changed by RMCF at any time.

8

 

     3.6 Obligations

          3.6.1. Best Efforts. Cold Stone will use best efforts to compel its Cold Stone Franchisee to:
(a) comply with all laws, and adhere to the highest standards of honesty, integrity, fair dealing
and ethical conduct; (b) offer such Services and only such products in connection with the
Services, as agreed to by the parties and as amended from time to time; (c) participate fully in
all national, regional and local promotions initiated by either Cold Stone or RMCF; (d) cause
on-site management to devote sufficient time and attention to the RMCF Business; (e) maintain a
minimum quantity of Inventory items and the mix of Inventory as RMCF may specify for the RMCF
Business products from time to time; (f) provide the other party with such written or other reports
related to the RMCF Business as are specified in this Agreement, the Franchise Agreement,
Amendment, Cold Stone Operating Manual, and RMCF Operating Manual from time to time including
without limitation, regular sales reports confirming gross sales for the Cold Stone Business and
the RMCF Business; (g) comply with the RMCF Operating Manual, as amended from time to time; (h)
abide by and implement all changes to the System as the parties agree to from time to time; (i)
adhere to the highest health and safety standards; and (j) maintain the Premises in a clean,
orderly condition and in excellent repair (including adjacent public areas). Cold Stone will notify
RMCF by telephone within twenty-four (24) hours of any investigation or violation, actual or
alleged, concerning any health or sanitary laws or regulations and, thereafter, and will use best
efforts to ensure that its Cold Stone Franchisee takes any actions directed by any government
agency or required by RMCF or Cold Stone in order to remediate the situation. In any event, Cold
Stone will provide prompt notice and ongoing information with respect to any such investigation or
violation.

          3.6.2. Health or Sanitary Violations. In the event that there is a health or sanitary
violation within the knowledge of RMCF (eg. product recall), then RMCF will provide the same notice
and ongoing information as required above.

     3.7 Employees and Contractors

          3.7.1. The parties agree that the Cold Stone Franchisee shall be responsible for all of its
employees including but not limited to compliance with laws, employee training, and wages and
commissions payable to any employee(s) or contractor(s) engaged to assist in carrying out the
obligations to comply with the RMCF System and the provisions of the Amendment, and for all other
legal obligations relating to the Services at and through the Co- Branded Stores.

4. TRAINING AND GUIDANCE

     4.1 Training

          4.1.1. Cold Stone Franchisees. Prior to operating the RMCF Business at the Premises, Cold
Stone Franchisees must complete RMCF’s three (3) days of classroom and on- the-job training,
conducted at RMCF’s training facility in Durango, Colorado, or such other location as designated or
approved by RMCF, by RMCF or by Cold Stone’s employees or ADs who have completed RMCF’s training
described in Section 4.1.2 and who have otherwise been approved by RMCF to conduct the RMCF
training. If a Cold Stone Franchisee does not complete the RMCF training in a manner satisfactory
to RMCF, RMCF may require such Cold Stone Franchisee to attend additional training as reasonably
necessary at a location designated by RMCF. RMCF reserves the Tight to charge a Cold Stone
Franchisee for its travel costs and living expenses incurred by its trainers and personnel and a
per diem fee at its then current published rates, in the event it determines that additional

9

 

training conducted at the Premises is reasonably necessary for the Cold Stone Franchisee’s
satisfactory completion of the training.

          4.1.2. Cold Stone Employees. Cold Stone’s Operational Support must complete RMCF’s three (3)
days of classroom and on-the-job training at RMCF’s training facility in Durango, Colorado, or such
other location as designated by RMCF. If Cold Stone’s Operational Support does not complete the
RMCF training in a manner satisfactory to RMCF, RMCF may require the Cold Stone Operational Support
personnel to attend additional training as reasonably necessary at a location designated by RMCF.
Cold Stone will bear all travel costs and living expenses incurred by its Operational Support
personnel to attend the RMCF training.

          4.1.3. Training of Transferees. Any transferee of a Co-Branded Store must attend training as
set forth above prior to operating the RMCF Business at the Premises.

     4.2 Operating Assistance

          4.2.1. During the Term of this Agreement, each party shall provide the other with such advice
and guidance, as may be reasonably necessary from time to time.

5. SYSTEM STANDARDS

     5.1 Operational Oversight

          5.1.1. The parties hereto acknowledge that the operational standards of each must be
maintained to the greatest extent reasonably possible in order to maintain the highest standards of
customer service, food safety, and food quality. The RDO or AD for the Cold Stone Business shall be
the primary operational contact with the Cold Stone Franchisee. Notwithstanding same, the RMCF
Operational Support will be permitted to enter the front of the house of the Premises on an
informal basis in order to evaluate compliance with proper operational standards. If the RMCF
Operational Support observes issues of significant concern, he/she shall promptly contact his/her
counterpart with the other party to alert him/her of the concerns and request that the concerns be
promptly addressed. If the RMCF Operational Support observes issues that create health or safety
issues for the customers, employees, or other third parties at the location, the RMCF Operational
Support will notify and request that his/her counterpart address the issue within twenty-four (24)
hours of receipt of the concern.

          5.1.2. The parties acknowledge that they will mutually work together to establish Cold Stone
Operational Support as the primary Operational Support for the RMCF Business and may make joint
visits to the Premises to evaluate the operations of the Cold Stone Franchisees, recognizing that
the RMCF Operational Support is a key resource for advice and direction on the RMCF Business
operational standards.

          5.1.3. In the event of a conflict with respect to differing operational standards between the
Cold Stone System and the RMCF System, the Cold Stone Business operational standards shall control.

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     5.2 Approval of Vendors and Suppliers

          5.2.1. Cold Stone will, within seven (7) days of receipt of notice from its Cold Stone
Franchisees of a request to purchase or lease goods or services from a vendor or supplier not
approved by RMCF in the RMCF Operating Manual, notify RMCF of such request and provide RMCF with
all relevant samples and specifications reasonably requested by RMCF (and provided by Cold Stone
Franchisee) to evaluate such request and determine whether the equipment, supplies or products meet
the quality standards of RMCF. RMCF Franchisor shall use reasonable efforts to evaluate such
request within twenty-one (21) days, or such other time period upon notice to Cold Stone, and
notify Cold Stone of its approval or disapproval of such vendor or supplier. Failure of RMCF to
notify Cold Stone within such twenty-one (21) day period shall not be deemed as approval of the
proposed vendor or supplier. RMCF shall be entitled to payment of all reasonable expenses it incurs
in this evaluation, which shall be paid by Cold Stone to RMCF within ten (10) days of RMCF’s notice
to Cold Stone of its approval or disapproval of the requested vendor or supplier, which notice
shall include all expenses reasonably incurred.

     5.3 Compliance with System and Conflict of Systems

          5.3.1. Cold Stone agrees to use its best efforts to ensure that its Cold Stone Franchisees
perform the Services associated with the RMCF Business in accordance with this Agreement and the
RMCF Operating Manual, as amended from time to time. To the extent a conflict arises between the
RMCF Operating Manual and the Cold Stone Operating Manual, the provisions of the Cold Stone
Operating Manual shall control.

          5.3.2. RMCF agrees to provide Cold Stone with written notice pursuant to Section 12.11 in the
event a Cold Stone Franchisee fails to pay RMCF for purchases of RMCF Products. Cold Stone agrees
to take all reasonably necessary steps to bring the Cold Stone Franchisee into compliance or
otherwise terminate the Cold Stone Franchisee’s rights to operate a RMCF Business pursuant to the
Amendment.

     5.4 Conflict of Products

          5.4.1. A Cold Stone Franchisee will not sell at the Premises a product of Cold Stone that is
the same or similar to the following products offered by RMCF: caramel apples in all varieties,
chocolate dipped fruit and confections (excluding waffle products), pre-packaged proprietary
chocolate, and assorted factory bulk chocolate sold by the pound.

          5.4.2. Where a product of RMCF is the same or substantially similar to a product of Cold Stone
which is already sold by the Cold Stone Franchisee, the Cold Stone Franchisee may retain the Cold
Stone product already being sold and is not required to sell such product of RMCF.

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     5.5 Confidentiality

          5.5.1. Obligations. Each party will at all times, both during the term of this Agreement and
thereafter, keep and hold all Confidential Information of the other party in the strictest
confidence, and will not use such Confidential Information for any purpose, other than as may be
reasonably necessary for the performance of its duties pursuant to this Agreement, without the
other party’s prior written consent. Each party agrees:

               5.5.1.1.1. that it will not disclose to any third party or use any Confidential Information
disclosed to it by the other except as expressly permitted in this Agreement; and

               5.5.1.1.2. that it will take all reasonable measures to maintain the confidentiality of all
Confidential Information of the other party in its possession or control, which will in no event be
less than the measures it uses to maintain the confidentiality of its own information of similar
importance.

          5.5.2. Exceptions. Notwithstanding the foregoing, each party may disclose Confidential
Information:

               5.5.2.1.1. to the extent required by a court of competent jurisdiction or other governmental
authority or otherwise as required by law; or

               5.5.2.1.2. on a “need-to-know” basis under an obligation of confidentiality to its affiliates
and to its and its affiliates’ authorized agents, contractors, legal counsel, accountants, banks
and other financing sources and their advisors, provided such third party are bound by a similar
duty of confidentiality.

          5.5.3. Definitions and Limitations. For purposes of this Agreement, Confidential Information
shall include without limitation, all data, software, processes, recipes, procedures, know-how,
documents, concepts, designs, improvements, inventions, materials, trade secrets and other
information (collectively, “Information”) with respect to or relating to party’s business, business
plans, marketing plans, financial information, products, personnel, suppliers, vendors, customers,
policies and operational methods and manuals. For Cold Stone, Information shall include, without
limitation, the formulation, research and development, and/or the manufacture of ice cream, yogurt,
sorbet and other frozen dessert products, whether oral or written, whether textual, graphic or
machine-readable form, regardless of whether the Information is marked or otherwise identified as
“confidential”. For RMCF, Information shall include, without limitation, the formulation, research
and development, and/or the manufacture of its chocolate and confection products, whether oral or
written, whether textual, graphic or machine-readable form, regardless of whether the Information
is marked or otherwise identified as “confidential”. The parties agree that any information marked
by one party as “Confidential” shall be treated as such by the other party and shall be subject to
the provisions of this Section 5.5.

     Confidential Information does not include the following information:

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               5.5.3.1.1. information which is in the public domain when it is received by or becomes known
to the recipient party or which subsequently enters the public domain through no fault of the
recipient party (but only after it enters the public domain);

               5.5.3.1.2. information which is already known to the recipient party at the time of its
disclosure to the recipient party by the disclosing party and is not the subject of an obligation
of confidence of any kind;

               5.5.3.1.3. information which is independently developed by the recipient party without any use
of or reference to the Confidential Information of the disclosing party where such independent
development can be established by evidence that would be acceptable to a court of competent
jurisdiction; and

               5.5.3.1.4. information which is received by the recipient party in good faith without an
obligation of confidence of any kind from a third party who the recipient party had no reason to
believe was not lawfully in possession of such information free of any obligation of confidence of
any kind, but only until the recipient party subsequently comes to have reason to believe that such
information was subject to an obligation of confidence of any kind when originally received.

          5.5.4. Remedies for Breach of Confidentiality Obligations. Each party acknowledges that its
failure to comply with the provisions of this section may cause irreparable harm to the other party
which cannot be adequately compensated for in damages, and accordingly acknowledges that the other
party may be entitled to obtain, in addition to any other remedies available to it, interlocutory
and permanent injunctive relief to restrain any anticipated, present or continuing breach of this
Section.

          5.5.5. Return of Confidential Information. Upon the termination of this Agreement, each party
will return to the other all Confidential Information of the other which is then in its possession
or control, and will remove all digital representations thereof in any form from all electronic
storage media in its possession or under its control. Cold Stone also agrees to make reasonable
efforts to require its Cold Stone Franchisees to return all Confidential Information of the other
which is then in their possession or control, and to remove all digital representations thereof in
any form from all electronic storage media in their possession or under their control.

     5.6 Non-competition

     The parties agree that they will not authorize or permit a competitor of either party, to
operate or otherwise sell their products at any Co-Branded Store during the Term of this Agreement.
Cold Stone will use its best efforts to ensure that its Cold Stone Franchisees do not during the
Term, except with the RMCF’s prior written consent, directly or indirectly, carry on, license,
franchise, or be engaged, employed or interested in or advise any business which may be considered
a competitor of RMCF.

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6. ADVERTISING

     6.1 Advertising and Marketing Materials Prepared by Cold Stone

     Any advertising or marketing materials prepared by Cold Stone or Cold Stone Franchisees that
contains the Marks of RMCF must be approved in writing by RMCF prior to such use, with such
approval not to be unreasonably withheld or unduly delayed. Cold Stone will use its best efforts to
monitor its respective Cold Stone Franchisees to ensure compliance with this Section. Any grand
opening cost for the opening of a Co-Branded Store shall be borne by the Cold Stone Franchisee.

     6.2 Advertising and Marketing by Cold Stone Franchisees

     RMCF shall include the Cold Stone Franchisees in all relevant marketing plans and promotions
for the Services; provided, however: (1) Cold Stone Franchisees will have to pay the published
charges for the production or printing of any advertising and marketing materials; and (2) Cold
Stone Franchisees may not have access to, or may not necessarily directly benefit from, marketing
plans and promotions paid for by the RMCF marketing fund for its standard store franchisees. RMCF
may send such advertising and marketing materials directly to the Cold Stone Franchisees, with a
copy to Cold Stone, and may collect related charges for the production or printing of materials and
promotions directly from Cold Stone Franchisees. The parties will endeavor to reconcile their
marketing calendars with respect to the Co-Branded Stores as soon as practicable after the
Commencement Date.

     6.3 Promotions Conflict

     Each party will use their best efforts to ensure that a Cold Stone Franchisee will only
participate in promotions of RMCF that relate to the RMCF products served at a Co-Branded Store.
Both parties shall also endeavor to incorporate both of their respective primary promotional
calendars at a Co-Branded Store from time to time. However, in the event of a conflict of
promotional calendars, the parties agree that the Cold Stone Franchisee will not be required to
follow any promotions of RMCF that conflict with similar or conflicting promotions of Cold Stone.

7. ROYALTY PAYMENTS; SALES REPORTS

     7.1 Royalties

In return for the ongoing rights and privileges granted in this Agreement, Cold Stone agrees to pay
a (This material has been omitted pursuant to a request for confidential treatment and such
material has been filed separately with the Commission.) royalty to RMCF on the “Net Sales” (as
defined below) of RMCF Products and RMCF-branded items sold at Co-Branded Stores. “Net Sales” shall
mean the total of all sales of RMCF Products and RMCF-branded items sold at each Co-Branded Store,
including catering, Internet and off-site sales, but excluding (i) the amount of any state or local
sales or use tax actually paid by Franchisee, (ii) refunds or returns and (iii) the discounted
portions of goods sold, including but not limited to sales under coupon or promotion so long as
such discounts are not provided in exchange for any rights, goods or services. Any payments based
upon this Section shall be based upon amounts actually collected from the Cold Stone Franchisees
and Cold Stone will not be liable to RMCF for royalties or other payments not actually collected
from the Cold Stone Franchisees. Notwithstanding the foregoing,

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Cold Stone agrees to use its best efforts to collect all amounts owed to it from the Cold Stone
Franchisees in connection with the Co-Branded Stores but will have no liability to RMCF if such
best efforts are unsuccessful in collecting amounts owed. To the extent that Cold Stone collects
some, but not all, of royalties or other monies owed pursuant to the Franchise Agreement and
Amendment from its Cold Stone Franchisee, the amount collected will be split between Cold Stone and
RMCF proportionately based upon the total amount due to each party. Payments shall be made pursuant
to this Agreement as long as any Co-Branded Store remains open for business. All payment amounts
shall be made no later than the fifteenth (15th) of each month for the previous month’s collected
royalties and fees.

     7.2 Franchise Fees.

          7.2.1. Converted Stores. In respect of Converted Stores, Cold Stone will pay to RMCF an
initial franchise fee of * within ten (10) days of receiving such amount from the Cold Stone
Franchisee.

          7.2.2. Greenfield Stores. In respect of Greenfield Stores, Cold Stone will pay to RMCF an
initial franchise fee as set forth below:

               7.2.2.1. If RMCF initially identified the franchisee and the franchisee is then approved by
Cold Stone as a Cold Stone Franchisee to open a Greenfield Store, then Cold Stone will pay to RMCF
* of the franchise fee it collects from such franchisee within ten (10) days of receiving such
amount from the franchisee.

               7.2.2.2. If Cold Stone initially identified the franchisee and the franchisee is approved by
RMCF to open a Greenfield Store, then Cold Stone will pay to RMCF * within ten (10) days of
receiving such amount from the franchisee.

     7.3 Royalty Relief

     Cold Stone may in its sole discretion, provide relief to its Cold Stone Franchisee for the
payment of royalties, advertising funds or other monies due under the Franchise Agreement for the
Cold Stone Business. Cold Stone may not offer any such similar relief with respect to the RMCF
Business without the prior written consent of RMCF.

     7.4 Transfer of Funds

     Each party agrees to cooperate fully and comply with any system implemented by the other party
for the transfer of funds directly from each other’s bank account, including the execution of any
pre-authorized payment forms required by either party or their respective bankers, from time to
time.

     7.5 Amounts Exclusive of Taxes

     Any and all amounts expressed as being payable pursuant to this Agreement are exclusive of any
applicable taxes.

     7.6 Currency

     All dollar amounts referred to in this Agreement or to be calculated pursuant to the terms hereof
are in U.S. funds.

 

			
	*	 	This material has been omitted pursuant to a request for confidential treatment and such material
has been filed separately with the Commission.

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     7.7 Sales Reports

     Cold Stone will provide RMCF with sales reports for each Co-Branded Store containing the
information set forth in Schedule C (the “Sales Reports”). Each Sales Report will cover a
period of one week (i.e. seven (7) consecutive days) and will be delivered within four (4) business
days following the end of Cold Stone’s normal sales reporting week. The parties may from time to
time, by mutual written agreement, alter the form of the Sales Reports. Cold Stone will use best
efforts to ensure the accuracy of the Sales Reports and will co-operate with RMCF in the event of
an investigation or audit with respect to the Sales Reports. RMCF may, following at least two (2)
days prior written notice, not more than one (1) time during each six (6) month period, cause an
audit to be made of the applicable records and books of Cold Stone (and if reasonably necessary,
its Cold Stone Franchisees) and prompt adjustment shall be made by Cold Stone to compensate for any
errors or omission disclosed by such audit. The audit shall be conducted at the expense of RMCF
performing such audit and by one of the major certified public accountancy firms; provided,
however, that where any such audit reveals an error in excess of five percent (5%) below the amount
actually owed, the entire cost of the audit shall be borne by Cold Stone.

          7.7.1. Without limiting the generality of the foregoing, Cold Stone agrees to keep complete
books and records reasonably necessary for the purpose of allowing RMCF to confirm the amount of
royalties or other fees billed or collected by Cold Stone for a period of time as required by law.

     7.8 Sharing of Sales

     Cold Stone may share with its general franchisee community sales information relating to the
sale of the RMCF products at the Premises operated by its Cold Stone Franchisee, provided such
information:

          7.8.1. Is presented in an anonymous fashion which does not identify the sites from which the
sales information is derived;

          7.8.2. Is an average of sales information at not less than five (5) locations;

          7.8.3. Is gross sales information only and does not include product mix information;

          7.8.4. Is disclosed in such a way as to not violate any local, state or federal law, including
but not limited to the Federal Trade Commission’s Rule Governing Franchise Disclosure Documents;
and

          7.8.5. Does not constitute material non-public information pursuant to applicable securities
law.

     7.9 Indemnification for Sharing of Sales

     Cold Stone will indemnify RMCF in respect of all claims that may be brought by current, future
and potential franchisees in connection with the dissemination and sharing of such sales
information pursuant to the terms of Section 12.2 herein.

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8. TRANSFER

     8.1 Master License Agreement

     Neither party may transfer, assign or sub-license this Agreement, or any of its rights and
obligations hereunder to an unaffiliated third party (each a “Transfer”) without the prior written
consent of the other party, which consent may not be unreasonably or unduly withheld.
Notwithstanding the foregoing, a Transfer does not require consent where such transfer forms part
of the sale of all, or substantially all, of the transferor’s assets or business; however,
transferor shall provide notice to the other party immediately upon such Transfer occurring. For
clarity, a transfer to an Affiliate shall not require consent but the transferring party shall give
the other party notice upon completion of the transfer to an Affiliate.

     8.2 Co-Branded Store

     The parties agree that any request by a Cold Stone Franchisee to transfer his/her Co- Branded
Store shall be subject to the transfer process utilized by Cold Stone, with written notice
forwarded to RMCF as soon after receipt of such notice from the Cold Stone Franchisee as
practicable, but in any event prior to the proposed date of the transfer.

9. DEFAULT AND TERMINATION

     9.1 Events of Default

     Either party has the right to terminate this Agreement, without prejudice to any other legal
right or remedy, if the other party is in material default of its obligations hereunder and fails
to rectify the default to the reasonable satisfaction of the non-defaulting party within forty-five
(45) days of receipt of written notice from the non-defaulting party detailing the default (in the
case of a monetary default pursuant to Section 9.1.1, within fifteen (15) days). Default shall
include, without limitation:

          9.1.1. 9.1.1 Failure to pay any amounts due hereunder;

          9.1.2. the party ceases to carry on business, or takes any action to liquidate its assets;
makes a general assignment for the benefit of creditors or a bulk sale of its assets; is the
subject of any proceeding under any law relating to insolvency or bankruptcy;

          9.1.3. stops making payments in the usual course of business;

          9.1.4. if there is Transfer of this Agreement in violation of Section 8;

          9.1.5. a criminal act or act of moral turpitude committed by a senior level employee of one
party during their employment or a public spokesperson associated with one party during the terms
of association that materially adversely affects the other party’s System’s reputation, its
intellectual property, the good will associated therewith, or its financial condition;

          9.1.6. failure of the other party to comply with the covenants in Sections 5.5 and 5.6;

          9.1.7. if any party knowingly submits any false reports or statements;

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          9.1.8. if any party defaults in paying any monies due to a third party for which the other
party is or may become liable;

          9.1.9. the habitual failure by Cold Stone to use its best efforts to enforce the operational
standards of the RMCF Business, including, but not limited to, Cold Stone’s failure to terminate a
Cold Stone Franchisee’s rights under an Amendment at RMCF’s reasonable request, following a Cold
Stone Franchisee’s default and failure to cure such default, if curable, under the Amendment; or

          9.1.10. if any party understates any payment due to the other by three percent (3%) or more.

     9.2 Notwithstanding the foregoing, the parties agree to extend the cure periods
referred to above, for a reasonable period of time, if the defaulting party is in the process of
diligently rectifying such default and through no fault of its own, the default was not cured
during such period.

     9.3 The parties agree that Sections 9.1.2 and 9.1.4 will have no cure period and shall be
subject to an immediate right of termination upon notice by the non-defaulting party.

     9.4 “Cure” for purpose of Section 9.1.5 is defined as dissociation from the employee or
spokesperson in question and/or otherwise addressing by way of public statement the impropriety of
the alleged act.

10. DISPUTE RESOLUTION

     10.1 Store Level Operational Dispute Resolution Process

     If a Dispute arises during the term of this Agreement between the parties concerning the
manner in which to resolve a perceived operational default by a Cold Stone Franchisee, the parties
will in good faith attempt to resolve such Dispute promptly and in an amicable manner. If a Dispute
arises which is not resolved by the operational personnel involved, the Dispute Resolution
Committee will be notified by either party. The Dispute Resolution Committee will meet, which
meeting may be held telephonically, within ten (10) calendar days of receipt of notice of a
Dispute. If the Dispute Resolution Committee cannot resolve the Dispute within ten (10) calendar
days after meeting, the dispute will be submitted to a limited arbitration hearing before a neutral
third party arbitrator mutually agreed to by the parties with expertise in restaurant operations.
If the parties cannot agree to an arbitrator within three (3) days, then each party will appoint an
arbitrator, who together will appoint a third arbitrator, who will preside over the arbitration
between the parties. The parties agree that very limited evidence may be presented and no discovery
will be permitted to resolve a Dispute pursuant to this Section 10.1. Notwithstanding this Section
10.1, either party retains the right to seek injunctive relief before the Federal Courts of the
United States where the other party’s United States headquarters is located if the alleged default
is not compensable by monetary damages and/or may cause immediate irreparable harm to the party
seeking such relief. In the event the Dispute involves a default of the Franchise Agreement or
Amendment, the parties agree that the arbitrator has the jurisdiction to award any available
remedies under the Franchise Agreement, including but not limited to compelling Cold Stone to
terminate the Amendment and de-identify the Co-Branded Store. The arbitrator may also award the
prevailing party its reasonable fees and costs. The non- prevailing party may not consider the
Dispute as an event of default pursuant to Section 9.1.

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11. REPRESENTATIONS AND WARRANTIES

     11.1 Cold Stone Representations, Warranties and Covenants

          Cold Stone represents, warrants and covenants to RMCF as follows and acknowledges that RMCF
has relied upon the completeness and accuracy of such representations, warranties and covenants in
entering into this Agreement:

          11.1.1. it has the corporate capacity to enter into this Agreement and to
perform each of its obligations hereunder;

          11.1.2. it has duly authorized, executed and delivered this Agreement and this Agreement
constitutes a legally valid and binding obligation of it enforceable against it in accordance with
its terms except as such enforcement may be limited by applicable bankruptcy, insolvency and other
laws of general application affecting the enforcement of creditors’ rights and subject to general
equitable principles;

          11.1.3. its performance of this Agreement will comply with and will neither contravene, breach
nor infringe any laws or regulations applicable in the U.S.;

          11.1.4. it has secured or will secure all consents required from the owners (or lessors, as
applicable) of the Premises to permit the RMCF Business to be conducted in the Premises;

          11.1.5. it will not issue a press release or make any other form of public
announcement about any business relationship contemplated by this Agreement without the express
prior written consent of RMCF, which consent may not he unreasonably withheld;

          11.1.6. it has been engaged in the operation of retail stores for substantially in excess of
two (2) years and anticipates that its incremental revenue attributable to its operation of the
Co-Branded Stores pursuant hereto is likely to represent twenty percent (20%) or less of the
aggregate revenues of Cold Stone during the first twelve (12) months of the Term of this Agreement
(the purpose of such representation being to provide RMCF with the information to determine whether
the arrangement provided for herein is an exempt “fractional franchise” within the meaning of
franchise disclosure or registration laws or regulations under federal law and the laws of the
several states).

          11.1.7. its UFDD is accurate and does not contain any material omissions and, as used during
the Term to disclose to Cold Stone Franchisees considering the development or conversion of a
Co-Branded Store, will be and remain accurate and not contain any material omissions;

          11.1.8. it is and will be the legal and beneficial owner or authorized licensor
of all Cold Stone Intellectual Property Rights in the Cold Stone Marks;

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          11.1.9 it will not infringe upon any of the Intellectual Property Rights of the other party or
its Affiliates or of any person or otherwise infringe, interfere with, breach, contravene, harm or
damage any other rights (including any personality, confidentiality, privacy, equitable or
statutory rights whatsoever) of any person in the performance of its obligations under this
Agreement; and

          11.1.10 it has not and will not grant any rights or licenses or enter into any agreement or
understanding that would conflict with Cold Stone’s obligations or RMCF’s rights under this
Agreement.

     11.2 RMCF Representations, Warranties and Covenants

     RMCF represents, warrants and covenants to Cold Stone as follows and acknowledges that Cold
Stone has relied upon the completeness and accuracy of such representations, warranties and
covenants in entering into this Agreement:

          11.2.1 it has the corporate capacity to enter into this Agreement and to perform each of its
obligations hereunder;

          11.2.2 its UFDD is accurate and does not contain any material omissions and, as used during
the Term to disclose to Cold Stone Franchisees considering the development or conversion of a
Co-Branded Store, will be and remain accurate and not contain any material omissions;

          11.2.3 the information regarding RMCF provided to Cold Stone for preparation of its Exhibit W
to its UFDD is accurate and does not contain any material omissions;

          11.2.4 it has duly authorized, executed and delivered this Agreement and this Agreement
constitutes a legally valid and binding obligation of it enforceable against it in accordance with
its terms except as such enforcement may be limited by applicable bankruptcy, insolvency and other
laws of general application affecting the enforcement of creditors’ rights and subject to general
equitable principles;

          11.2.5 it is and will be the legal and beneficial owner or authorized licensor of all RMCF
Intellectual Property Rights in the RMCF Marks free and clear of all liens, charges and
encumbrances to the extent that the same may restrict or limit the ability of RMCF to perform its
obligations or of Cold Stone to exercise its rights under this Agreement and RMCF has the full
power and authority to grant the rights and perform the obligations herein contemplated without the
consent of any other person;

          11.2.6 the RMCF Marks and its use by Cold Stone as permitted herein does not and will not
infringe on any Intellectual Property Rights whatsoever of any person and is not and will not: (a)
be libelous, slanderous, defamatory, obscene, pornographic, abusive, or otherwise offensive,
objectionable or unlawful; (b) give rise to civil liability; (c) constitute or encourage conduct
that would constitute a criminal offense; or (d) otherwise fail to comply with any applicable laws,
rules, regulations or court orders;

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          11.2.7 it will not infringe upon any of the Intellectual Property Rights of the other party or
its Affiliates or of any person or otherwise infringe, interfere with, breach, contravene, harm or
damage any other rights (including any personality, confidentiality, privacy, equitable or
statutory rights whatsoever) of any person in the performance of its obligations under this
Agreement;

          11.2.8 it has not and will not grant any rights or licenses or enter into any agreement or
understanding that would conflict with RCMF’s obligations or Cold Stone’s rights under this
Agreement;

          11.2.9 its performance of this Agreement (including without limitation the granting of all
rights by RMCF to Cold Stone herein) will comply with and will neither contravene, breach nor
infringe any laws or regulations applicable in the U.S;

          11.2.10 it will not issue a press release or make any other form of public announcement about
any business relationship contemplated by this Agreement without the express prior written consent
of Cold Stone, which consent may not be unreasonably withheld; and

          11.2.11 RMCF has been engaged in the operation of retail stores for substantially in excess of
two (2) years and anticipates that its incremental revenue attributable to its operation of the
Co-Branded Stores pursuant hereto is likely to represent twenty percent (20%) or less of the
aggregate revenues of RMCF during the first twelve (12) months of the Term of this Agreement (the
purpose of such representation being to provide Cold Stone with the information to determine
whether the arrangement provided for herein is an exempt “fractional franchise” within the meaning
of franchise disclosure or registration laws or regulations under federal law and the laws of the
several states).

     11.3 Survival of Representations, Warranties and Covenants.

     The parties agree that the representations, warranties and covenants contained in subsections
11.1.3 through 11.1.5 and 11.1.7 through 11.1.10 inclusive, 11.2.2, 11.2.3, 11.2.5 through 11.2.10
inclusive herein are continuous covenants and shall apply throughout the Term of this agreement and
for a period of one (1) year after a claim could have been validly brought in connection with any
breach or misrepresentation of said representation, warranty, or covenant.

     11.4 Limited Warranties

          11.4.1 THE FOREGOING WARRANTIES ARE EXCLUSIVE AND ARE GIVEN AND ACCEPTED IN LIEU OF ANY AND
ALL OTHER REPRESENTATIONS, WARRANTIES, COVENANTS AND CONDITIONS, EXPRESS OR IMPLIED, INCLUDING
WITHOUT LIMITATION ANY OTHER IMPLIED WARRANTIES OF MERCHANTABLE QUALITY, ANY IMPLIED WARRANTIES OF
FITNESS FOR A PARTICULAR PURPOSE AND ANY IMPLIED WARRANTIES ARISING FROM COURSE OF DEALING OR
COURSE OF PERFORMANCE.

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12 MISCELLANEOUS

     12.1 Legal Relationship

          12.1.1 Except as expressly provided in this Agreement, each party is an independent
contractor, neither party shall be considered to be the agent, representative, master or servant of
any other party hereto for any purpose whatsoever, and neither party has any authority to enter
into any contract, assume any obligations or to give any warranties or representations on behalf of
any other party hereto. Nothing in this Agreement shall be construed to create a relationship of
partners, joint venturers, fiduciaries, or any other similar relationship among the parties.

     12.2 Indemnification

          12.2.1 Notwithstanding any other provision hereof, each party agrees to defend, indemnify and
hold the other party and its affiliates and their respective directors, shareholders, officers,
employees and agents harmless from and against all claims, investigations, lawsuits, demands,
allegations, governmental actions, losses, costs, damages, expenses and liabilities (including
reasonable legal fees) which may be suffered or incurred by such party arising out of or as a
result of or relating in any manner whatsoever to any breach or non-performance of any term of this
Agreement (including without limitation any representations, warranties and covenants contained in
Sections 11.1 and 11.2) or any injury to persons (including injuries resulting in death) or loss of
or damage to property of others which may be or be alleged to be caused by or suffered as a result
of or in connection with the performance by such party or any of its employees or permitted
contractors of all or any part of such party’s obligations under this Agreement.

     12.3 Limitation of Liability

     EXCEPT FOR THE LIABILITY OF RMCF TO COLD STONE FOR BREACHES OF SECTION 11.2.6 OR THE LIABILITY
OF EITHER PARTY FOR BREACH OF SECTIONS 2.1, 5.5, 5.6 AND 8, HEREOF, OR BASED EXCLUSIVELY UPON
WILLFUL MISCONDUCT OR INTENTIONAL FRAUD OF A PARTY TOWARDS THE OTHER, WHICH IN ALL CASES WILL BE
UNLIMITED, THE LIABILITY OF EACH PARTY TO THE OTHER PARTY IN RELATION TO THIS AGREEMENT WILL IN ALL
CIRCUMSTANCES BE LIMITED TO DIRECT DAMAGES AND NEITHER PARTY WILL BE LIABLE FOR ANY SPECIAL,
CONSEQUENTIAL, INDIRECT, INCIDENTAL, EXEMPLARY OR PUNITIVE DAMAGES OR LOSS OF PROFIT, WHETHER IN
CONTRACT, TORT OR OTHERWISE RESULTING FROM ANY CAUSE OF ACTION WHATSOEVER, INCLUDING NEGLIGENCE,
GROSS NEGLIGENCE, NEGLIGENT MISREPRESENTATION AND/OR FUNDAMENTAL BREACH OR OTHER THEORY OF LAW, THE
LIMITATIONS DESCRIBED IN THIS SECTION 12.3 SHALL NOT APPLY TO ANY REQUEST FOR INDEMNIFICATION
RAISED PURSUANT TO SECTION 12.2 OF THIS AGREEMENT,

     12.4 Waiver and Severability

     No waiver hereunder may be granted except by a written instrument signed by RMCF and/or Cold
Stone, as the case may be. No waiver shall be inferred from or implied by any failure to act or
delay in acting by a party in respect of any default, breach, nonobservance or by anything done or
omitted to be done by another party. The waiver by a party of any

22

 

default, breach or noncompliance under this Agreement shall not operate as a waiver of the
party rights under this Agreement in respect of any continuing or subsequent default, breach or
noncompliance (whether the same or of any other nature). Any provision of this Agreement which is
invalid or unenforceable will be ineffective to the extent of such invalidity or unenforceability
and will be severed from the balance of this Agreement, all without affecting the remaining
provisions of this Agreement. In the event that any portion of this Agreement will have been so
determined to be or become invalid or unenforceable (the “Offending Portion”), the Parties will
negotiate in good faith such changes to this Agreement as will best preserve for the Parties the
benefits and obligations of such Offending Portion.

     12.5 Force Majeure

          12.5.1 Unless continuing or anticipated to continue for a period of thirty (30) days, no delay
or failure to perform on the part of either party will be considered a breach of this Agreement if
such delay or failure to perform is shown to be due to any event or cause beyond the reasonable
control of the party failing to perform, including without limitation, strikes, riots, civil
disturbances, actions or inactions concerning governmental authorities, epidemics, wars, embargoes,
severe weather, fire, earthquakes or acts of God or of the public enemy, power failure or failure
of the internet, provided that the party failing to perform:

          12.5.2 notifies the other party in writing as soon as it becomes aware of the fact and nature
of the delay; and

          12.5.3 establishes and implements a work-around plan for the delay which minimizes disruptions
to the other party and to the Cold Stone Franchisees resulting from the delay or failure to
perform.

     12.6 Binding Effect

     This Agreement will enure to the benefit of, and be binding upon, the parties hereto and their
respective heirs, executors, administrators, successors and permitted assigns.

     12.7 Applicable Law

     This Agreement will be construed in accordance with and governed by the laws of Delaware. The
parties agree that each shall be required to file any lawsuit permitted by this Agreement or file
any demand for arbitration permitted by this Agreement in the venue of the other (e.g. Cold Stone
will be required to file any claims against RMCF in the District of Colorado and RMCF will be
required to file any claims against Cold Stone in the District of Arizona.) Each of the parties
hereby waives the right to trial by jury of any such suit, action or proceeding and hereby waives
any right, claim or entitlement to any punitive or exemplary damages whatsoever.

     12.8 Insurance

          12.8.1 Cold Stone will require its Cold Stone Franchisees to add RMCF (and any other
affiliates, parents, subsidiaries or other related parties of RMCF as it may reasonably require),
as additional insureds under all insurance policies required by Cold

23

 

Stone in conjunction with the operation of the Cold Stone Business and to add additional
policies or increase the policy limits of those policies as to satisfy RMCF’s standard
requirements. Upon request, Cold Stone will provide RMCF with proof of its inclusion as an
additional insured as to each Co-Branded Store.

     12.9 Reasonable Cooperation and Assistance

          12.9.1 Each party will, at its expense, provide the other party with reasonable cooperation
and assistance in relation to the matters under this Agreement. Each party to this Agreement will,
at the request of the other party and without charge (provided that the cost to the providing party
is reasonable under the circumstances), execute and deliver all such further instruments and
documents and take such further actions as may be reasonably requested to further confirm, carry
out and otherwise accomplish the intent and purpose of this Agreement. Wherever consent or approval
is required pursuant to any term of this Agreement, unless provided for to the contrary, such
consent or approval shall not be unreasonably withheld or unduly delayed.

     12.10 Survival

          12.10.1 The termination of this Agreement will not affect or prejudice any rights or
obligations which have accrued or arisen under this Agreement or such part thereof prior to the
time of termination and those rights and obligations will survive the termination of this Agreement
or part thereof. Notwithstanding any other provision of this Agreement, Sections 5.5 and 12.2 and
all other provisions of this Agreement necessary to give effect thereto will survive the
termination of all or any part of this Agreement.

     12.11 Notice

          12.11.1 All written notices and reports permitted or required to be delivered by the
provisions of this Agreement shall be deemed so delivered on the earlier of: (a) the time delivered
by hand; (b) two (2) business days after placement with a commercial courier service; for express
delivery; (c) with regard to Cold Stone, ten (10) days after placement in the United States Mail by
Registered or Certified Mail, Return Receipt Requested, postage prepaid and addressed to the other
party at the respective address listed below; or (d) the date of actual receipt by a party with
regard to any of the foregoing delivery methods.

          12.11.2 For purposes of this Agreement, the parties agree that notice to Cold Stone shall be
addressed as follows:

Kahala Franchise Corp.

9311 E Via de Ventura

Scottsdale, AZ 85258

Attn: General Counsel

24

 

With a copy to:

Kahala Franchise Corp.

9311 E Via de Ventura

Scottsdale, AZ 85258

Attn: Brand President of Cold Stone Creamery

And to RMCF shall be addressed as:

Rocky Mountain Chocolate Factory, Inc.

265 Turner Drive

Durango, CO 81303

Attn: Chief Operating Officer

With a copy to:

Rocky Mountain Chocolate Factory, Inc.

265 Turner Drive

Durango, CO 81303

Attn: Chief Executive Officer

The parties may change these addresses from time to time upon written notice to the other.

     12.12 Entire Agreement

     This Agreement and any schedules are the entire agreement between the parties, and supersedes
all previous agreements and understandings between the parties, relating to the subject matter
hereof. There are no conditions, representations, warranties or other agreements between the
parties in connection with the subject matter of this Agreement, whether oral or written, express
or implied, statutory or otherwise, except as specifically set out in this Agreement.

     12.13 Test Stores

     Notwithstanding any Section in this Agreement to the contrary, the parties agree that the test
stores opened pursuant to that Test License Agreement between Cold Stone and RMCF dated April 4,
2009 will be governed by their respective test agreements and will not be subject to this Agreement
unless and until the test agreement regarding these locations expire and the Cold Stone Franchisees
at these locations execute an Amendment (where such locations are franchised) and at such time,
these locations will be governed by the terms of this Agreement and the Amendment. In the event
such locations are not franchised but are operated by either party, or by an Affiliate of either
party, the parties shall at the expiration of the respective test agreement for such location
confirm in writing their intention that such location be governed by this Agreement.

     12.14 Receipt of Disclosure

     Each party acknowledges receipt of a copy of the other party’s UFDD, at least fourteen (14)
days prior to execution of this Agreement or payment of any consideration.

25

 

     12.15 Joint and Several

     If two or more individuals, corporations, partnerships or other entities (or any combination
of two or more thereof) shall sign or be subject to the terms and conditions of this Agreement, the
liability of each of them under this Agreement shall be deemed to be joint and several.

     12.16 Limited Right of Set-Off

     Except to the extent of the payments between the parties pursuant to Sections 3.5.2 and 7 of
this Agreement, there shall be no right of set-off.

     12.17 Counterparts

     This Agreement may be executed by any party in one or more counterparts and when each party
has executed at least one counterpart, each of such counterparts shall be deemed to be an original,
and all such counterparts taken together shall constitute one and the same Agreement.

     12.18 Legal Counsel

     The parties acknowledge that their respective legal counsel have reviewed and participated in
settling the terms of this Agreement, and that any rule of construction to the effect that any
ambiguity is to be resolved against the drafting party will not be applicable in the interpretation
of this Agreement.

     12.19 Remedies Cumulative

     Notwithstanding any other provision of this Agreement, and unless otherwise expressly stated
herein, all rights and remedies of any party under this Agreement are in addition to such party’s
other rights and remedies and are cumulative, not alternative.

     12.20 Amendment and Supplement

     This Agreement, including each schedule to this Agreement, may not be amended or supplemented
except by mutual written agreement of both parties. Any such agreement will expressly state that it
is intended to amend or supplement, as the case may be, this Agreement.

     12.21 Execution of Agreement

     This Agreement may be executed in counterparts, each of which when executed and delivered
shall be deemed an original, and such counterparts together shall constitute one and the same
instrument.

     12.22 Time of Essence

     
Time will be of the essence of this Agreement in all respects.

26

 

     BY SIGNING BELOW, the Parties agree to be bound by the terms of this Agreement as of the date
of this Agreement first Above mentioned.

	 	 	 	 	 	 	 	 	 
	 	 	ROCKY MOUNTAIN CHOCOLATE FACTORY, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Per:	 	/s/ Bryan J. Merryman	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Bryan J. Merryman	 	 
	 

	 	 	 	Title:
	 	Chief Operating Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	(I have authority to bind the corporation)	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	KAHALA FRANCHISE CORP.	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Per:	 	/s/ Michael Reagan	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Michael Reagan	 	 
	 

	 	 	 	Title:
	 	EVP & General Council	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	(I have authority to bind the corporation)	 	 

27

 

Schedule A

List of Pre-Approved locations for Co-Branded Stores

(This material has been omitted pursuant to a request for confidential treatment and such

material has been filed separately with the Commission.)

 

 

Schedule B

Amendment to Cold Stone Franchise Agreement

(This material has been omitted pursuant to a request for confidential treatment and such

material has been filed separately with the Commission.)

 

 

Schedule C

Sales Reports

Sales Reports to RMCF:

     RMCF Products and RMCF-branded items:

Gross RMCF Sales

Net RMCF Sales

     Cold Stone Products:

Cold Stone Sales

Cold Stone Prior Year Salesexv10w1

Exhibit 10.1

ROBBINS & MYERS, INC.

AWARD AGREEMENT

RESTRICTED SHARE UNIT AWARD TO                                         

This AWARD AGREEMENT (the “Agreement”) is entered into as of the Award Date set forth below
between ROBBINS & MYERS, INC., an Ohio corporation (the “Company”), and                                         
(“Employee”).

     A. The Company from time to time makes Share Unit Awards to Employees under the Company’s 2004
Incentive Stock Plan As Amended (the “2004 Plan”), a copy of which has been provided to
Employee and is incorporated herein by this reference;

     B. For the purpose of encouraging Employee to have a proprietary interest in the Company
through stock ownership, to continue in the service of the Company and its Subsidiaries, and to
render superior performance during the period of employment, the Compensation Committee (the
“Committee”) of the Board of Directors (the “Board”) of the Company has determined
that Share Units should be awarded under the 2004 Plan to Employee; and

     C. Any capitalized term used herein that is not defined herein shall have the meaning ascribed
to it in the 2004 Plan.

NOW, THEREFORE, THE COMPANY AND EMPLOYEE INTENDING TO BE LEGALLY BOUND HEREBY AGREE AS FOLLOWS:

SECTION 1. RESTRICTED SHARE UNIT AWARD.

1.1 Grant of Restricted Share Units.

(a) The Company hereby grants to Employee on                                         , 20___(the “Award Date”),
subject to the terms and conditions of the 2004 Plan and this Agreement,                                         
Share Units (the “Restricted Share Units”), as a Share Unit Award under the 2004 Plan.
Each Restricted Share Unit represents the contingent right to receive one Common Share of the
Company (“Common Share”) and shall at all times be equivalent to one Common Share. The
Restricted Share Units shall be credited in a book entry account established for Employee until
payment in accordance with Section 1.4 hereof.

(b) From and after the Award Date and until the earlier of (i) the time when the Restricted Share
Units are paid in accordance with Section 1.4 hereof or (ii) the time when Employee’s right to
payment of the Restricted Share Units is forfeited in accordance with Section 1.5(c) hereof, on the
date that the Company pays a cash dividend (if any) to holders of Common Shares generally, Employee
shall be entitled to a cash amount equal to the product of (i) the dollar amount of the cash
dividend paid per Common Share on such date and (ii) the total number of unpaid

 

 

Restricted Share Units credited to Employee as of such date (“Dividend Equivalent”). The
Dividend Equivalent shall be paid to Employee at the same time that the related dividend is paid to
the holders of Common Shares. Dividend Equivalents will be subject to any required withholding for
federal, state, local, foreign or other taxes.

1.2 Restrictions.

(a) The Restricted Share Units may not be sold, transferred, assigned or subject to any
encumbrance, pledge or charge or disposed of for any reason.

(b) All unvested Restricted Share Units shall be forfeited and all rights of Employee with respect
to such units shall terminate in their entirety on the terms and conditions set forth in Section
1.5.

(c) Any attempt to dispose of unvested Restricted Share Units or any interest in such units in any
manner contrary to the restrictions set forth in the 2004 Plan or in this Agreement shall be void
and of no effect.

(d) Employee shall not possess any incidents of ownership (including, without limitation, dividend
and voting rights) in the Common Shares underlying the Restricted Share Units until such Common
Shares have been delivered to Employee in accordance with Section 1.4. The obligations of the
Company under this Agreement will be merely that of an unfunded and unsecured promise of the
Company to deliver Common Shares in the future in accordance with the terms, and subject to the
conditions, of this Agreement, and the rights of Employee will be no greater than that of an
unsecured general creditor. No assets of the Company will be held or set aside as security for the
obligations of the Company under this Agreement.

1.3 Vesting.

(a) Subject to the provisions contained in this Section 1.3, the restrictions set forth in Section
1.2 with respect to the Restricted Share Units shall apply during the restricted period and expire
on the Vesting Dates set forth below (each, a “Vesting Date”) (with any fractional units
rounded down to the next whole number) and the restricted periods and applicable Vesting Dates
shall be as follows:

     (i) For [one-third] of the Restricted Share Units awarded herein, the restricted period shall
begin on the Award Date and end on                     , which is the Vesting Date for such Restricted
Share Units;

     (ii) For [one-third] of the Restricted Share Units awarded herein, the restricted period shall
begin on the Award Date and end on                     , which is the Vesting Date for such Restricted
Share Units; and

     (iii) For [one-third] of the Restricted Share Units awarded herein, the restricted period
shall begin on the Award Date and end on                     , which is the Vesting Date for such
Restricted Share Units.

2

 

(b) All unvested Restricted Stock Units shall be forfeited and returned to the Company and all
rights of Employees with respect to such units shall terminate in their entirety on the terms and
conditions set forth in Section 1.5(c).

Section 1.4 Payment.

(a) The Company shall deliver to Employee (or Employee’s estate in the event of death) the Common
Shares underlying the Restricted Share Units that have become vested in accordance with Section 1.3
or Section 1.5 within ninety (90) days following the earlier of (A)                     , 20___; (B)
Employee’s “separation from service” within the meaning of Section 409A of the Code; or (C) the
occurrence of a “change in the ownership,” “a change in the effective control” or a “change in the
ownership of a substantial portion of the assets” of the Company within the meaning of Section 409A
of the Code. Notwithstanding the foregoing, in the event that the earlier to occur of the events
described in (A), (B) and (C) of the preceding sentence is Employee’s “separation from service” for
any reason other than death, the Company shall deliver the Common Shares underlying the vested
Restricted Share Units on the first day of the seventh month following such “separation from
service” (or, if earlier, within ninety (90) days after Employee’s death).

(c) The Company’s obligations with respect to the Restricted Share Units shall be satisfied in full
upon the delivery of the Common Shares underlying the vested Restricted Share Units.

1.5 Acceleration on Change of Control, Death or Disability; Forfeiture.

(a) In the event of a Change of Control of the Company, all unvested Restricted Share Units shall
automatically become vested on the date when the Change of Control is deemed to have occurred.

(b) In the event of Employee’s termination of employment on account of death, Disability,
Retirement, or, to the extent provided in an Employment Agreement between the Company and Employee
(an “Employment Agreement”), termination by the Company without “Cause” or termination by
Employee for “Good Reason” (as such terms are defined in the Employment Agreement), all unvested
Restricted Share Units shall automatically become fully vested on the date of Employee’s
termination of employment for such reason.

(c) If Employee’s employment with the Company terminates for any reason other than death,
Disability or Retirement, or, to the extent provided in an Employment Agreement, termination by the
Company without “Cause” or termination by Employee for “Good Reason” (as such terms are defined in
the Employment Agreement), all unvested Restricted Share Units shall be forfeited by Employee as of
the date of termination.

1.6 Payment of Applicable Taxes. 

No Common Shares shall be delivered to Employee hereunder until any taxes payable by Employee with
respect to the Restricted Share Units have been withheld by the Company or paid

3

 

by Employee. Employee may use Common Shares to pay the Company all or any part of the mandatory
federal, state, local, or foreign withholding tax payments due upon payment of the Common Shares.
Payment of applicable taxes may be made as follows: (i) in cash, (ii) payment in Common Shares
owned by Employee, including those that have been earned under the 2004 Plan, or (iii) by a
combination of the methods described above.

SECTION
2. REPRESENTATIONS OF EMPLOYEE.

Employee hereby represents to the Company that Employee has read and understands the provisions of
this Agreement and the 2004 Plan, and Employee acknowledges that Employee is relying solely on his
or her own advisors with respect to the tax consequences of the Restricted Share Unit Awards.
Employee understands and acknowledges that nothing contained in this Agreement shall confer upon
Employee any right with respect to continued employment by the Company, nor limit or affect in any
manner the right of the Company to terminate the employment or adjust the compensation of Employee.

SECTION 3.  NOTICES.

All notices or communications under this Agreement shall be in writing, addressed as follows:

	 	 	 
	To the Company:

	 	Robbins & Myers, Inc.
	 

	 	51 Plum Street, Suite 260
	 

	 	Dayton, Ohio 45440
	 

	 	Attention: Vice President, Human Resources
	 
	 	 
	To Employee:

	 	At the last residence address of Employee on file with the Company.

Any such notice or communication shall be (a) delivered by hand (with written confirmation of
receipt) or sent by a nationally recognized overnight delivery service (receipt requested), (b) be
sent certified or registered mail, return receipt requested, postage prepaid, addressed as above
(or to such other address as such party may designate in writing from time to time), or (c) be
given electronically, if receipt is confirmed electronically to the sender within 24 hours and the
actual date of receipt shall determine the time at which notice was given.

SECTION 4. PLAN CONTROLLING.

The Award is subject to all of the terms and conditions of the 2004 Plan. In the event of a
conflict between the 2004 Plan and this Agreement, the provisions of the 2004 Plan shall control.

SECTION 5. GOVERNING LAW. 

This Agreement and its validity, interpretation, performance and enforcement shall be governed by
the laws of the State of Ohio other than the conflict of laws provisions of such laws.

4

 

SECTION
6. SEVERABILITY.

Whenever possible, each provision in this Agreement shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this Agreement shall be held to
be prohibited by or invalid under applicable law, then (a) such provision shall be deemed amended
to accomplish the objectives of the provision as originally written to the fullest extent permitted
by law and (b) all other provisions of this Agreement shall remain in full force and effect.

SECTION
7. STRICT CONSTRUCTION.

No rule of strict construction shall be implied against the Company, the Committee or any other
person in the interpretation of any of the terms of the 2004 Plan, this Agreement or any rule or
procedure established by the Committee.

SECTION
8. DEFINITIONS.

(a) “Change of Control” means and shall be deemed to have occurred on (i) the date upon
which the Company is provided a copy of a Schedule 13D, filed pursuant to Section 13(d) of the
Securities Exchange Act of 1934 indicating that a group or person, as defined in Rule 13d-3 under
said Act, has become the beneficial owner of 20% or more of the outstanding Voting Shares or the
date upon which the Company first learns that a person or group has become the beneficial owner of
20% or more of the outstanding Voting Shares if a Schedule 13D is not filed; (ii) the date of a
change in the composition of the Board such that individuals who were members of the Board on the
date two years prior to such change (or who were subsequently elected to fill a vacancy in the
Board, or were subsequently nominated for election by the Company’s shareholders, by the
affirmative vote of at least two-thirds of the directors then still in office who were directors at
the beginning of such two year period) no longer constitute a majority of the Board; (iii) the date
the shareholders of the Company approve a merger or consolidation of the Company with any other
corporation, other than a merger or consolidation which would result in the Voting Shares of the
Company outstanding immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into Voting Shares of the surviving entity) at least 80% of the
total voting power represented by the Voting Shares of the Company or such surviving entity
outstanding immediately after such merger or consolidation; or (iv) the date shareholders of the
Company approve a plan of complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all the Company’s assets.

(b) “Company” means Robbins & Myers, Inc., an Ohio corporation, and when used with
reference to employment of Employee, Company includes any Subsidiary of the Company.

(c) “Retirement” means Employee’s Early Retirement or Normal Retirement as defined in the
2004 Plan.

5

 

IN WITNESS WHEREOF, the Company and Employee have duly executed this Agreement as of the Award
Date.

ROBBINS & MYERS, INC.

	 	 	 	 	 
	By: 

Name:

	 	/s/ Peter C. Wallace
 

Peter C. Wallace,
	 	 
	 

	 	President and Chief
Executive Officer	 	 

EMPLOYEE

                                                                   
             

Name:

6

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