EXHIBIT 3
[Jacksonville, FL]
MUZAK(R)
LICENSE AGREEMENT
Dated January 1, 1990
MUZAK(R)
LICENSE AGREEMENT
TABLE OF CONTENTS
X. XXXXX OF LICENSE................................................. 3
1.1 As to Services............................................. 3
1.2 As to Proprietary Marks.................................... 4
1.3 Rights Retained............................................ 4
II. PROVISION OF SERVICES............................................ 5
2.1 Services................................................... 5
2.2 Satellite-Delivered Services............................... 6
2.3 Delivery by Recorded Media................................. 9
2.4 Adjunct Services........................................... 10
2.5 Alternate Delivery Means................................... 10
2.6 Service Delivery Equipment................................. 11
III. TERM............................................................. 12
3.1 Term....................................................... 12
3.2 Renewal of Rights.......................................... 13
3.3 Notice from Licensee....................................... 17
IV. EXCLUSIVITY...................................................... 17
4.1 In the Territory........................................... 17
4.2 Future Services............................................ 18
4.3 No Other Services.......................................... 18
4.4 Promotion of All Services.................................. 21
V. STANDARDS OF SERVICE AND TRAINING................................ 21
5.1 Operations in General...................................... 21
5.2 Sales...................................................... 22
5.3 Protection of Services..................................... 23
5.4 Training................................................... 24
5.5 Confidentiality............................................ 25
VI. FEES AND ROYALTIES............................................... 26
6.1 Initial Fee................................................ 26
6.2 Market Fee................................................. 27
6.3 Royalty Fee................................................ 28
6.4 DBS Surcharge.............................................. 28
6.5 Recorded Media Charges..................................... 29
6.6 Adjunct Services Charges................................... 29
6.7 Payment Schedule........................................... 29
6.8 Gross Xxxxxxxx............................................. 30
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VII. RECORDS, REPORTS, AND INSPECTIONS................................ 31
7.1 Records.................................................... 31
7.2 Reports.................................................... 32
7.3 Audit...................................................... 32
VIII. MARKETING AND PROMOTION.......................................... 35
8.1 Advertisements............................................. 35
8.2 Yellow-Pages Advertising................................... 36
8.3 Additional Assistance by Muzak............................. 36
IX. MULTI-TERRITORY ACCOUNTS PROGRAM; CABLE RADIO/TV................. 36
X. DEFAULT AND TERMINATION OF THIS AGREEMENT........................ 38
10.1 Default of Licensee....................................... 38
10.2 Default of Muzak.......................................... 41
10.3 Additional Remedies....................................... 42
10.4 Force Majeure............................................. 43
XI. RELATIONSHIP OF THE PARTIES UPON TERMINATION OR
EXPIRATION OF THIS AGREEMENT..................................... 43
11.1 Action Required of Licensee............................... 43
11.2 Action Required of Muzak.................................. 44
XII. TRANSFER OF BUSINESS OR CONTROL OF LICENSEE...................... 45
12.1 By Licensee and its Owners................................ 45
12.2 Consent of Muzak.......................................... 45
12.3 Collateral................................................ 47
12.4 Transfer to Family Member................................. 48
12.5 By Muzak.................................................. 48
XIII. PROPRIETARY MARKS................................................ 48
13.1 Ownership................................................. 48
13.2 Infringement.............................................. 49
13.3 Use....................................................... 49
13.4 Substitution of Proprietary Marks......................... 50
XIV. MISCELLANEOUS.................................................... 51
14.1 Representations of Licensee............................... 51
14.2 Representations of Muzak.................................. 51
14.3 Independent Contractor.................................... 52
14.4 Release................................................... 52
14.5 No Waiver................................................. 53
14.6 Notices................................................... 54
14.7 Entire Agreement.......................................... 55
14.8 Severability.............................................. 55
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14.9 Captions................................................. 55
14.10 Binding Effect........................................... 56
14.11 Counterparts............................................. 56
14.12 Attorney's Fees.......................................... 56
14.13 Applicable Law........................................... 56
14.14 All Remedies............................................. 56
14.15 Limitation............................................... 57
14.16 No Warranties............................................ 57
14.17 No Implied Rights........................................ 58
14.18 Survival................................................. 58
14.19 Conversion............................................... 59
14.20 Most Favorable Terms..................................... 59
XV. ACKNOWLEDGEMENTS................................................. 60
15.1 Independent Investigations................................ 60
15.2 Disclosure................................................ 60
15.3 Opportunity to Review..................................... 61
EXHIBITS
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Exhibit A - Music Services
Exhibit B - Adjunct Services (Music-Related and Other)
Exhibit C - Marks
Exhibit D - Technical Specifications
Exhibit E - Sales of Adjunct Services
Exhibit F - Adjunct Services Revenue Sharing
Exhibit G - MUZAK(R) Multi-Territory Accounts Program
Exhibit H - Agreements Not To Be Superseded
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MUZAK(R)
LICENSE AGREEMENT
THIS MUZAK(R) LICENSE AGREEMENT ("Agreement") is made and entered into this
1st day of January, 1991, by and between MUZAK LIMITED PARTNERSHIP, a Delaware
limited partnership ("Muzak"), and FLORIDA SOUND ENGINEERING COMPANY, a Florida
corporation ("Licensee").
RECITALS:
--------
WHEREAS, Muzak has developed and owns a system (the "Muzak System") for the
production and delivery to licensees and subscribers of licensees of
subscription music services, adjunct communications services, and related
equipment, which system currently includes Muzak's unique software control
system for satellite distribution of multiple program services;
WHEREAS, the characteristics of the Muzak System also include, without
limitation, subscription music services, with certain unique and varied program
contents developed using distinctive and, in some cases, proprietary program-
scheduling techniques, which are set forth in Exhibit A attached hereto and
incorporated herein by reference (the "Music Services"); distinctive adjunct
services relating to the sequencing, changing, and switching of music-program
communications (the "Music-Related Adjunct Services") and to the delivery of
advertising, data and
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video communications (the "Other Adjunct Services"), (collectively the "Adjunct
Services"), which are set forth in Exhibit B attached hereto and incorporated
herein by reference; and delivery methods and procedures for both the Music
Services and the Adjunct Services (jointly, the "Services");
WHEREAS, Muzak identifies the Muzak System and the Services by means of
certain trade names, service marks, trademarks, logos, emblems, and indicia of
origin, including but not limited to the xxxx "MUZAK(R)," and such other trade
names, service marks, and trademarks as are set forth on Exhibit C attached
hereto and incorporated herein by reference (the "Proprietary Marks"), which
Proprietary Marks represent Muzak's high standards of quality and service; and
WHEREAS, Licensee desires to market and distribute the Services to
customers (the "Subscribers") who enter into agreements providing for receipt of
the Services at certain locations (the "Subscriber Premises"), and wishes to
obtain a license for that purpose from Muzak;
NOW, THEREFORE, the parties, in consideration of the undertakings and
commitments of each party to the other party set forth herein, hereby agree as
follows:
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X. XXXXX OF LICENSE
----------------
1.1 As to Services.
--------------
(a) Subject to the terms and conditions herein contained, Muzak hereby
grants to Licensee an exclusive license, and Licensee hereby agrees, to engage
in the business of providing the Services to Subscribers at Subscriber Premises
located solely within the following areas (such areas being hereinafter referred
to as the "Territory"): the Counties of Alachua, Baker, Bradford, Clay,
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Columbia, Dixie, Duval, Flagler, Gilchrist, Hamilton, Lafayette, Levy,
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Nassau, Xxxxxx, St. Xxxxx, Suwannee, and Union in the State of Florida, and the
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Counties of Appling, Bacon, Brantley, Camden, Charlton, Glynn, Xxxx Xxxxx,
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Mcintosh, Pierce, Xxxx, and Xxxxx in the State of Georgia. Except as
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specifically authorized by the Multi-Territory Sales Committee in connection
with the Multi-Territory Accounts Program as described in Article IX below and
Exhibit G attached hereto, or by Muzak in connection with certain Adjunct
Services sales as described in Exhibit E attached hereto, Licensee shall not
provide the Services to Subscriber Premises located outside the Territory.
(b) Licensee and Muzak recognize that some outlying areas of the
Territory may at some future date be more efficiently served by a Muzak licensee
who operates in a
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territory adjoining the Territory. Licensee therefore shall have the right at
any time to present to Muzak a written request for reallocation of such outlying
areas of the Territory to an adjoining licensee. Any such reallocation shall be
effective upon the written consent thereto of both Muzak and the adjoining
licensee. Muzak's consent shall not be unreasonably withheld.
1.2 As to Proprietary Marks. Subject to the terms and conditions herein
-----------------------
contained, Muzak grants to Licensee, and Licensee accepts, a license to use the
Proprietary Marks solely in connection with Licensee's provision of the Services
as provided in this Agreement. Licensee shall at all times seek to market and
sell the Services through use of the Proprietary Marks.
1.3 Rights Retained. The grant of rights in Sections 1.1 and 1.2 above
---------------
does not include the grant of the following rights, which are retained by Muzak:
(a) The right to use, and to license others to use, the Muzak System
and the Proprietary Marks for the provision of the Services to Subscriber
Premises which are located outside the Territory.
(b) The right to provide the Services, and to use the Proprietary
Marks in connection therewith, to transportation
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common carriers (including, without limitation, operators of automobiles, ships,
airplanes, trains, or buses) which sell or provide transportation common carrier
services, in whole or in part, within the Territory, it being understood that
the reservation of such right shall not be construed as limiting Licensee's
right to provide the Services to transportation common carriers located wholly
within the Territory.
(c) The right to provide a foreground music service by Recorded Media
(as hereinafter defined) under the "YESCO(R)" name and trademark to existing
dealers of the "YESCO(R)" Foreground Music Service and their customers pursuant
to existing contractual obligations or agreements with such dealers; provided,
however, that Muzak shall not authorize such dealers to distribute any of the
Services or use the Proprietary Marks within the Territory.
II. PROVISION OF SERVICES
---------------------
2.1 Services. Muzak shall supply Licensee with the Services for and
--------
during the term hereof, for use by Licensee solely in accordance with the terms
of this Agreement. Muzak reserves the right to add a Service and, except with
respect to the "Environmental Music by MUZAK(R)" and the "Foreground Music
One(R)" Music Services, to substitute a different Service or discontinue the
distribution of a Service, if Muzak reasonably
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determines that such addition, substitution, or discontinuation will be
beneficial to its business and the business of its licensees in general and
gives Licensee at least six (6) months' prior notice of such addition,
substitution or discontinuation. Any such addition, substitution or
discontinuation will be reflected in an amendment of Exhibit A or Exhibit B, as
the case may be, and will not affect the validity of this Agreement, which
shall, in all respects, be deemed modified to provide for such addition,
substitution, or discontinuation.
2.2 Satellite-Delivered Services.
----------------------------
(a) Subject to Section 2.3, Licensee agrees to deliver the Music
Services to Subscribers by such means as meet the standards and technical
specifications set forth in Exhibit D attached hereto and incorporated herein by
reference and the other terms and conditions of this Agreement. Muzak may
modify the standards and specifications set forth in Exhibit D from time to time
if Muzak reasonably believes that such modifications are necessary to maintain
or improve the quality of delivery of the Services to Subscribers or to maintain
or improve the effectiveness or quality, or reduce the price, of the Service
Delivery Equipment (as hereinafter defined); provided, however, that no such
modifications shall have the effect of rendering the satellite receivers and
associated antennae (collectively, the "Earth Stations") then in use by Licensee
or Subscribers in the
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Territory incapable of receiving satellite transmissions, or any other equipment
then in use by Licensee or Subscribers in the Territory for the reception of the
Services incapable of receiving the Services, unless such modifications are
necessitated by law or by the exercise of the rights of third parties under the
express terms of Muzak's satellite-space contracts; and provided further, that
Muzak shall provide Licensee with six (6) months' prior notice of any changes to
those standards and specifications in Exhibit D that pertain to the Service
Delivery Equipment and Licensee's obligations under Section 2.6 below.
(b) In the event that the Services are delivered by "Direct-Broadcast
Satellite" ("DBS"), which permits the satellite transmission of Services by
Muzak directly to the premises of a Subscriber, the following shall apply:
(i) Muzak shall, promptly after receipt of written notice from
Licensee, commence DBS delivery of the Services to Subscribers who have
Earth Stations suitable for receipt of such delivery. Subject to the
provisions of Exhibits E and G hereto, if Muzak delivers Services by DBS
directly to the Subscriber Premises, Muzak shall not discontinue such
delivery until the earlier of the following: (A) the date which Licensee
designates, or (B) one hundred eighty (180) days after the effective date
of the
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termination or expiration (without renewal of license rights) of this
Agreement. In the event Muzak discontinues delivery of Services in
violation of this subsection (b)(i), Muzak agrees to the granting of a
temporary injunction against it on the condition that the duration of such
injunction does not exceed ten (10) days. Such injunction may be granted
on an ex parte basis if Muzak fails to appear at the hearing following
-- -----
twelve (12) hours' notice by telephone to the twenty-four (24) hour
telephone number of the Muzak DBS Division. During the ten (10) day
temporary injunction period, Licensee may seek to have such temporary
relief converted to a permanent injunction in a hearing on the merits
following appropriate notice to Muzak.
(ii) During the above-referenced 180-day (or shorter, if
Licensee so designates) period, Licensee shall remain obligated to perform
the duties and be subject to the restrictions applicable to it under the
terms of this Agreement with respect to such continuing DBS delivery of the
Services, including without limitation those terms which obligate Licensee
to pay royalties, fees, charges, and surcharges (but only with respect to
Gross Xxxxxxxx [as hereinafter defined] and fees and charges to Subscribers
served by means of DBS), but not including terms which require Licensee to
pay a market fee or which restrict Licensee from offering or selling the
services of others.
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During such 180-day (or shorter) period, under no circumstances shall
Licensee use the Proprietary Marks except as necessary in association with
the continuing provision of the Services by DBS to Subscribers. In
addition, during such period Muzak shall not be precluded from appointing
one or more distributors of the Services in the Territory and from giving
to such distributors any rights previously accorded to Licensee under this
Agreement or any related agreement.
2.3 Delivery by Recorded Media. Certain Services, as reasonably
--------------------------
designated by Muzak, may be delivered by means of, among other things, magnetic
tape or compact disc, in analog or digital form (the "Recorded Media"). Muzak
shall at all times retain title to, and all ownership rights in, any Recorded
Media, whether furnished to Licensee or to a Subscriber. Licensee shall not
sell, assign, transfer, convey, give away, pledge, mortgage, or otherwise
encumber any Recorded Media. Licensee shall (i) prohibit all Subscribers who
receive Services delivered by Recorded Media from selling, assigning,
transferring, conveying, giving away, pledging, mortgaging, or otherwise
encumbering any of such Recorded Media, (ii) promptly notify Muzak in the event
it becomes aware that any Subscriber has violated any such prohibition, (iii)
cooperate with Muzak in the immediate termination of the provision of Services
to any Subscriber which has violated any such prohibition, and (iv) take such
further
9
action as is requested by Muzak (at Muzak's expense) to enforce such
prohibition.
2.4 Adjunct Services. All sales of the Adjunct Services shall be
----------------
conducted in the manner provided in Exhibit E attached hereto and incorporated
herein by reference.
2.5 Alternate Delivery Means. In the event of a failure of Muzak's
------------------------
satellite transmissions of the Services, Muzak shall use its reasonable best
efforts promptly to restore such transmissions. In addition, by no later than
30 days after the date of this Agreement, Muzak shall provide Licensee with tape
cassettes (or other form of Recorded Media) containing 72 hours of
"Environmental Music by MUZAK(R)" programming and 72 hours of "Foreground Music
One(R)" programming, at no cost to Licensee, which Licensee shall retain for
emergency use in the event of a failure of Muzak's satellite transmissions of
the Music Services. Should any such failure of satellite transmissions continue
for a period in excess of 48 hours, Muzak shall use its reasonable best efforts
promptly to provide Licensee with additional tape cassettes (or other form of
Recorded Media), at no cost to Licensee, to be used until such failure has been
corrected. All Recorded Media provided to Licensee or to Subscribers under the
terms of this Section 2.5 shall be subject to all other provisions of this
Agreement pertaining to Recorded Media, including, without limitation, Section
2.3.
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2.6 Service Delivery Equipment.
--------------------------
(a) Licensee, at its expense (except as provided in subsection (b)
below), shall obtain and maintain equipment (including, without limitation,
Earth Stations) to enable Licensee to receive and distribute the Services and
shall obtain and make available to the Subscribers equipment to enable the
Subscribers to receive the Services. (All equipment used to receive or
distribute the Services, including such equipment as is owned by Subscribers, is
hereinafter collectively referred to as the "Service Delivery Equipment.") The
Service Delivery Equipment, except Subscriber-owned equipment that is not sold
to the Subscriber by Licensee, shall conform to Muzak's standards and
specifications in effect on the date Licensee installs such Equipment at the
Subscriber Premises. The standards and specifications in effect as of the date
hereof are attached hereto in Exhibit D.
(b) Muzak shall, at no cost to Licensee, provide Licensee with two (2)
Earth Stations for Licensee's use (at such locations in the Territory as
Licensee determines) in receiving the Services during the term of this
Agreement. Muzak shall at all times retain title to, and all ownership rights
in, the Earth Stations that it provides to Licensee, and Licensee shall not
under any circumstances sell, assign, transfer, convey, give
11
away, pledge, mortgage, or otherwise encumber such Earth Stations. Licensee
shall, at Muzak's expense (except with respect to the obtaining of any required
permits, which shall be at Licensee's expense up to $500 per Earth Station),
install the Earth Stations which Muzak provides to Licensee, and shall, at its
own expense, maintain such Earth Stations in good working condition; provided,
however, that in the event any Earth Station provided to Licensee is, through no
negligent or intentional act or failure to act of Licensee, defective or in need
of replacement parts or repair, Muzak, after receipt of notice thereof, shall
promptly provide or arrange for such replacement parts and repair as are
necessary to restore such Earth Station to good working order.
III. TERM
----
3.1 Term. Except as otherwise provided herein, the term of this Agreement
----
shall begin as of the date set forth in the introductory paragraph of this
Agreement and shall continue in full force and effect for a period of ten (10)
years from such date.
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3.2 Renewal of Rights.
-----------------
(a) If Muzak reasonably determines that the performance of Licensee
during the term stated in Section 3.1 is not sufficiently satisfactory to
warrant renewal of Licensee's license rights hereunder, then, at least two years
prior to the date of expiration described in Section 3.1 of this Agreement,
Muzak shall notify Licensee that it does not intend to renew Licensee's license
rights and provide the specific reasons for such decision. Such notification is
intended to give Licensee the opportunity to assign its rights under this
Agreement, or to make satisfactory its performance, it being understood that any
such assignment is subject to Muzak's prior approval as provided in Article XII
hereof.
(i) In determining whether or not to renew Licensee's license
rights, Muzak shall consider Licensee's performance under this Agreement.
In evaluating Licensee's performance, Muzak shall consider such factors as,
among others, the following: Licensee's total xxxxxxxx for all Services,
the trend of Licensee's new xxxxxxxx and cancellations (and the reasons
therefor), local market conditions and the degree of Licensee's market
penetration in the Territory.
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(ii) In the event Muzak notifies Licensee that Muzak does not
intend to renew Licensee's license rights because Muzak has reasonably
determined that Licensee's performance is not sufficiently satisfactory to
warrant renewal of Licensee's license rights hereunder, Licensee shall have
a period of six months from the date of such
notice to attempt to improve its performance. At the end of such six-month
period, Muzak shall reconsider the adequacy of Licensee's performance and
if such performance has sufficiently improved so that it is no longer
inadequate, Muzak shall rescind its notice of intention not to renew
Licensee's license rights. Conversely, if at the end of such six-month
period Muzak determines that Licensee's performance remains inadequate,
Muzak shall inform Licensee of the reasons for such determination and send
to Licensee a final notice of nonrenewal.
(b) Muzak shall also have the right not to renew Licensee's license
rights if Licensee engages in conduct which Muzak reasonably deems inimical to
the best interests of the Muzak System (including the interests of the MUZAK(R)
licensees in such System). The exercise of Muzak's rights as stated in this
subsection (b) shall be subject to the following conditions:
(i) In the event such conduct constitutes a breach of this
Agreement, Muzak shall have the absolute
14
right not to renew Licensee's license rights, provided that Muzak has
notified Licensee of such breach, such breach occurred (or Muzak first
became aware of such breach) no more than six months before Muzak's
nonrenewal notice to Licensee, and Licensee has neither cured nor
challenged such breach within the period specified in Section 10.1(c)
hereof, and provided further that Muzak's nonrenewal notice to Licensee
states that it constitutes a final notice of nonrenewal; and
(ii) In the event that such conduct does not constitute a breach
of this Agreement, Muzak shall notify Licensee within 90 days of its
discovery of the objectionable conduct that it considers such conduct to be
inimical to the best interests of the Muzak System (including the interests
of the MUZAK(R) licensees in such System). If, after two such notices,
Licensee again engages in conduct which Muzak reasonably deems to be
inimical to the best interests of the Muzak System (including the interests
of the MUZAK(R) licensees in such System), then (whether or not such
conduct is similar to the conduct referred to in either of the earlier
notices) Muzak may notify Licensee of that fact and of the further fact
that as
15
a result of such conduct, it does not intend to renew Licensee's license
rights. This notice shall constitute a final notice of nonrenewal.
(c) In the event that, in accordance with the provisions of this
Section 3.2, Muzak notifies Licensee of its intention not to renew Licensee's
license rights, then Muzak shall have no obligation to offer to renew such
license rights; provided, however, that if, in the case of the final nonrenewal
notice sent pursuant to subparagraph (a) or subparagraph (b)(ii) above, Licensee
challenges, by litigation commenced no later than 120 days after the date of
such final nonrenewal notice, the propriety of such notice, such notice shall
become effective only after such litigation is finally resolved in favor of
Muzak. It is understood and agreed that Licensee's right to challenge the final
nonrenewal notice sent under subparagraph (b)(i) of this Section 3.2 shall be
exercised, if at all, by means of Licensee's challenge under Section 10.1 of
this Agreement of the breach supporting such nonrenewal. For purposes hereof,
final resolution shall include Licensee's failure to make a timely appeal of a
court decision in favor of Muzak. If Muzak does not so notify Licensee, then
Muzak shall be required to offer to enter into a new license agreement with
Licensee upon expiration of this Agreement, which new license agreement shall
correspond to the form of license agreement which Muzak is then bona fide
offering to licensees (or
16
prospective licensees) serving (or proposing to serve) licensed territories of
comparable size to that proposed to be licensed to Licensee under such new
agreement.
3.3 Notice from Licensee. Notwithstanding Section 3.2, Muzak shall have
--------------------
no obligation to offer to renew Licensee's license rights unless, after written
notice from Muzak sent to Licensee no less than eight (8) and no more than
twelve (12) months prior to the date of expiration described in Section 3.1
of this Agreement advising Licensee of the effect of this Section 3.3, Licensee
shall have given Muzak written notice of its desire to renew its license rights
not less than six (6) months nor more than twelve (12) months prior to the date
of expiration described in Section 3.1 of this Agreement.
IV. EXCLUSIVITY
-----------
4.1 In the Territory. Subject to the provisions of Sections 1.3 and 2.4
----------------
(including Exhibit E hereto) above, Article IX below (including Exhibit G
hereto), and the Licensee's In-Store Advertising Agreement described in Exhibit
H attached hereto, during the term of this Agreement, Muzak shall not authorize
anyone other than Licensee to (i) provide the Services in the Territory or (ii)
use the Proprietary Marks in the Territory.
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4.2 Future Services. Muzak shall conduct research and development to
---------------
maintain and improve the quality of the Services and the methods used to
distribute them. In the event that Muzak develops new subscription music
services, or new communications services in the nature of the Adjunct Services,
after the date hereof, Muzak shall amend Exhibit A or Exhibit B, as the case may
be, in the manner provided in Section 2.1 above (including the requirement of at
least six months' prior notice to Licensee of such amendment) to add such new
Services thereto, thereby giving Licensee the right and, subject to Exhibit E
hereto, the obligation to distribute such Services in the Territory under the
terms of this Agreement.
4.3 No Other Services. During the term of this Agreement, except as
-----------------
otherwise approved in writing by Muzak, neither Licensee nor any of the persons
or entities holding (either directly, indirectly, or beneficially) a controlling
ownership interest in Licensee shall, either directly or indirectly, for itself,
or through, on behalf of, or in conjunction with any person or entity:
(a) Participate or permit any of its employees, officers, or
directors to participate, either directly or indirectly in the distribution in
the Territory of any communications service substantially the same as or similar
to the Adjunct Services (except a communications service distributed
18
by any such person or entity pursuant to a contract or agreement in effect on
the date the Adjunct Service which is the same as or similar to such
communications service is first offered to Licensee by Muzak), or any
subscription music service other than the Music Services, including, without
limitation, a radio program service which is provided through special reception
devices tuned only to that station's signal and any music programming that is
provided to commercial or residential locations by means of cable television or
cable radio; provided, however, that the foregoing shall not become effective
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with respect to such other subscription music services that are distributed by
Recorded Media until the later of (i) January 1, 1993, (ii) the first date
Licensee may cancel or otherwise terminate the agreement under which Licensee is
the distributor of such other music services without causing a breach of such
agreement (provided such agreement was in effect on March 1, 1990), or (iii)
with reference to the distribution of such music services to any particular
customer, the first date Licensee may either substitute the Music Services for
such other music services or cancel or terminate the agreement with such
customer without causing a breach of such agreement (provided such customer
agreement was in effect on September 1, 1990); and provided further, that if, as
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a result of Licensee's acquisition of another music business or the assets
thereof during the term of this Agreement, Licensee becomes the assignee of a
customer agreement for such other music or communications services or an
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agreement under which Licensee is the distributor of such other music or
communications services and Licensee cannot substitute the Services for such
other services without causing a breach of such agreement, Licensee may provide
such other services to the customers receiving such services on the date of
assignment through the remaining term (without reference to renewal rights) of
such agreement. Indirect participation shall include participation as an
officer, director, owner (which term shall not include the holder of 5% or less
of the common stock of a publicly-held entity), partner, employee, or consultant
of an entity distributing such other communications or subscription music
service.
(b) Divert or permit any of its employees, officers, or directors to
divert any existing or prospective Subscriber to any competitor in the
Territory, by direct or indirect inducement or otherwise, or do or perform,
directly or indirectly, any other act injurious or prejudicial to the goodwill
associated with Muzak, the Proprietary Marks, or the Services.
(c) Display in any location in the Territory any trade names,
trademarks, or service marks of any other business providing subscription music
services or providing communications services substantially similar to the
Adjunct Services except if permitted to sell or distribute such services in the
Territory pursuant to Paragraph (a) above.
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4.4 Promotion of All Services. Throughout the term of this Agreement,
-------------------------
Licensee shall use its reasonable best efforts actively to promote, market, and
distribute each of the Services (except as otherwise provided in Article 4 of
Exhibit E hereto).
V. STANDARDS OF SERVICE AND TRAINING
---------------------------------
5.1 Operations in General. In order to maintain the reputation and
---------------------
goodwill of Muzak, the Services, and the Proprietary Marks, Licensee shall:
(a) Comply with all federal, state, and local laws, rules and
regulations, and timely obtain all permits, certificates, and licenses,
necessary in the reasonable judgment of Licensee for the proper conduct of the
business licensed hereunder (the "Business").
(b) Maintain an office in the Territory and promptly notify Muzak in
the event Licensee moves the office to a new location within the Territory;
provided, however, that if Licensee is also the Muzak licensee in a territory
adjacent to the Territory and maintains an office in that territory that
adequately serves Subscribers in both such territories, Licensee need not
maintain an office in the Territory.
21
(c) Be responsible for paying for all performing rights licenses
necessary for the distribution of the Services; provided, however, that Muzak
shall be responsible for paying for the license with SESAC to the extent
required for Licensee's distribution of the Services.
(d) Be responsible for paying all applicable local, state and federal
taxes of whatever nature, now or hereafter enacted, relating to Licensee's
provision of the Services, and all accounts and other indebtedness of every kind
incurred by Licensee in the conduct of the Business.
(e) Hold itself out to the public as an independent contractor,
operating under a license from Muzak. In the event Licensee elects to exhibit
the MUZAK(R) name on its stationery or vehicles, such exhibition shall be in a
conspicuous place and only in juxtaposition with Licensee's corporate name.
5.2 Sales. Licensee (or, if Licensee is a corporate or partnership
-----
entity, those individuals responsible for managing the Business) shall devote
full-time and reasonable best efforts to the sale, distribution, and support of
all the Services (it being understood that such obligation shall not be
construed as prohibiting Licensee from selling goods and services in addition to
the Services, provided such sale does not violate Section 4.3 above, or
requiring Licensee to sell certain Adjunct Services as
22
described in Article 4 of Exhibit E hereto). Without limiting the generality of
the foregoing, prior to the beginning of each consecutive twelve (12)-month
period during the term of this Agreement, with the first such period to begin on
the first anniversary of the date of this Agreement, Muzak and Licensee shall
mutually set a Services sales goal for Licensee. Such goal shall be based on the
amount of Gross Xxxxxxxx, plus the amount of xxxxxxxx for the sale of Recorded
Media and Adjunct Services, which Muzak and Licensee mutually believe can be
attained by Licensee during such twelve (12)-month period, taking into
consideration such factors as the size and other distinctive characteristics of
the Territory, the size and trend of Licensee's past Gross Xxxxxxxx and other
xxxxxxxx, Licensee's prior sales of each Service, and economic conditions
affecting the Territory. Licensee shall use its best efforts to meet such sales
goals during each respective twelve (12)-month period.
5.3 Protection of Services. Licensee shall not alter in any way the
----------------------
Services or any products (including Service Delivery Equipment) owned by Muzak
and in the possession of Licensee. Without limiting the generality of the
foregoing, Licensee shall not substitute or add any musical selections or other
material in or to any Service (except in extraordinary circumstances, with the
prior written consent of Muzak, which in such circumstances shall not be
unreasonably withheld). Licensee shall not represent that any product or
equipment not produced by Muzak has
23
been produced by Muzak; provided, however, that the foregoing shall not preclude
Licensee from displaying the MUZAK(R) name on items not produced by Muzak,
including promotional items, if Muzak has authorized such display. Licensee
shall report to Muzak any unauthorized reception of the Services promptly after
becoming aware of any such unauthorized reception, and shall further cooperate
with Muzak in protecting against and preventing the unauthorized reception of
the Services. Licensee shall not record, copy, or reproduce all or any part of
any Service and shall expressly prohibit, including by written agreement if
possible, Subscribers from recording, copying, or reproducing all or any part of
any Service.
5.4 Training. Muzak shall make available to Licensee and its employees
--------
training programs designed to maintain and improve Licensee's sales and delivery
of the Services; provided, however, that this obligation shall cease in the
event Muzak determines that such programs (or any sessions thereof) are not
cost-effective. For all such programs, Muzak shall provide instructors and
training materials, for which Muzak reserves the right to charge a reasonable
tuition fee. Licensee or its employees shall be responsible for any and all
other expenses incurred by them in connection with such training programs,
including without limitation the costs of transportation, lodging, meals, and
any wages.
24
5.5 Confidentiality. During the term of this Agreement and thereafter,
---------------
neither Muzak nor Licensee (including any persons or entities listed on the last
page of this Agreement) shall use for its own purposes or divulge to any third
party any trade secrets or confidential information of the other. As used
herein (i) the term "third party" shall not include any party otherwise lawfully
in receipt of the trade secrets or confidential information to be divulged; or
any employee, attorney, accountant, or consulting engineer of Muzak or Licensee,
as the case may be, provided that such individual agrees not to further use or
disclose such trade secrets or confidential information; or any person or entity
providing credit or financing to Muzak or Licensee, as the case may be, provided
such person or entity (and any representative thereof) is similarly charged with
maintaining the confidence of such trade secrets and confidential information;
or any representative of a governmental authority or other person or entity to
whom disclosure is required by compulsion of law, provided notice of the demand
for such disclosure is given, within 48 hours of receipt of such demand, to the
party owning the confidential information or trade secrets required to be
disclosed; and (ii) the term "confidential information" means information
designated as such in writing by the party owning such information, as well as
customer lists and revenue data (without further designation), but does not
include information that has become part of the public domain through
publication or other similar communication. During the term of this Agreement
25
Muzak shall not require that Licensee disclose to Muzak the name and address of
any Subscriber other than (i) for the purpose of participation in the Multi-
Territory Accounts Program, (ii) to permit delivery of the Services under the
Licensee's In-Store Advertising Agreement, and (iii) to permit delivery of the
Services by such technological means as require such information
for such delivery. Licensee understands and agrees that if Muzak is unable to
perform any of its obligations hereunder as a result of its inability to obtain
such Subscriber information, such nonperformance shall not be deemed a breach of
this Agreement.
VI. FEES AND ROYALTIES
------------------
6.1 Initial Fee. If this Agreement is entered into in connection with the
-----------
renewal or continuation (including amendments and adjustments of territories) of
rights granted under a prior agreement between Muzak (or its predecessor) and
Licensee (or its predecessor in the Territory), Licensee shall not be required
to pay any initial fee to Muzak. If this Agreement is not entered into in
connection with such renewal or continuation of rights granted under such a
prior agreement, Licensee shall pay to Muzak an initial fee of Five Thousand
Dollars, plus the amount, if any, paid by Muzak to purchase the rights of any
former licensee in the Territory in any Multi-Territory Contracts and certain
Adjunct Services Subscriber Agreements (as defined in Exhibits E and G hereto),
receipt of which initial fee is hereby
26
acknowledged. The initial fee shall be deemed fully earned and nonrefundable
upon execution of this Agreement and assignment of such subscriber contracts and
agreements in consideration of the administrative and other expenses incurred by
Muzak in granting this license to Licensee.
6.2 Market Fee. Licensee shall pay to Muzak, in accordance with Section 6.7
----------
each calendar month, a market fee in the amount set forth below for Licensee
--------
Category E and based upon information then available in the report entitled
----------
County Business Patterns by State and a U.S. Summary, as published by the Bureau
----------------------------------------------------
of the Census, United States Department of Commerce or any successor publication
(the "U.S. Business Pattern Report") and, in the case of Category I below, the
population within the Territory.
Licensee Number of Businesses and/or Monthly
Category Population Within Territory Market Fee
-------- --------------------------- ----------
A 70,000 or more businesses $950
B 60,000 through 69,999 businesses 900
C 50,000 through 59,999 businesses 850
D 40,000 through 49,999 businesses 770
E 30,000 through 39,999 businesses 690
F 20,000 through 29,999 businesses 610
G 10,000 through 19,999 businesses 530
H 5,000 through 9,999 businesses 450
I ("Junior 4,999 or fewer businesses or 350
Franchise") population of 100,000 or less
Upon a determination by Muzak, based upon the information then available in the
U.S. Business Pattern Report (or, in the case of Category I, the U.S. Census),
that the number of businesses or population within the Territory has changed so
as to require the
27
recategorization of the Business, Muzak will so notify Licensee. Any adjustment
in the market fee resulting from such recategorization shall become effective
for the calendar month immediately following the month in which such notice is
given. Cumulative adjustments in the market fee during the term of this
Agreement shall not exceed two (2) categories from that shown above in this
Section 6.2.
6.3 Royalty Fee. Licensee shall pay to Muzak each month a royalty fee in
-----------
the amount of ten percent (10%) of Licensee's Gross Xxxxxxxx, as defined in
Section 6.8 below.
6.4 DBS Surcharge. In consideration of Muzak's development and
-------------
implementation of DBS, Licensee shall pay to Muzak a surcharge (the "DBS
Surcharge") throughout the term of this Agreement; provided, however, that
Licensee's obligation to pay the DBS Surcharge shall no longer exist after
Licensee (and/or any predecessor of Licensee in the Territory) has paid to Muzak
the DBS surcharge with respect to the Territory for a cumulative total of
ninety-six (96) consecutive calendar months (including any months preceding the
date of this Agreement during which Licensee [or its predecessor in the
Territory] paid such DBS Surcharge with respect to the Territory). The DBS
Surcharge shall be equal to the following percentage of Licensee's Gross
Xxxxxxxx:
28
Calendar Months
(Including any applicable DBS Surcharge
months preceding the date (Percentage of
of this Agreement) Gross Xxxxxxxx)
------------------------------- ---------------
1 through 12 4/89 - 3/90 0.50%
13 through 24 4/90 - 3/91 1.25%
25 through 60 4/93 - 5/94 1.75%
61 through 96 6/94 - 7/97 1.00%
thereafter 0.00%
6.5 Recorded Media Charges. Licensee shall pay Muzak's standard Recorded
----------------------
Media charges, as the same may be set forth by Muzak from time to time in
writing, for all Recorded Media distributed to Licensee or the Subscribers.
Muzak shall not increase such Recorded Media charges prior to January 1, 1993,
and increases thereafter shall not exceed ten percent (10%) per annum.
6.6 Adjunct Services Charges. Licensee shall pay Muzak's Adjunct Services
------------------------
charges in accordance with the terms set forth in Exhibit F attached hereto and
incorporated herein by reference.
6.7 Payment Schedule. All monthly payments required by Sections 6.3 and
----------------
6.4 shall be paid within forty-five days of the end of the month in which the
applicable Services are provided to the Subscribers, and shall be submitted
together with any reports or statements required under Section 7.2 hereof. All
Market Fee charges required by Section 6.2, all Recorded Media charges required
by Section 6.5, and all Adjunct Services charges
29
required by Section 6.6 shall be paid within forty-five days after the date of
Muzak's billing to Licensee. Any payment of fees due to Muzak that is not
actually received by Muzak by the due date shall be deemed overdue. If any
payment is deemed overdue, simple interest may be assessed on such overdue
payment. Such interest shall accrue on a daily basis from the due date until
the date of payment, at the lesser of (i) the prime rate of The First National
Bank of Chicago per annum in effect at the beginning of the calendar quarter, or
(ii) the highest rate of interest permitted by law in Licensee's State.
Entitlement to such interest shall not limit any other remedies available under
law or this Agreement as a result of the overdue payment.
6.8 Gross Xxxxxxxx. "Xxxxx Xxxxxxxx" means all amounts billed or
--------------
otherwise charged to a Subscriber by Licensee in connection with (1) the
provision of any Music Service, and (2) the lease or rental (but not the sale)
of Service Delivery Equipment and other equipment used to receive and distribute
such Music Service but not including (i.e., excluding) equipment that is not
used primarily in the provision or reception of a Music Service.
Notwithstanding the foregoing, "Gross Xxxxxxxx" shall not include any amount
billed or otherwise charged to a Subscriber by Licensee for (a) the provision of
any Music Service on Recorded Media, (b) Music-Related Adjunct Services, or (c)
the lease or rental of any Service Delivery Equipment used with Recorded Media.
"Gross Xxxxxxxx" also shall not include (i) any
30
amounts billed to Subscribers as (and separately stated on the xxxxxxxx or
otherwise separately determinable as) sales or similar excise taxes; (ii) one-
time installation charges billed not later than ninety (90) days following
completion of such installation; (iii) charges for service of Subscriber-owned
equipment, provided that such charges are separately determinable; (iv) ad hoc
(i.e., extraordinary) charges for service actually performed on Subscriber-
-----
leased or Subscriber-owned equipment; and (v) late-payment penalties or interest
charges imposed by Licensee, provided that such penalties and charges do not
exceed standard industry practice. Licensee may deduct from its Gross Xxxxxxxx
(i) amounts paid by Licensee as performing rights fees to ASCAP, BMI, or similar
performing rights organizations with respect to the Music Services other than
those distributed by Recorded Media, and (ii) the amount of any xxxxxxxx that
were previously reported to Muzak as part of Licensee's Gross Xxxxxxxx but
which, in the month of the deduction, were written off by Licensee as
uncollectible in accordance with federal income tax standards of
uncollectibility.
VII. RECORDS, REPORTS, AND INSPECTIONS
---------------------------------
7.1 Records. Licensee shall prepare, and retain at its principal place of
-------
business for at least two (2) years thereafter, complete and accurate books,
records, and accounts of the Business. Such books, records, and accounts shall
fairly
31
represent the results of operations of such business, as determined on an
accrual basis, and shall be kept in sufficient detail to permit the transactions
included in such operations to be clearly identifiable and traceable to
underlying documentation. Licensee shall make available such records and books
of account to Muzak or its representatives if requested by Muzak for inspection
and audit as provided in Section 7.3.
7.2 Reports. Licensee shall submit to Muzak, together with the payments
-------
described in Section 6.7, royalty and fees reports, in such detail as Muzak may
from time to time reasonably request, accurately reflecting all Gross Xxxxxxxx
during the periods to which such payments pertain.
7.3 Audit.
-----
(a) Muzak or its representatives may, upon giving Licensee 30 days'
(or 10 days' in the case of an audit following a request for Muzak's consent to
a transfer under Article XII hereof) written notice, enter the premises of
Licensee (and of any person doing business [an "affiliated person"] controlling,
controlled by or under common control with Licensee) during normal business
hours for inspection and audit of the business and records of Licensee and of
such affiliated person, provided that such inspection and audit shall be no more
extensive than is required to verify that none of Licensee's or such affiliated
32
person's revenues should have been reported as Gross Xxxxxxxx or as charges for
Recorded Media and Adjunct Services and that Licensee's payments to Muzak have
been properly computed in accordance with the provisions of Article VI of this
Agreement. Licensee shall cooperate with any such inspection and audit. Muzak
shall not assess Licensee for amounts found, as a result of such audit, to be
owing hereunder if such amounts derive from a reporting period that ended more
than two years prior to the date such audit commenced, provided that Licensee
has not knowingly maintained false books or records, or knowingly submitted
false reports to Muzak.
(b) During any audit hereunder, Muzak or its representatives (at
Muzak's cost and expense) may make mechanical copies of only those books and
records of Licensee that are necessary for the verification of Licensee's
statements and accountings to Muzak and were physically examined as part of the
audit. Muzak shall take reasonable precautions to safeguard the confidentiality
of such copies and shall destroy any such copies upon the mutually-confirmed
completion of the audit and payment in full of any royalties and other charges
determined to be owing to Muzak as a result of the audit. Nothing contained
herein shall be construed as in any way limiting Muzak's right manually to copy
or make abstracts of Licensee's or any affiliated person's books and records or
to make any notes or the like whatsoever; provided, however, that such manual
copies or
33
abstracts (and any copies thereof) shall be destroyed upon the mutually-
confirmed completion of the audit.
(c) In the event that any audit conducted by or on behalf of Muzak
results in a determination that there has been either an underpayment or
overpayment of the amounts due Muzak hereunder, then within 30 days after such
determination, Licensee or Muzak, as the case may be, shall pay to the other the
amount of such underpayment or overpayment; provided, however, that in the event
that Licensee disputes the results of any such audit, the parties shall attempt
to resolve the matter by conducting a new audit under the joint supervision of
their respective independent certified public accountants. In the event that
such new audit resolves the dispute, the cost of each party's independent
certified public accountants shall be borne by the respective party. In the
event that such new audit fails to resolve the dispute, the matter shall be
resolved by arbitration under the rules of the American Arbitration Association,
and the losing party shall pay both parties' entire costs of the second audit.
(d) If it is determined as a result of an audit that there has been an
underpayment of seventeen percent (17%) or more of the amounts due Muzak for any
given calendar year, Licensee shall pay to Muzak, within thirty (30) days after
such determination and in addition to all other amounts due under this
34
Agreement, a penalty equal to fifteen percent (15%) of the underpayment for that
year. The foregoing remedies shall be in addition to any other remedies Muzak
may have for such underpayment.
(e) Muzak and Licensee shall confirm, at the conclusion of the audit
and following payment of any monies found owing as a result of the audit, that
such audit has been completed and that the periods audited shall not be audited
again absent a showing that Licensee knowingly maintained false books and
records for such period.
VIII. MARKETING AND PROMOTION
-----------------------
8.1 Advertisements. Licensee shall cooperate with any advertising or
--------------
promotional campaigns conducted by Muzak in accordance with sound business
practices. Licensee shall promptly discontinue any advertising or promotion
which Muzak informs Licensee is, in Muzak's judgment, inimical to Muzak's
reputation. Without limiting the generality of the foregoing, Licensee shall
submit to Muzak upon request samples of all advertising and promotional plans
and materials that Licensee proposes to use. Licensee shall amend any such
plans and materials as requested by Muzak upon receipt of notice from Muzak that
such plans or materials fail to comply with the requirements of this Section
8.1. In the event that Muzak notifies Licensee
35
to amend any advertising or promotional plans previously approved by Muzak's
predecessors-in-interest, Licensee shall have up to 180 days after the date of
such notice to make such amendments.
8.2 Yellow-Pages Advertising. Each year during the term of this
------------------------
Agreement, Licensee shall ensure that it is listed in at least one "trademark
ad" under the appropriate classification in the yellow pages of one major-market
telephone book in the Territory. Muzak will reimburse Licensee for the annual
cost of one such "trademark ad" within thirty (30) days after receipt from
Licensee of the invoice for the advertisement.
8.3 Additional Assistance by Muzak. Within the limits of its available
------------------------------
personnel, Muzak, when so requested by Licensee, shall make available technical
and marketing assistance to Licensee. The charges for such assistance shall be
mutually agreed upon by the parties.
IX. MULTI-TERRITORY ACCOUNTS PROGRAM; CABLE RADIO/TV
------------------------------------------------
9.1 Multi-Territory Accounts Program. Recognizing that potential
--------------------------------
Subscribers with substantial numbers of Subscriber Premises located throughout
the United States represent a significant potential market for Licensee and
other Muzak licensees marketing the Services, and that the effective marketing
of the Services to such accounts frequently requires a
36
coordinated effort by Muzak and its licensees, Muzak, in conjunction with a
Multi-Territory Sales Committee, shall establish and maintain during the term of
this Agreement a Multi-Territory Accounts Program. The Multi-Territory Accounts
Program and the Multi-Territory Sales Committee are more fully described in
Exhibit G attached hereto and incorporated herein by reference. Licensee and
Muzak agree to participate in the Multi-Territory Accounts Program as set forth
in Exhibit G and otherwise to abide by the terms of Exhibit G. Without limiting
the generality of the foregoing, Licensee agrees to participate during the term
of this Agreement in all Multi-Territory Contracts (as defined in Exhibit G)
that pertain to Subscriber Premises in the Territory.
9.2 Cable Radio/TV. In the event that (i) a provider of cable television
--------------
or cable radio programming requests that Muzak provide music for such
programming that cannot otherwise be provided by Licensee utilizing the Music
Services, and (ii) such programming will be distributed to residences (but not
to commercial locations) in the Territory, then prior to Muzak's providing such
music, Muzak and Licensee shall jointly determine their respective interests in
the revenues deriving from the provision of such music to such provider.
37
X. DEFAULT AND TERMINATION OF THIS AGREEMENT
-----------------------------------------
10.1 Default of Licensee.
-------------------
(a) Licensee shall be deemed to be in default under this Agreement,
and all rights granted herein shall, at the option of Muzak, immediately
terminate upon notice thereof to Licensee (without opportunity to cure), if at
any time:
(i) Licensee shall file in any court pursuant to any statute
either of the United States or of any State a petition in bankruptcy or
insolvency or for reorganization or for the appointment of a receiver or
trustee of all or a portion of Licensee's property, or if there is
commenced against Licensee any such petition which is not opposed by
Licensee or not dismissed within ninety days after such filing, or if
Licensee admits in writing its inability to pay its debts or makes a
general assignment for the benefit of creditors, or if Licensee makes
general application to Licensee's creditors to settle, compromise, or
extend the time of payment of all of Licensee's obligations; or
(ii) there occurs a voluntary or involuntary transfer or purported
transfer of an interest in Licensee or in this Agreement in violation of
Article XII.
38
(b) Licensee shall be deemed to be in default under this Agreement,
and all rights granted herein shall terminate, if any of the following events
shall occur and not be cured, in the time and manner provided in subsection (c)
below, following notice thereof from Muzak:
(i) if Licensee fails to comply with any of its obligations
under this Agreement and Muzak has been or is reasonably likely to be in
any way damaged thereby, or if any representation made by Licensee herein
is found to be untrue when and as made and Muzak has been or is reasonably
likely to be in any way damaged thereby; or
(ii) if Licensee ceases to distribute the Music Services or
ceases to operate or otherwise abandons the Business; or
(iii) if Licensee loses the right to transact business in any
jurisdiction included in the Territory and Licensee refuses to surrender to
Muzak its license rights hereunder with respect to such jurisdiction; or
(iv) if Licensee knowingly maintains false books or records, or
submits false reports to Muzak.
39
(c) Licensee shall have thirty (30) days after its receipt from Muzak
of a written notice of default within which to remedy any default as defined in
subsection (b) above (or, if the default cannot reasonably be cured within such
thirty (30) days, to initiate within that time substantial and continuing action
to cure the default) and to provide evidence thereof to Muzak. If any such
default is not cured within that time (or, if appropriate, substantial and
continuing action to cure the default is not initiated within that time), or
such longer period as applicable law may require, this Agreement shall terminate
following Licensee's receipt of a Notice of Termination reciting Licensee's
failure to cure or commence to cure and setting forth a definite termination
date, which shall be no sooner than 5 business days following Licensee's receipt
of such Notice or such longer period as applicable law may require; provided,
however, that in the event the existence of such default is disputed by
Licensee, and Licensee notifies Muzak of such dispute within 10 days after
receipt of Muzak's notice of default and thereafter promptly proceeds to take
all steps necessary to resolve such dispute, including (if necessary) the
commencement of litigation by no later than 30 days after receipt of Muzak's
notice of default, such termination shall not become finally effective until 10
days after the date such dispute is finally resolved in favor of Muzak. For
purposes hereof, final resolution shall include without limitation Licensee's
failure to make a timely appeal of a court decision in favor of Muzak.
Notwithstanding anything in
40
this paragraph (c) to the contrary, in the event that the final resolution in
favor of Muzak of Licensee's dispute of a notice of default is by means of a
court decision and such court also specifically decides that, at each successive
level of Licensee's legal challenge to the notice of default, Licensee had a
strong likelihood of success on the merits (without application by the court of
any balance-of-hardships tests), Licensee shall have 30 days from the date of
such final resolution to cure the default; in such event, if such cure is not
effectuated by the end of such 30-day period, the termination shall then become
immediately effective.
10.2 Default of Muzak. Muzak shall be deemed to be in default, and
----------------
Licensee shall have the right to terminate this Agreement, if Muzak fails to
comply with any of its obligations under this Agreement, and Licensee has been
or is reasonably likely to be in any way damaged thereby, and such failure is
not cured within thirty (30) days after Muzak's receipt of a written notice of
default from Licensee (or, if the default cannot reasonably be cured within such
thirty (30) days, if such cure has not been initiated and is not continuing
within that time); provided, however, that in the event the existence of such
default is disputed by Muzak, and Muzak notifies Licensee of such dispute within
10 days after receipt of Licensee's notice of default and thereafter promptly
proceeds to take all steps necessary to resolve such dispute, including (if
necessary) the
41
commencement of litigation by no later than 30 days after receipt of Licensee's
notice of default, such termination shall not become effective until 10 days
after the date such dispute is finally resolved in favor of Licensee. For
purposes hereof, final resolution shall include Muzak's failure to make a timely
appeal of a court decision in favor of Licensee. Notwithstanding anything in
this Section 10.2 to the contrary, in the event that the final resolution in
favor of Licensee of Muzak's dispute of a notice of default is by means of a
court decision and such court also specifically decides that, at each successive
level of Muzak's legal challenge to the notice of default, Muzak had a strong
likelihood of success on the merits (without application by the court of any
balance-of-hardships tests), Muzak shall have 30 days from the date of such
final resolution to cure the default; in such event, if such cure is not
effectuated by the end of such 30-day period, the termination shall then become
immediately effective.
10.3 Additional Remedies. No termination of this Agreement shall affect
-------------------
any obligation, including any obligation arising as a result of a default of
this Agreement, of any party accrued up to the date of termination or limit any
additional rights or remedies provided the nondefaulting party under this
Agreement or under law.
42
10.4 Force Majeure. Neither Muzak nor Licensee shall have any liability
-------------
to the other or to any other person as a result of the failure of either of such
parties to perform its obligations hereunder, nor shall such failure be
considered a breach of this Agreement, if such failure is due to fire, flood,
other act of God, strike or other event or situation beyond the control of such
party acting in accordance with sound business practices.
XI. RELATIONSHIP OF THE PARTIES UPON TERMINATION OR EXPIRATION OF THIS
------------------------------------------------------------------
AGREEMENT
---------
11.1 Action Required of Licensee. Upon termination or expiration (without
---------------------------
renewal of license rights) of this Agreement, Licensee shall, subject to Section
2.2(b), Section 2.4 (including Exhibit E), and Article IX (including Exhibit G),
immediately
(a) Cease to distribute the Services to Subscribers and shall not
thereafter, directly or indirectly, represent itself to the public or hold
itself out as a licensee of Muzak;
(b) Cease to use, in any manner whatsoever, the Services and the
Proprietary Marks. Without limiting the generality of the foregoing, Licensee
shall immediately cancel any assumed name or equivalent registration which
contains the xxxx "MUZAK(R)" or any other service xxxx or trademark of Muzak, or
otherwise permit Muzak to effect such cancellation;
43
(c) Sell to Muzak at Licensee's cost of acquisition, if any, all
manuals, instructions, sales literature, and other materials related to the
Services or the Proprietary Marks and retain no copy or record of any of the
foregoing except Licensee's copies of this Agreement and any other document
which Licensee reasonably needs for compliance with specific provisions of state
or federal law;
(d) Dismantle (if necessary) and dispose of as Muzak requests (at
Muzak's cost) all Earth Stations, Recorded Media, and other equipment provided
Licensee by Muzak; and
(e) Promptly pay all sums indisputably owing to Muzak.
11.2 Action Required of Muzak. Upon termination or expiration (without
------------------------
renewal of License rights) of this Agreement, Muzak shall promptly pay all sums
indisputably owing to Licensee. Muzak shall not provide or directly or
indirectly make available to any successor licensee in the Territory (including
any owned affiliates) any of Licensee's customer lists or customer contract
termination dates or terms; provided, however, that Muzak may transfer to such
successor licensee any contract rights purchased by Muzak from Licensee under
the terms of Exhibits E and G hereto.
44
XII. TRANSFER OF BUSINESS OR CONTROL OF LICENSEE
-------------------------------------------
12.1 By Licensee and its Owners. Muzak has entered into this Agreement in
--------------------------
reliance on the business skills, financial capacity, and personal character of
Licensee and its owners. Accordingly, Licensee shall not permit the transfer of
any interest in or of Licensee that would have the effect, alone or together
with other previous, simultaneous, or proposed transfers, of directly or
indirectly transferring a controlling interest (whether in stock, partnership
interests or otherwise) in this Agreement, Licensee, or a major portion of the
assets used in the Business without the prior written consent of Muzak and
without otherwise complying with the requirements of this Article XII. Any such
purported assignment or transfer, by operation of law or otherwise, not having
the written consent of Muzak and not otherwise complying with the requirements
of this Article XII shall be null and void and shall constitute a material
breach of this Agreement.
12.2 Consent of Muzak. Muzak shall not unreasonably withhold its consent
----------------
to a transfer described in Section 12.1; provided, however, that Muzak may
require any or all of the following as conditions of its approval:
(a) All of Licensee's accrued monetary obligations to Muzak shall have
been satisfied (or otherwise provided for to
45
Muzak's satisfaction, including without limitation the escrowing with counsel at
closing of the full amount of such obligations);
(b) The transferee and its owners shall enter into a written
assignment, in a form reasonably satisfactory to Muzak, assuming and agreeing to
discharge all of Licensee's obligations under this Agreement;
(c) The transferee shall demonstrate to Muzak's reasonable
satisfaction that (i) the transferee has the personal character and the
financial resources to conduct the Business, (ii) the transferee personally has
the general business experience to conduct the Business or will employ during
the term of this Agreement a general manager with such business experience to
conduct the Business, and (iii) the transferee is not in a position to use the
information obtained as a licensee of Muzak in a manner that will be harmful to
Muzak outside the Territory; and
(d) The transferee shall pay Muzak a transfer fee as follows:
(i) For any transfer to an existing licensee of Muzak (or any
entity owned or controlled by or having common ownership with an existing
licensee of Muzak), the sum of $1,000; or
46
(ii) For any other transfer, (A) the sum of $2,500 for a Business
having Gross Xxxxxxxx (as defined herein) of $20,000 per month or less, and
(B) the sum of $5,000 for a Business having Gross Xxxxxxxx (as defined
herein) in excess of $20,000 per month.
In the event Muzak fails to respond to any request for approval of a
transfer to another MUZAK(R) licensee within 20 business days and to all others
within 30 business days of its receipt of a completed application for transfer,
then the request shall be deemed approved, subject only to Muzak's receipt of
notification of the transferee's assumption of Licensee's obligations, and of
the assignment to the transferee of Licensee's rights, under this Agreement.
12.3 Collateral. Muzak will not require approval of the assignment,
----------
transfer, pledge, or hypothecation of all or any part of the assets of the
Business, excluding this Agreement, and, if Licensee is a corporation, all or
any part of the stock of said corporation, to banks or other lending
institutions as collateral security for loans made directly to or for the
benefit of the Business. However, such approval will be required for any
proposed assignment of this Agreement.
47
12.4 Transfer to Family Member. An individual may transfer his or her
-------------------------
interest in Licensee or this Agreement to a member of his or her immediate
family or to a corporation controlled by such individual, provided that the
requirements set forth in paragraphs (a), (b), and (c) of Section 12.2 are met.
No transfer fee shall be required for any such transfer.
12.5 By Muzak. Muzak shall have the right to transfer or assign all or
--------
any part of its rights or duties hereunder to any person or entity. Muzak shall
promptly notify Licensee of any such transfer.
XIII. PROPRIETARY MARKS
-----------------
13.1 Ownership. Muzak represents that it is the owner of all right,
---------
title, and interest in and to the Proprietary Marks. Muzak will take all steps,
including the taking of legal action, reasonably necessary to preserve and
protect the ownership and validity in and of the Proprietary Marks. Licensee
shall not directly or indirectly contest the validity or Muzak's ownership of
the Proprietary Marks. In the event that litigation involving the Proprietary
Marks is instituted or threatened against Licensee, Licensee shall promptly
notify Muzak and shall cooperate in the defense or settlement of such
litigation, which Muzak shall have the right to control at its expense.
Licensee expressly understands and acknowledges that Muzak is the owner of
48
all right, title, and interest in and to the Proprietary Marks and the goodwill
associated with and symbolized by them. Licensee's use of the Proprietary Marks
pursuant to this Agreement does not give Licensee any ownership interest or
other interest in or to the Proprietary Marks, except the license granted by
this Agreement.
13.2 Infringement. Licensee shall promptly notify Muzak of any suspected
------------
infringement of the Proprietary Marks, and of any challenge to Muzak's ownership
of, or Licensee's right to use, the Proprietary Marks. Subject to Section 13.1,
Muzak shall have the sole right to decide whether an administrative or judicial
proceeding, or other action, should be undertaken in response to any such
suspected infringement or challenge, and, if any such proceeding or action is to
be undertaken, to initiate and control such proceeding or action at its expense.
In the event Muzak elects to undertake any such proceeding or action, Licensee
agrees to cooperate with Muzak in such effort. Licensee shall have no right to
institute any litigation against a third party relating to the Proprietary Marks
without Muzak's prior written consent.
13.3 Use. Licensee's right to use the Proprietary Marks is limited to
---
such uses as are authorized under this Agreement. Licensee shall not use the
Proprietary Marks as part of its corporate or other legal name. Licensee shall
comply with
49
Muzak's instructions at Muzak's cost in filing and maintaining the requisite
trade name or fictitious name registrations, and shall execute any documents
reasonably deemed necessary by Muzak or its counsel to obtain protection for the
Proprietary Marks or to maintain their continued validity and enforceability.
Unless otherwise authorized or required by Muzak, Licensee shall use the
Proprietary Marks without prefix or suffix and shall comply with Muzak's
instructions regarding the use of the federal registration symbol and other
trademark or service xxxx designations.
13.4 Substitution of Proprietary Marks. Muzak reserves the right to add
---------------------------------
Proprietary Marks and, except with respect to the MUZAK(R) trademark, to
substitute different Proprietary Marks, or discontinue the use of Proprietary
Marks, for use in identifying the Services if Muzak's currently owned
Proprietary Marks no longer can be used, or if Muzak determines that such
addition, substitution, or discontinuation will be beneficial to its business
and provides to Licensee at least six (6) months' prior notice of such addition,
substitution or discontinuation. All such additions, substitutions or
discontinuations will be reflected in an amendment of Exhibit C and shall not
affect the validity of this Agreement, which shall, in all respects, be deemed
modified to provide for such addition, substitution or discontinuation.
50
XIV. MISCELLANEOUS
-------------
14.1 Representations of Licensee. Licensee represents and warrants to
---------------------------
Muzak that, on the date of this Agreement:
(a) If Licensee is a trust, corporation, or partnership, it is duly
organized, in good standing, and qualified to do business in all jurisdictions
included in the Territory; all controlling ownership interests in Licensee are
directly and indirectly held by those persons and entities listed on the
signature pages hereof, and no other persons or entities own any controlling
interests in Licensee; and it has all necessary power and authority to execute,
deliver, and perform this Agreement.
(b) There are no actions, suits, proceedings, or investigations in any
court or before any governmental agency or instrumentality which affect or are
reasonably likely to affect Licensee's ability to perform its obligations under
this Agreement.
14.2 Representations of Muzak. Muzak represents and warrants to Licensee
------------------------
that, on the date of this Agreement, it is duly organized and in good standing
as a limited partnership under the laws of the State of Delaware and has all
necessary power and authority to execute, deliver, and perform this Agreement.
51
14.3 Independent Contractor. Muzak and Licensee are independent
----------------------
contractors vis-a-vis each other and neither party, nor their respective
employees and agents, are or are to be construed to be either legal or implied
agents, servants or employees of the other party or to have authority to act for
or on behalf of the other party. No acts taken or assistance given by one party
to the other pursuant to this Agreement will be construed to alter this
relationship. Without limiting the generality of the foregoing, but subject to
the terms of the Multi-Territory Accounts Program as described herein, Section
2.4 (including Exhibit E), the In-Store Advertising Agreement between Muzak and
Licensee, and any other written contract between Muzak and Licensee, nothing in
this Agreement shall authorize one party to make any contract, agreement,
warranty or representation on behalf of the other party or to incur any debt or
obligation in the other party's name, and the other party shall in no event
assume liability for, or be deemed liable hereunder as result of, any such
action. Without limiting the rights of a party to enforce its rights hereunder,
a party shall not be liable to a third party by reason of any action or omission
of the other party in the conduct of its business.
14.4 Release. Muzak and Licensee hereby release and forever discharge
-------
each other, and their respective predecessors, successors, representatives,
assigns, agents, owners, employees,
52
officers, and directors ("Designees"), of and from any claims, debts,
liabilities, demands, obligations, costs, expenses, actions, and causes of
action of every nature, character, and description, vested or contingent, which
such releasing party now owns or holds, or has at any time heretofore owned or
held, or may at any time own or hold, against the other party or its Designees,
arising prior to and including the date of this Agreement and relating to any
prior franchise or license agreement; provided, however, that this release shall
not apply to any royalties or other monies owed, whether or not previously
reported as owing, from Licensee to Muzak; and further provided that this
release shall not apply to any claims, debts, liabilities, demands, obligations,
costs, expenses, actions and causes of action of every nature, character and
description, vested or contingent which are (i) at any time raised or asserted
by any party against the other party as a defense, counterclaim, or crossclaim
in any arbitration or litigation; (ii) of which the other party is advised
within 120 days of the date hereof; or (iii) the existence of which could not
now be reasonably known to a party and of which the other party is advised
within 120 days of the claiming party's knowledge thereof.
14.5 No Waiver. No failure of a party to exercise any right or power
---------
reserved to it in this Agreement or to insist upon compliance by the other party
with any obligation or condition in this Agreement, and no custom or practice of
the parties at
53
variance with the terms hereof, shall constitute a waiver of such party's rights
to demand exact compliance with any of the terms of this Agreement. Waiver by a
party of any particular default shall not affect or impair such party's right
with respect to any subsequent default of the same or of a different nature,
and, except as otherwise expressly provided herein, any delay, forbearance, or
omission of a party to exercise any power or right arising hereunder shall not
affect or impair such party's right thereafter to exercise that or any other
power or right.
14.6 Notices. Unless otherwise expressly provided herein, any and all
-------
notices required or permitted under this Agreement shall be in writing and shall
be personally delivered or mailed by certified or registered mail, return
receipt requested, postage prepaid, to the respective parties at the following
addresses unless and until a different address has been designated by written
notice to the other party:
Notices to Muzak: MUZAK
000 Xxxxx 00xx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attention: Vice President, Affiliate
-------------------------
Sales & Development
Notices to Licensee: FLORIDA SOUND ENGINEERING
COMPANY
0000 XXXXXXX XXXX X.
------------------------------------
XXXXXXXXXXXX, XX 00000
------------------------------------
------------------------------------
Notice by certified or registered mail shall be deemed to have been given at the
date and time of receipt.
54
14.7 Entire Agreement. This Agreement, the documents referred to herein,
----------------
and the exhibits and attachments hereto, constitute the entire, full, and
complete agreement between the parties concerning the subject matter hereof, and
supersede all prior agreements except those set forth in Exhibit H (the terms of
which shall remain in effect to the extent not expressly contradicted by the
terms hereof). Except for those amendments referred to in Sections 2.1, 2.2 and
13.4 and Exhibits E, F, and G, no amendment of this Agreement shall be binding
on either party unless mutually agreed to by the parties and executed by their
authorized officers or agents in writing.
14.8 Severability. Each portion, part, and term of this Agreement shall
------------
be considered severable, and if, for any reason, any portion, part, or term
herein is determined by a court or agency with valid jurisdiction to be contrary
to any existing or future law or regulation and invalid, it shall not impair the
operation of, or have any other effect upon, the other portions, parts, or terms
of this Agreement that remain otherwise intelligible.
14.9 Captions. All captions in this Agreement are for convenience only
--------
and do not in any way limit or amplify the provisions hereof.
55
14.10 Binding Effect. This Agreement shall be binding upon and shall
--------------
inure to the benefit of the parties hereto and, subject to Article XII, their
respective heirs, executors, representatives, successors, and assigns.
14.11 Counterparts. This Agreement may be executed in several
------------
counterparts, and all of such counterparts together shall constitute one
agreement binding on all parties thereto, notwithstanding that all parties are
not signatory to the original or same counterpart.
14.12 Attorney's Fees. If any action or proceeding is brought for the
---------------
enforcement of this Agreement, the successful or prevailing party or parties
shall be entitled to recover reasonable attorneys' fees and other costs incurred
in the action or proceeding, in addition to any other relief to which it or they
may be entitled.
14.13 Applicable Law. This Agreement shall be interpreted and construed
--------------
under the laws of the State of Colorado without reference to conflicts of law.
14.14 All Remedies. No right or remedy conferred upon or reserved to
------------
Muzak or Licensee by this Agreement is intended to be exclusive of any other
right or remedy herein or by law or equity provided, but each shall be
cumulative of every other right or
56
remedy. Without limiting the generality of the foregoing, Licensee acknowledges
that its violation of the terms of Sections 4.3, 5.5, or 11.1 will result in
irreparable injury to Muzak for which no adequate remedy at law may be
available, and Licensee accordingly agrees that Muzak may seek to obtain the
issuance of an injunction prohibiting any conduct by Licensee in violation of
such terms.
14.15 Limitation. Licensee shall commence any action relating to Muzak's
----------
offer or sale of license rights hereunder to Licensee, or the execution of this
Agreement by Licensee, within one (1) year from the later of the date of
execution of this Agreement or the date Licensee reasonably should have
discovered the event or non-occurrence of the event first giving rise to the
action, and Licensee shall commence any other action arising hereunder within
two (2) years from the date Licensee reasonably should have discovered the event
or non-occurrence of the event first giving rise to such action. Licensee
agrees that any such claim not commenced within such time periods shall be
barred, it being understood that the assertion of any such claim as a defense,
counterclaim or cross-claim shall not be barred by this paragraph.
14.16 No Warranties. Muzak makes no warranties or guarantees upon which
-------------
Licensee may rely, and assumes no liability or obligation to Licensee, by
providing any waiver, approval,
57
consent or suggestion to Licensee in connection with this Agreement, or by
reason of any neglect, delay, or denial of any request therefor.
14.17 No Implied Rights. Except as expressly provided to the contrary
-----------------
herein, nothing in this Agreement is intended, nor shall be deemed, to confer
upon any person or legal entity other than Licensee, Muzak, Muzak's officers,
partners, and employees, and such of Licensee's and Muzak's respective
successors and assigns as may be contemplated (and, as to Licensee, permitted)
by Article XII hereof, any rights or remedies under or by reason of this
Agreement.
14.18 Survival. All provisions of this Agreement that pertain to
--------
Licensee's rights and duties regarding Licensee's delivery of the Services to
certain Subscribers after the date of expiration or termination of this
Agreement shall survive such expiration or termination to the extent necessary
to give full effect to such rights and duties. All other covenants and
obligations of Muzak or Licensee that are to be performed or observed after the
expiration or termination of this Agreement, including, without limitation,
those set forth in Sections 5.5 and 14.3, Article XI, and Exhibits E and G,
shall also survive such expiration or termination.
58
14.19 Conversion. Upon the expiration or earlier termination of this
----------
Agreement, in the event the addressability feature of Muzak's DBS facilities
permits Muzak to switch Licensee's music subscribers to another subscription
music supplier and Muzak has received written permission from such music
supplier and blanket indemnification from Licensee, then within a reasonable
time following Licensee's written direction to Muzak, Muzak shall perform one
such switch with respect to each such subscriber at the following cost to
Licensee: the greater of (i) Muzak's standard switching charge then in effect,
or (ii) Muzak's incremental out-of-pocket costs directly attributable to the
making of such switches.
14.20 Most Favorable Terms. In the event that after September 1, 1990
--------------------
Muzak grants for the first time (and not pursuant to or in renewal of any
agreement in existence at September 1, 1990) to any other U.S. licensee of Muzak
(i.e., a distributor of the Services in a territory within the United States)
financial or other material terms (other than temporary or transient adjustments
and accommodations) that are more favorable than the terms set forth herein,
Muzak must offer such more favorable terms to Licensee; provided, however, that
if, and to the extent, Muzak is required by the laws and regulations of the
State in which another licensee resides or operates its business to offer such
other licensee more favorable terms than those set forth herein, Muzak shall not
be required to offer such
59
more favorable terms to Licensee but shall notify the then-president of the IPMA
of the imposition of such legal or regulatory requirement.
XV. ACKNOWLEDGEMENTS
----------------
15.1 Independent Investigations. Licensee acknowledges that it has
--------------------------
conducted an independent investigation of the business licensed hereunder, and
recognizes that the business venture contemplated by this Agreement involves
business risks and that its success will be largely dependent upon the ability
of Licensee as an independent person or entity. Muzak expressly disclaims the
making of, and Licensee acknowledges that it has not received, any warranty or
guarantee, express or implied, as to the potential volume, profits, or success
of the business venture contemplated by this Agreement.
15.2 Disclosure. Licensee acknowledges that it received a copy of this
----------
Agreement and all exhibits and attachments thereto, and agreements relating
thereto, at least five (5) business days prior to the date on which this
Agreement was executed. Licensee further acknowledges that it received the
disclosure documents required by the Trade Regulation Rule of the Federal Trade
Commission entitled "Disclosure Requirements and Prohibitions Concerning
Franchising and Business Opportunity Ventures" at
60
least ten (10) business days prior to the date on which this Agreement was
executed.
15.3 Opportunity to Review. Licensee acknowledges that it has read and
---------------------
understands this Agreement and the exhibits and attachments hereto, and
agreements relating hereto, and that Muzak has accorded Licensee ample time and
opportunity to consult with advisors of Licensee's own choosing about the
potential benefits and risks of entering into this Agreement.
IN WITNESS WHEREOF, the parties have executed and delivered this Agreement
on the day and year first above written.
MUZAK LIMITED PARTNERSHIP,
a Delaware limited partnership
By: /s/ Xxxx X. Xxxxxx
------------------------------
Title: President
---------------------------
Licensee:
FLORIDA SOUND ENGINEERING COMPANY,
a Florida corporation
By: /s/ Xxxx Xxxxxxxx
------------------------------
Title: President
---------------------------
61
Each of the undersigned (i) owns, directly, indirectly, or beneficially, a
controlling interest in Licensee; (ii) has read this Agreement; and (iii) agrees
to be bound by those provisions of this Agreement that impose obligations on the
owners of controlling interests in Licensee.
/s/ Xxxxxx X. Xxxxxxxx
-------------------------------------
(Typed Name) XXXXXX X. XXXXXXXX
-------------------------------------
Date: 1-8-91
------------------------------
Address: 0000 Xxxxxxx Xxxx X.
---------------------------
Jacksonville, Fla. 32207
---------------------------
/s/ Xxxx Xxxxxxxx
-------------------------------------
(Typed Name) XXXX XXXXXXXX
-------------------------------------
Date: 1/10/91
------------------------------
Address: 0000 Xxxxxxx Xxxx X.
---------------------------
Jacksonville, Fla. 32207
---------------------------
/s/ Xxxxx Xxxx Xxxxxxxx
-------------------------------------
(Typed Name) XXXXX XXXX XXXXXXXX
-------------------------------------
Date: 1/2/91
------------------------------
Address: 0000 Xxxxxxx Xxxx X.
---------------------------
Jacksonville, Fla. 32207
---------------------------
/s/ Xxxxxxx Xxxxxxxx Xxxxxxx
-------------------------------------
(Typed Name) XXXXXXX XXXXXXXX XXXXXXX
-------------------------------------
Date: 1/10/91
------------------------------
Address: 0000 Xxxxxxxxxx Xxxx
---------------------------
Xxxxxxxxxxxx, Xxx. 00000
---------------------------
