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Licensee will have the right to operate up to Fifteen (15 ESP units at a specified location in the United States which has been requested by the Licensee and further approved by ESP as designated.

An annual renewal fee will be required 90 days prior to renewal date. A Licensee will have exclusive rights to their area. If the Licensee has set up 7 or more units at this location, the area will be protected for one additional year. Failure to set up and operate 7 units within the first year will result in the area being offer to other Licensees. At the end of the two year period, the Licensee must purchase an Exclusive License to protect the area from other Licensees.

Multiple Licenses - In the event there is more than one ESP License at a single location/area either by one ESP Licensee or that includes another licensed ESP Member, each such ESP License shall be subject, among other things, to the fees as set forth in the Licensing Agreement.

Within 7 days of the final approval of the Licensing Agreement, Licensor shall make the Licensed Materials available to the Licensee and Authorized Users.

BUSINESS DESCRIPTION

ESP operates fully furnished, corporate and temporary housing units engaged in the lodging of travelers, business­ people, family members, etc. for a period of time of one week or longer per stay.

RENEWAL

Without limiting the termination rights, ESP may renew the License for an ESP location/unit for periods of one (1) year. Special provisions may also allow up to five (5) years as may be appropriate pursuant to the satisfaction by ESP of the Licensee’s past performance and record with the company and the Licensee’s Clients.

The Licensing Contract shall automatically renew at the end of the current term for a successive ONE (1) YEAR TERM unless either party gives written notice of its intention not to renew ninety (90) days prior to the expiration of the current term. Renewal fees must also be paid 90 days prior to the renewal date.

EXPANSION

An expansion, would be the addition of a New ESP Unit/Location, either within the Licensed Area or as a Satellite or an Expansion Location.

SATELLITE LOCATION LICENSE

A Satellite Location is up to 3 units at a location in addition to the Licensee’s original location within the same geographic area approved by ESP. The Satellite units must not cause the Licensee to exceed the total number of units allowed by their original license. This is a location that is never meant for expansion by the Licensee and may not exceed 3 units. A Satellite Locations is subject to Licensing and other applicable Fees. If a Satellite Location is managed/operated by someone other than the original licensee, it is not considered an Expansion Location and will be subject to fees for a new License. Satellite Locations are subject to availability and must be approved in writing by ESP.

 MARKET EXPANSION LOCATION LICENSE

Market Expansion Locations are extensions of an initial Licensee’s Location and must have the same owner/operator as the original location. The Expansion Location is outside the boundaries of the original/current location. If a Market Expansion location is managed/operated by someone other than the original licensee, it is not considered an Expansion Location and will be subject to fees for a new License. Additional “Trial Expansion Options” are available upon request.

TRIAL LOCATION LICENSE

Trial Locations are extensions of an initial Licensee’s Location and must have the same owner/operator as the original location. The Trial Location is outside the boundaries of the original/current location and will be used to test an area for expansion. A Trial Locations may not exceed two units provided the Licensee has at least 2 units of his/her license that have not been utilized. If a Trial Location is managed/operated by someone other than the original licensee, it is not considered an Expansion Location and will be subject to fees for a new License. Trial Locations are subject to availability and must be approved in writing by ESP. A Trial Location does not shield the location/area from other Licenses being sold for that area/location. A Trial License is valid for a period up to 12 months. At the end of this time, the Licensee must either purchase the License for that location or vacate the location.

FEES AND PAYMENTS

Training / Consulting Fees - The fees and initial costs typically charged by ESP for training one person for each Licensed ESP location are included in the Licensing Fee. For any other persons to be trained by ESP, ESP may charge reasonable fees and costs for materials and participation. ESP shall not be responsible for any out-of-pocket expenses, travel, hotel, or salary costs, incurred during training by the Licensee’s personnel (including without limitation any Management Employees or Regular Employees).

The Licensee shall promptly pay when due all ESP, trade and supplier accounts, all federal, state, and local taxes (including, but not limited to, income, business and occupation, gross receipts, sales, use, property, and excise taxes), lease payments, and indebtedness of any kind incurred by the Licensee in the operation of the ESP units, unless the Licensee in good faith, contests any such payment.

Interest - Any sum owed to ESP by the Licensee or paid by ESP on the Licensee's behalf shall bear interest from the date due until paid by the Licensee at the rate of twelve percent (12%) or, the maximum lawful rate. Substantial Penalties may also apply.

OPERATION OF THE BUSINESS

Standards of Performance and Quality - It is important to ESP and the Licensee to develop and maintain high and uniform operating standards, to increase the demand for ESP's products and services, and to protect the reputation and goodwill of ESP. The Licensee shall ensure that the operation of each ESP unit is at all times under the direct control of the Licensee or a Management Employee.  

The ESP units must be operated in accordance with the standards of service, advertising, promotion, management, and cleanliness prescribed by ESP and on established days and during such hours as the Licensee may reasonably determine, exercising its judgment as a national provider of short-term/temporary lodging/housing and other managed services; comply with all business policies, practices, and procedures imposed by ESP; maintain the physical facilities of each ESP unit at a "pleasantly appealing" level of cosmetic appearance; provide at the ESP units only those services and products designated and approved by ESP; and maintain the interior and exterior of the ESP units in a sound, clean, decorated and attractive condition. The Licensee may, exercising its judgment as a national provider of short-term/temporary lodging/housing and other managed services, reasonably determine which ESP-approved services and products are to be offered in their unit(s).

Materials distinctive to the operations of ESP Units (brochures, toiletries, guest information, etc.) must be used. The products used to serve clients’ comfort needs are an integral and valuable part of the ESP service.

All employees, while working at ESP units, must present a neat and clean appearance according to the ESP Handbook, and to render competent and courteous service to customers.

TRAINING / CONSULTATION

Training Programs: Quality control and adherence to the ESP System are needed to preserve and enhance the value of the ESP System and the License.

Opening Assistance - ESP will have available, primarily via email, to the Licensee one (1) person experienced in the ESP System to assist the Licensee for a minimum period of six (6) months from the date of this Agreement in conjunction with, and prior to, the opening of any ESP unit and licensed location. Secondary locations will only be available once the Licensee establishes and operates the original location to the satisfaction of ESP.

Support - ESP will offer support, including assisting with the implementation of any ESP Programs and Procedures. ESP will offer reasonable levels of continuing support to assist the Licensee in the use of the Licensed Information.  ESP will make its personnel available primarily by email during the first six months for feedback, problem-solving or general questions.

Extended Stay Properties’ Licensing Terms and Conditions

Terms and Conditions Continues….