Exhibit 10.7
Date:_____________
CAREY LICENSE AGREEMENT
SUMMARY PAGES
-------------
These pages summarize the attached License Agreement, the details of which shall
control in the event of any conflict with this summary.
1. Licensee: ______________________
2. Initial License Fee: ______________________
Total due: ______________________
Amount due upon signing
Agreement: ______________________
Amount Financed: ______________________
Monthly Note Payment: ______________________
3. Monthly License Fee: Five Percent (5%) of Total Revenue
4. Minimum Monthly License Fee: ______________________
5. Monthly Advertising & Marketing
Fee: Two and one-half percent (2.5%)
of Total Revenue (subject to
change. See Section 5.b.)
6. Minimum Monthly Advertising
& Marketing Fee: ______________________
7. Monthly Base Revenue
(If any): ______________________
Carey Initials _____
Licensee Initials _____
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8. Office Location: _________________________________
_________________________________
Street and Number
_________________________________
City, State and Zip Code
_________________________________
Phone Number
_________________________________
Facsimile Number
9. Licensee's Operator: _________________________________
10. Licensee's Agent to Receive Service of Process:
Name: _________________________________
Address: _________________________________
11. Effective Date: _________________________________
12. Expiration Date: _________________________________
13. Send Notices to Carey to: _________________________________
Name: _________________________________
Address: _________________________________
_________________________________
_________________________________
Fax Number: _________________________________
Carey Initials _____
Licensee Initials _____
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14. Send Notices to Licensee to:
Name: _________________________________
Address: _________________________________
_________________________________
_________________________________
Fax Number: _________________________________
15. Confidential Standards Manual Control
Number: _________________________________
Carey Initials _____
Licensee Initials _____
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TABLE OF CONTENTS
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PAGE
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1. PARTIES AND RECITALS............................................... 1
2. GRANT OF LICENSE................................................... 2
3. TERM AND RENEWAL................................................... 2
4. OPERATING ASSISTANCE............................................... 3
5. FEES AND PAYMENTS.................................................. 4
6. LICENSED MARKS..................................................... 4
7. STANDARDS OF OPERATION............................................. 5
8. CONFIDENTIAL STANDARDS MANUAL; CUSTOMER LISTS...................... 7
9. ADVERTISING AND MARKETING.......................................... 8
10. STATEMENTS AND RECORDS............................................. 8
11. COVENANTS.......................................................... 8
12. TRANSFER AND ASSIGNMENT OF AGREEMENT............................... 10
13. DEFAULT AND TERMINATION............................................ 11
14. POST TERM OBLIGATIONS.............................................. 13
15. TAXES, PERMITS AND INDEBTEDNESS.................................... 13
16. INDEMNIFICATION, SECURITY AND INDEPENDENT CONTRACTOR............... 14
17. WRITTEN APPROVALS, WAIVERS, ENTIRE AGREEMENT AND
AMENDMENT.......................................................... 14
18. ENFORCEMENT........................................................ 15
19. NOTICES............................................................ 16
20. GOVERNING LAW, CHOICE OF FORUM, AND WAIVER OF JURY TRIAL.......... 16
21. SEVERABILITY AND CONSTRUCTION..................................... 16
22. ACKNOWLEDGMENTS................................................... 17
SCHEDULE 1, LICENSEE'S TERRITORY
SCHEDULE 2, PROMISSORY NOTE
SCHEDULE 3, GUARANTY OF LICENSEE'S AGREEMENT
SCHEDULE 4, SECURITY AGREEMENT
1. PARTIES AND RECITALS
a. This License Agreement ("Agreement") is made as of ________, 19 ___ ,
by and between Carey Licensing, Inc., a Delaware corporation, with its principal
place of business at 1900 Delaware Avenue, Wilmington, Delaware 19806 ("We" or
"Carey" or "Us"), and ________________________________________________ ("You" or
"Licensee"), a _______________________________________ with a principal place
of business at_______________________________________________________ .
b. We and our predecessors have developed a plan for conducting a
chauffeur driven vehicle business ("Chauffeur Driven Vehicle Business" or
"Licensed Business") which plan or system includes furnishing to our Licensees
information and advice regarding: standards and methods of operation, marketing,
advertising and public relations, courtesy and appearance standards, charge card
services, reservation services, insurance programs and equipment standards for
conducting a Chauffeur Driven Vehicle Business called the "Carey System" or
"System." We may modify the System to reflect improvements in operating
procedures that you may use, and in the mix of products and services you may
sell to your customers as a Carey Licensee.
c. The use and promotion of our "Licensed Marks, " including "CAREY" is a
major part of our System. Our "Confidential Standards Manual" or "Manual"
details our System, and contains the requirements and restrictions which
determine how you may use the System to operate your Chauffeur Driven Business
using the Licensed Marks.
d. As our Licensee you agree to operate your Chauffeur Driven Vehicle
Business only in the manner explained in this Agreement and in our Confidential
Standards Manual, and you agree to change the way you operate your Chauffeur
Driven Vehicle Business whenever changes in the Manual require you and other
Licensee operating under this Agreement to do so, even if the changes require
you to spend money. You acknowledge that the success of us and the success of
our Licensee Network depends on each of our Licensees to diligently present a
consistent image and to operate in the same manner. You also acknowledge that
Carey Licensees have signed different License Agreements at different times,
that we have allowed some Licensees to conduct business in ways which differ
from the standard requirements of our System, and that we will continue to do so
if and when we think it is appropriate. However, such variations will have no
effect whatsoever on your rights and duties as a Carey Licensee operating under
this Agreement.
e. You acknowledge that on the date of this Agreement we have delegated
management responsibility for fulfilling our obligations to you under this
Agreement to Carey International, Inc. , a Delaware corporation, with its
principal place of business in Washington, D.C. Notwithstanding our delegation
of management responsibilities, we alone are responsible to you for fulfilling
our obligations under this Agreement.
2. GRANT OF LICENSE
We hereby grant you a Carey License which authorizes you, and you alone, to
operate a Carey Chauffeur Driven Vehicle Business from a location within the
Territory described on Schedule 1. We will not permit another Carey Chauffeur
Driven Business to be headquartered in your Territory, or to operate from
business premises located there; nor shall we publish in any directories or
advertising materials that we or any other Carey Licensee operate a Chauffeur
Driven Business in your Territory. We may obtain telephone listings in phone
directories in your Territory for phones which will be answered at our
reservation center. Neither we nor other Carey Licensees are prohibited from
providing services to clients in your Territory. We also may refer clients to
other chauffeur driven vehicle businesses in your Territory if, in our judgment,
you cannot adequately service such client(s) at the time. We may conduct
business in your Territory through a business which is not identified by the
Licensed Marks, and we may use the Licensed Marks in the conduct of a business
other than a Chauffeur Driven Vehicle Business.
3. TERM AND RENEWAL
a. This Agreement becomes effective when we sign it (the "Effective Date")
and its term extends until the Expiration Date stated on the Summary Pages.
b. So long as you have complied with all requirements of this Agreement
during its term, we will grant you a renewal license which will become effective
on the Expiration Date. As a condition of our signing your renewal license
agreement you will be required to:
i. Pay us 30% of the standard license fee we then charge for
territories of the same size as your Territory as a renewal
administration fee;
ii. Execute a general release of claims you may have against us on
the form we provide;
iii. Sign our then current form of renewal license agreement. It may
have terms and conditions which differ materially from this
Agreement, e.g., (without limitation) different fees or
Territorial boundaries; and
iv. Give us written notice of your desire to sign a renewal license
agreement not less than 6 and no more than 12 months before the
Expiration Date.
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4. OPERATING ASSISTANCE
We agree to provide you with no less than the following to help you operate
your Carey Chauffeur Driven Business so long as you are current in providing us
with monthly and annual reports and license fees:
a. Our Confidential Standards Manual;
b. Advertising, as defined in Section 9, including:
i. telephonic consultation with our advertising, sales promotion,
reservations and public relations staff concerning increasing and
developing your business;
ii. for purchase at our standard prices, signs, business forms,
decalomonias and promotional materials;
iii. for dissemination to travel agents, former clients and targeted
potential clients, directories and tariffs identifying your
business and the equipment and services you offer, as well as
other advertising materials; and
iv. benefits of worldwide promotion of the Carey System.
c. For our standard fees, participation in the Carey reservation center
program;
d. For our standard fees, participation in the Carey central billing
program;
e. Telephonic consultation about business and management problems of
operating your Chauffeur Driven Vehicle Business;
f. Bulletins and other written materials containing information and advice
related to your Chauffeur Driven Vehicle Business; and
g. For our standard prices, participation in our national purchasing
programs.
5. FEES AND PAYMENTS
a. To become our Licensee you must pay us the nonrefundable initial
license fee in the amount and at the times stated on the Summary Pages.
b. Once you commence business under the License Agreement, you must
deliver to us by the 20th of each month a monthly license fee equal to the
higher of the Minimum Monthly
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Service Fee specified on the Summary Pages or 5% of your Total Revenue for the
previous month.
c. Once you commence business under the License Agreement you must pay us
a monthly advertising and marketing fee which is no less than the Minimum
Monthly Advertising and Marketing Fee specified on the Summary Pages. We may set
monthly advertising and marketing contributions at any rate we select, at rates
of up to 5% of your Total Revenue. We shall notify you at least 30 days before
changing the contribution rate.
d. Once each year we may change the minimum monthly amounts specified in
Section 5.b. & c. by as much as the percentage increase in the United States
Consumer Price Index or any other national index of inflation that we select.
For the purpose of computing the fees due us pursuant to Section 5.b. & c. , we
shall subtract from your Total Revenue, the Monthly Base Revenue amount
specified on the Summary Pages, if any.
e. "Total Revenue" means as all revenue which is derived from your
Chauffeur Driven Business, including all types of vehicles used, whether owned
by you, leased, provided by independent operators or farm-outs, greeter,
consulting and coordination fees, phone revenues, driver only and surface
transportation charges ("STC") -- less tips, taxes, tolls and funeral revenue,
as we may define such items from time to time.
f. You shall pay us a service charge equal to the lesser of the compounded
daily equivalent of 18% per year of all amounts you owe us which are overdue by
more than 5 days, or the highest rate then permitted by applicable law for each
day such amount is past due.
6. LICENSED MARKS
a. You may only use our Licensed Marks for the purpose of operating the
Licensed Business, and in the manner prescribed in this Agreement and in the
Manual. This Agreement gives you no ownership in the Licensed Marks, or any
right to a payment for goodwill when the Agreement expires or terminates. You
may never directly or indirectly commit any act of infringement, or contest or
aid others in contesting the validity of our right to use the Licensed Marks, or
take any other action in derogation of our rights. You may not sublicense,
subdivide or otherwise dispose of any right to use our Licensed Marks, unless we
have given you our prior written approval to do so.
b. You shall promptly notify us of any unauthorized attempt to use, or use
of the Licensed Marks, or any variation of them, or any other mark or name in
which we claim a proprietary interest. Once you learn of violation of any of our
rights to the Licensed Marks, you shall diligently obtain details of the
violation, and, after obtaining our prior approval, take all actions necessary
to protect our interests. At our expense, you shall assist us in taking any
action we decide is appropriate to halt such activities. You shall take no
action nor incur any
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expenses on our behalf without our prior approval.
c. We may designate new, modified or replacement Licensed Marks for your
use, and require you to use them in addition to or in lieu of any previously
designated Licensed Marks. You must pay your own expenses associated with
implementing required changes.
7. STANDARDS OF OPERATION
a. You must always operate the Licensed Business in the way which is described
in this Agreement and in the Manual, including without limitation, the
following, and you must use:
i. the forms we prescribe;
ii. the Licensed Marks as we prescribe or approve;
iii. the signs we prescribe for use at your premises;
iv. only nondeceptive methods of promoting your business and
representing your services;
v. Advertising programs and materials we prescribe in the way we
prescribe;
vi. products and services purchased from Preferred Suppliers we
select and which have been approved by our Licensees following
the procedures we establish;
vii. central purchasing programs involving the Designated Suppliers we
prescribe which provide materials and services which, when
evaluated as a group, cost you less than you would pay for such
items from other approved sources;
viii. the charges and rates for your services which we publish at your
request. The rates must be submitted on an annual basis by
December 1 for the following year, and must be valid for the
entire year. When billing your clients, you alone shall set your
rates and charges;
ix. the promotional materials we provide you, and participate in all
Advertising and promotional activities and programs (as defined.
in Section 9) which we prescribe;
x. all reasonable means available to you in your Territory to
encourage use
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of Carey chauffeur driven services throughout the world, and
solicit, without a commission to you, reservations for our
chauffeur driven services throughout the world. However, if you
accept the billing and collection responsibility for a
reservation, you are entitled to collect a 10% commission. Also,
if you accept a reservation from us or another Carey Licensee or
Carey affiliate who agrees to accept billing and collection
responsibility for the reservation, you must pay that entity a
10% commission on each such reservation;
xi. Any computer software or hardware communication system we
prescribe for use as part of the System.
b. You must maintain your fleet of vehicles and premises, train and
monitor your drivers, and diligently implement the quality assurance procedures
we prescribe.
c. You must maintain the types and amounts of liability insurance that we
prescribe and all coverages required by law, name us an additional insured,
provide us the notices of coverage we request, and direct all of your insurance
carriers to give us 30 days advance written notice of the cancellation of any
policy we require you to maintain.
d. You must honor all reservations placed through our reservation service,
and comply with all our policies and procedures related to reservations.
e. You must offer to the clients all services we prescribe, using all the
equipment and vehicle types we prescribe, including, without limitation,
limousines, luxury sedans, vans, minibuses and motorcoaches.
f. Only the individual designated as the Operator on the Summary Pages may
manage and operate the Chauffeur Driven Vehicle Business. The Operator shall be
directly responsible to us for assuring that the Chauffeur Driven Vehicle
Business is conducted as this Agreement requires. You may not designate a new
Operator without our prior written approval. If you are the Operator, and if you
become incapacitated or disabled to the extent which we conclude interferes with
your ability to normally conduct the affairs of the Licensed Business, at our
option we may require the designation of a new Operator whom we approve, or we
may require your shareholders, partners, conservator, or guardian to transfer or
sell the Chauffeur Driven Vehicle Business to a third party whom we approve. Any
such transfer (as defined in Section 12) must be concluded within a reasonable
time from our request, not to exceed six (6) months.
g. You only may promote the telephone, facsimile, Internet, electronic
mail and similar numbers (collectively "Telephone Numbers") for your Chauffeur
Driven Business which we publish in our directories, or which we otherwise
approve in writing. You may not directly or indirectly promote Chauffeur Driven
Service through other Telephone Numbers.
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h. You must participate in all customer satisfaction and customer service
programs we prescribe, using all hardware, software and other communications
media we specify for use in the programs. You must assume all costs of providing
chauffeur driven services to customer satisfaction representatives which we
retain to evaluate your compliance with our Standards.
i. You must participate in such promotional programs as we prescribe,
including, without limitation, coop programs with other travel-related
companies, direct sales, advertising, direct mail and public relations programs,
and you must attend the travel-related trade shows and workshops we designate.
8. CONFIDENTIAL STANDARDS MANUAL; CUSTOMER LISTS
a. Our Confidential Standards Manual ("Manual") and customer lists contain
trade secrets and confidential information which we have developed at
considerable expense, and which we own. You may not disclose the Manual's
contents or our customer list to anyone but your employees who have signed
confidentiality and noncompetition agreements which we approve.
b. You may not copy or disseminate contents of the Manual or our customer
lists without our written approval. You must keep your Manual current and in a
secure place. Unauthorized use or disclosure of the Manual's contents will cause
irreparable harm to us and the System. Because legal damages could not
adequately compensate us, you agree that a court should enjoin you from any
further unauthorized use or disclosure of the Manual or its contents if we sue
you.
9. ADVERTISING AND MARKETING
We will administer and direct all expenses of the advertising and marketing
fund ("Fund") in a way we deem best. The Fund consists of all advertising and
marketing fees we collect. We may use the Fund for any expenses reasonably
related to advertising, public relations, promotional activities, reservations,
market research and telemarketing (collectively "Advertising") including,
without limitation, the cost of salaries, agencies, equipment and associated
overhead. We are not obliged to advertise in your Territory or to provide you or
any Licensee with Advertising which benefits you directly or which is
proportionate to your contributions.
10. STATEMENTS AND RECORDS
a. You shall maintain at least three years original and complete records
which accurately reflect all information we prescribe in the Manual. We or our
designee may examine
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and audit all your records, including, but not limited to, all books, schedules,
journals, bank accounts, tax returns, whether filed corporately or individually,
and any other documents we deem necessary. We are entitled to examine them where
they are kept in the ordinary course of business, and we may visit your premises
at any reasonable time.
b. You must provide us monthly income statements, and complete financial
statements and business tax returns and records within 30 days of your receipt
of our request. You must provide us with an independent audit of your financial
statements at your expense within 90 days of your receipt of our request.
11. COVENANTS
a. During the term of this Agreement, you and your guarantor(s) covenant,
individually:
i. Not to engage in, work in or for, or own more than 2% of any
business which derives 10% or more of its gross income from
providing chauffeur driven services, other than the Licensed
Business anywhere in the world, without our prior approval. For
purposes of this Section, chauffeur driven services includes,
without limitation, all ground transportation services in which
the services of a driver are provided to a customer. You and your
guarantor(s) who are not specifically excluded from this
obligation, agree to devote your full-time and best efforts to
the operation of the Chauffeur Driven Business; and
ii. Not to divert or attempt to divert any business or any actual or
potential customers of us, you or other Carey Licensees to any
competitive business;
b. For two years after this Agreement expires or is terminated, neither you
nor your guarantor(s) shall:
i. Contact, for the purpose of selling any service similar to
any Chauffeur Driven Vehicle Services, any person or organization
which was, at any time during the two-year period prior to such
expiration or termination, a customer who was referred to you
through the Carey reservation service, by a Carey Licensee or
Carey Affiliate, or through a marketing program we have sponsored
or developed; and
ii. Participate in, own any interest in, work for or be a licensee,
franchisee or affiliate of any organization or network which
offers chauffeur driven services from locations which are within
your Territory, within an area
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which is no more than 10 miles outside the border of your
Territory, or in the territory of any Carey Licensee operating
pursuant to a Carey License Agreement on the date this Agreement
is terminated or expires.
c. Each covenant in this Agreement shall be construed independently of any
other covenant or provision of this Agreement. If all or any portion of a
covenant is held unenforceable by a court or tribunal having valid jurisdiction
in an unappealed final decision to which we are a party, you shall be bound by
any lesser covenant imposing the maximum duty permitted by law that is subsumed
within the terms of such covenant, as if the resulting covenant were separately
stated in and made a part of this Agreement. The existence of any claim you may
have against us, whether or not arising from this Agreement, shall not
constitute a defense to our enforcement of the covenants in this Agreement.
d. We may reduce the restrictions placed on you by any covenant in this
Agreement without your consent, effective immediately upon your receipt of our
notice. You shall comply immediately with any covenant as so modified.
12. TRANSFER AND ASSIGNMENT OF AGREEMENT
a. We may freely transfer our rights and duties under this Agreement, and
the transfer shall be binding upon and inure to the benefit of our successors
and assigns.
b. The rights and duties set forth in this Agreement are personal to you
and others who own an interest in the License or the Chauffeur Driven Business
(collectively "you"). We granted you this License in reliance on your personal
character and financial capacity. Accordingly, you may not, without our prior
written consent, give away, sell, assign, pledge, lease, license, devise or
otherwise transfer, either directly or in any other manner, this Agreement, any
of your rights or obligations under this Agreement, or any interest or shares of
stock of any kind or nature in your Chauffeur Driven Business, or any
significant asset of the Chauffeur Driven Business, including without
limitation, any accounts, customers or clients of the Licensed Business (any
such transaction being referred to as a "Transfer"). We may prohibit a Transfer
or a change of control of assets of the Licensed Business which does not also
involve a Transfer of the License Agreement or a Transfer to another Carey
Licensee.
c. Any Transfer which does not comply with the terms of Section 12 shall
be null and void.
d. Before completing a Transfer, you must comply with our then current
Transfer policies and procedures which need not be written, pay us our standard
transfer fee, and give us a 30 day right of first refusal to purchase whatever
you propose to Transfer. Our duty to act upon your request, and the time within
which we must act upon our first refusal rights both
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commence only after we have received all information we have requested from you
and your prospective transferee. In exercising our first refusal rights, we need
only match the economic terms of the proposed Transfer, less any brokerage fees
and commissions. If the proposed Transfer involves items in addition to the
Chauffeur Driven Business, we may allocate a portion of the purchase price to
the Chauffeur Driven Business and acquire it without having to purchase the
other items. We may require any transferee to guarantee your obligations under
this Agreement or under any new License Agreement he enters with us.
e. Regardless of Subsection 12.d. above, if your heirs or personal
representatives desire to acquire or retain your interest in the Agreement, the
Licensed Business, or its assets after your death, they must agree to be bound
by the terms of this Agreement and any personal guarantees associated with it
and persuade us that they are compatible with us and are qualified in all
respects to operate the Licensed Business. Otherwise, your heirs or personal
representatives must Transfer the interest to someone whom we approve within a
reasonable time, not to exceed six months. The Transfer is subject to our first
refusal right and must comply with the procedures described above, and the
Licensed Business must be conducted in compliance with this Agreement at all
times prior to the Transfer's conclusion.
13. DEFAULT AND TERMINATION
a. Without waiving our other legal and equitable rights, we may terminate
this Agreement and all your rights granted in this Agreement, upon the
occurrence of any of the following defaults:
i. If you do not timely pay any financial obligation created in this
Agreement, and if you fail to cure such nonpayment within 30 days
after we give you a notice to cure;
ii. If you do not perform, or if you breach any covenant, obligation,
term, condition, warranty or certification of this Agreement and
if you fail to cure such non-compliance within 30 days after we
give you a notice to cure;
iii. If you do not commence business within 60 days of the Effective
Date;
iv. If you make, or have made, any materially false statement or
report to us in connection with this Agreement or your
application for this License;
v. If you do not operate the Chauffeur Driven Business in or as
specified in the Manual, and if you fail to cure such deficiency
within thirty (30) days after we give you a notice to cure;
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vi. If there is any violation of our Transfer requirements;
vii. If in the same calendar year we send you two or more notices to
cure defaults or violations of this Agreement;
viii. If you abandon or cease to operate the Chauffeur Driven
Business;
ix. If you or any person owning an interest in you are convicted of a
felony, a crime of moral turpitude, or any other crime or offense
relating to the operation of the Chauffeur Driven Business, or if
you fail to comply with any laws applicable to the operation of
the Chauffeur Driven Business;
x. If you (or your principal owner(s)) become insolvent or
incapacitated, and if a receiver or trustee is appointed for your
Chauffeur Driven Business and the requirements of Section 7(g)
are not fulfilled to our satisfaction;
xi. If you or any of your guarantors default in any other agreement
with us, and the default is not cured in accordance with the
terms of such other agreement;
xii. If you violate or permit a violation of any covenant of
confidentiality or nondisclosure contained in Section 8 of this
Agreement or any agreement you have made with us;
xiii. If, based upon standards communicated to you in our Manual, or
otherwise, we reasonably determine that you have failed to
satisfactorily perform your duties under, or to participate in
the Carey System, and you fail to cure your default within 30
days after we have given you written notice of your default; and
xiv. If your Total Revenue for any 24-month period is less than 75%
of 24 times the Monthly Base Revenue stated on the Summary Pages.
b. If a different notice or cure period or good cause standard is
prescribed by applicable law, it shall apply to a termination of this Agreement.
c. At any time following the first anniversary of the Effective Date, you
may terminate this Agreement without cause by giving us at least 60 days prior
written notice, and by paying us all amounts you owe us, plus an amount equal to
24 times the highest monthly license fee you owed us at any time during the term
of this License Agreement. Otherwise, you may terminate this Agreement only if
we have committed two or more material breaches of our obligations under this
Agreement within a calendar year, and have failed to cure such breach within 60
days after you have provided us with written notice to cure each such breach.
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14. POST TERM OBLIGATIONS
a. Upon the expiration or termination of this Agreement, you shall
immediately:
i. Cease to be a Carey Licensee, and cease to use the Licensed Marks
or the System in any way;
ii. Pay all you owe us under the License Agreement, plus costs and
expenses we incur as a result of your default;
iii. Return to us all copies of the Manual and all our customer
lists; trade secrets and confidential materials and all our other
property. You shall retain no copy or record of any of the
foregoing, except your copy of this Agreement, any correspondence
between the parties, and any other document which you reasonably
need for compliance with applicable laws; and
iv. Take such action as we request to transfer to us or our designee
white and yellow page telephone references and advertisements,
your Telephone Numbers, and all trade and similar name
registrations and business licenses, and to cancel any interest
which you may have in them. If you don't turn over to us or our
designee all Telephone Numbers you have used in association with
the Licensed Marks, you agree to pay us, as liquidated damages
and not as a penalty, the base sum of $500 per day for each day
until you do surrender the Telephone Numbers to us or our
designee, plus any additional damages we may prove.
15. TAXES, PERMITS AND INDEBTEDNESS
a. You shall promptly pay when due any and all federal, state and local
taxes, including without limitation, unemployment, workers compensation, and
sales taxes, levied or assessed with respect to any services or products
furnished pursuant to this Agreement and all accounts or other indebtedness of
every kind you incur in the operation of the Chauffeur Driven Business.
b. You shall comply with all federal, state and local laws, rules and
regulations and timely obtain any and all permits, certificates and licenses for
the full and proper conduct of the Licensed Business.
c. You hereby acknowledge and accept full and sole responsibility for any
and all debts and obligations incurred in the operation of the Chauffeur Driven
Business.
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16. INDEMNIFICATION, SECURITY AND INDEPENDENT CONTRACTOR
a. You agree to protect, defend, indemnify and hold us, our affiliates,
and our respective partners, directors, officers, employees and shareholders,
jointly and severally, harmless from and against all claims, actions,
proceedings, damages, costs, expenses and other losses and liabilities,
consequently, directly or indirectly incurred (including, without limitation,
attorneys' and accountants' fees) as a result of, arising out of, or connected
with the your negligent operation of the Chauffeur Driven Business, your breach
of contract or your tortious conduct.
b. To secure all your obligations arising under the License Agreement, you
hereby grant us a security interest in this Agreement, in your Chauffeur Driven
Business and its assets, including, without limitation its accounts receivables
You agree to sign all documents and to help us in any other way we may
reasonably request to perfect our security interest.
c. This Agreement is not intended to create a fiduciary relationship
between us, nor to constitute you as our agent, legal representative,
subsidiary, joint venturer, partner, employee or servant for any purpose
whatsoever. You are an independent contractor, and you are not authorized to
make any contract, warranty or representation or to create any obligation on our
behalf.
d. You are not intended to be a third party beneficiary of any agreement
between us and anyone else unless this Agreement expressly so provides. Our
agreements with other Licensees may be different from yours, and we have no duty
to enforce any agreement we have with a third party for your benefit. This
Agreement does not give you standing to sue any third party because of any
breach of their duties to us.
17. WRITTEN APPROVALS, WAIVERS, ENTIRE AGREEMENT AND AMENDMENT
a. Whenever this Agreement requires our prior approval, you shall make a
timely written request. Unless the Agreement specifies a different time period,
we shall respond with our approval or disapproval within 15 business days. If we
have not specifically approved a request within such period, our failure to
respond shall be deemed a disapproval of your request.
b. Our failure to exercise any power reserved to us by this Agreement, and
any customs or practices in which we engage which vary from the terms of this
Agreement, shall not constitute a waiver of our right to demand your exact
compliance with any of the terms of this Agreement or the Manual. Our waiver or
approval of any particular default, or our acceptance of any payments due under
this Agreement shall not be considered a waiver or approval of any preceding or
subsequent breach of this Agreement.
13
c. We may modify the System and any and all of our standards and bases for
approving or disapproving your requests, through changes to the Manual and
otherwise, so long as such modifications don't conflict with your express rights
created by this Agreement. Otherwise no amendment or variance from this
Agreement shall be binding on either of us without both parties written
agreement.
d. This Agreement constitutes the entire final and binding agreement
between you and us relating to its subject matter. It supersedes all prior and
contemporaneous negotiations, understandings, representations and agreements, if
any.
18. ENFORCEMENT
a. We shall be entitled to obtain, without bond, declarations, temporary
and permanent injunctions, and orders of specific performance, to enforce the
provisions of this Agreement.
b. The prevailing party in any litigation or arbitration concerning this
Agreement shall be entitled to receive from the non-prevailing party all its
costs and expenses of obtaining such relief, including, but not limited to,
court costs and reasonable attorneys' fees which may be incorporated into the
terms of any judgment, order or relief granted to the prevailing party.
c. If you prevail in any dispute against us or any of our partners,
affiliates, officers, agents, employees or representatives as a result of any
dispute arising out of the License Agreement, or the awarding of the License,
the damages awarded you shall not exceed the actual amounts you have paid us to
acquire and to operate the License Business. Your recovery shall be subject to
set off for income you have received from operating the Chauffeur Driven
Business.
14
19. NOTICES
Any notice required to be given hereunder shall be in writing and shall be
mailed by registered or certified mail, return receipt requested or personally
delivered. Notices also may be provided by overnight express, e.g., Federal
Express or fax. Notices sent by overnight express shall be deemed received the
second business day following their being sent. Any mailed notice complying with
the provisions hereof shall be deemed to be received on the fourteenth day after
it was deposited in the mail with proper postage affixed. Fax notices shall be
deemed received upon receipt of confirmation of receipt by the party to whom
they are sent. Personally delivered notices shall be deemed received when they
are actually delivered to a principal or officer of the receiving party. Notices
to Licensee and Licensor shall be addressed to them at their addresses or fax
number listed on the Summary Pages or to such other addresses or fax numbers as
the parties may hereafter prescribe.
20. GOVERNING LAW, CHOICE OF FORUM, AND WAIVER OF JURY TRIAL
This Agreement is accepted by us in the District of Columbia and it shall
be governed by and interpreted in accordance with the laws of the District of
Columbia, (except for its rules governing conflicts of law) which law shall
prevail in the event of any conflict of law. You and we consent to exclusive
personal and subject matter jurisdiction and exclusive venue in the Superior
Court of Washington, D.C., or in the Federal District Court for the District of
Columbia. Both parties and their guarantors hereby waive their right to trial by
jury.
21. SEVERABILITY AND CONSTRUCTION
a. Should any part of this Agreement, for any reason, be declared invalid
by a court of competent jurisdiction, such decision or determination shall not
affect the validity of any remaining portion, and such remaining portion shall
remain in force and effect as if this Agreement had been executed with the
invalid portion eliminated; provided, however, that in the case of a declaration
of invalidity, the provision declared invalid shall not be invalidated in its
entirety, but shall be observed and performed by the parties to the extent such
provision is valid and enforceable. The parties hereby agree that any such
provision shall be deemed to be altered and amended to the extent necessary to
effect such validity and enforceability.
b. This Agreement may be executed in any number of counterparts, each of
which when so executed and delivered shall be deemed an original, but such
counterparts together shall constitute one and the same instrument.
c. The headings and captions contained herein are for the purposes of
convenience and reference only and are not to be construed as a part of this
Agreement. All terms and words
15
used herein shall he construed to include the number and gender as the
context of this Agreement may require.
22. ACKNOWLEDGMENTS
You acknowledge that:
a. A Carey License involves business risks, and that your volume, profit,
income and success is dependent primarily upon your efforts as an independent
business operator;
b. No one associated with us has warranted or guaranteed, expressly or by
implication, the potential volume, profit, income or success you will achieve as
a Carey Licensee;
c. We gave you a Franchise Offering Circular no later than the earlier of
the first personal meeting held to discuss the sale of a Carey License, ten (10)
business days before the execution of this Agreement, or ten (10) business days
before any payment of any consideration. You have read our Franchise Offering
Circular and understand its contents;
d. We gave you a copy of this Agreement and all related documents, fully
completed, at least five (5) business days before you signed the Agreement;
e. You have had ample opportunity to consult with Carey Licensees and your
own attorneys, accountants and other advisors. Our attorneys have not advised or
represented you with respect to this Agreement; and
f. Our ability to assist you in overcoming operational, financial or
other problems depends in substantial part upon whether you make us aware of
such problems. You, therefore, agree to promptly notify us if you believe that
you are unable to meet your obligations arising from this Agreement, if you are
unable to satisfy your expectations or needs relating to the Licensed Business,
or if you believe we are not fulfilling our obligations to you. You agree that
we will under no circumstances be liable to you for any loss suffered by you
which resulted from a problem or default which you did not bring to our
attention promptly after it arose.
16
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
under seal on the date first written above.
LICENSOR:
Carey Licensing, Inc.
Witness: By:
------------------------ ---------------------------------
Title:
-------------------------------
Date:
----------------------
LICENSEE:
Witness: By:
------------------------ ---------------------------------
Title:
-------------------------------
Date:
----------------------
Witness: By:
------------------------ ---------------------------------
Title:
-------------------------------
Date:
----------------------
17
SCHEDULE 1
LICENSEE'S TERRITORY
The Licensee's Territory includes all of the following: (a map depicting
the borders of the Territory may be attached if it is initialled and dated by
both parties).
SCHEDULE 2
PROMISSORY NOTE
$ __________________
Washington, D.C.
__________________, 199 __
FOR VALUE RECEIVED, the undersigned promises to pay to the order of Carey
Licensing, Inc., at such place as hereinafter may be designated in writing, the
principal sum of _____________________________________Dollars over a
___________________ (___). year period, plus interest at the rate of
________________ percent per annum. Principal and accrued interest shall be
payable in equal monthly installments of _______________________
__________Dollars ( $) with the first payment due on _________________________.
All unpaid interest and principal shall be due and payable on or before
________________________________________ .
This Note may be prepaid without penalty or cost to the undersigned and at
no discount to the undersigned.
In the event of any default in the payment of any installment of principal
or interest, or any part thereof, when due hereunder, then the principal sum,
together with accrued interest, may, at the option of the holder of this Note,
be declared immediately due and payable. Failure to exercise this option,
however, shall not constitute a waiver of the right to exercise it thereafter.
The undersigned hereby waives presentment, demand for payment, notice of
dishonor, notice of protest, protest and all other notices or demands in
connection with the delivery, acceptance, performance or default of this Note.
ATTEST:
_______________________ ______________________________________
SCHEDULE 3
GUARANTY OF LICENSEE'S AGREEMENT
In consideration of, and as an inducement to, the execution of the
foregoing License Agreement ("Agreement") dated the
________________________________ day of ____________ __________________, 19__,
by Carey Licensing, Inc. ("Carey"), each of the undersigned hereby guarantees
unto Carey that _____________________________________________________________
__________________ ("Licensee") will perform during the term of this Agreement
each and every covenant, payment, agreement and undertaking on the part of
Licensee contained and set forth in or arising out of such Agreement, and any
instruments or agreements related thereto including, without limitation, the
covenants set forth in Sections 5, 6, 8, 12, 14, 16, 18 and 20.
Carey, its successors and assigns, may from time to time, without notice to
the undersigned (a) resort to the undersigned for payment of any of the
liabilities, whether or not it or its successors have resorted to any property
securing any of the liabilities or proceeded against any other of the
undersigned or any party primarily or secondarily liable on any of the
liabilities, (1)) release or compromise any liability of any of the undersigned
hereunder or any liability of any party or parties primarily or secondarily
liable on any of the liabilities, and (c) extend, renew or credit any of the
liabilities for any period (whether or not longer than the original period);
alter, amend or exchange any of the liabilities; or give any other form of
indulgence, whether under the Agreement or not.
The undersigned further waives presentment, demand, notice of dishonor,
protest, nonpayment and all other notices whatsoever, including without
limitation: notice of acceptance hereof; notice of all contracts and
commitments; notice of the existence or creation of any liabilities under the
foregoing Agreement and of the amount and terms thereof; and notice of all
defaults, disputes or controversies between Licensee and Carey resulting from
such Agreement or otherwise, and the settlement, compromise or adjustment
thereof.
The undersigned agrees to pay all expenses paid or incurred by Carey in
attempting to enforce the foregoing Agreement and this Guaranty against Licensee
and against the undersigned and in attempting to collect any amounts due
thereunder and hereunder, including reasonable attorneys' fees if such
enforcement or collection is by or through an attorney-at-law. Any waiver,
extension of time or other indulgence granted from time to time by Carey or its
agents, successors or assigns, with respect to the foregoing Agreement, shall in
no way modify or amend this Guaranty, which shall be continuing, absolute,
unconditional and irrevocable.
If more than one person has executed this Guaranty, the term "the
undersigned," as used herein shall refer to each such person, and the liability
of each of the undersigned hereunder shall be joint and several and primary as
sureties.
IN WITNESS WHEREOF, each of the undersigned has executed this Guaranty
under seal effective as of the date of the foregoing Agreement.
i
_______________________________________
Signature
_______________________________________
Printed Name
_______________________________________
Home Address
_______________________________________
Home Telephone
_______________________________________
Business Address
_______________________________________
Business Telephone
_______________________________________
Date
_______________________________________
Signature
_______________________________________
Printed Name
_______________________________________
Home Address
_______________________________________
Home Telephone
_______________________________________
Business Address
_______________________________________
Business Telephone
_______________________________________
Date
_______________________________________
Signature
_______________________________________
Printed Name
ii
_______________________________________
Home Address
_______________________________________
Home Telephone
_______________________________________
Business Address
_______________________________________
Business Telephone
_______________________________________
Date
_______________________________________
Signature
_______________________________________
Printed Name
_______________________________________
Home Address
_______________________________________
Home Telephone
_______________________________________
Business Address
_______________________________________
Business Telephone
_______________________________________
Date
iii
SCHEDULE 4
SECURITY AGREEMENT
______________________, whose address is______________________________________
______________________________________________________________________________
______________________________________________________________________________
[hereinafter collectively (if more than one/debtor) called "Debtor"] and Carey
Licensing, Inc., a Delaware Corporation with its principal place of business at
1900 Delaware Avenue, Wilmington, Delaware 19806 (hereinafter called "Secured
Party") agree as follows:
In order to further secure the obligations described in that certain
License Agreement dated __________________________ between debtor and Secured
Party (herein "License Agreement"), as amended, and all other indebtedness and
liabilities of all kinds of Debtor to Secured Party (whether created directly or
acquired by Secured Party by assignment or otherwise, and whether now existing
or hereafter arising, absolute or contingent, joint and/or several, due or to
become due, primary or secondary, and all renewals and extensions thereof),
Debtor herein below grants to Secured Party a security interest in the
collateral described herein.
NOW, THEREFORE, for and in consideration of the premises, and in order
to perfect a security interest, the parties agree as follows:
23. Indebtedness. The Security Interest (defined below) is herein created
------------
to secure all obligations, liabilities and indebtedness (collectively,
"Indebtedness") to Secured Party, direct or indirect, now existing or hereafter
arising, of whatsoever kind or
character, whenever or however created or incurred of Debtor, including without
limitation:
a. All indebtedness arising pursuant to the provisions of this Security
Agreement and all indebtedness arising pursuant to the License Agreement,
including interest, collection and attorneys' fees as therein provided;
b. All outstanding loans and advances which Secured Party has
heretofore, contemporaneously herewith and may hereafter make to Debtor;
c. All other and additional debts, obligations and liabilities of every
kind and character of Debtor, now or hereafter existing in favor of Secured
Party; and
d. Any and all renewal of extensions of any of the foregoing debts,
obligations and liabilities or any part thereof.
24. Agreement and Collateral. For value received, Debtor hereby grants to
------------------------
Secured Party, a Security Interest ("Security Interest") in all of Debtor's
right, title and interest and to the following described property
("Collateral"):
a. All present and hereafter existing or acquired accounts, money
deposits, credits, securities, claims, demands, contract rights and general
intangibles including, without limitation, the rights and interests of Debtor
under the License Agreement.
b. All personal property located within or used in connection with the
premises located at the address hereinafter designated for Debtor, including
without limitation, automobiles , equipment, furnishings, inventory supplies,
and mobile equipment of all kinds and replacements therefor.
All other terms used herein which are defined in the Uniform Commercial
Code of the state in which the Collateral is located shall have the meanings
therein stated.
25. Debtor's Warranties, Covenants and Further Agreements.
------------------------------------------------------
- i -
a. Title. Debtor has, or on acquisition will have, fee simple tide to the
-----
Collateral free from any lien, security interest, encumbrance or claim (except
liens for current taxes not due or liens previously disclosed to Secured Party
and except for such claims, liens and Security Interests, if any, described in
Exhibit "A" hereto) and Debtor will, during the term of this Security Agreement,
at Debtor's cost, keep the Collateral free from other liens, security interests,
encumbrances or claims, and defend any action which may affect the Security
Interest or Debtor's title to the Collateral. This Security Agreement and any
account, instrument or document which is, or shall be, included in the
Collateral is, and shall be, genuine and legally enforceable and free from any
set off, counterclaim or defense. No notice of bankruptcy or insolvency of any
account debtor has been received by Debtor.
b. Perfection. No financing statement covering the Collateral or any part
----------
or proceeds thereof is on file in any public office except as may be on file
with respect to the claims, liens and security interests, if any, described in
Exhibit "A" and, at Secured Party's request, Debtor will join in executing all
financing statements and other instruments deemed necessary by Secured Party to
perfect the Security Interest and to assist Secured party in complying with
Federal Assignment of Claims Act and will pay all cost thereof.
c. Assignment. Notwithstanding any other provision hereof, Debtor will not
----------
process, sell, lease or otherwise dispose of all or part of the Collateral
(except, as to supplies, in the ordinary course of business). Secured Party may
assign or transfer all or part of its right in, and obligations, if any, under
the Indebtedness, the Collateral and this Security Agreement.
d. Additional Property. The Collateral includes all proceeds, increases,
-------------------
substitutions, replacements, products, accessions, and attachments thereof,
including, without limitation, all proceeds, securities, subscription rights,
dividends or other property or benefits which Debtor is entitled to receive on
account of the Collateral.
e. Delivery of Receipts to Secured Party. Upon Secured Party's demand, Debtor
-------------------------------------
will, upon receipt of any remittance in payment of or for the Collateral,
immediately deposit all of same properly endorsed in a special bank account
maintained with Secured Party over which Secured Party alone has power of
withdrawal. The funds in said bank account shall be held by Secured Party as
security for the indebtedness. Secured Party may, from time to time, apply all
or part of said collected funds against the Indebtedness.
f. Maintained Securitv Interest, Reports. In addition to all other
---------------------------------------
provisions hereof, the undersigned will, from time to time; at the expense of
the Debtor, perform any and all steps requested by the Secured Party, at any
time, to perfect and maintain the Secured Party's security interest in the
Collateral.
If at any time, part or all of the Collateral shall be in the
possession or control of any of the Debtor's baileens, agents or processors, the
Debtor will notify such persons of the Secured Party's security interest therein
and upon the Secured Party's request, the Debtor will instruct such persons to
hold all such Collateral for the Secured Party's account and subject to the
Secured Party's instructions and the Debtor will obtain and deliver to the
Secured Party such instruments(s) requested by the Secured Party pursuant to
which such persons consent to the security interest granted herein, disclaim any
interest in the Collateral, waive, in favor of the Secured Party, all liens upon
and claims to the Collateral or any part thereof, and authorize the Secured
Party, at any time, to enter upon and remove the Collateral from any premises
upon which the same may be located.
g. Further Documentation. The Debtor shall, at its sole cost and
---------------------
expense, upon the request of the Secured Party, at any time and from time to
time, execute and deliver to the Secured party one or more financing statements
pursuant to the Uniform Commercial Code, and any other papers, documents or
instruments required by the Secured Party in connection herewith. The Debtor
hereby authorizes the Secured Party to execute and file, at any time and from
time to time; on behalf of the Debtor, one or more financing statements with
respect to all or any part of the Collateral, the filing of which is advisable,
in the sole judgment of the Secured Party, pursuant to the law of the state in
which the Collateral is located, although the same may have been executed only
by the Secured Party as secured party. The Debtor also irrevocably appoints
- ii -
the Secured Party, its agents, representatives and designeens, as the Debtor's
agent and attorney-in-fact, to execute and file, from time to time on behalf of
the Debtor, one or more financing statements; with respect to all or any part of
the Collateral.
h. Settlement of Accounts. The Secured Party is authorized and empowered
----------------------
to compromise or extend the time for payment of any of the Collateral, for such
amounts and upon such terms as the Secured Party may determine, and to accept
the return of goods represented by any of the Collateral, all without notice to
or consent by the Debtor and without discharging or affecting the obligations of
the Debtor hereunder.
i. Payment of Debtor's Obligation. Reimbursement. The Secured Party may, in
---------------------------------------------
its discretion, for the account and expense of the Debtor: (i) pay any amount or
do any act which is required to be paid or done by the Debtor under this
Security Agreement (including, but not limited to, the repair and insuring of
Collateral and payment of taxes) and which the Debtor fails to do or pay as
herein required; (ii) pay any sums due and owing by the Debtor to the
landlord(s) of any premises where any Collateral is located; and (iii) pay or
discharge any lien, security interest or encumbrance in favor of anyone other
than the Secured Party which covers or affects the Collateral or any part
thereof. The Debtor will promptly reimburse and pay the Secured Party for any
and all sums, costs and expenses which the Secured Party may pay or incur by
reason of defending, protecting or enforcing the security interest herein
granted or the priority thereof or in enforcing payment of the Indebtedness or
in discharging any lien or claim against the Collateral or any part thereof or
in the exchange, collection, compromise or settlement of any of the Collateral
or receipt of the proceeds thereof or for the care of the Collateral, by
litigation or otherwise, and with respect to either the Debtor, account debtors,
guarantors of the Debtor and other persons, including but not limited to all
court costs, collection charges, travel and reasonable attorneys' fees (not less
than 15% of the outstanding Indebtedness where permitted by applicable law). All
sums paid and all costs, expenses and liabilities incurred by the Secured Party
pursuant to the foregoing provisions, together with interest thereon at the
Maximum Rate specified in the Note and described in the License Agreement shall
be added to and become part of the Indebtedness secured hereby.
26. Rights of Secured Party. The extent permitted by applicable law, Debtor
-----------------------
hereby appoints Secured Party as Debtor's attorney-in-fact to do any act which
Debtor is obligated by this Agreement to do, to exercise all rights, voting and
otherwise, of Debtor in the Collateral, and to do all things deemed necessary by
Secured Party and to perfect the Security Interest and to preserve, collect,
enforce and protect the Collateral and any insurance proceeds hereunder, all at
Debtor's cost.
Whether or not an event of default has occurred, the right is
expressly granted to the Secured Party to the extent permitted by applicable
law, at its discretion: whether or not any of the Indebtedness be due, in its
name or in the name of the Debtor or otherwise, to notify any account debtor or
the obligor of any instrument to make payment to the Secured Party, demand, sue
for, collect or receive any money or property, at any time, payable or
receivable on account of or in exchange for, or make any compromise or
settlement deemed desirable by the Secured Party with resect to, any of the
Collateral, but shall be under no obligation to do so, and/or the Secured Party
may extend the time of payment, arrange for payment in installments or otherwise
modify the terms of, or release any of the Collateral without thereby incurring
responsibility to, or discharging or otherwise affecting any liability of, the
Debtor. At any time the Secured Party may assign, transfer and/or deliver to any
transferee of any of the Indebtedness any or all of the Collateral, and
thereafter the Secured Party shall be fully discharged from all responsibility
with respect to the Collateral so assigned, transferred and/or delivered. Such
transferee shall be vested with all the powers and right of the Secured Party
hereunder with respect to such Collateral, but the Secured Party shall retain
all rights and powers hereby given with respect to any of the Collateral not so
assigned, transferred or delivered.
27. Events of Default. The Debtor shall be in default under this Agreement
-----------------
upon the happening of any of the following events or conditions:
a. Default in the timely payment or performance of the Indebtedness, any
obligation, covenant or agreement contained herein, secured
- iii -
hereby or otherwise made or owed to Secured Party;
b. Any warranty, representation or statement made to Secured Party by or
on behalf of Debtor proves to have been false in any material respect when made;
c. Any time the Secured Party believes that the prospect of payment of all
or part of the Indebtedness or performance of this Agreement is impaired; or
d. If Debtor defaults under its Carey License Agreement, or if the License
Agreement is terminated or not renewed.
28. Remedies of Secured Party Upon Default. When an event of default
--------------------------------------
occurs, and at any time thereafter, Secured Party may, without notice to or
demand of any kind upon Debtor, declare all or part of the Indebtedness
immediately due and payable and may proceed to enforce payment of same and to
exercise any and all of the rights and remedies provided by the Uniform
Commercial Code ("Code"), as well as all other rights and remedies possessed by
Secured Party under this Security Agreement or otherwise at law or in equity.
The Secured Party shall have the following rights and remedies in addition to
all rights and remedies under the License Agreement and in addition to all
rights and remedies of a Secured Party under the Uniform Commercial Code or
other applicable statute or rule, in any jurisdiction in which enforcement is
sought, all such rights and remedies being cumulative and not exclusive:
a. Secured Party Deposits. Balances. Etc. The Secured Party may
-------------------------------------
appropriate, set off and apply for the payment of any or all of the
Indebtedness, any and all balances, sums, property, claims, credits, deposits,
accounts, reserves, collections, drafts, notes, or other items or proceeds of
the Collateral in or coming into the possession of the Secured Party or its
agents and belonging or owing to the Debtor, without notice to the Debtor, and
in such manner as the Secured Party may in its discretion determine.
b. Proceeds. Any of the proceeds of the Collateral received by the Debtor shall
--------
not be co-mingled with other property of the Debtor, but shall be segregated,
held by the Debtor in trust for the Secured Party as the exclusive property of
the Secured Party and the Debtor will immediately deliver to the Secured Party
the identical checks, monies, or other proceeds of collateral received, and the
Secured Party shall have the right to endorse the name of the Debtor on any and
all checks, or other forms of remittance received, where such endorsement
is required to effect collections. The Debtor hereby designates, constitutes and
appoints the Secured Party and any designee or agent of the Secured Party as an
attorney-in-fact of the Debtor, irrevocably and with power of substitution, with
authority to receive, open and dispose of all mail addressed to the Debtor, to
notify the Post Office authorities to change the address for delivery of mail
addressed to the Debtor to such address as the Secured Party may designate; to
endorse the name of the Debtor on any notes, acceptances, checks, drafts, money
orders or other evidences of payment or proceeds of the Collateral that may come
into the Secured Party's possession; to sign the name of the Debtor on any
invoices, documents, drafts against accounts of the debtors of the Debtor,
assignments, requests for verification of accounts and notices to debtors of
Debtor's to execute any endorsements, assignments or other instruments or
conveyance or transfer; and to do all other acts and things necessary and
advisable in the sole direction of the Secured Party to carry out and enforce
this Security Agreement. All acts of said attorney or designee are hereby
ratified and approved and said attorney or designee shall not be liable for any
acts of commission or omission nor for any error of judgment or mistake of fact
or law. This power of attorney being coupled with an interest is irrevocable
while any of the Indebtedness shall remain unpaid.
Secured Party may also require Debtor to assemble the Collateral and make
it available to Secured Party at any place to be designated by Secured Party
which is reasonably convenient to both parties. For purposes of the notice
requirements of the Code, Secured Party and Debtor agree that notice given at
least five (5) calendar days prior to the related action hereunder is
reasonable. Secured Party shall be entitled to immediate possession of the
Collateral and all books and records evidencing the same and shall have
authority to enter upon any premises, upon which said items may be situated, and
remove same therefrom. Expenses of retaking, holding, preparing for sale,
selling, or the like, shall include, without limitation, Secured Party's
- iv -
reasonable attorneys' fees and all such expenses shall be recovered by Secured
Party before; applying the proceeds from the disposition of the Collateral
toward the Indebtedness. To the extent allowed by the Code, Secured Party may
use its discretion in applying the proceeds of any disposition of the Collateral
and Debtor will remain liable for any deficiency remaining after such
disposition. All rights and remedies of Secured Party hereunder are cumulative
and may be exercised singly or concurrently. The exercise of any right or remedy
will not be a wavier of any other.
29. General.
--------
a. Liability Disclaimer. Under no circumstances whatsoever shall the
--------------------
Secured Party be deemed to assume any responsibility for or obligation or duty
with respect to any part or all of the Collateral, of any nature or kind
whatsoever, or any matter or proceedings arising out of or relating thereto. The
Secured Party shall not be required to take any action of any kind to collect or
protect any interest in the Collateral, including but not limited to any action
necessary to preserve its or the Debtor's rights against prior parties to any of
the Collateral. The Secured Party shall not be liable or responsible in any way
for the safekeeping, care or custody of any of the Collateral, or for any loss
or damage thereto, or for any diminution in the value thereof, or for any act or
default of any agent or bailee of the Secured Party or the Debtor, or of any
carrier, forwarding agency or other person whomsoever, or for the collection of
any proceeds, but the same shall be at the Debtor's sole risk at all times. The
Debtor hereby releases the Secured Party from any claims, causes of action and
demands at any time arising out of or with respect to this Security Agreement or
the Indebtedness, and any actions taken or omitted to be taken by the Secured
Party with respect thereto, and the debtor hereby agrees to hold the Secured
Party harmless from and with respect to any and all such claims, cause of action
and demands. The Secured Party's prior recourse to any part or all of the
Collateral shall not constitute a condition of any demand for payment or the
Indebtedness or of any suit or other proceeding for the collection of the
Indebtedness.
b. Waiver by Secured Party. No failure or delay on the part of the
-----------------------
Secured Party in exercising any of its rights and remedies hereunder or
otherwise shall constitute a waiver thereof, and no single or partial waiver by
the Secured Party of any default or other right or remedy which it may have
shall operate as a waiver of any other default, right or remedy or of the same
default, right or remedy of a future occasion.
c. Waiver by Debtor. The Debtor hereby waives presentment, notice of
----------------
dishonor and protest of all instruments included in or evidencing any of the
Indebtedness or the Collateral and any and all other notices and demands
whatsoever (except as expressly provided herein) whether or not relating to such
instruments. In the event of any litigation at any time arising with respect to
any matter connected with this Security Agreement or the Indebtedness, the
Debtor hereby waives the right to a trial by jury and any and all defenses,
rights of set off and rights to interpose counterclaims of any nature.
d. Parties Bound. This Agreement shall be binding upon and inure to the
-------------
benefit of the parties hereto and their respective heirs, executors,
administrators, legal representatives, successors, receivers, trustees and
assigns where permitted by this Agreement. All representations and warranties
and agreements of Debtor are joint and several if Debtor is more than one. This
Agreement shall constitute a continuing agreement, applying to all future as
well as existing transactions, such future transactions being contemplated by
Debtor and Secured Party.
e. State Law to Apply. This Agreement shall be construed in accordance
------------------
with the Uniform Commercial Code (the definitions of which apply herein) and
other applicable laws of the state in which the Collateral is located.
f. Notice. Notice shall be given or sent when mailed postage prepaid to
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Debtor' address shown below or to Debtor's most recent address as shown by
notice of change on file with Secured Party.
g. Construction. If there is any conflict between the provisions hereof
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and the provisions of the Indebtedness, the latter shall control. The captions
herein are for convenience of reference only and not for definition or
interpretation.
h. Modification. No provision hereof
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- v -
shall be modified, altered, or limited except by a written instrument expressly
referring to this Security Agreement and to the provision so modified or
limited, and executed by the party to be charged.
i. Authorization. The execution and delivery of this Security Agreement
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has been authorized by the Boards of Directors of the Debtor and by any
necessary vote or consent of stockholders (if any) of the Debtor.
j. Binding Effect. This Security Agreement and all Indebtedness of the
---------------
Debtor hereunder shall be binding upon the successors or assigns of the Debtor
shall, together with the rights and remedies of the Secured party hereunder,
inure to the benefit of the Secured Party and its successors, endorsees and
assigns; and shall constitute a continuing Security Agreement applying to all
future as well as existing transactions, whether or not of the nature
contemplated at the date of this Security Agreement.
k. Additional Terms. All annexes and schedules attached hereto, if any,
----------------
are hereby made a part hereon.
IN WITNESS WHEREOF, the Debtor has executed or caused this Security
Agreement to be executed in Washington, D.C. as of _____________________
_________________, 19 ___ .
- vi -
DEBTOR:
___________________________________________
by: ___________________________________________
Title: ___________________________________________
by: ___________________________________________
Title: ___________________________________________
by: ___________________________________________
Title: ___________________________________________
by: ___________________________________________
Title: ___________________________________________
SECURED PARTY:
CAREY LICENSING, INC.
by: ___________________________________________
Title: ___________________________________________
- vii -
The chief place of business, the location of the books and records
pertaining to the Collateral of Debtor and the location of the Collateral is:
Carey Licensing, Inc.
c/o Carey International, Inc.
4530 Wisconsin Avenue, N.W.
Washington, D.C. 20016
All Notices to be sent to Debtor pursuant to this Security Agreement shall
be sent to:
Carey Licensing, Inc.
c/o Carey International, Inc.
4530 Wisconsin Avenue, N.W.
Washington, D.C. 20016
All Notices to be sent to Secured Party pursuant to this Security Agreement
shall be sent to:
Carey Licensing, Inc.
c/o Carey International, Inc.
4530 Wisconsin Avenue, N.W.
Washington, D.C. 20016