Exhibit 10.2
LICENSE
AGREEMENT
This LICENSE AGREEMENT
(“Agreement”) is made and entered into as of the
17 th day of November, 1998, by and
between Trolley Barn Brewery, Inc., a Tennessee corporation
(“Trolley”), and Rock Bottom Restaurants, Inc.,
a Delaware corporation (“Rock Bottom”).
Background
Rock Bottom and Trolley currently
own and operate restaurants and brew pubs located, respectively, in
the western, mid-western and eastern United States and in the
southeastern United States. Rock Bottom is the owner of certain
rights in the marks listed on Exhibit A attached hereto (the
“Licensed Marks”) which it has allowed Trolley to use
since July, 1996, when the parties entered into their joint
venture. Rock Bottom and Trolley are also the owners of various
valuable secret formulas, methods, and know-how, including, but not
limited to, specific ingredients, recipes and quality control
procedures, along with any and all specifications and instructions
useful in providing brew pub restaurant services and making and
assembling various brewery and food items including those
ingredients, recipes, procedures, specifications, instruction and
other information contained in the written standards and statements
of each (e.g., recipes and brewing procedures for producing the
various beers and ales), all of which have been originated by or
are within the knowledge of each, are subject to protection under
recognized legal principles and relate to the operation of the Brew
Pubs (as defined below) (the “Licensed Trade Secrets”).
During their joint venture, which began in July, 1996, each has
shared its Licensed Trade Secrets with the other.
Trolley has used the Licensed Marks
in the operation of certain Brew Pubs. Trolley and Rock Bottom are,
concurrently with the execution of this Agreement,
(i) terminating all existing
agreements between them, including a License and
Development Agreement dated July 1, 1996, for the operation,
development and licensing of restaurants and brew pubs, and
(ii) entering into a Stock Redemption Agreement, Mutual
Release and Termination Agreement.
Rock Bottom agrees that Trolley may
continue to use the Licensed Marks on the terms and conditions set
forth below.
Agreement
NOW THEREFORE, in consideration of
the premises and the mutual covenants and agreements hereinafter
set forth, the parties hereto agree as follows:
1. License . Rock Bottom
hereby grants to Trolley, and Trolley hereby accepts, a
royalty-free, nonexclusive and nontransferable license to use the
Licensed Marks only in connection with the operation of the
restaurants and brew pubs located at 401 North Tryon Street, Suite
100, Charlotte, North Carolina 28202 and 3242 Peachtree Road N.E.,
Buckhead Place, Atlanta, Georgia 30305, as well as the Sing Sing
restaurant located at 221 Market Street, Chattanooga, Tennessee
(collectively, the “Brew Pubs”), consistent with
current practices and in accordance with the terms of Exhibit
A , and not for any other purpose unless expressly agreed to in
advance and in writing by Rock Bottom.
2. Quality Control
.
a. In accordance with and subject to
the terms and conditions of this Agreement, Trolley agrees to use
the Licensed Marks only in connection with the operation of the
Brew Pubs, and shall not “mix” the Licensed Marks with
any of its own or with any other marks or brands. Trolley also
agrees that the quality of the restaurant operations and of the
beer and food made and services rendered at the Brew Pubs are, and
shall be during the term of this Agreement,
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consistent with and substantially
similar to the overall theme and motif, food and brewery quality
and tastes, and service standards as provided by the other Rock
Bottom restaurants (as to the Brew Pubs in Charlotte, North
Carolina and Atlanta, Georgia) and the other Sing Sing restaurants
(as to the Brew Pub in Chattanooga, Tennessee) operated by Rock
Bottom as of the date hereof and as may be reasonably established
by Rock Bottom from time to time hereafter consistent with a brew
pub operation serving eclectic American cuisine (collectively, the
“Rock Bottom Standards”). Rock Bottom acknowledges and
affirms that each of the Brew Pubs is in compliance with the Rock
Bottom Standards as of the date hereof.
b. In accordance with and subject to
the terms of this Agreement:
i. Trolley shall permit inspection
at the premises of any of the Brew Pubs during normal business
hours (each a “Discretionary Inspection”) to ensure
compliance with the Rock Bottom Standards, and Trolley shall, upon
request, submit to Rock Bottom samples of the food and brewery
items it sells or intends to sell under the Licensed Marks for the
purpose of ascertaining compliance herewith.
ii. In addition to the Discretionary
Inspections described in Section 2(b)(i) above, Rock Bottom
shall inspect, on a semi-annual basis, each of the Brew Pubs (each
a “Mandatory Inspection”) to ensure compliance with the
Rock Bottom Standards. Any and all reasonable expenses incurred by
Rock Bottom in conducting such Mandatory Inspections, including,
but not limited to, expenses for airfare, lodging, meals, beverages
and rental cars, shall be reimbursed by Trolley; provided, however,
that this reimbursement obligation shall be limited to one
representative of Rock Bottom.
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iii. If, in the course of a
Discretionary Inspection or a Mandatory Inspection, Rock Bottom
determines that a Brew Pub is not in compliance with the Rock
Bottom Standards (each an “Exception”), Rock Bottom
shall notify Trolley, in writing, of the nature of such Exception.
Trolley shall have ninety (90) days from the date of its
receipt of such notice to cure such Exception. If, in the sole and
absolute discretion of Rock Bottom, Trolley has not timely and
fully cured such Exception, then Rock Bottom may terminate this
Agreement in accordance with the provisions of Section 4
below.
3. Rights in Licensed Marks .
Trolley agrees that nothing herein shall give to Trolley any right,
title, or interest in the Licensed Marks; that the Licensed Marks
and all rights therein and thereto are the sole property of Rock
Bottom; and that any and all use by Trolley of the Licensed Marks,
except as otherwise provided herein, shall inure to the benefit of
Rock Bottom.
4. Term; Termination
.
a. The term of this Agreement shall
be, with respect to each of the Licensed Marks, co-extensive with
the term of each lease, including any renewal periods, for those
Brew Pub locations using such Licensed Marks. Upon termination of
any such lease, the right to use the Licensed Marks at such Brew
Pub location will terminate.
b. Notwithstanding the provisions of
Section 4(a) above, this Agreement may be terminated under any
of the following circumstances;
i. If a corporate party commits a
breach of this Agreement, the Stock Redemption Agreement, Mutual
Release or Termination Agreement which is not capable of being
remedied, or, if such breach is capable of being remedied, which is
not remedied within ninety
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(90) days after receipt by the
breaching party of a notice identifying the breach and requiring
its remedy, the non-breaching
