Formula Agreement - Alvin C. Copeland, Gilbert E. Copeland, Mary L. Copeland, Catherine Copeland, Russell J. Jones, A. Copeland Enterprises Inc. and Popeyes Famous Fried Chicken Inc.
STATE OF LOUISIANA
PARISH OF JEFFERSON
KNOW ALL MEN BY THESE PRESENTS, that:
WHEREAS, Alvin C. Copeland ("Alvin"), Gilbert E. Copeland ("Gilbert"),
Mary L. Copeland ("Mary"), Catherine Copeland ("Catherine") and Russell J. Jones
("Russell") are now the sole owners of the basic recipe and formula used in the
preparation of a spicy fried chicken commonly known as Popeyes Famous Fried
Chicken ("Popeye Formula"), said ownership being in the following proportions:
Alvin 80.000%
Mary 5.334%
Gilbert 8.666&
Catherine 4.000%
Russell 2.000%
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TOTAL 100.000%
WHEREAS, pursuant to oral agreements with A. Copeland Enterprises, Inc.
("ACE") and its wholly-owned subsidiary, Popeyes Famous Fried Chicken, Inc.
("PFFC"), Alvin granted ACE the right to use the Popeye Formula and granted PFFC
the right to license others to use the Popeye Formula, and
WHEREAS, the parties hereto desire to confirm the prior oral agreements
referred to in the preceding paragraph and to enter into a written license
agreement;
NOW, THEREFORE, for and in consideration of the premises and mutual
undertakings hereinafter set forth, Alvin, Mary, Gilbert, Catherine, Russell,
ACE and PFFD do hereby agree as follows:
(1) Alvin warrants that the Popeye Formula, and detailed
instructions with respect thereto, have been committed to
writing and have been deposited in a safety deposit box at First
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Progressive Bank, 1501 Veterans Memorial Boulevard, Metairie,
Louisiana. In the event of the unavailability, incapacity or
death of Alvin, arrangements have been made that one of the
senior officers of ACE will always be in a position to gain
access to the Popeye Formula so that it will always be available
to ACE and PFFC.
(2) Alvin, Mary, Gilbert, Catherine and Russell ("Grantors") hereby
license and grant to ACE, its successors and assigns, the
exclusive right to use the Popeye Formula in the United States
of America and all foreign countries, in stores owned or
operated by ACE or any subsidiary of ACE, subject only to the
rights of PFFC as hereafter set forth.
(3) ACE shall pay to Grantors a royalty for the use of the Popeye
Formula, computed at the rate of one and one-half (1.5%) per
cent on gross receipts from all items sold, less the direct
sales taxes paid or owed with respect thereto, at all stores
owned or operated by ACE or any subsidiary of ACE.
(4) Grantors hereby license and grant to PFFC, its successors and
assigns the exclusive right to license others, except ACE or any
subsidiary of ACE, to use the Popeye Formula in the United
States of America and all foreign countries, subject only to the
rights of ACE as hereinabove set forth, and Grantors herewith
ratify and confirm all previous licenses granted by PFFC.
(5) With respect to any store operated pursuant to a Franchise
Agreement from PFFC or any subsidiary
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thereof PFFC shall pay to Grantors a royalty of one-half of one
(0.5%) per cent on the gross receipts from all items sold, less
the direct sales taxes paid or owed with respect thereto, from
all such stores.
(6) The royalties hereinabove set forth shall be paid on or before
the 10th day after the close of each month. Grantors or anyone
designated in writing by any of them shall have the right to
examine the books and records of ACE and PFFC or any subsidiary
of either, at reasonable times, to such limited extent as may be
necessary to determine the accuracy or inaccuracy of the royalty
being paid.
(7) ACE and PFFC specifically covenant and agree to maintain as
strictly confidential and secret, and not to disclose to anyone,
any or all information obtained or received from Alvin relating
to the Popeye Formula.
(8) During the life of this agreement, Alvin shall not disclose to
any party, other than designated representatives of ACE or PFFC,
the Popeye Formula or anything related thereto.
(9) Alvin has disclosed to ACE certain secret methods, secret
formulas and secret "know-how" used in connection with Popeyes
Famous Fried Chicken restaurants, including and without
limitation the following:
A unique system relating to the opening and operating of
restaurants specializing in the preparation and sale of highly
spiced chicken made with a unique spice and batter formula and
other
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related menu items utilizing confidential food formulas (the
"POPEYES Famous Fried Chicken System"), the distinguishing
characteristics of which include, without limitation, the name
POPEYES Famous Fried Chicken; other confidential food formulas
and recipes used in the preparation of other food products,
specialized menus; specially designed buildings; interior and
exterior layouts, unique trade dress and other identification
schemes ("Indicia of Origin"); standards and specifications for
equipment, equipment layouts, products, operating procedures and
management programs.
(10) The Popeye Formula, for which royalty is being paid pursuant to
Paragraphs 3 and 5 above, was developed prior to the
incorporation of ACE. The items referred to in Paragraph 9
above were substantially developed after the incorporation of
ACE and have always been the property of ACE. So that there
will be a written record, Grantors ratify and confirm the
ownership of ACE of all of the items referred to in Paragraph 9,
it being specifically understood that this ratification and
confirmation of ownership does not apply to the Popeye Formula.
(11) If Alvin makes, develops, or invents improvements in methods
relating to the production of the Popeye Formula or has or
hereafter acquires additional secret recipes for products
suitable for use in POPEYES Famous Friend Chicken restaurants,
such improvements and new recipes shall be promptly disclosed by
Alvin to ACE and PFFC and shall be included herein without any
alteration in royalty
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payments.
(12) Mary, Gilbert, Catherine and Russell stipulate and agree that
Alvin knows the entire Popeye Formula and is in the best
position to determine how and for what consideration it should
be licensed. Therefore, Mary, Gilbert, Catherine and Russell do
hereby give and grant to Alvin, his assigns, his succession
representative or anyone designated by him in his last will and
testament, for the mutual benefit of all owners of the Popeye
Formula, the absolute and irrevocable right, exercisable by
Alvin, in their sole discretion to (i) reduce the royalty
payments due by ACE or PFFC or any successor or assignee of
either, (ii) grant a moratorium on royalty payments due by ACE
or PFFC or any successor or assignee of either, (iii) terminate
either or all royalty payments, (iv) change the time at which
either or all royalty payments are made or (v) make any other
arrangement including and without limitation the lease or sale
thereof with any person, firm or corporation for the use of the
Popeye Formula, including the sale or transfer of ownership of
the entire Popeye Formula to any third person or corporation,
not related in any manner to Alvin, for cash, notes, stock or
any combination thereof. Additionally, Mary, Gilbert, Catherine
and Russell agree to execute any and all documents presented to
them for the purpose of accomplishing the foregoing, and, in the
event they are unwilling or unable for any reason to execute
such documents, they hereby appoint Alvin their agent, which
agency is coupled with an interest, for the purpose of executing
any
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and all documents necessary or desirable to accomplish such
purpose. The sole and only restriction upon Alvin, his assigns,
succession representative or anyone designated by him in his
last will and testament in relation to the Popeye Formula is
that if any when any cash, notes, stock or other consideration
or any combination thereof is received by Alvin or available by
virtue of the ownership of the Popeye Formula, 20% thereof will
be delivered or paid to Mary, Gilbert, Catherine and Russell in
their respective proportions at the same time Alvin receives
same.
(13) This agreement shall be subject to termination by Grantors or
ACE or PFFC upon default by the other party in the performance
of any of the terms, conditions, or covenants of this agreement
and failure to remedy said default within thirty (30) days after
written notice or demand, except that the rights of any third
person holding under any franchise agreement from PFFC, its
successors or assigns shall not be prejudiced by any such
termination. Termination of this agreement in any manner shall
not discharge the liability for royalty accrued or unpaid at the
time of such termination.
(14) This agreement shall remain in full force and effect unless
otherwise cancelled as provided in Paragraph 13 above, as long
as ACE or any subsidiary thereof or any franchisee of PFFC, its
successors or assigns, is using the Popeye Formula, it being
understood that a default or termination by ACE shall not
entitle Grantors to terminate
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PFFC and, similarly, a default or termination by PFFC shall not
entitle Grantors to terminate ACE.
IN WITNESS WHEREOF, the parties have executed this agreement at New
Orleans, Louisiana, effective as of the 2nd day of July, 1979.
WITNESSES:
/s/
---------------------------- /s/ Alvin C. Copeland
/s/ ---------------------------
---------------------------- Alvin C. Copeland
/s/
---------------------------- /s/ Mary L. Copeland
/s/ ----------------------------
---------------------------- Mary L. Copeland
/s/
---------------------------- /s/ Gilbert E. Copeland
/s/ ----------------------------
---------------------------- Gilbert E. Copeland
/s/
---------------------------- /s/ Catherine Copeland
/s/ ----------------------------
---------------------------- Catherine Copeland
/s/
---------------------------- /s/ Russell J. Jones
/s/ ----------------------------
---------------------------- Russell J. Jones
A. COPELAND ENTERPRISES, INC.
/s/
---------------------------- By: /s/ W. Ronald Lewis
/s/ -------------------------
---------------------------- W. Ronald Lewis
Vice President
POPEYES FAMOUS FRIED CHICKEN, INC.
/s/
---------------------------- By: /s/ W. Ronald Lewis
/s/ -------------------------
---------------------------- W. Ronald Lewis
Vice President