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Extended Stay Properties’ Licensing Terms and Conditions - Continued

LICENSEE OBLIGATIONS

Licensee will agree to take extreme care and precautions to protect all personal and credit card information of Clients. The Licensee will be held responsible for damages caused to the Client or ESP for failure to protect such information, as well as a minimum penalty of $500 per incident.  

Promotional Programs: The Licensee will honor all coupons, discounts, and similar promotions provided by ESP for use at its units generally that are presented by the Licensee's customers.  The Licensee must submit all such items to ESP within two weeks of receiving them. ESP shall reimburse the Licensee for any direct costs incurred by the Licensee thereby.  ESP shall have no obligation to reimburse the Licensee for coupons, discounts, and similar promotions if (i) promoted or undertaken for the Licensee’s ESP Units but not for ESP Units generally, or (ii) if the Licensee has delayed more than 60 days in submitting reimbursement requests for such coupons, discounts and promotions pursuant to the above.

The Licensee is an independent business person and will not hold his/her self out as, a partner, joint-venturer, agent, employee, or legal representative of ESP, and is not otherwise authorized to act for or on behalf of ESP

The Licensee can hire and be exclusively responsible for the compensation and training of all employees of its ESP units except for the training described in this License, and the Licensee willll have sole responsibility to collect and promptly pay when due all federal, state, and FICA, FUTA, withholding, and other applicable payroll taxes, worker's compensation contributions, unemployment insurance premiums, and all similar or applicable taxes, fees, and charges.

The Licensee will be an independent contractor, and not as an agent for ESP. Licensee must obtain Clean Background Checks on anyone who deals directly or indirectly with an ESP Client through your Business.

Promotional Materials: The Licensee will be required to purchase all trade/service marked promotional materials such as customer brochures and counter cards from ESP or a vendor approved by ESP. The Licensee may submit samples of such products from other vendors to ESP for testing and approval.

DESIGN & SET-UP

ESP may provide initial design/set-up consultation for each ESP location via email. The costs of such initial design consultation shall be included within the License Fee. Licensee shall design and set-up any and all ESP unit acting reasonably and following procedures set forth in the Manual.  The Licensing Fee covers only initial design consultation, and ESP shall not be responsible for detailed furnishing, architectural or construction drawings or revisions.

Refurbishment - From time to time, the Licensee will be required to refurbish each ESP unit as needed to maintain trade image, color schemes, and presentation then used by ESP in its other operations.  Refurbishment may include, without limitation, remodeling, redecoration, and modifications to existing improvements.

ADVERTISING

All advertising for its ESP units conducted by the Licensee must be dignified and must conform to the highest ethical advertising standards and to policies prescribed by ESP.  All advertising, promotional or marketing plans and materials that the Licensee uses shall be developed by ESP or shall be approved (except with respect to prices charged) in writing by ESP before use.

Web Site Access - ESP will maintain the ESP website.

INSURANCE

At all times, the Licensee will be required keep in effect such insurance (including, but not limited to, as may be required by law, comprehensive general liability insurance (including products and operations), and personal injury at a minimum limit of liability of $1,000,000.00 (One Million Dollars) to cover any liability to ESP. Proof of such insurance must be submitted to ESP upon purchase or renewal.

TRADE/SERVICE MARKS, CONFIDENTIAL & LICENSED MATERIALS

ESP ha exclusive ownership and validity of the Extended Stay Properties/Extended Stay Properties, Inc. names as well as any Trade and/or Service Marks.

The Licensee will be required to treat as confidential at all times, the Confidential Information, and to use all reasonable efforts to keep such information confidential. The Licensee acknowledges that the unauthorized use or disclosure of such Confidential Information will cause incalculable and irreparable harm that would result to either party if the other party were to breach its covenants and agreements.

The Licensee will not at any time during or after the term of The Licensing Contract disclose or use or permit the use (except as may be required by applicable law or authorized by this Agreement) of the Confidential Information, in whole or in part, or otherwise make the same available to any unauthorized person or source without ESP's prior written consent.

ESP owns the name along with any DBA name connected to the License.

 TERMINATION / EXPIRATION

The License may be terminated at any time by mutual agreement of the Licensee and ESP by written agreement.

 Immediate Termination of the License

If the Licensee:

 Participation in fraud or criminal misconduct relating to operation of the ESP units or if the Licensee or any of its officers, directors, or key employees is convicted of or pleads guilty or no contest to a charge of any felony, or any law, the violation of which will adversely affect the ESP Units, the Trade and/or Service Marks, any Confidential Information, or the reputation of ESP or the Licensee.

 Assignment, transfer, or attempt to assign or transfer: (i) the ESP unit, License Agreement, or the Licensee in whole or in part or (ii) any portion of the premises upon which any ESP Units is located, in a manner inconsistent with the provisions of this Agreement.

 Failure to have its employees complete successfully and timely the Initial Training Program.

Unauthorized use, disclosure, or duplication of the Confidential Information will be considered a violation of this Agreement.

 Surrendered or transfer of control of any ESP units without ESP's written consent.

ESP, without waiving any other rights it may have, and in its sole discretion, may elect not to terminate a License as a result of a default.  In the event a default occurs, ESP may elect to give written notification (a "Notice of Noncompliance") to the Licensee that an ESP unit/location (or more than one ESP unit/location, if applicable), is not in compliance with the terms and conditions of The Licensing Contract. Such Notice of Noncompliance shall state a period for the Licensee to cure the noncompliance, which shall be a period not less than thirty (30) days.  

Upon termination, expiration or non-renewal of this Agreement for any reason, with respect to each ESP Location/Unit, the Licensee agrees as follows:

TRANSFERABILITY

The Licensee may not sell, assign, or transfer its interest in this Agreement, including transfers for security, without ESP's prior written approval, which ESP may withhold in its sole and absolute discretion, and any attempt or purported assignment or transfer shall constitute a breach of this Agreement and be void and shall be cause for termination.