EXHIBIT 10.18
FORM OF BROKER MEMBERSHIP AGREEMENT
[GRAPHIC OMITTED] BROKER MEMBERSHIP AGREEMENT
This Agreement, dated, _________________is between Red Carpet Real
Estate Service, ("Red Carpet") and ________________________________,
("Broker") dba, ________________________________________, ("The Business"),
Broker's State of Registration ____,
Address:__________________________________________________________
__________________________________, Telephone number:
________________________________.
Red Carpet has been established for the purpose of developing a unique
membership of real estate brokerage businesses under the name "Red Carpet
Real Estate Service ("The Membership").
B. Broker is a fully licensed and registered real estate broker in good
standing with the State listed above, and has conducted real estate business
for no less than two years, as described in Broker Membership Application.
C. Broker has applied to join the Membership and participate in the
Membership under the terms and conditions contained in this Agreement. in
consideration of the following mutual promises, the parties agree that:
1. ADMISSION. (a) Red Carpet admits Broker into the Membership and
authorizes Broker to operate the Business using the trade name Red Carpet
Real Estate Service Membership . (When using Red Carpet Real Estate Service
Membership as part of its trade name, Red Carpet Real Estate Service
Membership may only be followed by Broker's DBA Name).
(b) Red Carpet authorizes the Business to use Red Carpet 's
trademarks and service marks and participate in the Membership's programs and
other benefits so long as Broker remains in good standing under this
Agreement. Broker acknowledges that Red Carpet, at its discretion, may modify
its programs from time to time as necessary.
2. TERMS: The term of this Agreement is five years, beginning
___________________________. This Agreement may be renewed for an additional
five year term under the terms available at the time of renewal if Broker
gives written notice of renewal to Red Carpet at least ninety (90) days prior
to the end of its initial term, is in good standing at such time, sends with
its notice a renewal fee of $500.00, and signs the Red Carpet Membership
Agreement in effect at the time of renewal.
(a) Broker agrees to pay Red Carpet upon signing this
Agreement a non-refundable Membership Fee of $1,500.00.
(b) Broker also agrees to pay Red Carpet monthly
dues of $100.00 for the Broker and $40.00 for each additional Associate. An
Associate is defined as any licensed broker, salesperson or assistant who is
affiliated, directly or indirectly, with Broker, and/or who uses the marks or
programs of Red Carpet in any way. Within 5 days after an Associate becomes
affiliated with the Business, Broker must give written notice of such
affiliation to Red Carpet . Failure to report such affiliation within the 5
day period shall be considered a material default of this Agreement, and
Broker agrees to pay Red Carpet $250.00 per month for any and all new
Associates from the date of affiliation with Broker until Red Carpet receives
written notice hereunder. So long as Broker follows the reporting
requirements outlined in this Section, dues for a new Associate will commence
on the first month following the second full month of affiliation..
(c) Broker agrees to pay the dues each month and
authorizes Red Carpet to make a direct transfer of the dues from Broker's
bank account or designated credit card between the 20th and 25th day of each
month. Broker will sign the Authorization attached to this Agreement as
Schedule A and take any additional action that may be required by Broker's
bank to set up and maintain direct transfer bank authorization. Broker will
maintain sufficient funds in the designated bank account or sufficient credit
limits with the designated credit card at all times to allow timely honoring
of each transfer. No payments may be made from Broker's trust accounts.
(d) If any payment of dues is not received by Red
Carpet when due, Broker will pay a late payment fee for the additional
collection costs and pay interest on the delinquent amount at the highest rate
permitted by law until paid in full. The amount of the late payment fee will
be $25.00 if the full delinquent amount and late payment fee are received by
Red Carpet on or before the first day of the month following the date payment
was due, or $100.00 if received thereafter.
(e) Red Carpet, from time to time, intends to
offer additional services over and above those services included in the
Membership which may require additional fees. These services will be optional
and are not required to participate in the Membership.
Broker herein agrees to pay the sum of $100.00 on each closed
transaction unit to Red Carpet as a service fee. The fee shall become due and
payable immediately upon the closing of each closed unit. From this fee the
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Broker shall be reimbursed 30% of the fees collected for Red Carpet Real
Estate Service name and trademark promotion). Broker shall be entitled to
reimbursement only for months when Broker's closed units exceed four.
Reimbursements shall be made quarterly upon submission of advertising copy
accompanied by a paid invoice.
Broker shall be invoiced annually a fee of $295.00 for computer
services. Such fee is due and payable upon receipt of invoice.
3. GOOD STANDING: "Good Standing" means that Broker is current
with all payments owed to Red Carpet or its affiliates, remains fully
licensed and registered as set forth above in section C2(b), has not been
convicted of a felony and is in full compliance with Section 6(b) below and
all other requirements of this Agreement. Broker warrants that the Broker's
license submitted with Broker's Membership Application is in full force and
effect. Broker agrees to notify Red Carpet immediately of any suspension or
revocation of such license and to deliver to Red Carpet, immediately after
each license renewal, a true and correct copy of the renewed license.
4. USAGE OF MARKS: Broker agrees to use the Marks only in the ways
designated by Red Carpet. Broker will never use the Marks in a way which may
be in bad taste or inconsistent with the high quality reputation of the
Membership and its public image or tend to bring disparagement, ridicule, or
scorn upon the Marks, the Membership or its goodwill. Broker agrees that all
goodwill associated with the Marks and the Membership belong exclusively to
Red Carpet . Broker will never, during the term of this Agreement or
thereafter, directly or indirectly contest the validity, ownership or use of
the Marks by the Membership or the rights of Red Carpet to the Marks. Broker
acknowledges that the authority to use the Marks set forth in this Agreement
is not exclusive and that Red Carpet may grant similar authority or license
at its sole discretion to other brokers within and outside the trade area
covered by Broker. Broker further acknowledges that an affiliate of Red
Carpet has granted and will continue to grant franchise licenses for the
operation of franchised businesses under the name "Red Carpet Real Estate
Service" and agrees to cooperate with such franchisees and not interfere with
their business interests.
5. RELATIONSHIP. Broker is not and will not represent or hold
itself out as being an agent, legal representative, joint venturer, partner,
employee or servant of Red Carpet for any purpose. Broker is not authorized
to make any statement or to create any obligation, expressed or implied, on
behalf of Red Carpet or the Membership. Broker agrees to identify itself as
an independently owned and operated business when using any of Red Carpet's
trademarks or service marks. The parties intend that the relationship between
them is defined as an exemption by the Federal Trade Commission's Trade
Regulation Franchise Rule, 16 CFR 436.2(a)(3)(i),(h). Broker agrees that it
is not relying on Red Carpet or its expertise to operate the Business
successfully or make it profitable, or for significant assistance in its
methods of operation, including but not limited to, its business
organization, management, marketing plan, promotional activities, or business
affairs.
6. INDEMNIFICATION: (a) Broker will indemnify Red Carpet, its
parent and affiliates and its and their officers, directors, employees,
agents, affiliates, successors and assigns from and against any and all
claims in any way related to the operation of the Business or the property
where the business is operated and any and all fees (including reasonable
attorneys' fees), costs and other expenses incurred by or on behalf of Red
Carpet in the investigation of or defense against any such claim.
(b) Broker agrees to obtain within thirty (30) days after
the date of this Agreement and will continue to maintain in full force and
effect throughout the term of this Agreement, an insurance policy or policies
(the "Insurance") with the following protections: (i) General liability
insurance insuring the Business and its primary owners and managers against
any claims, losses or liabilities arising out of or in connection with the
operation of the Business and the ownership of property used in the Business
with minimum coverage of $200,000 per person, $500,000 per incident, and
$50,000 property damage; (ii) Errors and omissions coverage against any
customer claims, with minimum coverage of $1,000,000; and (iii) Vehicle
liability insurance for all vehicles used in the business with minimum
coverage of $100,000 per person and $300,000 per accident for bodily injury,
and $50,000 for property damage. Broker agrees to report all transactions to
its Errors and Omissions insurance provider as required by such policy.
Failure to report each and every transaction as required by such policy shall
be considered a material default of this Agreement. Broker agrees that Red
Carpet shall be named as an additional insured on the Insurance. Broker
agrees that it will not use the Marks until such insurance has been obtained
and Red Carpet has received a true and correct copy thereof as well as a
certificate of insurance showing compliance with the requirements of this
Agreement, stating that the insurance will not be canceled or altered without
at least thirty days (30) days prior written notice to Red Carpet.
(c) If Red Carpet has not received the above within thirty
(30) days after the date hereof, this Agreement shall be automatically
canceled, and a failure to maintain such insurance is a material default of
this Agreement. The Insurance must be written by a responsible insurance
company or companies satisfactory to Red Carpet. If Red Carpet fails to
enforce this requirement for whatever reason, it shall not be deemed in any
way to have waived its rights under this Section.
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7. PERSONAL CONTRACT. Broker agrees that a the primary reason that
Red Carpet is admitting Broker to the Membership is the personal confidence
it has in Broker and its management. No person will succeed to any of
Broker's rights under this Agreement by virtue of any voluntary or
involuntary proceeding in bankruptcy, receivership, attachment, execution,
assignment tor the benefit of creditors, other legal process or transfer not
expressly authorized by Red Carpet . Any attempt by Broker to transfer any of
its rights or interest under this Agreement without Red Carpet's
authorization will constitute a material breach of this Agreement, in which
case Red Carpet may terminate this Agreement immediately upon written notice
to Broker. Red Carpet will not be bound by an attempted transfer, by law or
otherwise, of any part or all of this Agreement unless Broker has received
Red Carpet 's prior written consent, which will not be unreasonably withheld.
Broker will pay Red Carpet a transfer fee of $1,000.00 with its request for a
consent to transfer, and must be in good standing at the time of such
request. In considering a request for transfer, Red Carpet will consider
qualifications, apparent ability and credit standing of the proposed
transferee as if he or she were a prospective direct purchaser of a
membership in the Membership.
8. COVENANT Broker expressly agrees during the term hereof: (a) to
maintain its good standing at all times, (b) to comply with the reporting
requirements of Sections 2(b), 3 and 6(b) of this Agreement, 6(c) to provide
full, true and accurate information as necessary, to maintain in full force
and effect the Insurance required by Section 6(b) above, and (d) to provide
at the Business at all times service which meets Red Carpet 's service
requirements as set forth from time to time in writing and sent to Broker.
Broker's failure to maintain any of its obligations under this Section 8
shall be considered a material default of its obligations hereunder.
9. Red Carpet may terminate this Agreement in full following thirty
(30) days written notice unless Broker has cured such default or failure
within such thirty day period. The parties agree that in such event, actual
damages to Red Carpet would be extremely difficult to ascertain, and
consequently broker agrees to pay Red Carpet as liquidated damages all dues
which would otherwise be required to be paid to Red Carpet during the six (6)
months following termination in addition to any payments due hereunder.
(b) Broker may terminate this Agreement without cause by
giving written notice to Red Carpet in the first six (6) months prior to
termination or by including with such notice full payment of all dues which
would be due hereunder during such six (6) month period, in which case the
termination shall be effective upon receipt of the notice and payment by Red
Carpet. In each case, Broker must be and remain current in all amounts
otherwise due under this Agreement for such notice to be effective.
(c) This Agreement will be automatically and immediately
terminated if a petition for bankruptcy, an arrangement for the benefit of
creditors or a petition for reorganization is filed by or against Broker, or
if Broker will make any assignment for the benefit of creditors, or if a
Receiver or Trustee is appointed for the Business, unless remedied to Red
Carpet's satisfaction within twenty (20) days.
(d) When this Agreement expires or terminates for any
reason, Broker must immediately discontinue the use of the Marks and return
all items bearing the Marks to Red Carpet, and remove all of the Marks from
the Business to Red Carpet 's satisfaction.
10. CONFIDENTIALITY: (a) Broker agrees that Red Carpet is the owner
of all rights in and to the system employed by the Membership, and that such
system contains trade secrets which are revealed to Broker in strictest
confidence. Broker agrees not to disclose, duplicate, license, sell or reveal
any portion of any confidential documents within the system to any other
person, except an employee or Associate of Broker required by his or her work
to be familiar with such information. Broker agrees to keep and respect all
confidential information received from Red Carpet, to obtain from each of
the Business's Associates an agreement to keep and respect all such
confidences and to be responsible for its compliance with such agreements.
(b) Neither Broker nor any Associate will, directly or
indirectly, engage in or have any interest whatsoever in any Similar Business
or provide services to a Similar Business without Red Carpet's prior written
consent. A "Similar Business" is any business which primarily involves
assisting in the sale of real property for a fee or commission.
(c) Broker agrees that any violation of this Section 10
would result in irreparable injury to Red Carpet and the Membership and that
Red Carpet would be without an adequate remedy at law. In the event of a
breach or threatened breach of this Section 10, Red Carpet will not be
required to prove actual or threatened damage in order to obtain a temporary
or permanent injunction or a decree for specific performance of these terms.
Red Carpet shall also be entitled to any other remedies which it may have at
law or in equity. Each of these covenants will be construed as independent of
each other and of any other provision of this Agreement. If all or any
opinion of this Section 10 is held unenforceable by a court having valid
jurisdiction in a final decision between the parties hereto and from which no
appeal has or may be taken, Broker expressly agrees to be bound by the
remaining portion of this Section.
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11. TRADEMARK INFRINGEMENT. If Broker refuses to comply with a
written notice of termination sent by Red Carpet and a court later upholds
such termination of this Agreement, any operation of the Business by Broker
using the Marks from and after the date of termination stated in such notice
will constitute trademark infringement by Broker, and Broker will be liable
to Red Carpet for damages resulting from such infringement, including,
without limitation, any profits made by Broker.
12. ARBITRATION: Except as set forth in this Section 12, any dispute
between the parties which involves this Agreement and cannot be resolved by
the parties themselves must be submitted to binding arbitration in accordance
with the rules of the American Arbitration Association applicable to
commercial arbitrations. Such arbitration will be held within the county
where Red Carpet executive headquarters are located ("the Home County"), and
judgment upon the decision of the arbitrator may be entered in any court
having jurisdiction over the matter. However, arbitration will not be used
for any dispute which involves Broker's continued usage of any of the Marks
or any issue involving injunctive relief against Broker, all of which issues
will be submitted initially to a court within the Home County. The parties
expressly consent to personal jurisdiction in the Home County as set forth
above and agree that such courts will have exclusive jurisdiction over any
such issues not subject to arbitration.
13. MISCELLANEOUS. (a) The expiration or earlier termination of this
Agreement will not discharge or release a party from any liability or
obligation then accrued or any liability or obligation continuing beyond or
arising out of the expiration or earlier termination of this Agreement,
including without limitation the indemnification requirement contained in
this Agreement. Whenever the consent of a party is sought or required
hereunder, such consent will not be unreasonably withheld. If any pan of this
Agreement is for any reason declared invalid, unenforceable or impaired in
any way the validity of the remaining paragraphs will not be affected
thereby, and such remaining portions will remain in full force and effect as
if this Agreement had been executed with such invalid opinion eliminated. It
is hereby declared the intention of the parties that they would have executed
the remaining portion of this Agreement without including therein any such
portions which might be declared invalid.
(b) If either party initiates any legal proceeding which
involves issues arising out of this Agreement, the prevailing party in such
action will be paid its reasonable attorneys' fees and costs by the other
party. The parties agree that the law of the state where the Business is
located will apply to the construction and enforcement of this Agreement and
govern all questions which arise with reference hereto.
(c) The headings inserted in this Agreement are for
reference purposes only and will not affect the construction of this
Agreement or limit the generality of any of its provisions. This Agreement
and the documents referred to herein constitute the entire agreement between
the parties and supersede and cancel any and all prior and contemporaneous
agreements, understandings, representations, inducements and statements, oral
or written, of the parties in connection with the subject matter hereof.
Except as expressly authorized herein, no amendment or modification of this
Agreement will be binding unless executed in writing by both parties. A
facsimile of a signed copy of this Agreement will be accepted as if it were a
signed original.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the day and year first above written.
"Member Broker"
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Name of Company
By: By
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By
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RED CARPET REAL ESTATE SERVICE
"Red Carpet"
By:
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Authorized Officer
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This contract is not valid until signed by an Officer of Red Carpet Real Estate
Service
GUARANTY
Each undersigned Guarantor, jointly and severally, covenants,
promises to pay or cause to be paid all monies which become payable by Member
licensee under this Agreement Each Guarantor adopts each and every covenant
to be preformed by Member License and agrees with Licensor and Red Carpet
Real Estate Service to perform and observe all such covenants. Licensor
entering into this Agreement with Licensee constitutes consideration for this
Guaranty. The receipt an sufficiency of this consideration is acknowledged by
the signature of each Guarantor.
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Name (Typed or Printed) Name (Typed or Printed)
WITNESS:
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Signature Signature
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