LICENSE
THIS AGREEMENT is made and entered into as of
the 5th day of September,1997 by and between
Mississippi Baptist Health Systems, Inc., a not-
for-profit Mississippi corporation (hereinafter
called "MBHS") and Emeritus Corporation, a
Washington corporation and its subsidiary and
affiliated corporations, including Emeritus
Properties I, Inc., a Washington corporation, and
any limited liability companies and partnerships
in which Emeritus and/or such affiliated or
subsidiary corporations alone or in conjunction
with MBHS and/or its qualified affiliates are the
sole members or partners (hereinafter collectively
called "Licensee").
RECITALS
A. MBHS is the sole owner of its name, trade
name and certain trademarks relating to MBHS, and
any and all of its affiliates, which are specified
in Exhibit A attached hereto (hereinafter referred
to as the "Marks"), and any copyrights relating to
or arising from the use of the Marks (the
"Related Rights"); and has the sole right to grant
Licenses for the use thereof.
B. Licensee desires to obtain a license to
use the Marks, and the Related Rights of MBHS, in
connection with the development, operation and
maintenance of assisted living facilities in
Mississippi (the "License").
C. Pursuant to that Master Agreement and
Subordination Agreement of even date herewith
between MBHS and Licensee (the "Master
Agreement"), Emeritus agrees to cause its
subsidiary, Emeritus Properties I, Inc. ("EP I")
to grant to MBHS a 50% Economic Interest in that
80 unit assisted living facility operated by EP I,
and commonly known as Ridgeland Court and located
in Ridgeland, Mississippi and MBHS agreed to grant
Licensee a License and to authorize the use of
said Marks and Related Rights upon the terms and
conditions hereinafter stated.
D. By Economic Interest Assignment Agreement
and Subordination Agreement of even date herewith
(the "Assignment Agreement"), Emeritus has caused
EP I to grant the Economic Interest contemplated
by the Master Agreement.
E. Emeritus and MBHS are now interested in
documenting the terms and conditions under which
the License shall be granted to Emeritus.
NOW, THEREFORE, in consideration of the
premises and mutual covenants herein contained and
other good and valuable consideration the receipt
and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows:
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AGREEMENT
1. GRANT OF LICENSE. In consideration for the
execution and delivery of the Assignment
Agreement, MBHS hereby grants to Licensee the non-
exclusive right to use the Marks and Related
Rights to identify each of the facilities which
serves as assisted living facilities for the
elderly identified by location on Exhibit B
attached hereto as such Exhibit B may hereafter be
amended or modified from time to time by mutual
agreement of the parties hereto (the
"Facilities"), to use the Marks and Related Rights
for the purpose of developing, marketing,
operating and maintaining the Facilities and in
conjunction therewith, to use the Marks and
Related Rights in furtherance of the purposes for
which this License is issued. Where Exhibit B
refers to more than one Facility, every reference
hereafter in this License shall be deemed to be a
reference to each such Facility. Notwithstanding
the non-exclusive nature of the License granted
hereunder, nothing herein shall be construed as
permitting MBHS to grant a similar License to any
person or entity unaffiliated with MBHS providing
services or facilities in competition with the
Facilities.
2. TERM OF AGREEMENT.
(a) The term of this License shall commence
on the date set forth above and shall continue
until terminated by mutual agreement of the
parties, unless earlier terminated by MBHS
pursuant to Sections 2(b) or 2(c).
(b) Licensee acknowledges that elder care is
an integral part of the health care mission of
MBHS. Licensee also acknowledges that MBHS is a
Southern Baptist health care organization. As
such, Licensee agrees not (i) to advocate, allow
or condone euthanasia or assisted suicide at the
Facilities, even were these practices to be
legalized or (ii) violate the Guiding Principles
attached hereto as Exhibit C, and that a breach of
this provision would entitle MBHS to terminate
this Agreement.
(c) In addition to the termination rights
provided for in Section 2(b), this Agreement shall
terminate in the event the Release and Development
Conditions (as that term is defined in the Master
Agreement) are not satisfied by the end of the
Release and Development Period and MBHS provides
an Election Notice to Emeritus pursuant to Section
5(a)(i) of the Master Agreement. Such termination
shall be effective as of the date of the Election
Notice.
(d) Upon termination of this License,
Licensee and its affiliates will within thirty
(30) days thereafter (i) cease the further use of
the Marks and the Related Rights, including but
not limited to the names "Mississippi Baptist,"
"Mississippi Baptist Health Systems," "Baptist
Health Systems" and "Mississippi Baptist Medical
Center" in connection with the development,
marketing, operation and maintenance of the
Facilities and (ii) destroy all promotional and
all marketing or other materials then in its
possession or control using or displaying the
Marks or Related Rights.
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3. LIMITATIONS ON LICENSE. No license is
granted hereunder for use of the Marks or Related
Rights for any purpose other than the development,
marketing, operation and maintenance of the
Facilities and other than on the terms expressly
provided herein. In addition, unless and until
title to the Ridgeland Facility is transferred to
the Ridgeland LLC (as defined in the Master
Agreement), Licensee shall use the Marks and
Related Rights with the designation that the
project or service at issue is "affiliated with"
Mississippi Baptist, Mississippi Baptist Health
Systems, Baptists Health Systems, Mississippi
Baptist Medical Center or a similar designation,
it being understood and agreed that any such
projects or services shall be designated as a
project or service of Mississippi Baptist,
Mississippi Baptist Health Systems, Baptist Health
Systems, Mississippi Baptist Medical Center or a
similar designation after MBHS has a direct
ownership interest in the Ridgeland Facility. All
rights not expressly granted to Licensee in the
Agreement are reserved by MBHS.
4. COMPLIANCE WITH LAWS. With respect to the
Facilities, Licensee shall at all times conform to
all applicable, federal, state and local laws,
rules and regulations, ordinances and other
enactments including, but not limited to, those
relating to the development, marketing, operation
and maintenance of Facilities for assisted living
for the elderly.
5. RESERVED RIGHTS. MBHS reserves the right,
by itself or its designees, upon reasonable notice
to periodically inspect the Facilities and/or any
use of the Marks or Related Rights by Licensee to
ensure that such use, as well as the marketing and
operation of such Facilities, is consistent with
the standards and Guiding Principles attached
hereto as Exhibit C. Licensee shall forward to
MBHS's representative samples of materials using
the Marks and Related Rights upon MBHS's periodic
request.
6. INDEMNIFICATION. Licensee shall indemnify,
defend and hold MBHS, its subsidiaries, affiliates
and their respective directors, officers,
trustees, employees, insurers and agents
(collectively, the "Indemnitees") harmless from
and against any and all claims, liabilities,
judgments, penalties, settlements, losses, damages
and expenses, including court costs and reasonable
attorneys' fees, incurred or suffered by these
parties, which arise out of a breach by Licensee
of its obligations under this Agreement or which
are imposed against the Indemnitees in connection
with the operation by Licensee of the Facilities
solely as a result of the existence of this
Agreement, as compared to or as a result of any
other ownership interest in or relationship to the
Facilities which MBHS may have under the terms of
the Master Agreement or any documents executed
pursuant thereto or any actions or omissions of
MBHS hereunder or thereunder. MBHS agrees to
immediately provide Licensee and its and their
respective directors, officers, employees,
insurers and agents, with notice of any
allegations of trademark or copyright infringement
based upon specifically authorized uses of the
Marks or Related Rights and to indemnify, defend
and hold Licensee harmless from and against any
and all claims, liabilities, judgments, penalties,
settlements, losses, costs, damages and expenses,
including court costs and reasonable attorneys'
fees, arising by reason of or in connection with
allegations of trademark or copyright infringement
based upon specifically
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authorized uses of the Marks or Related Rights or
the breach by MBHS of its obligations under this
Agreement.
7. INSURANCE. Licensee shall at all times
name MBHS as an additional insured or loss payee,
as appropriate, on the insurance maintained by
Licensee with respect to the Facilities under the
terms of any applicable lease or financing
documents. Licensee and MBHS acknowledge and agree
that with respect to the Facility located in
Ridgeland, Mississippi, Licensee is currently
required to maintain in effect the insurance
described in Exhibit D hereto. Licensee shall
cause its insurance companies to send to MBHS, a
certificate of insurance verifying such coverages
within thirty (30) days of the execution of this
License. Each certificate shall provide that MBHS
shall be notified by Licensee's insurance company
not less than thirty (30) days in advance of any
proposed change in or termination of Licensee's
insurance coverage. Licensee or its insurance
companies shall provide annual confirmation of all
Licensee's insurance coverages promptly following
renewal thereof.
8. MARK DESIGNATION. All copyrights relating
to or arising from the use of the Marks and
Related Rights under this Agreement shall belong
to MBHS and shall bear the following copyright
notice: "O 1997 Mississippi Baptist Health
Systems, Inc.", where the year is that in which
the work was created. All trademarks, designs,
slogans and copyrights created or developed by or
on behalf of Licensee which relate to or arise
from the Marks or the Related Rights licensed to
Licensee hereunder are hereby assigned to MBHS.
9. ASSIGNMENT. This License and all rights
and duties thereunder are personal to Licensee and
shall not (without the prior written consent of
MBHS) be assigned, sublicensed or otherwise
encumbered or alienated by Licensee or its
affiliates or by operation of law or otherwise. In
the event of any attempted assignment or
encumbrance or other alienation by operation of
law or otherwise, this License shall immediately
be null and void and of no effect as if it had
never been discussed, negotiated and/or executed.
10. SURVIVAL. The obligations of the parties
under Sections 2(d) and 6 shall survive the
termination of this License.
11. GOVERNING LAW. This License shall be
construed and interpreted in accordance with the
laws of the State of Mississippi and in the courts
located therein without giving effect to choice of
law principles.
12. ENTIRETY. This Agreement represents the
entire and final agreement of the parties hereto
with respect to the subject matter hereof and may
not be amended or modified except by written
instrument signed by the parties hereto.
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13. ATTORNEYS FEES. In the event of a dispute
between the parties hereto with respect to the
interpretation or enforcement of the terms hereof,
the prevailing party shall be entitled to collect
from the other its reasonable costs and attorneys
fees, including its costs and fees on appeal.
14. COUNTERPARTS. This Agreement may be
executed in counterparts, each of which shall be
deemed to be an original but all of which taken
together shall constitute but one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have
executed this License Agreement as of the day and
year first set forth above.
MISSISSIPPI BAPTIST
HEALTH SYSTEMS, INC.
By: /s/ Kurt W. Metzner
-------------------
Kurt W. Metzner,
CEO/President
EMERITUS CORPORATION on
behalf of itself and its
affiliated and subsidiary
corporations including
Emeritus Properties I,
Inc.
By: /s/ Raymond R. Brandstrom
-------------------------
Its: President
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