TRADEMARK AGREEMENT
THIS AGREEMENT is made and entered into as of this _____ day of _____,
1996 by and among MANOR CARE, INC., a Delaware corporation ("Manor Care"), and
CHOICE HOTELS HOLDINGS, INC. (to be renamed CHOICE HOTELS INTERNATIONAL,
INC.)("CHH"), a Delaware corporation.
RECITALS
Manor Care, directly and through certain subsidiaries ("Lodging
Subsidiaries") develops, owns and conducts the business of operating lodging
facilities (the "Lodging Business") and, directly and through its other
subsidiaries, develops, owns and conducts the business of operating health care
and senior living facilities;
CHH, directly and through its subsidiaries, engages in the business of
operating and franchising lodging facilities, resorts, food facilities, other
products procurement and distribution and other contract services businesses
pertaining to lodging;
Manor Care and CHH have entered into a distribution agreement dated as
of __________, 1996, whereby, inter alia, Manor Care and the Lodging
Subsidiaries transfer to CHH the stock of the Lodging Subsidiaries and certain
other assets relating principally to the Lodging Business, and whereby CHH will
conduct the Lodging Business formerly conducted by the Lodging Subsidiaries;
Manor Care and the Lodging Subsidiaries desire to assign and transfer
to CHH, and CHH desires to acquire, all of the right, title and interest of
Manor Care and the Lodging Subsidiaries in and to all the registered and pending
trademarks and service marks that are owned by Manor Care, Inc., and that are
used exclusively in the Lodging Business (marks in Schedules A and C,
collectively "Assigned Marks").
AGREEMENT
NOW THEREFORE, in consideration of the foregoing, the mutual promises
contained in this Agreement, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Manor Care and CHH
agree as follows:
1. Assignment. Without representation or warranty of any kind, express or
implied, and subject to all existing licenses, Manor Care hereby grants and
assign to CHH all of its right, title and interest in and to:
a. The Assigned Marks;
b. All federal, state and foreign registrations related to the
Assigned Marks and all pending applications for the Assigned Marks;
c. All statutory, common law, equitable and civil law rights (whether
arising under federal, state or foreign law) related to the Assigned Marks;
d. All of the goodwill of the Lodging Business connected with and
symbolized by the Assigned Marks;
e. All rights to income, royalties, license and franchise fees and any
other payments now or hereafter due or payable with respect to the Assigned
Marks, including without limitation, all damages and payments for past, present
and future infringements of the Assigned Marks;
f. All right to sue for, and all rights of recovery with respect to,
all past, present and future infringements of the Assigned Marks;
g. All rights of Manor Care under all license agreements with respect
to the Assigned Marks;
and
h. All other rights and privileges pertaining to or associated with
the Assigned Marks throughout the world, the same to be held and enjoyed by CHH
as fully as the same would have been held and enjoyed by Manor Care had this
Agreement not been made. These rights in sections a. through h. above are
collectively the "Assigned Mark Rights."
2. Assumption. CHH agrees to assume all obligations of Manor Care and the
Lodging Subsidiaries arising after the date of this Agreement under any license
agreements to which Manor Care or any of the Lodging Subsidiaries is a party
that are being assigned to CHH under this Agreement.
3. Manor Care Obligations. Within a reasonable time of the execution of this
Agreement, not to exceed 3 months, Manor Care and the Lodging Subsidiaries agree
to:
a. Cease all use of the Assigned Marks or any mark that is confusingly
similar to, or a colorable imitation of, the Assigned Marks, and dispose of all
current inventory and supplies marked with the Assigned Marks;
b. Prepare and file with proper authorities an assignment of rights,
registrations and obligations associated with all trademarks, service marks and
trade names, listed in Schedule A, of Manor Care, Inc. to CHH;
c. Prepare and file with proper authorities all corporate resolutions
and forms necessary to change the corporate name, and trademark registrant
status of the marks listed in Schedule B, of the Lodging Subsidiary Manor Care
Hotels France, S.A. to Choice Hotels France, S.A.;
d. . Prepare and file with proper authorities all
forms necessary to effect a change in each Manor Care business and corporate,
except as otherwise provided in this Agreement, name to a name which does not
include the words "Hotels ";
e. Execute all internal resolutions or other forms necessary to change
the business or company's name under the applicable corporations law or other
corporations legislation, together with an appointment, by each party's officers
and employees as the corporation's agent to complete and lodge the form; and
f. Deliver to the CHH copies of the documents referenced above.
4. Acknowledgement and Recordation.
a. Manor Care acknowledges, without representation, warranty or inquiry
that, by virtue of the assignment made in this Agreement, CHH is the exclusive
owner of the Assigned Mark Rights, and that Manor Care and the Lodging
Subsidiaries do not have any right, title or interest in or to any of the
Assigned Mark Rights from and after the date of this Agreement, except as
otherwise provided in this Agreement.
b. Manor Care and the Lodging Subsidiaries agree to cooperate fully
with CHH in filing for the recordation of appropriate assignment and other
documents in the appropriate foreign, state, and/or local jurisdictions
evidencing CHH's acquisition and ownership of the Assigned Marks and the
Assigned Mark Rights, and evidencing name changes and other assignments
contemplated by this Agreement. Neither Manor Care nor the Lodging Subsidiaries
will take action inconsistent with CHH's ownership of and interest in the
Assigned Mark Rights.
c. Manor Care and the Lodging Subsidiaries may not attack the validity
of any of the Assigned Mark Rights, CHH's ownership of the Assigned Mark Rights,
or any of the terms of this Agreement, or assist any third party in doing any of
the same, and Manor Care and the Lodging Subsidiaries waive any right to contest
the validity of the Assigned Mark Rights.
5. Relationship of the Parties. Nothing in this Agreement shall be construed to
create any relationship between the parties of agency, partnership or joint
venturer or render any party liable for
any debts or obligations incurred by any
other party to this Agreement. No party is authorized to enter into agreements
for or on behalf of any other party to this Agreement, to collect any obligation
due or owed to any such party, or to bind any other party in any manner
whatsoever.
6. General.
a. Entire Agreement. This Agreement constitutes the entire Agreement
between Manor Care and the Lodging Subsidiaries and CHH regarding the subjects
of this Agreement and supersedes all oral and written agreements, entered before
or at the same time as this Agreement, concerning the subjects of this
Agreement. This Agreement may be executed in one or more counterparts, each of
which shall be deemed original, and all such counterparts together shall
constitute but one and the same instrument.
b. Modification. This Agreement may be modified only by written
agreement signed by both parties to this Agreement.
c. Waiver. No waiver of any obligation under this Agreement will be
effective unless in writing, and will then be effective only for the specific
instance for which such waiver was given.
d. Assignment of Agreement. Neither party to this Agreement may
transfer or assign its rights under this Agreement; provided, however, that this
provision will not limit CHH from assigning rights to the Assigned Marks or the
Assigned Mark Rights to any party.
e. Governing Law. This Agreement will be governed by the laws of the
State of Maryland, without regard to Maryland conflicts of laws principles.
Parties to this Agreement consent to the exclusive personal jurisdiction of the
federal and state courts sitting in Maryland with respect to any action
concerning their respective obligations under this Agreement.
f. Severability. If any provision of this Agreement is held by a court
of competent jurisdiction to be unenforceable, then such provision may be
rewritten by that court with the least
modification necessary to render the
provision valid, and the remaining provisions of this Agreement will remain in
full force and effect.
g. Headings. The headings in this Agreement are for convenience only
and are not intended to affect the interpretation of this Agreement.
h. Binding Effect. This Agreement shall be binding on and inure to the
benefit of the parties to this Agreement and their respective transferees and
successors.
i. Geographic Scope. This Agreement shall be effective within the
United States and in any country in which the Lodging Subsidiaries do business
or intend to do business, including, but not limited to, Belgium, France,
Germany, Great Britain, Italy, Luxembourg, the Netherlands, Portugal, Spain, and
Switzerland.
7. Commercially Reasonable Terms and Conditions. The terms and
provisions of this Agreement are intended to reflect commercially reasonable
terms and conditions (including, but not limited to, pricing) that are at least
as favorable and as competitive to CHH as the terms and conditions Manor Care
would grant or require of third parties for substantially similar goods and
services.
SIGNATURES ON NEXT PAGE
IN WITNESS WHEREOF, a duly authorized representative of each party has
executed this Agreement as of the date first above written.
MANOR CARE, INC.
By: /s/ James H. Rempe
James H. Rempe
Title:Senior Vice President and Secretary
Date: November 1, 1996
CHOICE HOTELS HOLDINGS, INC.
By: /s/ James A. MacCutcheon
James A. MacCutcheon
Title Executive Vice President, Chief Financial Officer and Treasurer
Date: November 1, 1996
STATE OF MARYLAND )
) ss:
COUNTY OF MONTGOMERY )
Before me, a Notary Public, in and for said County and State, on this
day personally appeared James H. Rempe, the Sr. VP and Secretary of Manor Care,
Inc., and James A. MacCutcheon, the Ex. VP, CFO & Treasurer of Choice Hotels
Holdings, Inc., each known to me as those persons whose names are subscribed to
the foregoing instrument.
Given under my hand and seal this 1st day of November, 1996.
----------------------------------
Notary Public
My Commission Expires: _______________________________________
SCHEDULE A
MANOR CARE, INC.
Applications/Registrations: Pending and Registered
U.S. Application
Mark App.. No.
FREQUENT SLEEPER 75/028437
U.K. Registration
Mark Reg. No.
FOUR SEASONS 1493169
SCHEDULE B
MANOR CARE HOTELS FRANCE, S.A.
International Applications/Registrations: Pending and Registered
WIPO Registrations
Mark App./Reg. No.
PRIMEVERE and Design 563843
RESTHOTEL PRIMEVERE and Design 545399
SAPHIR and Design 562038
RESTHOTEL SAPHIR and Design 546480
UK Applications/Registrations
Mark App./Reg. No.
PRIMEVERE 1538745
SAPHIR App. No.
1538744
RESTHOTEL SAPHIR App. No.
15387453
RESTHOTEL PRIMEVERE 1538742
RESTHOTEL PRIMEROSE B1538740
DORDINE HOTEL 1538741
Other European Registrations
Mark Reg. No. Country
PRIMEVERE 555138 Benelux
PRIMEVERE 94506010 France
PRIMEVERE GE 94C 000242 Italy
PRIMEVERE and Design 302688 Portugal
PRIMEVERE 302688 Portugal
PRIMEVERE 1918022 Spain
PRIMEVERE 423869 Switzerland
SCHEDULE C
MANOR CARE HOTELS INTERNATIONAL, INC.
International Applications/Registrations
France Registrations
Mark Reg. No.
PRIMA PIZZA 1688145
PRIMEVERE and Design 1354090
RESTHOTEL PRIMEVERE and Design 1426424
SAPHIR and Design 1593020
RESTHOTEL SAPHIR and Design 1456476
DORDINN HOTEL 1562819