EXHIBIT 10.1

DATED  7 MARCH 2006

(1) PERFECT PIZZA LIMITED (to be renamed PAPA JOHN’S (GB) LIMITED)

(2) SMARTFIRST LIMITED (to be renamed PERFECT PIZZA LIMITED)

AGREEMENT

for the sale and purchase of the Perfect Pizza franchise business operated by

PERFECT PIZZA LIMITED (to be renamed PAPA JOHN’S (GB) LIMITED)

CONFORMED COPY

CONTENTS

THIS AGREEMENT is made on 7 March 2006

BETWEEN

(1)           PERFECT PIZZA LIMITED (to be renamed PAPA JOHN’S (GB) LIMITED) (registered number 2569801) whose registered office is at Perfect Pizza House, The Forum, ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ (“Vendor”); and

(2)           SMARTFIRST LIMITED (to be renamed PERFECT PIZZA LIMITED) (registered number 5088946) whose registered office is at ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ (“Purchaser”).

WHEREAS

The Vendor wishes to sell and the Purchaser wishes to purchase the Business (as hereinafter defined) as a going concern together with certain assets and rights vested in the Vendor in connection with the Business for the consideration and upon the terms set out in this Agreement.

IT IS AGREED AS FOLLOWS

1              DEFINITIONS AND INTERPRETATION

1.1           In this Agreement (including the Schedules), unless expressly stated to the contrary, the following expressions shall have the following meanings:

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1.2           References to statutes or statutory provisions shall be construed to include references to those statutes or provisions as amended or re-enacted (whether with or without modification) prior to Completion and shall include any statute or provision of which they are re-enactments (whether with or without modification).

1.3           Any document expressed to be “in the Approved Form” means in a form approved and for the purpose of identification signed by or on behalf of the parties to this Agreement and includes any amendments to such document which are so agreed and signed.

1.4           The headings in this Agreement are for ease of reference only and shall not in any way affect its construction or interpretation.

1.5           The expressions “Vendor” and “Purchaser” shall include their respective successors and permitted assigns.

1.6           The Schedules form part of this Agreement and shall be construed and have the same full force and effect as if expressly set out in the main body of this Agreement.

1.7           References to “indemnify” and “indemnifying” any person against any liability or circumstance include indemnifying him and keeping him harmless from all actions, claims, demands and proceedings from time to time made against that person and all losses, damages, payments, costs and expenses (including legal costs and expenses on a full indemnity basis) made, suffered or incurred by that person as a consequence of or which would not have arisen but for that liability or circumstance and where any payment made under any indemnity is subject to any Taxation or cost or expense which would not have been incurred by the payee but for the payment, it shall be increased by such amount as is necessary to ensure that the payee receives the same net amount as it would have received had the payment not been so subject.

1.8           Unless expressly stated to the contrary, in this Agreement:

1.8.1        words denoting the singular include the plural and vice versa, words denoting any one gender include all genders and vice versa, and references to persons include individuals, partnerships, bodies corporate and unincorporated associations;

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1.8.2        a reference to a Recital, clause or Schedule is a reference to a Recital or clause of or Schedule to this Agreement and a reference to a sub-clause is a reference to a sub-clause of the clause in which the reference appears;

1.8.3        expressions defined in the Companies Acts 1985 and 1989 shall have the same meanings in this Agreement; and

1.8.4        the words and phrases “other”, “including” and “in particular” shall not limit the generality of any preceding words or be construed as being limited to the same class as the preceding words where a wider construction is possible.

2              SALE OF THE BUSINESS

2.1           Subject to the terms of this Agreement, the Vendor shall sell with full title guarantee, free from all Encumbrances, and the Purchaser shall purchase as a going concern as at and with effect from the Effective Date, the Business and the Assets comprising:

2.1.1        the Goodwill;

2.1.2        the Business Intellectual Property;

2.1.3        the Properties;

2.1.4        the Fixed Assets;

2.1.5        the Debts;

2.1.6        the Stock;

2.1.7        the benefit (subject to the burden to the extent expressly assumed in this Agreement) of the Franchise Agreements and the Supplier Contracts;

2.1.8        the Business Information;

2.1.9        the Records;

2.1.10      the Third Party Rights; and

2.1.11      all other property or rights owned by the Vendor and used exclusively in the Business or in connection with the Assets.

2.2           The Excluded Assets and the Excluded Businesses are both excluded from the sale and purchase of the Business and Assets under this Agreement.

2.3           The provisions of Schedule 5 shall apply in relation to the sale of the Properties and in the event of any inconsistency between Schedule 5 and the remainder of this Agreement the provisions of Schedule 5 shall prevail.

3              CONSIDERATION

3.1           The consideration for the sale by the Vendor of the Business and the Assets shall be the aggregate of:

3.1.1        £7,000,000 (seven million pounds); and

3.1.2        such sum as is payable pursuant to the provisions of clause 4 below  in respect of the Debts;

3.2           The consideration shall be payable as follows:

3.2.1        £4,600,000 (four million six hundred thousand pounds) at Completion in cash;

3.2.2        £2,000,000 by the issue of the Loan Notes to the Vendor at Completion;

3.2.3        £400,000 by the issue of the Additional Loan Notes to the Vendor at Completion; and

3.2.4        the element of consideration payable in respect of the Debts shall be payable  in cash at such times and in such amounts as are designated in clause 4.

3.3           The consideration referred to in clause 3.2.1, 3.2.2 and 3.2.3 shall be allocated as follows:

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4              DEBTS

4.1           The Vendor shall, as soon as practicable after Completion but in any case not later than five Business Days after Completion, deliver to the Purchaser a statement of Debts as at the Effective Date in the form of the Debt Pro Forma (“Statement of Debts”).

4.2           The Vendor covenants and undertakes with the Purchaser that so far as lies within its power in the period between the Effective Date and the production of the Statement of Debts there will be no movements in the debtors ledger other than in the ordinary course of business as carried on by the Vendor up to the date hereof and that invoices will only be raised on the respective due dates in the ordinary course of business.

4.3           The Debts as shown in the Statement of Debts shall be paid by the Purchaser in accordance with the provisions of clauses 4.4 to 4.7 below.

4.4           The amount to be paid for the Debts shall be calculated as follows:

4.5           Payment for the Debts shall be made free from any withholding, deduction, counterclaim or set-off at the following times and in the following proportions:

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4.6           If any sum due to be paid by the Purchaser to the Vendor under this clause 4 is not paid on the due date for payment noted in clause 4.5 above, such unpaid sum shall carry interest calculated on a daily basis (as well after as before judgment) at the rate of 2 per cent above the annual base lending rate of The Royal Bank of Scotland plc from the due date to the date of actual payment (both dates inclusive). Any such interest shall be payable upon demand being made by the Vendor to the Purchaser.

4.7           For the avoidance of doubt, the Purchaser shall assume the risk of non-payment of any of the Debts in whole or in part and the Purchaser acknowledges that it shall have no rights or claims against the Vendor in relation to any such non-payment.

4.8           If at any time after the Effective Date the Vendor receives any sums by way of repayment of any Debt it shall hold the same as trustee for the Purchaser and account to the Purchaser for the same as soon as practicable after such receipt.

5              COMPLETION

Completion shall take place at the offices of the Vendor’s Solicitors (or such other place as may be agreed by the Vendor and the Purchaser) immediately upon execution of this Agreement when the Vendor and the Purchaser shall comply in full with their respective obligations set out in clause 6.

6              COMPLETION OBLIGATIONS

6.1           The following provisions will apply to Stock:

6.1.1        prior to Completion the Vendor and the Purchaser shall procure that a stock take shall be carried out at the ▇▇▇▇▇▇ Park Site for the purpose of identifying the Stock, the Generic Stock and the ▇▇ ▇▇▇▇▇ situated at the ▇▇▇▇▇▇ Park Site and shall jointly prepare and agree a Stock Statement showing the amount and book value of each category referred to above;

6.1.2        for the avoidance of doubt, no adjustment shall be made to the Consideration by reference to the book value of the Stock as shown in the Stock Statement; and

6.1.3        the Purchaser shall have the right upon giving written notice to the Vendor within two Business Days of Completion to purchase from the Vendor such amount of Generic Stock as the Purchaser may require at the book value of such stock as identified in the Stock Statement and payment for any Generic Stock purchased shall be made within 30 days of the Completion Date.

6.2           On Completion:

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6.2.1        the Vendor shall permit the Purchaser to take possession of the Business and shall deliver or cause to be delivered to the Purchaser or the Purchaser’s Solicitors:

(a)           at the ▇▇▇▇▇▇ Park Site such of the Assets as are capable of being transferred by delivery;

(b)           the Records (in so far as they are capable of being separated from any consolidated records held by the Vendor);

(c)           the Distribution Agreement, duly executed by the Vendor;

(d)           the IT/Accounting Support Letter, duly executed by the Vendor;

(e)           duly executed assignment in the Approved Form of the Perfect Pizza Trade Marks and the Gino’s Pizza Trade Marks;

(f)            the PJ Side Letter, duly executed by Papa John’s International Inc;

(g)           a certified copy written resolution of the Vendor changing its name, in the Approved Form;

(h)           (to the extent not already delivered pursuant to clause 6.2.1(a)) all the designs and drawings, plans, technical and sales publications, advertising material and other technical and sales matter of the Vendor relating specifically to the Business insofar as the same exist and are in the ownership and control of the Vendor immediately prior to Completion; and

(i)            a duly executed assignment of the ▇▇▇▇▇▇ Park Lease in accordance with paragraph 2 of Part C of Schedule 5.

6.2.2        the Purchaser shall deliver to the Vendor duly executed counterparts of  the Distribution Agreement, the IT/Accounting Support Letter, the Loan Note Instrument,  the Debenture and the Additional Loan Note Instrument, each duly executed by the Purchaser;

6.2.3        the Vendor and the Purchaser shall, in respect of the Properties, comply with any obligations to be performed by them respectively at Completion in accordance with the provisions of Part C of Schedule 5; and

6.2.4        the Purchaser shall:-

(a)           pay to the Vendor’s Solicitors (whose receipt shall be an absolute discharge of the Purchaser and binding upon and conclusive against the Vendor) by way of telegraphic transfer the aggregate sum of £4,600,000 (four million six hundred thousand pounds) referred to in clause 3.2.1; and

(b)           issue to the Vendor the Loan Notes referred to in sub-clause 3.2.2, and the Additional Loan Notes referred to in sub-clause 3.2.3, and deliver duly executed certificates in respect of such Loan Notes and Additional Loan Notes to the Vendor’s Solicitors (whose receipt shall be an absolute discharge of the Purchaser and binding upon and conclusive against the Vendor).

7              ACTION AFTER COMPLETION

7.1           Without prejudice to its right to carry on the Excluded Businesses, immediately following Completion the Vendor shall discontinue carrying on the Business.

7.2           Notices, correspondence, information, orders or enquiries (“Communications”) of a material nature to the extent that they relate to the Business or the Assets (excluding those

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in relation to settlement of the Liabilities) which are received by the Vendor after Completion shall as soon as reasonably practicable be passed to the Purchaser and any Communications received by the Purchaser after Completion  to the extent that they relate to the Excluded Businesses or the Excluded Assets or the Liabilities shall as soon as reasonably practicable be passed to the Vendor.

7.3           Subject to the provisions of clause 7.4 below, the Vendor undertakes to procure that after Completion neither the Vendor nor any other member of the Vendor’s Group shall use in any way whatsoever any name including the words “Perfect Pizza”,  “Gino’s Pizza” or “Gino’s Dial-a-Pizza” or any other name intended or likely to be confused with any such names or suggest any connection with any member of the Purchaser’s Group or use the “Perfect Pizza”,  “Gino’s Pizza”  or “Gino’s Dial-a-Pizza” logo or livery (including where the “Perfect Pizza”,  “Gino’s Pizza” or “Gino’s Dial-a-Pizza” name, logo or livery appears on or is embedded in any item (including stationery)) and shall immediately change or remove or procure change or removal of any sign boards, fascias, logos, promotional materials or similar items at any property owned by the Vendor in the style of or containing the “Perfect Pizza”, “Gino’s Pizza” or “Gino’s Dial-a-Pizza” name or any related logo or livery save that the Vendor may continue to display or permit the display of the “Perfect Pizza”,  “Gino’s Pizza” or “Gino’s Dial-a-Pizza” logos on delivery trucks owned or operated by or for the Vendor if such trucks deliver to the Business and the Purchaser acknowledges and agrees that the Vendor may require up to 30 days from Completion in order to alter the name “Perfect Pizza House” at its premises at ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇.

7.4           The provisions of clause 7.3 shall be without prejudice to the right of the Vendor’s Group to continue at any time after Completion to use the phrase “…delivering the perfect pizza” in the manner and in the territory currently used, which for the avoidance of doubt shall be outside the United Kingdom, in the ordinary course of the Excluded Business as part of any trade ▇▇▇▇ or logo of the Vendor’s Group or otherwise howsoever and the Purchaser hereby expressly authorises such use on a perpetual, royalty free basis.

7.5           The Purchaser undertakes to procure that after Completion neither the Purchaser nor any other member of the Purchaser’s Group shall use in any way whatsoever any name including the word or words “Papa”, “▇▇▇▇” or “Papa John’s” or any other name intended or likely to be confused with any such names or suggest any connection with any member of the Vendor’s Group or use the “Papa John’s” logo or livery (including where the “Papa John’s” name, logo or livery appears on or is embedded in any item (including stationery)) and shall immediately change or remove or procure change or removal of any sign boards, fascias, logos, promotional materials or similar items at the Properties in the style of or containing the “Papa John’s” name or any related logo or livery.

7.6           The Purchaser shall not, after Completion, be allowed access to the Vendor’s “In-Touch” or “Airwaves” systems and the Purchaser undertakes to procure that none of its franchisees use or continue to use either of these systems. The Purchaser acknowledges and agrees that, to the extent that it is able to do so, immediately upon Completion the Vendor will terminate all rights of access of the Purchaser and its franchisees to those systems.

7.7           As soon as is reasonably practicable after Completion the Vendor and the Purchaser shall issue a statement in the Approved Form to the Franchisees and the suppliers of the Business informing them of the transfer of the Business to the Purchaser.

7.8           Each party undertakes to and covenants with the other that it shall not, and it shall procure that each member of (respectively) the Vendor’s Group or the Purchaser’s Group shall not

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for the period of 5 years after Completion (except as required by law or any regulatory authority) disclose or divulge to any person (other than to officers or employees of any member of the other party’s Group whose province it is to know the same or use (other than for the benefit of the other party) any Confidential Information which may be within or have come to its knowledge, possession, custody or control and it shall use its reasonable endeavours to prevent the publication, disclosure or misuse of any such Confidential Information.

8              VAT

8.1           All amounts expressed in this Agreement as payable by the Purchaser are expressed exclusive of any VAT which may be chargeable thereon.

8.2           The parties intend that the Business shall be transferred as a going concern with effect from the Effective Date and that the provisions of Article 5 of the Value Added Tax (Special Provisions) Order 1995 will apply to the transfer and the sale and purchase of the Business and the Assets.

8.3           The Purchaser will within 30 days of the Completion Date give notice of such transfer to the appropriate office of HM Revenue and Customs in accordance with applicable regulations and requirements.

8.4           The Purchaser warrants to (and hereby notifies) the Vendor that:

8.4.1        after the Completion Date it is the Purchaser’s intention that the Business will be carried on by it as a going concern and that the Assets will be used by it in carrying on the Business or the same kind of business whether or not as part of any existing business of the Purchaser;

8.4.2        it is properly registered for the purposes of VAT (and the Purchaser shall on or before Completion produce evidence reasonably satisfactory to the Vendor that it is so registered or has applied for such registration);

8.4.3        it has validly made an election to waive exemption pursuant to Schedule 10 Paragraph 2 VATA 1994 in respect of the Properties and such election has been notified in writing to H M Revenue and Customs, remains effective and will not after Completion be withdrawn or disapplied;

8.4.4        the election referred to in clause 8.4.3 will not be revoked within 3 months of its making;

8.4.5        article 5 paragraph (2B) of the Value Added Tax (Special Provisions) Order 1995/1268 does not apply to the Purchaser; and

8.4.6        the Purchaser will acquire and hold the Assets as beneficial owner and not as a nominee or trustee for or in a representative capacity for any other person.

8.5           The parties further intend that Section 49 VATA 1994 will apply to the transfer of the Business under this Agreement and accordingly:

8.5.1        on Completion, the Vendor shall retain the VAT Records; and

8.5.2        the Vendor shall make a request to HM Revenue and Customs for the VAT Records to be preserved by the Vendor rather than the Purchaser.

8.6           If, notwithstanding clause 8.2, HM Revenue and Customs shall determine that VAT is chargeable in respect of the supply of all or any part of the Business or the Assets under this Agreement, the Vendor shall notify the Purchaser of that determination within 10 Business Days of its being so advised by HM Revenue and Customs and the Purchaser shall pay to the Vendor by way of additional consideration a sum equal to the amount of VAT determined by HM Revenue and Customs to be so chargeable within 10 Business

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Days of the Vendor notifying the Purchaser of that determination (and against delivery by the Vendor of an appropriate tax invoice for VAT purposes). If such determination is caused  as a direct result of any act or omission by the Purchaser, including non-compliance by the Purchaser with any of the matters warranted by it in clause 8.4, the Purchaser shall indemnify the Vendor in respect of any penalties, interest or other payments imposed on the Vendor by HM Revenue and Customs as a result of VAT not having been charged by the Vendor in respect of the sale of the Business and the Assets under this Agreement.

8.7           The Vendor shall be entitled to receive and to retain for its own benefit all reimbursement or credit from HM Revenue and Customs for VAT borne by the Vendor on goods and services supplied to the Vendor or any other member of the Vendor’s Group prior to Completion and any payments received in respect of VAT overpaid to HM Revenue and Customs prior thereto.

9              RISK AND INSURANCE

9.1           Subject to the provisions of this Agreement, title in, and risk of loss or damage to, the Business and the Assets shall pass to the Purchaser on Completion.

9.2           Nothing in this Agreement shall make the Vendor or any other member of the Vendor’s Group liable in respect of anything done or omitted to be done after Completion by any member of the Purchaser’s Group in relation to the Business or Assets other than as may be specifically agreed in writing to the contrary by the Vendor and the Purchaser shall indemnify the Vendor and all members of the Vendor’s Group and their respective officers, employees, representatives, agents and professional advisers in respect of anything so done or omitted to be done after Completion.

9.3           For the avoidance of doubt, all insurances relating to the Business previously provided by any member of the Vendor’s Group shall cease on Completion, and the Purchaser shall not be entitled to the benefit of any such insurances and shall make its own insurance arrangements in respect of the Business and Assets from Completion.

10            LIABILITIES

10.1         The Vendor shall remain responsible for and shall promptly pay, discharge or satisfy all debts payable by the Vendor and other obligations and liabilities arising from or attributable to the carrying on of the Business before the Completion Date which are not expressly assumed by the Purchaser under this Agreement including:

10.1.1      all liabilities to trade and other creditors including banks and all taxation liabilities of the Vendor;

10.1.2      all liabilities and obligations accrued or falling to be performed under the Supplier Contracts up to the Completion Date; and

10.1.3      all claims made by third parties on or after the Completion Date arising from defective products or parts of products manufactured by the Vendor prior to the Completion Date even if the defective products or parts were sold by the Purchaser provided that, on becoming aware of any such claim as is referred to in this clause 10.1.3, the Vendor shall promptly give notice of it to the Purchaser and shall not take any steps which might reasonably be expected to damage materially and adversely the commercial interests of the Purchaser without prior consultation with the Purchaser.

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10.2         The Vendor shall indemnify the Purchaser in respect of those debts, obligations and liabilities for which it remains responsible under clause 10.1.

10.3         With effect from the Completion Date, the Purchaser shall:

10.3.1      observe and perform, or procure to be observed and performed, all the obligations of the Vendor under the Franchise Agreements and (subject to clause 14) the Supplier Contracts;

10.3.2      assume responsibility for payment for all goods delivered or services received under the Franchise Agreements and the Supplier Contracts after the Completion Date whether the invoices for such goods or services are received before or after the Completion Date; and

10.3.3      keep the Vendor indemnified against any liability howsoever arising from the Franchise Agreements and the Supplier Contracts as a result of any act or omission of the Purchaser after Completion.

10.4         With effect from the Completion Date, all complaints received by the Vendor or the Purchaser from Franchisees in relation to goods supplied before the Completion Date (including warranty claims arising in the normal course of the Business) shall be dealt with as follows:

10.4.1      all such complaints shall be promptly referred in the first instance to the Purchaser who may elect in respect of any such complaint either;

(a)           to endeavour to resolve it and to supply any replacement goods accordingly; or

(b)           to refer it to the Vendor who shall be responsible at its own expense for resolving the same;

10.4.2      each party shall provide any information or assistance reasonably requested by the other in dealing with complaints under this clause 10; and

10.4.3      the Vendor shall reimburse to the Purchaser on demand all expenses and costs incurred in dealing with any such complaint as is referred to in this clause 10.

10.5         The foregoing provisions of this clause 10 shall be without prejudice to the Vendor’s rights under clause 13 in relation to the Franchise Agreements.

11            APPORTIONMENTS

11.1         As soon as reasonably practicable after and in any event within one month of Completion the Vendor shall provide to the Purchaser in writing an apportionment (“Apportionment Statement”) in respect of the Business and Assets between periods up to and after the Effective Date (subject to any express statement to the contrary in this Agreement, the former to be for the benefit of or the responsibility of the Vendor and the latter for the benefit of or the responsibility of the Purchaser) of:

11.1.1      all recurring outgoings, accruals and expenses of the Business; and

11.1.2      the amount of all outstanding deposits and prepayments (if any) received by the Vendor  up to the Effective Date in respect of the Business and the amount of all outstanding payments in advance (if any) paid by the Vendor  up to the Effective Date in respect of the Business

following which the Vendor and the Purchaser shall consult together with a view to agreeing the content of the Apportionment Statement.

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11.2         All sums payable in respect of the Transferring Employees (including salaries, pension contributions, accrued holiday pay, national insurance and PAYE) are to be apportioned as part of the Apportionment Statement with effect from the Effective Date so that all sums relating to the period up to and including that date are the responsibility of the Vendor and all sums relating to the period from the Effective Date are the responsibility of the Purchaser.

11.3         Upon agreement of all the matters referred to in clauses 11.1 and 11.2:

11.3.1      the apportionments shall be netted off as appropriate; and

11.3.2      any sums due by one party to the other party as a consequence of the above shall be paid in full within 5 Business Days of such agreement.

11.4         If the Vendor and the Purchaser shall have failed to agree the Apportionment Statement within 20 Business Days after the Completion Date:

11.4.1      the Vendor or the Purchaser (as the case requires) shall within 5 Business Days thereafter make a payment of the minimum amount which would be due from the one to the other, according to that part of the Apportionment Statement which is undisputed (if any), but if the disputed items could result in a payment either way, no payment shall be made and any balance (or the whole payment if no minimum payment has been made) shall be paid within 5 Business Days of the resolution or determination of the dispute; and

11.4.2      the matter(s) in dispute may be referred at the instance of the Vendor or the Purchaser to an expert for determination in accordance with clause 21.

12            CONSENTS FOR TRANSFER OF CERTAIN BUSINESS ASSETS

12.1         Subject to clause 12.2 the Purchaser shall use all reasonable endeavours after Completion to obtain at its own cost and expense all such consents (if any) as may be necessary for the transfer of the Assets to the Purchaser with effect from the Effective Date and the Vendor declares itself, with effect from the Effective Date, trustee for the Purchaser in respect of all such Assets until the same shall, with any necessary consents from third parties, have been finally assigned to the Purchaser. The Vendor undertakes that until completion of such assignments it will with effect from the Completion Date, at the written request and expense of the Purchaser, act in accordance with the reasonable directions of the Purchaser in all matters relating to such Assets provided that the Purchaser shall fully and effectively indemnify the Vendor and all other members of the Vendor’s Group in respect of the consequences of any such act and whilst so acting.

12.2         Clause 12.1 shall not apply to the Franchise Agreements, the Supplier Contracts or the Properties.

13            FRANCHISE AGREEMENTS

13.1         The Vendor hereby assigns to the Purchaser, as at and with effect from the Effective Date, the benefit (subject to the burden) of each Franchise Agreement. Forthwith after Completion the Purchaser shall submit to each Franchisee a contract in the Approved Form, duly executed as a deed by the Purchaser, containing a direct covenant by the Purchaser with each Franchisee to observe and perform all the franchisor’s obligations contained in the relevant Franchise Agreement and the Purchaser shall deliver to the Vendor such evidence as the Vendor shall reasonably require that the Purchaser has complied with its obligations under this clause.

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13.2         After Completion the Purchaser shall:

13.2.1      perform all the Vendor’s obligations under each Franchise Agreement; and

13.2.2      indemnify the Vendor in respect of the Franchise Agreements including any acts or omissions (or alleged acts or omissions) before as well as after Completion.

13.3         The Vendor undertakes that, if and to the extent it has the right at any time after Completion under the provisions of any franchise agreement (including any renewal or extension thereof) between it and any Franchisee which does not relate to the Business to prevent that Franchisee being party to the relevant Franchise Agreement or to any new franchise agreement relating to the Business, the Vendor shall not invoke such right.

13.4         The Purchaser undertakes that, if and to the extent at any time after Completion it has the right under any Franchise Agreement (including any renewal or extension thereof) to prevent any Franchisee from being a franchisee under any other franchise agreement (including any new franchise agreement entered into after Completion) between that franchisee and any member of the Vendor’s Group, the Purchaser shall not invoke such right.

14            SUPPLIER CONTRACTS

14.1         Subject to clauses 14.3 to 14.6 (inclusive) and to the provisions of clause 10 above the Vendor hereby assigns to the Purchaser, as at and with effect from the Effective Date, the benefit of each Supplier Contract.

14.2         The Vendor shall indemnify the Purchaser against all losses, costs, claims, expenses or liabilities suffered or incurred in relation to the Supplier Contracts for any claim occurring prior to the Effective Date or any breach of any Supplier Contracts occurring prior to the Effective Date.

14.3         If a Supplier Contract cannot be assigned to the Purchaser except by an agreement of novation with, or consent to assignment from, one or more third parties, this Agreement shall not constitute an assignment or attempted assignment of the Supplier Contract, and

14.3.1      the Vendor shall, at the Purchaser’s written request and at the Purchaser’s cost, use its reasonable endeavours with the co-operation of the Purchaser to procure such novation or consent;

14.3.2      subject to clause 14.4, unless and until the Supplier Contract is novated or assigned:

(a)           the Vendor will hold the benefit of the Supplier Contract on trust for the Purchaser and (so far as it lawfully may) at the Purchaser’s cost give its reasonable assistance to the Purchaser to enable to Purchaser to enjoy the benefits of the Supplier Contract and to enforce its rights under it; and

(b)           the Purchaser will (to the extent that the relevant contract permits without it causing a breach of its terms) perform the Supplier Contract in accordance with its terms and conditions as sub-contractor to the Vendor.

14.4         If it is unlawful or prohibited under the relevant contract for the Vendor to hold the benefit of the Supplier Contract on trust for the Purchaser and/or for the Purchaser to perform the Supplier Contract as sub-contractor to the Vendor:

14.4.1      this Agreement shall not constitute a declaration of trust over the Supplier Contract and/or the appointment or attempted appointment of a sub-contractor under the Supplier Contract (as the case may be); and

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14.4.2      until such Supplier Contract is novated or assigned, the Vendor and the Purchaser shall each (at the cost and expense of the Purchaser) use their reasonable endeavours to do or procure to be done all such further acts and things and execute or procure the execution of all such other documents as may be necessary in order (as nearly as may be possible) to put the Vendor and the Purchaser in the position in which they would have been had the benefit and burden of the Supplier Contract passed to the Purchaser on Completion in the manner contemplated by clause 14.1.

14.5         If the necessary consent of a third party to the novation or assignment of any Supplier Contract is refused or is not given on terms acceptable to the Vendor and the Purchaser within 60 Business Days after Completion and no alternative arrangements have been made on terms reasonably acceptable to the Vendor and the Purchaser within such period to enable the Purchaser to receive the benefits of that Supplier Contract, then the Purchaser (save in respect of the Split Contracts) may require the Vendor to serve notice to terminate that Supplier Contract in accordance with its terms or the Vendor (in respect of any Supplier Contract) may elect to serve such a notice and the Purchaser shall indemnify the Vendor in respect of the termination of such Supplier Contract.

14.6         The parties recognise that the Split Contracts relate both to services provided in respect of the Business and certain other goods and services provided by or to the Vendor and/or other members of the Vendor’s Group to, or by, the relevant customers or suppliers in respect of the Excluded Businesses. Accordingly, the provisions of this clause 14 shall not apply to the Split Contracts which shall be excluded from the sale and remain with the Vendor. The Vendor agrees and acknowledges that for a transitional period of up to 6 weeks after Completion the Vendor will place orders (if the Purchaser so requests) for the Purchaser with suppliers with whom there are Split Contracts in place and the Purchaser shall pay such suppliers directly or reimburse the Vendor, as appropriate, in respect of such orders placed with the suppliers. The Purchaser shall indemnify the Vendor in respect of any such orders placed including in respect of any non-payment or other default by the Purchaser in relation thereto.

14.7         The Vendor shall pay and discharge any amount which is or may become due and payable to Glanbia Cheese Limited (including by way of price adjustment) under the provisions of the Glanbia Contract in respect of the period prior to Completion and the Vendor shall indemnify the Purchaser in respect thereof.

14.8         To the extent that any payment is made to the Vendor in respect of the Purchaser’s performance of the Supplier Contracts after Completion the Vendor shall receive the same as trustee and shall account to the Purchaser for the same within 10 Business Days of receipt.

15            EMPLOYEES

15.1         The parties acknowledge and agree that it is their intention that pursuant to the Regulations the contracts of employment between the Vendor and each of the Transferring Employees will have effect as from the Effective Date as if originally made between the Purchaser and each of the Transferring Employees and the Purchaser agrees, on or before Completion, to offer employment to all of the Transferring Employees on the same terms as they enjoyed with the Vendor.

15.2         The Purchaser warrants that it intends to take no measures in connection with the Transferring Employees in accordance with regulation 10(3) of the Regulations.

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15.3         The Vendor shall transfer all relevant employee records of the Transferring Employees to the Purchaser on or as soon as reasonably practicable after Completion.

15.4         The Vendor shall indemnify the Purchaser in respect of any matter connected with the employment, or, subject to clause 15.5.2, the termination of the employment, of a Transferring Employee up to Completion, including in respect of claims relating to redundancy, breach of contract, unfair dismissal, discrimination by reason of sex, race, disability, sexual orientation, religion or belief, equal pay, outstanding wages or other remuneration, PAYE, National Insurance contributions or pension contributions and, subject to the Purchaser having complied with clause 15.2, any protective award under the Regulations but excepting any claims for personal injury to the extent that such is covered by a policy of insurance of which the Purchaser has or acquires the benefit.

15.5         The Purchaser shall indemnify the Vendor in respect of any matter connected with:-

15.5.1      the employment, or termination of the employment, of any of the Transferring Employees on or after Completion, including claims relating to redundancy, breach of contract, unfair dismissal, discrimination by reason of sex, race, disability, sexual orientation, religion or belief, equal pay, outstanding wages or other remuneration, PAYE, National Insurance contributions, pension contributions and any claim for personal injury to the extent that any such claim and the subject matter of any such claim are as a result of any act or omission of the Purchaser after Completion; or

15.5.2      a Transferring Employee resigning or objecting to the transfer to the Purchaser on the grounds of any change in a Transferring Employee’s working conditions or terms and conditions of employment or any, or any intended, act or omission of the Purchaser; or

15.5.3      any breach by the Purchaser of the warranty set out in clause 15.2 and, in the event of such a breach, any protective award under the Regulations in relation to any Transferring Employee; or

15.5.4      any finding or allegation that the Regulations do not apply to any Transferring Employee.

15.6         If as a result of the Regulations, a contract of employment between a Non- Transferring Employee and the Vendor has effect as if originally made between such Non-Transferring Employee and the Purchaser or if any claim is made to that effect, then:

15.6.1      the Purchaser shall notify the Vendor in writing (such notice being an “NTE Notice”) and consult with the Vendor as to how such Non-Transferring Employee is to be dealt with;

15.6.2      without prejudice to the generality of clause 15.6.1 the Vendor may offer to re-employ such Non-Transferring Employee or give directions to the Purchaser to terminate such employment;

15.6.3      subject to clause 15.6.1, if the Vendor has neither re-employed such Non-Transferring Employee nor given directions for the termination of such employment within three months of the Vendor receiving the relevant NTE Notice, the Purchaser may terminate such employment with effect from the date three months after the date of delivery to the Vendor of the relevant NTE Notice; and

15.6.4      provided that the Purchaser has complied with clauses 15.6.1 to 15.6.3 (inclusive) including any directions for the termination of any such employment, the Vendor shall indemnify the Purchaser at all times in respect of any contract of employment between a Non-Transferring Employee and the Vendor being

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deemed to have effect as if originally made between such Non-Transferring Employee and the Purchaser, including:

(a)           the employment of any Non-Transferring Employee by the Purchaser up to the end of the three month period referred to in clause 15.6.3 or such a termination, if earlier;

(b)           any claims and liabilities arising out of or in connection with the employment of any Non-Transferring Employee prior to his employment by the Purchaser;

(c)           any claims and liabilities arising from the termination of the employment of any Non-Transferring Employee, including without limitation any claims arising out of the Purchaser complying with any directions given to it by the Vendor; and

(d)           in respect of any claim arising out of the actual or alleged application of the Regulations to any Non-Transferring Employee in connection with this Agreement

and including, in each relevant case, claims relating to redundancy, breach of contract, unfair dismissal, discrimination by reason of sex, race, disability, sexual orientation, religion or belief, equal pay, personal injury, outstanding wages or other remuneration, PAYE, national insurance contributions, pension contributions or otherwise, or arising out of or in connection with any alleged failure to inform and consult with appropriate representatives pursuant to the Regulations.

16            VENDOR’S WARRANTIES

16.1         General

The Vendor hereby warrants to the Purchaser in the terms set out in Schedule 3 but subject to the exclusions and limitations set out in Schedule 4. The Vendor acknowledges that the Purchaser has been induced to enter into this Agreement on the basis of and in full reliance upon the Warranties.

16.2         Disclosures

The Warranties are given subject to all those matters fairly disclosed in the Disclosure Letter and the Purchaser shall accordingly have no claim in respect of any of the Warranties in relation to any matter  fairly disclosed in the Disclosure Letter.

16.3         Separate Warranties

Each of the Warranties shall be construed as a separate and independent warranty and (save where expressly provided to the contrary) shall not be limited or restricted by reference to or inference from the terms of any other term of this Agreement or any other Warranty.

16.4         Scope of Warranties

The Purchaser acknowledges and agrees that the Vendor does not give any Warranty:

16.4.1      in respect of the Properties save for the Warranties in paragraph 34 of Schedule 3 and each of the other Warranties shall be deemed not to be given in respect of the Properties;

16.4.2      in respect of Environmental Matters save for the Warranties in paragraph 35 of Schedule 3 and each of the other Warranties shall be deemed not to be given in respect of matters relating to Environmental Matters, Environmental Liabilities or Environmental Law;

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16.4.3      in respect of pensions save for the Warranties in paragraphs 31 to 33 (inclusive) of Schedule 3 and each of the other Warranties shall be deemed not to be given in respect of pensions; and

16.4.4      in respect of Taxation save for the Warranties in paragraphs 19 to 22 (inclusive) of Schedule 3 and each of the other Warranties shall be deemed not to be given in respect of Taxation.

16.5         Warranties given on the date of this Agreement

The Warranties are given on the date of this Agreement and the Vendor is under no  obligation to disclose to the Purchaser anything which is or may constitute a breach of or be inconsistent with any of the Warranties of which it may become aware after the date of this Agreement.

16.6         No Rescission

The Purchaser acknowledges that in the event that it becomes aware following the entering into of this Agreement that there has been a breach of the Warranties or any other term of this Agreement, the Purchaser shall not be entitled to rescind or otherwise treat this Agreement as terminated and its sole remedy (subject to clause 19.5) shall be in damages.

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16.7         Treatment of Claims

Any payment made by the Vendor in respect of breach of the Warranties shall constitute a reduction in the Consideration.

16.8         Vendor’s Knowledge

Where any statement set out in Schedule 3 is expressed to be given or made “to the best of the Vendor’s knowledge and belief” or “so far as the Vendor is aware” or is qualified in some other manner having substantially the same effect, such statement shall mean that the Vendor is deemed to be aware of all those facts and matters within the actual knowledge of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, each having made reasonable enquiries into the subject matter of that statement or Warranty, including where they, acting reasonably, considered it appropriate due enquiry of the Vendor’s professional advisers but for the avoidance of doubt the Purchaser acknowledges that no enquiries have been made of any of the Franchisees.

16.9         Reliance on Warranties Only

The Purchaser acknowledges that it has not relied on any warranty, representation, covenant, undertaking, indemnity or other statement by or of the Vendor or any member of the Vendor’s Group or any of its or their officers, employees, agents or other representatives, other than the Warranties and further agrees that any breach by the Vendor of any Warranty shall not give rise to any claim other than a claim against the Vendor (not any other member of the Vendor’s Group or any of their or the Vendor’s officers, employees or representatives) in respect of such Warranty.

16.10       Purchaser’s Knowledge

The Purchaser shall not be entitled to bring any claim for breach of any of the Warranties to the extent that the subject matter of the claim was within the actual knowledge of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and/or ▇▇▇▇ ▇▇▇▇▇ on or before Completion.

16.11       Limitations of Liability

Schedule 4 shall have the effect of limiting further the liability of the Vendor in respect of the Warranties.

17            PURCHASER’S REMEDIES

17.1         Scope of the Purchaser’s Remedies

The rights conferred on the Purchaser by this Agreement shall be the Purchaser’s sole rights and remedies.

17.2         Undertaking by Purchaser

The Purchaser agrees and undertakes that it has no rights against and shall not make any claim against any present or former employee, officer, agent or other representative of the Vendor or any member of the Vendor’s Group in connection with this Agreement or its subject matter.

17.3         Exclusion of Liability

Notwithstanding any other provision in this Agreement and the Disclosure Letter, nothing herein or therein shall operate to limit or exclude the liability of the Vendor or the remedies of the Purchaser for fraud, fraudulent misrepresentation or wilful concealment on the part of the Vendor.

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18            PURCHASER’S WARRANTIES

18.1         The Purchaser warrants to the Vendor that the Purchaser has the requisite power and authority to enter into and perform its obligations under the Relevant Documents and the execution and delivery of, and the performance by it of its obligations under the Relevant Documents, will not:

18.1.1      result in a breach of, or constitute a default under, any instrument to which it is a party or by which it is bound;  or

18.1.2      result in a breach of any order, judgement or decree of any court or governmental agency to which it is a party or by which it is bound.

18.2         The Purchaser warrants to the Vendor that all of the Relevant Documents constitute binding obligations of the Purchaser.

18.3         The Purchaser warrants to the Vendor that:

18.3.1      no order has been made and no resolution has been passed for the winding up of the Purchaser or for a provisional liquidator to be appointed in respect of it and no petition has been served and no meeting has been convened for the purposes of winding up the Purchaser;

18.3.2      no administration order has been made and no petition for such an order has been presented in respect of the Purchaser;

18.3.3      no receiver (which expression shall include an administrative receiver) has been appointed in respect of the Purchaser;

18.3.4      the Purchaser is not insolvent or unable to pay its debts within the meaning of s.123 Insolvency ▇▇▇ ▇▇▇▇ and has not stopped paying its debts as they fall due;

18.3.5      no voluntary arrangement has been proposed under s.1 Insolvency ▇▇▇ ▇▇▇▇ in respect of the Purchaser;

18.3.6      no event analogous to any of the foregoing has occurred in or outside the United Kingdom with respect to the Purchaser;

18.3.7      the Purchaser has obtained all necessary shareholder and board approvals in respect of the entry into of this Agreement and the Relevant Documents; and

18.3.8      in relation to the acquisition of the Business and Assets under this Agreement the Purchaser is acting as principal and not directly or indirectly as an agent or other representative of any other person.

18.4         The Purchaser warrants to the Vendor that true, accurate and complete copies of each of the documents numbered 2.3.3, 2.3.5, 2.4.1, 2.4.3, 2.4.4 and 2.4.6 in the closing agenda contained at document 19.29 in the Disclosure Bundle and the memorandum and articles of association of the Purchaser as the same will be in force immediately after Completion have been supplied to the Vendor on or before execution of this Agreement.

19            RESTRICTIONS

19.1         It is agreed by the Vendor and the Purchaser that each of them has a legitimate business interest in retaining their goodwill and therefore that clauses 19.2 and 19.3 below are no more than is reasonably necessary for the protection of that legitimate business interest.

19.2         The Vendor undertakes that it will not within the Relevant Period, whether alone or jointly with or for or on behalf of another, directly and intentionally solicit from the Purchaser any Transferring Employee.

19.3         The Purchaser undertakes that it will not within the Relevant Period, whether alone or jointly with or for or on behalf of another, directly and intentionally solicit from the Vendor any Restricted Vendor Employee.

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19.4         Nothing in clauses 19.2 or 19.3 shall prevent either the Vendor or the Purchaser from advertising for staff in the ordinary course of its business or from employing any person who responds to such an advertisement.

19.5         Without prejudice to any other rights and remedies they may have, the Vendor and the Purchaser each acknowledges and agrees that damages alone may not be an adequate remedy for any breach by the other of the provisions of this clause 19 and that accordingly the party not in breach of any such provision shall be entitled, without proof of special damages, to the remedies of injunction, specific performance or other equitable relief for any threatened or actual breach of such provision.

19.6         The parties agree that each of clauses 19.2 and 19.3 shall constitute an entirely separate and independent restriction but that, if any such restriction shall be adjudged by any court or authority of competent jurisdiction to be void or unenforceable but would be valid if part of the wording thereof were to be deleted and/or the period thereof were to be reduced, the said restriction shall apply within the jurisdiction of that court or authority with such modifications as are necessary to make it valid and effective.

19.7         For the purpose of this clause 19, the following definitions shall apply:

19.7.1      “Relevant Period” means the period commencing on the Completion Date and ending on the first anniversary thereof; and

19.7.2      “Restricted Vendor Employee” means any employee of the Vendor at Completion other than the Transferring Employees.

20            SET-OFF BY PURCHASER

20.1         For the purpose of clause 20.2 a Claim (as defined in Clause 20.2) shall be regarded as having been “settled” if either:

(a)           it has been admitted or agreed in writing by the Vendor; or

(b)           an amount has been awarded or adjudicated as being payable or due by the Vendor by a court of competent jurisdiction from which it has been determined that there is no further right to appeal and from which no appeal is made within the relevant time permitted

and shall include any interest and costs if and to the extent the amount thereof has been so admitted, agreed or awarded in favour of the Purchaser.

20.2         If, prior to the date when any part of the Loan Notes or the Additional Loan Notes remain to be paid or satisfied by the Purchaser, the Purchaser shall have notified the Vendor in writing of a claim under the Warranties or otherwise under this Agreement (a “Claim”) and such Claim has been settled (and has not been withdrawn or set off by any previous application of this clause) the Purchaser shall be entitled to deduct the amount of the Claim firstly, from the amount of any interest due and payable on the Loan Notes and for the time being standing to the credit of the Escrow Account (as defined in the Escrow Agreement referred to in paragraph 1.1 of Part C of Schedule 5) and secondly, to the extent that the amount of such Claim has not been so satisfied, from the Loan Notes and accordingly from any amount due from the Purchaser in respect of

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outstanding payments due to the Vendor under the Loan Notes  which are in issue and the principal amount of the Loan Notes shall be permanently reduced by any amount so deducted and thirdly, to the extent that the amount of such Claim has not been so satisfied, from the Additional Loan Notes and accordingly from any amount due from the Purchaser in respect of outstanding payments due to the Vendor under the Additional Loan Notes which are in issue and the principal amount of the Additional Loan Notes shall be permanently reduced by any amount so deducted. The amount due to the Purchaser in respect of the settled Claim that forms the basis of any such deduction from the Loan Notes or the Additional Loan Notes (as the case may be) shall be reduced by the amount of such deduction. In the event of any such reduction in the Loan Notes or the Additional Loan Notes the Vendor shall, within 10 Business Days of demand by the Purchaser, deliver any certificates in respect of the Loan Notes and the Additional Loan Notes issued to it by the Purchaser for cancellation and the Purchaser shall issue new certificates to the Vendor for the reduced amount.

20.3         To the extent that in respect of a Claim an amount has been awarded or adjudicated as being payable or due by the Vendor by a court of competent jurisdiction from which there is a right of appeal and the Vendor has commenced appeal proceedings within the relevant time permitted then the amount which has been awarded or adjudicated (“Retention Amount”) shall be subject to the provisions of Clause 20.4.

20.4         If Clause 20.3 applies at any time when any sum payable under the Loan Notes or Additional Loan Notes remains outstanding then the Purchaser shall be entitled to withhold an amount equal to the Retention Amount from any sums payable under firstly, the Loan Notes and secondly, to the extent that the amount of the Loan Notes then outstanding is insufficient, the Additional Loan Notes provided that prior to the date upon which such sum or sums was or is due to be paid or satisfied it places an amount equal to the Retention Amount, not exceeding the maximum amount of Loan Notes and the Additional Loan Notes which remains unpaid, in an interest bearing deposit account (“Retention Account”) to be held by the Purchaser’s Solicitors and the Vendor’s Solicitors (jointly) subject to Clause 20.5 and otherwise upon such terms and conditions as the Vendor and the Purchaser, acting reasonably and in good faith, shall agree.

20.5         The Vendor and the Purchaser hereby irrevocably instruct the Purchaser’s Solicitors and the Vendor’s Solicitors to hold any sums paid into the Retention Account until the Claim or Claims to which the sums relate have been finally settled (or have been withdrawn) and to release the appropriate amount (together with all interest accrued thereon less any tax on bank charges) to the Vendor or the Purchaser (as the case may be) within 10 Business Days thereafter as appropriate. For the avoidance of doubt any interest accrued on the Retention Account shall belong to the Vendor and/or the Purchaser in proportion to the respective amounts released to the Vendor and/or the Purchaser from the Retention Account from time to time.

20.6         For the avoidance of doubt, the Purchaser shall not be entitled to any right of set off, counterclaim, withholding or deduction or similar right in relation to its obligation to pay for the Debts in accordance with clause 4.

21            EXPERT DETERMINATION

21.1         Where under any provision of this Agreement any disputed matter is to be referred to expert determination in accordance with this clause 21, the matter shall be referred to a single independent expert (“Expert”) to be appointed, in default of agreement between the parties within 10 Business Days, by the President for the time being of the Institute of Chartered Accountants in England and Wales on the application of either party.

21.2         In the event that a disputed matter is referred to an Expert:

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21.2.1      each party shall prepare a written statement on the disputed matters which, together with any relevant documentation, they shall submit to each other and to the Expert;

21.2.2      each party shall, following receipt of the other’s written statement, be entitled to prepare and submit to each other and to the Expert one set of written comments on the other’s written statement.

21.3         The Expert shall, in his absolute discretion, be entitled:

21.3.1      to stipulate the time periods within which the parties shall prepare and submit the written statements and written comments referred to in clauses 21.2.1 and 21.2.2 respectively, and to disregard any written statement or comments not delivered within any such stipulated time periods;

21.3.2      to require the parties to attend one or more meetings and/or to raise enquiries of them about any matters which the Expert considers relevant;

21.3.3      in the absence of agreement between the parties within such time period as the Expert may specify, to determine such other procedures (including time periods for their completion) to assist with the conduct of the expert determination; and

21.3.4      to determine any issues of law or involving the interpretation of any provisions of this Agreement relevant to the matters which the Expert is required to determine.

21.4         The Expert shall be entitled, in his reasonable discretion, to appoint advisers (including legal advisers) to assist him in reaching his determination.

21.5         Each party shall co-operate with the Expert and provide him with such information as the Expert may reasonably require for the purposes of his determination; if either party claims such information to be confidential to it then, provided that in the opinion of the Expert that party has properly claimed the same to be confidential, the Expert shall not disclose the same to the other party or to any third party.

21.6         In making his decision, the Expert shall act as an expert and not as arbitrator and his decision shall (in the absence of manifest error) be final and binding on the parties.

21.7         In delivering his decision to the parties, the Expert shall show his reasoning and any relevant calculations.

21.8         The costs of the Expert (including any fees and costs of any advisers appointed by him) shall be borne by the parties in equal proportions unless the Expert otherwise directs having regard, without limitation, to the conduct of the parties, but each party shall be responsible for its own costs of making its written statement and written comments and otherwise presenting its case to the Expert. Each party undertakes promptly to enter into any engagement letter(s) reasonably requested by the Expert reflecting the provisions of this clause 21.

22            INDEMNIFIED PARTIES

22.1         Where either party is indemnified by the other under the provisions of this Agreement that party shall use all reasonable endeavours to mitigate any costs (including any redundancy costs), damages, claims, liabilities and expenses which the other may be or become responsible for under any such indemnity.

22.2         Without prejudice to the generality of clause 22.1, a party (“Claimant”) shall in relation to any actual or threatened claim, demand or proceeding against it or any of its group undertakings (a “Claim”) which might give rise to a claim against the other party (“Indemnifier”) under any indemnity in this Agreement:

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22.2.1      as soon as is reasonably practicable given written notice thereof to the Indemnifier;

22.2.2      give the Indemnifier and its professional advisers reasonable access to the Claimant’s premises and personnel and to any relevant chattels, documents and records within the Claimant’s power, permission or control to enable the Indemnifier and its professional advisers to examine such chattels, accounts, documents and records and take copies or photocopies thereof at the Indemnifier’s own expense;

22.2.3      take such action as the Indemnifier may reasonably require to avoid, contest, dispute, resist, appeal, compromise or defend the Claim (including making counter claims and exercising all rights of set off) subject to being indemnified by the Indemnifier against all reasonable costs and expenses in connection therewith;

22.2.4      upon the written request of the Indemnifier, permit the Indemnifier in the name of and on behalf of the Claimant to have the conduct of all proceedings relating to the Claim including the appointment of solicitors and other professional advisers and the making of any settlement or compromise of the Claim;

22.2.5      render to the Indemnifier all such assistance as the Indemnifier may reasonably require (including providing access to information and to employees of the Claimant) for the purposes of avoiding, contesting, disputing, resisting, appealing, compromising or defending the Claim; and

22.2.6      the Claimant shall in any event keep the Indemnifier informed as to the steps which are being taken in connection with the Claim and no correspondence of a material nature with respect to the Claim shall be sent and, in particular but without limitation, no admission of liability, agreement, compromise or settlement shall be made by the Claimant with any person, body or authority in respect of the Claim without the prior written consent of the Indemnifier (such consent not to be unreasonably withheld or delayed).

23            INFORMATION

Subject to clause 8 (VAT), the Purchaser shall preserve all information, records and other documents relating to the Business, the Assets and the Transferring Employees delivered to the Purchaser pursuant to this Agreement for a period of not less than 7 years after the Completion Date and upon reasonable notice by the Vendor shall make such information, records and other documents available at all reasonable times during usual business hours for inspection by the Vendor (other than to the extent that such information, records and other documents contain confidential information relating to the Business) or its authorised agents who may (at the Vendor’s cost) take such copies therefrom as the Vendor may reasonably require. The Vendor shall preserve all information, records and other documents retained pursuant to this Agreement for a period of not less than 7 years after the Completion Date and upon reasonable notice by the Purchaser shall make such information, records and other documents available at all reasonable times during usual business hours for inspection by the Purchaser (other than to the extent that such information, records and other documents contain confidential information relating to the business of any member of the Vendor’s Group) or its authorised agents who may (at the Purchaser’s cost) take such copies therefrom as the Purchaser may reasonably require.

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24            ANNOUNCEMENTS

The Purchaser and the Vendor each undertakes that, save as may be required by law or any regulatory authority or as expressly provided for in this Agreement, it will not directly or indirectly make, or cause to be made, before on or after Completion, (whether to the public, press, employees, customers or suppliers or otherwise), any media statement, announcement, communication or other disclosure whatsoever (including notifying Franchisees or suppliers of the Business of the change of ownership in general business correspondence) in relation to this Agreement and the other documents entered into contemporaneously with it, whether written or oral, without the prior written approval of the other.

25            COSTS

Save as expressly otherwise provided in this Agreement, each of the parties shall pay its own legal, accountancy and other professional costs, charges and expenses connected with the negotiation, preparation and implementation of this Agreement and of all other documents referred to in it and the Purchaser shall pay all stamp duty arising in relation thereto.

26            ENTIRE AGREEMENT AND THIRD PARTY RIGHTS

26.1         Save as may be otherwise agreed by the Vendor and the Purchaser in writing for the purposes of this clause 26, this Agreement together with the other documents entered into contemporaneously with or pursuant to this Agreement constitutes the entire agreement and understanding between the parties with respect to all matters referred to in them.

26.2         No variation of this Agreement or any of the documents entered into pursuant to this Agreement shall be effective unless it is made in writing and signed by or on behalf of each of the parties hereto or thereto. For the purpose of this clause 26.2, the expression “variation” includes any variation, supplement, deletion or replacement however effected.

26.3         Each member of the Vendor’s Group and (in respect of clauses 16.9 and 17.2 only) each of those persons referred to in clauses 16.8 and 17.2 shall be entitled, pursuant to the Contracts (Rights of Third Parties) ▇▇▇ ▇▇▇▇ (“TP Act”), in its/his own right to the benefit of and to enforce the provisions of this Agreement, subject to and in accordance with the provisions of this Agreement and the TP Act, save that the parties to this Agreement shall not be required to obtain the consent of any other person in order to rescind, vary or terminate this Agreement or any provision thereof.

26.4         Save as set out in clause 26.3 and 33.2, no provision of this Agreement shall be enforceable pursuant to the TP Act by any person who is not a party to it.

27            INTEREST ON LATE PAYMENT

If any sum due to be paid by one party to the other under this Agreement, except a payment due from the Purchaser to the Vendor under clause 4 (which shall be subject to the default rate set out in clause 4.6), is not paid on the due date for payment, such unpaid sum shall carry interest calculated on a daily basis (as well after as before judgement) at the rate of 4% per annum above the annual base lending rate (or equivalent published rate) of The Royal Bank of Scotland plc from time to time from the due date to the date of

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actual payment (both dates inclusive). Any such interest shall be payable upon demand being made to the defaulting party by the party entitled to receive the overdue payment concerned.

28            RIGHTS AND REMEDIES

No failure to exercise and no delay in exercising on the part of the Purchaser or the Vendor any right or remedy available to it under this Agreement shall operate as a waiver of such right or remedy.

29            NO SET-OFF AND GROSSING UP

Except as otherwise expressly agreed in this Agreement, the Loan Notes or the Additional Loan Notes all amounts due from the Purchaser to the Vendor under this Agreement, the Loan Notes, the Additional Loan Notes and/or the Debenture shall be paid in full:

29.1         without and clear of any set-off, abatement or cross claim; and

29.2         without and clear of all deductions or withholdings whatsoever save only as may be required by law, in which event the Purchaser shall be obliged to pay such sum as will after such deduction or withholding has been made leave the Vendor with the same amount as it would have been entitled to receive in the absence of any such requirement to make a deduction or withholding.

30            FURTHER ASSURANCE AND IMPLIED COVENANTS

The Vendor hereby agrees, at the written request and expense of the Purchaser, to execute and deliver or do (as appropriate) such other documents and acts as may be reasonably necessary after Completion to vest in the Purchaser the legal and beneficial ownership of the Assets in accordance with the provisions of this Agreement.

31            PROVISIONS TO SURVIVE COMPLETION

All provisions of this Agreement so far as they are capable of being performed or observed and all warranties and undertakings herein contained shall continue in full force and effect notwithstanding Completion except in respect of those matters already then performed.

32            COUNTERPARTS

This Agreement may be executed in any number of counterparts, each of which when executed by one or more of the parties hereto shall constitute an original but all of which, when dated with the same date, shall constitute one and the same agreement.

33            ASSIGNMENT

33.1         Subject to clause 33.2 this Agreement shall be binding upon and shall enure for the benefit of the successors of the parties but shall not be assignable in whole or in part by either party without the prior written consent of the other party.

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33.2         Notwithstanding clause 33.1, the Purchaser may assign or otherwise encumber by way of security its rights under this Agreement but not its obligations for the benefit of National Westminster Bank plc and its transferees or assigns and any such security or encumbrance may be enforced or released. For the avoidance of doubt notwithstanding any such assignment the Purchaser shall remain liable to the Vendor for all its obligations under this Agreement.

34            NOTICES

34.1         Any notice or other communication under this Agreement shall be in writing and signed by or on behalf of the party giving it.

34.2         Any such notice may be served by delivering it personally or by sending it by pre-paid recorded delivery post (in the United Kingdom) or by courier with guaranteed next day delivery (to the United States of America) or by facsimile transmission:

34.2.1      in the case of the Vendor, at or to the following addresses and fax numbers or any other address or fax number in the United Kingdom or the United States of America which it may from time to time notify in writing to the Purchaser:

34.2.2      in the case of the Purchaser, at or to the following address or fax number or any other address or fax number in the United Kingdom which it may from time to time notify in writing to the Vendor:

34.3         Any notice delivered personally shall be deemed to be received when delivered (or if delivered otherwise than between 9.00 am and 5.00 pm on a Business Day, at 9.00 am on the next Business Day), any notice sent by pre-paid recorded delivery post shall be deemed to be received two Business Days after posting and in proving the time of despatch it shall be sufficient to show that the envelope containing such notice was

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properly addressed stamped and posted; and any notice sent by facsimile transmission shall be deemed to have been received at the time of transmission (or if transmitted otherwise than entirely between 9.00 am and 5.00 pm on a Business Day, at 9.00 am on the next Business Day) and in proving the service of the same it shall be sufficient to show that such facsimile transmission was duly transmitted to a current facsimile number of the addressee provided that any service by facsimile transmission shall not be effective unless the sender shall have received printed confirmation of the transmission and a copy of such transmitted notice is sent by pre-paid recorded delivery post no later than two Business Days after the day of such facsimile transmission being effected.

35            GOVERNING LAW AND JURISDICTION

This Agreement (together with all documents referred to herein) shall be governed by and construed in accordance with the laws of England and the parties hereto irrevocably submit to the non-exclusive jurisdiction of the English Courts for the settlement of all disputes or claims which may arise out of or in connection with this Agreement (and any documents referred to herein).

AS WITNESS the hands of the parties hereto or their duly authorised representatives the day and year first above written

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SCHEDULE 1

TRANSFERRING EMPLOYEES

▇▇▇▇▇ ▇▇▇▇▇▇

▇▇▇▇ ▇▇▇▇▇▇▇

▇▇▇▇▇▇▇ ▇▇▇▇▇▇

▇▇▇▇ ▇▇▇▇▇▇▇

Babinder Kaur

▇▇▇▇▇ ▇▇▇▇▇▇▇

▇▇▇▇▇▇ ▇▇▇▇▇

▇▇▇▇▇ ▇▇▇▇▇▇

▇▇▇▇▇▇ ▇▇▇▇▇▇▇

▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇

▇▇▇▇▇▇ ▇▇▇▇▇▇

▇▇▇▇▇▇▇▇ ▇▇▇▇▇

▇▇▇▇▇ ▇▇▇▇▇▇

▇▇▇▇▇▇ ▇▇▇▇▇▇

▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇

▇▇▇▇ Sivorn

▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇

▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇

▇▇▇▇▇ ▇▇▇▇▇▇▇▇

▇. ▇. Hollingmode

▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇

▇▇▇▇▇▇ ▇▇▇

▇▇▇▇ ▇▇▇▇▇▇

▇▇▇▇▇ ▇▇▇▇▇▇▇

▇▇▇▇▇ ▇▇▇▇▇▇▇▇

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SCHEDULE 2

PART A
THE EXCLUDED ASSETS

1              All cash in hand or at the bank.

2              Any amounts recoverable by the Vendor in respect of Taxation relating to the Business attributable to periods ended on or before the Completion Date.

3              All intellectual property rights in and all rights to use the business name Papa John’s or any logo or ▇▇▇▇ incorporating such name and all other intellectual property rights of the Vendor’s Group save for those expressly assigned under this Agreement.

4              All rights in respect of the computer systems referred to in the IT Agreement.

5              All assets of the Vendor used by it in any business other than the Business.

6              The Split Contracts

7              The Generic Stock.

8              Any debts or other amounts owing to the Vendor, other than the Debts.

9              Any assets owned by the Franchisees or the Principals (as defined in the Franchise Agreements) or any company owned or controlled by any of them.

10            Any debts owed to the Vendor from former franchisees including in respect of Sidcup and Penn.

11            Any equipment belonging to the Vendor’s Group situated in the possession or control of suppliers of the Business.

12            Any BlackBerry (or similar) handheld devices used in connection with the Business.

13            The Cisco Router and Dell Proliant Server situated at the ▇▇▇▇▇▇ Park Site.

14            The PJ Equipment as defined in clause 2.3.6 of the Distribution Agreement.

15            The computer equipment stored on racking in the stock area at the ▇▇▇▇▇▇ Park Site.

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SCHEDULE 2

PART B
THE EXCLUDED BUSINESSES

1              Any business other than the Business owned or operated by any member of the Vendor’s Group at or after the Completion Date including any business operated by Papa John’s Pizza Limited (Company Number 3872801).

2              Any business owned or operated by the Franchisees or the Principals (as defined in the Franchise Agreement) or any company owned or controlled by any of them.

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SCHEDULE 3

WARRANTIES

PRELIMINARY

1              Schedules and Information

The details contained in Schedules 1, 5 (Parts A and B), 6, 7, 8 and 9 are true and accurate in all material respects.

2              Capacity, Title and Solvency of Vendor

2.1           The Vendor is entitled to transfer the legal and beneficial ownership of the Business and Assets to the Purchaser on the terms of this Agreement without the consent of any third party.

2.2           The execution and delivery of, and the performance by the Vendor of its obligations under, this Agreement will not:

2.2.1        result in a breach of, or constitute a default under, any instrument to which the Vendor is a party or by which the Vendor is bound; or

2.2.2        result in a breach of any order, judgement or decree of any court or governmental agency to which the Vendor is a party or by which the Vendor is bound.

2.3           This Agreement constitutes, and the Relevant Documents to which the Vendor is a party will constitute, binding obligations on the Vendor.

2.4           No order has been made and no resolution has been passed for the winding up of the Vendor or for a provisional liquidator to be appointed in respect of it and no petition has been served and no meeting has been convened for the purposes of winding up the Vendor.

2.5           No administration order has been made and no petition for such an order has been presented in respect of the Vendor.

2.6           No receiver (which expression shall include an administrative receiver) has been appointed in respect of the Vendor.

2.7           The Vendor is not insolvent or unable to pay its debts within the meaning of s.123 Insolvency ▇▇▇ ▇▇▇▇ and has not stopped paying its debts as they fall due.

2.8           No voluntary arrangement has been proposed under s.1 Insolvency ▇▇▇ ▇▇▇▇ in respect of the Vendor.

2.9           No event analogous to any of the foregoing has occurred in or outside the United Kingdom with respect to the Vendor.

2.10         The Vendor has obtained all necessary shareholder and board approvals in respect of the entry into of this Agreement and the Relevant Documents to which it is a party.

3              Position Since 31 December 2004

Since 31 December 2004 the Business has been carried on in the ordinary and usual course as regards its nature and extent and manner of carrying it on.

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SUPPLIERS

4              Suppliers

Since 1 January 2006 the Business has not lost any important supplier (being a supplier accounting for more than 5% of the purchases of the Business on an annualised basis).

SUPPLIER CONTRACTS

5              Material terms disclosed

All material terms of each of the Supplier Contracts with any important supplier (within the meaning of paragraph 4 above) have been disclosed to the Purchaser in the Disclosure Letter.

6              Default

So far as the Vendor is aware no party or parties (including the Vendor) to a Supplier Contract with an important supplier (within the meaning of paragraph 4 above) is in default of any material obligation under such Supplier Contract where such default gives rise to a right to terminate such Supplier Contract.

FRANCHISE AGREEMENTS

7              The Disclosure Bundle contains true and complete copies of all the Franchise Agreements as the same are in force at the date hereof, including any amendments thereto.

8              So far as the Vendor is aware each of the Franchise Agreements is in full force and effect and neither the Vendor nor the relevant Franchisee has served any written notice of termination thereunder which notice is still outstanding.

9              So far as the Vendor is aware no party or parties (including the Vendor) to a Franchise Agreement is in default at the date hereof of any material obligation thereunder where such default gives rise to a right of any such party to terminate such Franchise Agreement.

INSURANCE

10            Details Provided

Details of all insurance policies maintained by the Vendor relating to the Business or the Assets are provided in the Disclosure Bundle and such details are true and accurate in all material respects.

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ASSETS

11            Ownership of assets

11.1         The Vendor is the legal and beneficial owner of all of the tangible Assets free from any Encumbrances.

11.2         No Encumbrance over the whole or any part of the Assets is outstanding and the Vendor is not a party to any agreement or commitment to give or create any Encumbrance over the whole or any part of the Assets.

11.3         So far as the Vendor is aware there are no material assets other than the Assets required by the Vendor to carry on the Business as carried on immediately prior to the Completion Date and those Assets which are tangible are in the possession or under the control of the Vendor.

11.4         None of the Assets including the Debts, are the subject of any assignment, royalty, overriding royalty, factoring arrangement, leasing or hiring agreement, hire purchase agreement, agreement for payment on deferred terms or any similar agreement or arrangement.

11.5         The Vendor has not created any option, right to acquire, mortgage, pledge, charge, lien or other form of security or encumbrance of any nature on, over or affecting any part of the Assets, and there is no agreement or commitment to give or create any of the foregoing and no claim has been made by any person to be entitled to any of the foregoing.

DEBTS, STOCK ETC

12            Debts, Stock etc

12.1         The Debts have each been invoiced and have been incurred in the ordinary course of the Business and so far as the Vendor is aware are valid debts owing to the Vendor.

12.2         Since the date on which the Stock Statement was prepared since there have been no abnormal movements in levels of the Stock, other than in the ordinary course of business.

FINANCIAL INFORMATION

13            Sales Statement

13.1         The figure attributed to “Periods 1 to 12, 2005, System Sales” in column (2) of the Sales Statement does not overstate the system sales of the Perfect Pizza business operated by the Vendor in the period from 27 December 2004 to 25 December 2005.

13.2         The figure attributed to “Periods 1 to 12, 2005, Food Sales” in column (2) of the Sales Statement does not misstate in any material respect the food sales of the Vendor to Perfect Pizza franchisees in the period from 27 December 2004 to 25 December 2005.

13.3         The figure attributed to “Periods 1 to 12, 2005, Marketing Income” in column (2) of the Sales Statement does not overstate the invoiced marketing income of the Perfect Pizza franchising business as operated by the Vendor in the period from 27 December 2004 to 25 December 2005.

13.4         The figure attributed to “Periods 1 to 12, 2005, Distribution Costs” in column (2) of the Sales Statement does not misstate in any material respect the aggregate distribution costs of the Vendor in respect of distribution from the ▇▇▇▇▇▇ Park Site to Perfect Pizza franchisees and Papa John’s franchisees and other restaurants in the period from 27 December 2004 to 25 December 2005.

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13.5         The figure attributed to “Periods 1 to 12, 2005, Adjusted System Sales” in column (2) of the Sales Statement does not overstate the system sales of the Franchise Sites in the period from 27 December 2004 to 25 December 2005.

13.6         The figure attributed to “2006, Adjusted Systems Sales” in column (2) of the Sales Statement does not overstate the systems sales of the Franchise Sites in the period from 27 December 2005 to 22 January 2006.

13.7         The figure attributed to “Periods 1 to 12, 2005, Admin Royalty Income” in column (2) of the Sales Statement does not overstate the invoiced admin royalties of the Perfect Pizza franchising business as operated by the Vendor in the period from 27 December 2004 to 25 December 2005.

14            Business since 22 January 2006

Since 22 January 2006 the Business has been carried on in its ordinary course without material interruption.

COMPLIANCE AND LITIGATION

15            Compliance with statute

15.1         No investigations or enquiries by or on behalf of any governmental or other body in respect of the Business or any of the Assets (other than routine taxation investigation or enquiries) have been notified to the Vendor.

15.2         So far as the Vendor is aware, neither the Vendor nor any of its officers, agents or employees which for the avoidance of doubt shall exclude any past or present franchisee of the Business (during the course of their duties in relation to the Business) has committed or omitted to do any act or thing the commission or omission of which is or could be in contravention of any statutory obligation or any other law of the United Kingdom giving rise to any fine, penalty, default proceedings or other liability in relation to the Business or any of the Assets which would in any such case materially and adversely affect the financial or trading position of the Business.

15.3         So far as the Vendor is aware the Business has been operated in all material respects in accordance with the laws of the United Kingdom.

16            Licences and consents

So far as the Vendor is aware insofar as any licence or consent is essential for the proper carrying on of the Business as presently carried on these have been duly obtained by the Vendor and are in full force and effect. So far as the Vendor is aware, no party to them (or any of them) is in material breach of any of the terms and conditions attached to them and there are no circumstances which indicate that any of them may be suspended, terminated, varied, revoked or not renewed in whole or in part.

17            Data Protection

The Vendor has not received any written notice or allegation from any person or third party in relation to the Business for failure or non-compliance with the Data Protection ▇▇▇ ▇▇▇▇ or 1998.

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18            Litigation and Disputes

Save in respect of collection of debts in the ordinary course of business (none of which exceed £5,000), the Vendor is not engaged (whether as defendant, claimant or otherwise) in any litigation or arbitration proceedings or in any claim or dispute in respect of the Business or the Assets, and, so far as the Vendor is aware, there are no such proceedings or claims or disputes pending or threatened either by or against the Vendor.

TAXATION

19            VAT

So far as the Vendor is aware the Vendor has complied, in all material respects, with all statutory requirements, orders, provisions, directions or conditions relating to value added tax to the extent that they are relevant to the Business.

19.1         No security has been given by the Vendor over any of the Assets in favour of the Commissioners for Customs and Excuse under the provisions of paragraph 4 of schedule 11 to the Value Added Tax ▇▇▇ ▇▇▇▇.

19.2         An election has been made by the Vendor under paragraph 2 of schedule 10 to the Value Added Tax ▇▇▇ ▇▇▇▇ in relation to the Properties and a true copy of such election is contained in the Disclosure Bundle at document 19.6.

19.3         The Vendor has not received notice of an election under paragraph 2 of schedule 10 to the Value Added Tax ▇▇▇ ▇▇▇▇ from the holder of any interest immediately superior to that held by the Vendor in respect of any of the Properties.

19.4         So far as the Vendor is aware none of the Assets is a capital item the input tax on which may be subject to adjustment under part XV of the Value Added Tax Regulations 1995.

20            Disputes

The Vendor has not received written notice of any dispute with the HM Revenue & Customs or other relevant fiscal authority concerning any matter which, so far as the Vendor is aware, will affect the Business or any of the Assets in any material respect.

21            PAYE/NIC

21.1         The Vendor has properly operated the Pay As You Earn system, by making deductions, as required by the applicable Taxation statute, from all payments made, or treated as made, to the Transferring Employees, and has accounted HM Revenue & Customs for all Taxation so deducted and for all Taxation chargeable on the Vendor on benefits provided to the Transferring Employees.

21.2         All National Insurance contributions (both employer’s and employee’s) due in respect of the Transferring Employees have been duly paid.

22            STAMP DUTY

22.1         So far as the Vendor is aware all material documents in the possession or under the control of the Vendor or to the production of which the Vendor is entitled which are necessary to establish the title of the Vendor to any asset relating to the Business and which attract stamp duty on the United Kingdom or elsewhere have been properly stamped.

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TRANSFERRING EMPLOYEES

23            Terms of employment

23.1         Particulars of the identity, date of commencement of employment, date of birth, job title and current salary of each Transferring Employee are set out in the Disclosure Letter.

23.2         Full particulars of all material terms and conditions of employment of all the Transferring Employees are set out in the Disclosure Letter.

23.3         Particulars of any profit sharing, commission, discretionary bonus arrangements, share option or phantom share option schemes, profit related pay schemes, employee share ownership plans or trusts or employee benefit trusts in which the Transferring Employees participate in are set out in the Disclosure Letter.

24            Employment Offers

Particulars have been given in the Disclosure Letter of any outstanding offer of employment made to any person to be engaged in the Business and there is no person who has accepted an offer of employment in the Business whose employment has not yet started.

25            Industrial Agreements

The Vendor has not entered into any recognition or other agreement or arrangement (whether legally binding or not) with any trade union or other body representing any of the Transferring Employees.

26            Leave of Absence

So far as the Vendor is aware there are no Transferring Employees on maternity leave, absent on grounds of disability or other leave of absence with a statutory or contractual right to return to work for the Business.

27            Compliance, Disputes and Disability

27.1         The Vendor has complied in all material respects with all its obligations under the Employment Rights ▇▇▇ ▇▇▇▇ in relation to the Transferring Employees.

27.2         No dispute between the Vendor and any Transferring Employee has occurred in the 12 months before Completion and has led to proceedings being issued against the Vendor.

27.3         So far as the Vendor is aware none of the Transferring Employees is disabled within the meaning of the Disability Discrimination ▇▇▇ ▇▇▇▇.

28            Termination of Employment

No Transferring Employee has given written notice to the Vendor terminating his contract of employment or is under notice of dismissal.

29            Variation of Transferring Employee Terms

The Vendor has not offered, promised or agreed (in each case on a binding basis) for the future any material variation in the current contract of employment of any Transferring Employee where such offer, promise or agreement remains outstanding.

30            Industrial Action

No industrial action or dispute is existing or, so far as the Vendor is aware, has been threatened against the Vendor in respect of or concerning any of the Transferring Employees.

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31            Pension Arrangements Disclosed

31.1         In this paragraph:

“Approved” means approved by the Board of Inland Revenue for the purposes of Chapter I or Chapter IV of part XIV of ICTA 1988 and references to “Approval” shall be construed accordingly;

“Disclosed Schemes” means the Perfect Pizza Limited Group Personal Pension Plan (“the GPPP”) with Prudential and the Perfect Pizza Limited Pension Scheme (“the Final Salary Scheme”);

“ICTA 1988” means the Income and Corporation Taxes ▇▇▇ ▇▇▇▇;

“Members” means the employees engaged in the Business who are entitled to benefits under the Disclosed Schemes; and

31.2         The Vendor is not a party to any agreement or arrangement other than the Disclosed Schemes for the provision of any Relevant Benefits (as defined in section 612 of ICTA 1988) for any of the Transferring Employees engaged in the Business, including any retirement benefits pension or personal pension scheme or stakeholder arrangement.

31.3         In respect of the Final Salary Scheme the Purchaser has been supplied with:

31.3.1      true and complete copies of all the deeds and rules currently governing or relating to the Final Salary Scheme;

31.3.2      a copy of the report of the most recent actuarial valuation of the Final Salary Scheme; and

31.3.3      a copy of the Perfect Pizza Limited Pension Scheme report and accounts for the year ended 5 April 2005.

31.4         All material details of the GPPP which are sufficient to enable the Purchaser to determine the type of benefits payable and the contributions payable to the GPPP in respect of the Members of the GPPP have been disclosed to the Purchaser, and all benefits provided under the GPP are on a money purchase basis.

31.5         No undertaking or assurance has been given to any person as to the continuance introduction increase or improvement of any Relevant Benefits (whether or not there is any legal obligation to do so).

31.6         As far as the Vendor is aware there are in respect of the Disclosed Schemes no civil, criminal, arbitration, administrative or other proceedings, claims or disputes (including, without limitation, complaints under the internal disputes resolution procedure, to the Pensions Ombudsman or any investigation or enquiry, routine or otherwise by the Pensions Regulator) by any Group Company against any Member or by any Member previous member or prospective member against any Group Company in progress, pending or threatened in writing and, so far as the Vendor is aware, no circumstances exist which might give rise to any such proceedings, claims or disputes.

31.7         Each Disclosed Scheme is Approved and the Vendor is not aware of any circumstances which might give the Board of Inland Revenue reason to withdraw Approval.

31.8         All death in service benefits which may be payable under the Group Life Assurance Scheme, G91635, are fully insured, all insurance premiums have been duly paid and so far as the Vendor is aware there is no ground on which the relevant insurance company could avoid liability under any policy of insurance applicable to such benefit.

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31.9         So far as the Vendor is aware the Disclosed Schemes have been administered so as to comply with all applicable legislation including all requirements relating to the payment of contributions.

32            Ex gratia Payments

The Vendor has not, in the last 12 months, made any material voluntary or ex gratia payments of any Relevant Benefits to or in respect of any Transferring Employee.

33            Undertakings

No undertaking has been given by the Vendor to any Transferring Employee as to the introduction, continuance, increase or improvement of any Relevant Benefits.

PROPERTY AND ENVIRONMENTAL

34            The Properties

34.1         All written replies to enquiries and requisitions relating to the Properties made or given by ▇▇▇▇▇▇ ▇▇▇▇▇ on behalf of the Vendor to the Purchaser (or to the Purchaser’s Solicitors) are true and accurate in all material respects.

34.2         The information relating to the Properties set out in Part A and Part B of Schedule 5 is true and accurate in all material respects.

34.3         So far as the Vendor is aware, there is no outstanding order, notice or claim (including any dilapidations order, notice or claim) which has been served upon or sent to the Vendor which relates to the state of repair and condition of the Properties or involves expenditure in complying with it.

35            Environmental Law

The Vendor has not received any formal written notice or complaint from any local authority, agency, body or third party threatening any civil, criminal or administrative action, proceeding or suit alleging breach of Environmental Laws in relation to the ▇▇▇▇▇▇ Park Site.

36            Intellectual Property

36.1         The Vendor is the sole unencumbered legal and beneficial owner and where registered the sole registered proprietor of all the Business Intellectual Property and the Vendor is not aware of any other Intellectual Property which is necessary to operate the Business.

36.2         Material particulars as to ownership, registration (and applications therefor) of the Business Intellectual Property including priority and renewal dates where applicable are set forth in Schedule 8 and/or in the Disclosure Letter and such details are complete and correct in all material respects. Such Intellectual Property comprises all material Intellectual Property which the Vendor has used in connection with the Business as carried on immediately prior to the date hereof or which is required to be used in connection with the operation of the Business as carried on immediately prior to the date hereof.

36.3         So far as the Vendor is aware the Business Intellectual Property is not the subject of any pending or threatened proceedings for opposition, cancellation, revocation or rectification or claims from employees and so far as the Vendor is aware there are no facts or matters which are likely to give rise to any such proceedings.

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36.4         All the application and renewal fees and costs and charges regarding the Business Intellectual Property due on or before Completion have been duly paid in full.

36.5         Save for those agreements listed in the Disclosure Letter, the Vendor has not entered into any agreement, arrangement or understanding (whether legally enforceable or not) for the licensing or otherwise permitting or authorising the use or exploitation of the Business Intellectual Property or which would prevent restrict or otherwise inhibit the Purchaser’s freedom to use and exploit the Business Intellectual Property.

36.6         So far as the Vendor is aware none of the Business Intellectual Property is currently being infringed by any third party or has been so infringed in the two year period preceding Completion.

36.7         So far as the Vendor is aware there are no outstanding claims against the Vendor for infringement of any Business Intellectual Property and no such claims have been settled by the giving of any undertakings which remain in force.

37            Restrictive Agreements and Competition

So far as the Vendor is aware, the Vendor has not within the period of 2 years prior to the date of this Agreement been party to or involved in any agreement, understanding, arrangement, concerted practice or conduct directly or indirectly affecting the Business which may infringe or have infringed.

37.1         the Competition ▇▇▇ ▇▇▇▇;

37.2         the Enterprise ▇▇▇ ▇▇▇▇;

37.3         Articles 81 and 82 of the Treaty establishing the European Community; or

37.4         any other competition or anti-trust legislation or regulations which apply or have applied in the EEA or within any jurisdiction within the EEA or any other jurisdiction in the world and the Vendor has not in connection with any matter directly or indirectly affecting the Business received any notice, request, order or other communication of any kind from any authority, commission, government department, court or other public agency charged with the oversight or enforcement of any of the legislation referred to in this paragraph 37.

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SCHEDULE 4

VENDOR’S LIMITATIONS OF LIABILITY

The provisions in this Schedule shall operate to limit the liability of the Vendor under and in respect of this Agreement and reference in this Schedule to “hereof”, “hereunder” and to “liability hereunder” shall be construed to refer to such liability as appropriate.

1              Minimum Claim Levels

No liability shall arise in respect of any claim for breach of the Warranties and/or the ▇▇▇▇▇▇ Park Indemnity unless and until the aggregate amount of all substantiated claims thereunder shall exceed £100,000 (one hundred thousand pounds) and, in addition, each individual substantiated claim to be counted towards the total sum referred to above must exceed £7,500 (seven thousand five hundred pounds), and in such event the Vendor shall be liable for the entire amount of the substantiated claims and not merely the excess. For the purpose of this paragraph 1, the expression “substantiated claim” means a claim (in whole or in part) which is admitted by the Vendor or proved in a court of competent jurisdiction.

2              Cap on Liability

The aggregate liability of the Vendor in respect of all claims under the Warranties and the ▇▇▇▇▇▇ Park Indemnity shall not exceed £4,600,000 (four million six hundred thousand pounds).

3              Time Limits

No claim shall be brought by the Purchaser against the Vendor in respect of any breach of the provisions of this Agreement unless notice in writing of any such claim (specifying so far as reasonably practicable the nature of the breach or claim and the amount claimed in respect thereof) shall have been given to the Vendor on or before the date which is 15 months after the Completion Date and proceedings are commenced by the Purchaser in respect of such claim within 6 months of notice in respect thereof being given to the Vendor and for this purpose proceedings shall not be deemed to have been commenced unless they shall have been issued and served upon the Vendor.

4              Reimbursement

Where the Purchaser is entitled to recover from some other person (including its insurers) any sum in respect of any matter giving rise to a claim against the Vendor hereunder, the Purchaser shall at the reasonable request and expense of the Vendor procure that reasonable steps are taken to enforce such recovery and if any sum is so recovered then (i) the amount of the Vendor’s liability in respect of that claim shall be reduced by an amount equal to the sum so recovered (less the reasonable costs and expenses of recovering it) or (ii) if an amount shall already have been paid by the Vendor or otherwise satisfied in respect of that claim there shall be repaid to the Vendor an amount equal to the amount so recovered or (if less) the amount of such liability already satisfied by the Vendor provided that nothing in this clause shall require the Purchaser to act in any manner which is likely to be materially and adversely prejudicial to the goodwill of the Business.

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5              Specific Limitations

5.1           No claim whatsoever shall be made by the Purchaser against the Vendor in respect of any breach of the provisions of this Agreement (and the Vendor shall not be liable in respect of any such claim which is made):-

5.1.1        to the extent that such breach or claim occurs or is increased as a result of any legislation not in force at the date hereof or occurs as a result of any increase in the rates of Taxation in force at the date hereof or occurs as a consequence of a change in the published practice of any taxation authority or in the interpretation of the law after the date hereof in any jurisdiction;

5.1.2        to the extent that such breach or claim would not have arisen but for:-

(a)           any voluntary act, omission, transaction or arrangement after Completion by the Purchaser or any other member of the Purchaser’s Group; or

(b)           any claim, election, surrender or disclaimer made or notice or consent given or any other thing done in respect of Taxation after Completion by the Purchaser or any other member of the Purchaser’s Group under the provisions of any enactment or regulation relating to Taxation; or

5.1.3        to the extent that reference, allowance, provision or reserve has been made in the Sales Statement Supporting Documents in respect of the matter to which such liability relates or such matter was taken into account in computing the amount of any such allowance provision or reserve or such matter was referred to in the notes to the Sales Statement Supporting Documents or is otherwise referred to in the Disclosure Letter or the Disclosure Bundle.

6              Contingent Claims

If any claim against the Vendor arises by reason of some liability of the Purchaser which, at the time such claim is notified to the Vendor, is contingent only or otherwise not capable of being quantified, then the Vendor shall not be under any obligation to make any payment in respect of such claim unless and until such liability ceases to be contingent or becomes capable of being quantified, as the case may be and if any such claim shall have been notified to the Vendor within the period stipulated in paragraph 3 above but does not cease to be contingent within 3 months of the giving of such notice then such claim shall lapse.

7              Recovery - Only Once

7.1           Payment of any claim shall pro tanto satisfy and discharge the amount payable in respect of any other claim which is capable of being made in respect of the same loss giving rise to such claim.

7.2           The Vendor shall not be liable in respect of any claim to the extent that the subject of the claim has been or is made good or is otherwise compensated for without cost to the Purchaser.

8              Conduct of Claims

If any claim comes to the notice of the Purchaser by reason or in consequence of which the Vendor may be liable under the Warranties the Purchaser shall:

8.1           as soon as reasonably practicable give written notice thereof to the Vendor;

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8.2           not make any admission of liability, agreement or compromise with any person, body or authority in relation thereto without the prior written agreement of the Vendor (not to be unreasonably withheld or delayed);

8.3           give the Vendor and its professional advisers reasonable access to the premises and personnel of the Purchaser upon prior written notice during normal business hours and to any relevant documents and records within the power, permission or control of the Purchaser to enable the Vendor and its professional advisers to examine such accounts, documents and records and take copies thereof at their own expense; and

8.4           take all such reasonable steps or proceedings as the Vendor may reasonably consider necessary in order to mitigate such claim and provide such other reasonable assistance as the Vendor may reasonably request, subject to the Purchaser being indemnified against all reasonable costs and expenses in connection therewith.

Provided that nothing in this paragraph 8 shall require the Purchaser to act in any manner which is likely to be materially and adversely prejudicial to the goodwill of the Business.

9              Mitigation

Nothing in this Schedule 4 or elsewhere in this Agreement shall in any way reduce the obligation of the Purchaser or any other member of the Purchaser’s Group to mitigate any loss which it suffers, or may suffer, in consequence of the circumstances giving rise to any claim or potential claim against the Vendor.

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SCHEDULE 5

PART A
THE LEASES

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