01/04/2007 AT 03:15 AM EST
01/04/2007 AT 09:45 AM EST
It seemed like a perfect match: Paris Hilton and a pair of nightclubs.
But the two Florida establishments named after the heiress will no longer be associated with her, according to their owner, Fred Khalilian.
Khalilian "fired" Hilton, 25, because she didn't make scheduled appearances at the 2-year-old Club Paris in downtown Orlando, he tells the Associated Press. Another Club Paris opened in Jacksonville last year,
"Paris was a friend of mine, and I hoped that this would work out," Khalilian tells PEOPLE. "Unfortunately, she didn't hold up her end of the bargain, so I had to take action."
In April, Hilton told PEOPLE that she would like her own club "with great music and good-looking people."
But signs of trouble were apparent from the start, when Hilton arrived six hours late
to the Orlando club's grand opening in January 2005.
"I was in the Swiss Alps skiing, and I got caught at the airport with all the holiday travel so I've been trying to travel for the past 24 hours," Hilton said at the time. "I'm so sorry I'm late."
Under the terms of her deal with Khalilian, who sank $3 million into the club, Hilton was required to make four appearances a year at the Orlando location. She herself had made no financial investment in the operation.
Khalilian says the last straw was when the club bought Hilton a $450,000 Mercedes SLR McLaren last year. "She didn't even say thank you," he says. "We gave her a lot of benefits, but she still didn't do what she needed to do. "
Khalilian says he doesn't plan to change the name of the clubs, but says Club Paris will now refer to the city, not the socialite. He also says he plans to hold a contest to find a new face for the hot spots.
"It'll be part Apprentice,
part American Idol,
and part Miss USA
," he tells PEOPLE. "Club Paris will go on, even without Paris Hilton."
Hilton's rep, Elliot Mintz, tells the AP that neither he nor Hilton has heard from Khalilian. "I'm certainly disappointed to learn of Fred's unfortunate comments," says Mintz. "We shall address his statements at the appropriate time."