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EXHIBIT 10.1
AMENDED AND RESTATED
LICENSE AGREEMENT
THIS AMENDED AND RESTATED LICENSE AGREEMENT (this "Agreement") is
entered into this 27th day of September, 2000, by and between SHONEY'S, INC.
(successor to Shoney's Investments, Inc.), a Tennessee corporation with offices
at 1727 Elm Hill Pike, Nashville, Tennessee 37210 ("Licensor"), and SHOLODGE
FRANCHISE SYSTEMS, INC., (formerly known as Shoney's Lodging, Inc.), a Tennessee
corporation with offices at 130 Maple Drive North, Hendersonville, Tennessee
37075 ("Licensee"). SHOLODGE, INC., (formerly known as Gulf Coast Development,
Inc.), a Tennessee corporation with offices at 130 Maple Drive North,
Hendersonville, Tennessee 37075 and the parent corporation of Licensee
("ShoLodge"), is executing this Agreement for the purposes set forth herein.
W I T N E S S E T H
WHEREAS, Shoney's Investments, Inc. and Licensee entered into that
certain License Agreement on October 25, 1991 (the "License Agreement") pursuant
to which Licensor granted to Licensee a license to use certain service marks of
Licensor; and
WHEREAS, Shoney's Investments, Inc. and Licensee previously amended the
License Agreement pursuant to Amendment No. 1 to License Agreement dated
September 16, 1992, Amendment No. 2 to License Agreement dated March 18, 1994,
Amendment No. 3 to License Agreement dated March 13, 1995, Amendment No. 4 to
License Agreement dated June 26, 1996 and Amendment No. 5 to License Agreement
dated October 25, 1996; and
WHEREAS, SHN Investments, LLC subsequently succeeded to all of the
right, title and interest of Shoney's Investments, Inc. in and to the License
Agreement and the Licensed Marks (as defined herein); and
WHEREAS, on or about August 30, 2000, SHN Investments LLC converted to a
corporation, Captain D's, Inc.; and
WHEREAS, on or about September 19, 2000, Captain D's, Inc. transferred
the Licensed Marks (as defined herein) and all of its right, title and interest
therein (including, without limitation, the License Agreement) to Licensor; and
WHEREAS, the Licensor and Licensee now desire to further amend and
restate their agreements contained in the License Agreement, as previously
amended;
TERMS
NOW, THEREFORE, in consideration of the premises and covenants contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Licensor and Licensee agree as
follows:
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I. DEFINITIONS
Section 1.1. Motel. "Motel" shall mean first class limited-service motor
hotels intended to provide moderately priced motel rooms primarily for business
persons and vacationers which are owned, operated or franchised by Licensee
under the Licensed Marks.
Section 1.2. Term. "Term" shall mean a period commencing on the date of
this Agreement and, unless sooner terminated as provided for herein, continuing
until the expiration of the last license agreement entered into between Licensee
and any of its franchisees for the operation of Motels.
Section 1.3. Licensed Marks. "Licensed Marks" shall mean the service
mark "SHONEY'S INN" and design which was registered on February 16, 1982 with
the United States Patent and Trademark Office (the "USPTO") at Registration No.
1,190,289, the service mark "SHONEY'S INN" (block letters) which was registered
on August 4, 1992 with the USPTO at Registration No. 1,705,676, and the service
mark "SHONEY'S INN & SUITES" (block letters) which was registered on October 22,
1996 with the USPTO at Registration No. 2,011,023, and all common law rights
therein. Copies of the certificates of registration for the Licensed Marks are
attached hereto as Exhibit A. Should Licensor register with the USPTO additional
or different versions of the name "Shoney's Inn," Licensor agrees to notify
Licensee of such registration(s). Licensor and Licensee agree to thereafter
appropriately amend this Agreement so as to grant Licensee the same rights with
respect to such additional or different versions of such name as Licensee is
granted hereunder with respect to the Licensed Marks.
Section 1.4. Territory. "Territory" shall mean the United States of
America, with the exception of those geographic areas described in Exhibit B
attached hereto and incorporated herein by reference. At such time as Licensor
or its affiliates obtain the right to use the name "Shoney's Inn" in connection
with lodging facilities in the excluded areas described in Exhibit B, such
excluded areas shall then be deemed included in the Territory. Further, at such
time as "Shoney's" restaurants are being operated or franchised in any foreign
country by Licensor or Licensor's affiliates, and the Licensed Marks have been
registered or otherwise protected in such foreign country, Licensor agrees to
notify Licensee of such registration or protection. Licensor and Licensee agree
to thereafter appropriately amend this Agreement so as to include such foreign
country within the Territory.
II. REPRESENTATIONS AND WARRANTIES OF LICENSOR
Section 2.1. Ownership. Except as disclosed on Exhibit B, Licensor owns
the Licensed Marks free and clear of all liens, security interests,
encumbrances, claims, ownership interest, pledges, charges or interests of any
kind, whether voluntarily incurred or arising by operation of law or otherwise.
Except for the rights of Licensee and its franchisees granted pursuant to the
terms of this Agreement and the rights
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reserved to the Licensor hereunder, no other person has any right to use the
Licensed Marks.
III. GRANT OF LICENSE
Section 3.1. Grant. Licensor hereby grants to Licensee, during the Term,
the non-exclusive right and license to use and license the use of the Licensed
Marks in the Territory, and Licensee hereby undertakes to use and license the
use of the Licensed Marks in conjunction with the advertising, franchising,
management and operation of Motels. This license is granted for use only in
connection with the operation of Motels and only for use of the Licensed Marks
as a service mark to promote the services of Motels. Licensor agrees that,
during the Term of this Agreement, Licensor will not use or license others to
use the Licensed Marks in connection with lodging facilities of any type. During
the Term, Licensee shall be the exclusive entity from which to obtain the right
to operate a lodging facility utilizing the Licensed Marks.
Section 3.2. Reservation of Rights. No license or other right is
granted, by implication or otherwise with respect to any name, trade name,
trademark or service mark other than the Licensed Marks, whether or not such may
be similar to the Licensed Marks. Nothing in this Agreement shall restrict
Licensor and its affiliates and subsidiaries or their respective licensees from
using or licensing others to use the name "Shoney's" in connection with any
services other than lodging or motel services (including, without limitation,
restaurant services) or in connection with any goods. Licensor and its
affiliates also reserve the right to use the Licensed Marks in "Shoney's"
restaurant menus and in advertisements for "Shoney's" restaurants to indicate
that a "Shoney's" restaurant operated or franchised by Licensor or its
affiliates is located in close proximity to a "Shoney's Inn" or "Shoney's Inn &
Suites" motel operated or franchised by Licensee.
IV. OBLIGATIONS OF LICENSEE
Section 4.1. Trademarks, Trade Names and Service Marks.
(a) Licensee agrees that nothing contained in this Agreement shall give
Licensee any right, title or interest in the Licensed Marks or any other trade
names, trademarks or service marks owned by Licensor or Licensor's affiliates
which terms shall include, but not be limited to, any words, symbols, designs,
insignias, devices, or combinations thereof used to identify Licensor and the
products or services sold by it or its affiliates (except the right to use and
license the use of the Licensed Marks in accordance with the terms of this
Agreement). Licensee also agrees that the Licensed Marks and said trade names,
trademarks and service marks are the sole property of Licensor or its affiliates
and Licensee agrees, and agrees to require each of its franchisees to agree, not
to raise or cause to be raised any questions concerning, or objections to, the
validity of the Licensed Marks or any other mark owned by Licensor or its
affiliates and used in connection with the Licensed Marks on any grounds
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whatsoever. Except to the extent expressly permitted in Section 4.3(d) hereof,
Licensee agrees not to use or permit the use of any trade names, trademarks or
service marks other than those included in the Licensed Marks in connection with
Motels using the Licensed Marks without first obtaining the prior written
consent of Licensor. If local laws or ordinances require that Licensee or its
franchisees file an application to do business under an assumed name or
otherwise file any document indicating that any of the Licensed Marks or any
other name included in any of the Licensed Marks, is being used as a fictitious
or assumed name, Licensee will include, and will require its franchisees to
include, in such filing or application a statement that the filing is made "as a
licensee (or sublicensee) of SHN Investments, LLC, Nashville, Tennessee."
Licensee shall place, and will require each of its franchisees to place, the
symbol (R), or other symbols or words as Licensor may designate to protect the
Licensed Marks, on all surfaces where the Licensed Marks appear.
(b) Licensee will not seek, and agrees to require each of its
franchisees not to seek, to register, re-register, or assert any claim to or
ownership of, or otherwise appropriate to itself the Licensed Marks or any other
trade name, trademark, service mark or name similar thereto, or the goodwill
symbolized by any of the foregoing, except insofar as such action inures to the
benefit of and has the prior written approval of Licenser. Upon termination or
cancellation of this Agreement, whether by lapse of time, default or otherwise,
Licensee agrees to discontinue within thirty (30) days following such
termination or cancellation all use of the Licensed Marks and to remove all
copies, replicas, reproductions or simulations thereof from Licensee's places of
business and to take all necessary steps to assign, transfer or surrender to
Licensor or otherwise place in Licensor or its designee title to all such marks
which Licensee may have used during the term of this Agreement or any renewal or
extension thereof.
(c) Licensee shall not use and shall not permit the use of any name or
word included in the Licensed Marks or any other trade name, trademark or
service mark of Licensor or any names or words similar thereto in a corporate or
other name without the prior written consent of Licensor; provided, however,
that to the extent that Licensee is permitted to use such a name and to qualify
to do business in any state under such name, in the event that Licensor or its
affiliates is unable to qualify to do business under any similar corporate name
in any state as a result of the prior qualification of Licensee, Licensee agrees
to execute such documents as may be necessary or appropriate to permit the
qualification of Licensor or its affiliates. Licensee also acknowledges and
agrees that any such permission may be conditioned upon Licensee taking other
actions (including, without limitation, the use of appropriate legends and
disclaimers) that may be required by Licensor and such permission, once given,
may be revoked at any time without affecting any of the rights and obligations
of either of the parties under this Agreement.
(d) Licensee shall promptly inform Licensor in writing of any
infringement of any of the Licensed Marks or any act of unfair competition
relating to any of the Licensed Marks against Licensor, or its affiliates, or
Licensee as to which Licensee has knowledge. Licensee shall make such demands,
serve such notices, orally or in writing, or institute such legal action as is
necessary or appropriate to protect the Licensed
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Marks from any acts of infringement and/or unfair competition; provided,
however, that Licensee shall not, and shall not permit any of its franchisees
to, compromise or settle any controversy with respect to any such infringement
or unfair competition without first obtaining Licensor's written consent.
Notwithstanding Licensee's obligations with respect to any acts of infringement
and/or unfair competition, Licensor shall have the right, at its expense, to
institute and/or intervene in and assume the control of, negotiate, compromise,
settle, dismiss, appeal or otherwise handle any such action and take such steps
as it may deem advisable to protect the Licensed Marks from any acts of
infringement and/or unfair competition and to join Licensee (with Licensee being
responsible for its expenses, including its reasonable attorneys fees) as a
party to any such action to which Licensor may be a party and to which Licensee
is or would be a necessary or proper party, but nothing herein shall be
construed to obligate Licensor to seek recovery of costs or damages of any kind
in any such litigation, the assertion or waiver of such claims being within the
sole discretion of Licensor. The costs of any such action shall be paid by
Licensor and any recovery obtained from such infringers, after reimbursing
Licensor for its costs and expenses in pursuing such action, shall be divided
equally between Licensor and Licensee.
(e) In the event that Licensor determines, in its sole discretion, to
seek federal or state registration of any trade names, trademarks or service
marks included in any of the Licensed Marks, Licensee agrees to cooperate with
and assist Licensor in such registration. Licensor shall bear the cost of any
such registration. Any and all use of the Licensed Marks by Licensee, or its
franchisees, under this Agreement shall inure to the benefit of Licensor.
Section 4.2. Approvals Required.
(a) Licensee shall display and shall require that its franchisees
display the Licensed Marks only in the styles, shapes, colors and forms set
forth in Exhibit C, attached hereto and incorporated herein by reference, in all
signs, literature, packages, labels, artwork, advertising or promotional
materials prepared by or for Licensee or its franchisees. Any alteration or
deviation from the displays set forth in Exhibit C must be approved in advance
by Licensor. Licensor shall have thirty (30) days to approve or disapprove such
alterations or deviations. If Licensor fails to notify Licensee in writing of
its objection to such alterations or deviations within such thirty (30) day
period, such alterations or deviations shall be deemed to have been approved.
Licensee shall require that each of its franchisees agree to allow Licensor or
its authorized representative at any time to enter upon the premises of any
Motel and remove any signs or advertising materials that display the mark in a
manner that has not been approved. Licensee agrees to refrain, and to require
its franchisees to refrain, from using the Licensed Marks in any fashion which
would cast disfavor upon the Licensor. Licensee will permit, and require its
franchisees to permit, Licensor or its authorized representatives to inspect the
premises of all Motels during business hours for the purpose of ascertaining or
determining compliance with the terms of the Agreement.
(b) Licensee shall submit to Licensor, for Licensor's prior approval,
any form of franchise or license agreement, offering circular or other
promotional materials that
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Licensee intends to utilize in the franchising of the Motels. All fees,
royalties and advertising fees required to be paid by franchisees to Licensee
shall be determined by Licensee in its sole and absolute discretion. Licensee
shall immediately cease use of any form of franchise or license agreement,
offering circular or other promotional materials to which Licensor objects.
Licensor shall not object to a form of agreement, offering circular or other
promotional items because of the fees, royalties, advertising fees or similar
financial obligations proposed to be charged thereunder. Approval of such form
of agreements, offering circular or other promotional materials shall not be
unreasonably withheld or delayed. Licensor shall have thirty (30) days to
approve such forms, offering circulars or other promotional materials. If
Licensor fails to notify Licensee in writing of its objection to such forms,
offering circulars or other promotional materials within such thirty (30) day
period, such forms, offering circulars or other promotional materials shall be
deemed to have been approved.
Section 4.3. Operation of Motels.
(a) Upon Licensor's request, Licensee shall provide to Licensor, within
ten (10) days following such request, copies of all agreements entered into
between Licensee and its franchisees.
(b) Licensee shall operate, and cause its franchisees to operate, all
Motels in compliance with all applicable governmental laws, ordinances and
regulations.
(c) Licensee shall maintain and operate, and cause its franchisees to
maintain and operate, all Motels in good condition and repair and in a proper
and businesslike manner, and use its best efforts to maintain, or cause its
franchisees to maintain, a clean, quiet, and respectable atmosphere therein and
do, or cause its franchisees to do, such redecoration, repairing and restoration
as from time to time may be required to continue to meet such standards.
(d) Licensee shall not, and shall not permit any of its franchisees to,
offer or provide any food or food service for either on or off premises
consumption at any Motel, without the prior written consent of Licensor, except
as provided in this Section 4.3(d).
(1) With regard to Motels operated by Licensee or its
franchisees as of September 27, 2000 (the "Effective
Date") and which, as of the Effective Date, are not
adjacent to an operating Shoney's Restaurant
("Non-Adjacent Motels"), Licensor agrees that Licensee and
its franchisees may operate a full service restaurant
inside the Motel building or adjacent thereto (a "Motel
Restaurant"). Each Motel Restaurant shall be operated
under a name that is different from and not confusingly
similar to any of the Licensed Marks or any other
trademark or service mark owned by Licensor. Each Motel
Restaurant shall display the notice "[Name of Motel
Restaurant] has no affiliation with Shoney's Restaurants
or Shoney's, Inc." in prominent public view on a wall
plaque in the Motel Restaurant, on all eat-in and
carry-out menus and on any advertising materials
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(excluding billboards and signage) for the Motel
Restaurant. Any advertising or promotional materials,
billboards or exterior signage that indicates or suggests
that a restaurant is operated within a Non-Adjacent Motel
shall display the name of the Motel Restaurant in a type
font, script and colors that are different and
distinguishable from those in which the Licensed Marks
appear and shall be sufficiently separated from the
Licensed Marks to avoid the appearance that the Motel
Restaurant name is a part of any Licensed Mark.
(2) Without limiting the provisions of Section 4.3(d)(1),
Licensee and its franchisees shall be allowed to: (i)
operate in any Motel vending machines selling soft drinks,
coffee, snacks and similar items; (ii) serve guests on a
complimentary basis during breakfast hours (from 6:00 a.m.
to 10:00 a.m.) coffee, juice, tea and similar breakfast
beverages and hot or cold continental breakfast foods
consisting of breads, fruits, cereals, waffles, pancakes,
pop tarts and other items popularly known as "continental
breakfast" foods; provided, however, that, with regard to
Motels operated by Licensee or its franchisees as of the
Effective Date which, as of that date, are adjacent to a
Shoney's Restaurant ("Adjacent Motels"), except as
provided above, in no event shall the term "continental
breakfast foods" be deemed to include any other hot
breakfast foods including, without limitation (x) any meat
or meat products (including pork and pork products); and
(y) eggs; and (iii) hire a caterer or to assist in hiring
a caterer to serve special menu items to specific
banquet/convention groups meeting at any Motel; provided,
however, neither Licensee nor its franchisees shall be
permitted to operate at any Adjacent Motel a full service
kitchen or to prepare food for such banquet/convention
group at any Adjacent Motel (other than preparation by the
caterer incidental to the serving of such food). No food
products showing brand names (such as Dunkin' Donuts)
shall be allowed at any Adjacent Motel, although brand
name products may be used as long as the brand name itself
is not displayed. The intent of this Section 4.3(d)(2) is
that Licensee and its franchisees may serve the breakfast
items described herein in Adjacent Motels only for the
convenience of guests and must not be perceived as serving
food prepared by, or in competition with, a "Shoney's
Restaurant" except as expressly provided in this Section
4.3(d). Licensee agrees, and shall require its franchisees
to agree, to place menus for the adjacent "Shoney's
Restaurant" (which must be approved by Licensor and any
expense borne by the adjacent restaurant operator) in each
guest room of all Adjacent Motels and shall not allow any
other restaurant or food service organization to place
promotional material in the guest rooms of any Adjacent
Motels, without the prior written consent of Licensor.
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(3) Each new Motel opened for business after the Effective
Date by Licensee or its franchisees shall be classified as
either an Adjacent Motel or Non-Adjacent Motel based upon
whether the Motel is adjacent to a Shoney's Restaurant on
the date that it opens for business.
(4) In the event that the Shoney's Restaurant adjacent to an
Adjacent Motel shall close for more than one hundred and
eighty (180) consecutive days, such Adjacent Motel shall
thereafter become a Non-Adjacent Motel for purposes of
this Section 4.3(d).
(5) For purposes of this Section 4.3(d), the words "adjacent
to" shall mean within a one mile radius.
(e) Licensee shall: (i) employ, and cause its franchisees to employ,
only suitable individuals of good moral character who will at all times conduct
themselves in a competent and courteous manner; and (ii) use, and cause its
franchisees to use, best efforts to ensure that its or their employees maintain
a neat and clean appearance and render competent, sober and courteous service to
patrons of the Motels. Licensor, however, shall have no control over employees
of Licensee or of its franchisees, including their hours of work, wages and the
hiring and firing of the same.
(f) Subject to the restrictions set forth in this Agreement which are
designed solely to protect the Licensed Marks and any other trade names,
trademarks and service marks of Licensor and its affiliates, Licensor shall have
no control over the business affairs of the Licensee or its franchisees, all of
whom are independent contractors. Licensee shall have the exclusive authority
and responsibility to determine the mode and method of franchising, advertising,
merchandising, promoting, and selling all Motel services subject to this
Agreement, and the exclusive authority to set the prices, discounts, and terms
of sale to all customers. All expenses of development, franchising and operation
of the Motels shall be borne solely by Licensee and its franchisees.
Section 4.4. Dealing with Third Parties. Any and all purchases of goods
or services made by Licensee, or its franchisees, for the Motels shall be on
purchase orders bearing the corporate (or other) name of the Licensee, or its
franchisee, and shall include the address of Licensee or its franchisee. Only
with the consent and prior written approval of Licensor under the same
conditions as are set forth in Section 4.1(c) above may any of the Licensed
Marks appear on or be referred to on any such purchase orders, but no reference
to Licensor or Licensor's affiliates shall appear on any such purchase orders.
Licensee shall take such additional steps as Licensor may reasonably require to
establish the independent contractor status of Licensee and its franchisees.
Section 4.5. Notice of License. Licensee shall display, and cause its
franchisees to display, at any Motel, in prominent public view a plaque, in such
form and size as are acceptable to Licensor, stating the name and address of
Licensee, or Licensee's franchisee, as applicable, identifying Licensee or the
franchisee, as applicable, as the
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owner and operator of the Motel, indicating Licensee's, or such franchisee's,
status as an independent contractor and stating that Licensee, or such
franchisee, is using the Licensed Marks under a license agreement.
Section 4.6. Compliance with Laws. Licensee agrees to comply, and to
cause its franchisees to comply, with the requirements of all applicable laws or
regulations (whether federal, state or local) from time to time in effect in the
Territory, including, without limitation, regarding the offer and/or sale of
franchises or relating to the business relationship between a franchisor and its
franchisees. Licensee, at its expense, also agrees to take such actions as are
necessary to disclose the relationship between Licensee and Licensor or
Licensor's affiliates and/or register, as necessary, Licensor under or pursuant
to any such laws. Licensee shall promptly provide Licensor with copies of any
final franchise offering circulars or other documents for Motels that are
prepared and/or submitted in order to comply with any such laws or regulations.
Section 4.7. Insurance and Indemnification. Licensee shall be responsible
for all expense, loss or damage originating from, or arising in connection with,
the franchising of the Motels and for all claims or demands for damages
allegedly resulting therefrom, and Licensee agrees to defend, indemnify and hold
Licensor harmless from and against any and all losses, liabilities, damages,
costs, expenses (including, but not limited to, any attorneys fees incurred by
Licensor) and claims arising from or in any way related to: (1) any alleged
injury or damage to any person or property occasioned by any alleged act or
acts, omissions or commissions of Licensee or of any of its franchisees or their
respective agents, employees or contractors with respect to, or arising out of,
or related to the use, occupancy or operation of any of the Motels; (2) this
Agreement; (3) any agreement (or alleged breach thereof) between Licensee and
any franchisee; or (4) any of the franchising activities of Licensee or of any
of its agents, employees or contractors (including, without limitation, any
guaranties previously executed by Licensor or its affiliates for the obligations
of Licensee under its franchise agreements); provided, however, that Licensee
shall not be required to defend, indemnify or hold Licensor harmless from or
against any losses, liabilities, damages, costs, expenses or claims arising from
or in any way related to: (1) any act or event or series of acts or events which
occurred prior to October 25, 1991; or (2) any breach of this Agreement by
Licensor. Licensee shall at all times carry, and cause its franchisees to carry,
fire and extended coverage insurance covering any Motel's building, equipment
and inventory in the amount of the full insurable value of such property.
Licensee also agrees to secure, at its own cost, and to require each of its
franchisees to secure, a comprehensive public liability policy with such limits
as Licensor shall from time to time determine, which limits shall not be less
than $500,000 for bodily injury to any one person and $1,000,000 for bodily
injury in any one occurrence and $500,000 for property damage, and which shall
further specifically insure Licensee's obligation to indemnify Licensor
hereunder, and, in the case of a franchisee, shall specifically insure the
franchisee's obligation to indemnify Licensor under that franchisee's agreement.
Licensee agrees that Licensor shall be named as an additional insured under each
of said policies. All such policies shall contain endorsements requiring the
insurance company to give Licensor at least thirty (30) days written notice
before terminating, cancelling or making any changes in any such policy.
Licensee shall also secure, and cause its franchisees to secure, at their
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own costs, such workers' compensation insurance policy covering all of their
respective employees as is required by local law. If Licensee at any time fails
or refuses, or fails or refuses to require its franchisees, to maintain any
insurance coverage required by Licensor or to furnish satisfactory evidence
thereof, Licensor, at its option and in addition to its other rights and
remedies hereunder, may, but need not, obtain such insurance coverage on behalf
of Licensee (or its franchisees), and Licensee shall pay to Licensor on demand
any costs and premiums incurred by Licensor in connection therewith.
Notwithstanding the existence of such insurance, Licensee, as agreed above, is
and shall be, and shall require its franchisees to be, responsible for all loss
or damage and contractual liability to third persons originating from or in
connection with the operation of the Licensee's (or the franchisee's, as the
case may be) business and for all claims or demands for damages to property or
for injury, illness or death of persons directly or indirectly resulting
therefrom.
Section 4.8. Assignment.
(a) Licensee shall not sublicense (except to a franchisee as permitted
herein), sell, assign, transfer, convey or encumber its rights and obligations
hereunder or suffer or permit any such assignment, transfer or encumbrance to
occur by operation of law without the prior express written consent of Licensor.
In the event Licensee is a corporation, limited partnership, business trust,
partnership or similar association, the shareholders, limited partners,
beneficiaries, partners or investors, as the case may be, may not sell, assign
or otherwise transfer their shares or interests in such corporation, limited
partnership, business trust, partnership or similar association, without the
prior written consent of Licensor. In the event Licensee is a corporation, all
stock certificates shall have conspicuously endorsed upon them a legend in
substantially the following form:
"A transfer of this stock is subject to the terms and conditions of an
Amended and Restated License Agreement between Shoney's, Inc. and
ShoLodge Franchise Systems, Inc. dated the 27th day of September, 2000,
as amended.
Licensor agrees that it will not unreasonably withhold its consent to a
sale, assignment, transfer or conveyance contemplated by this paragraph to a
person or entity who has experience in the operation of motels and who is, in
the sole judgment of Licensor, of good character and reputation and capable,
financially and otherwise, of performing the duties and obligations of Licensee
hereunder. Any approval by Licensor of such transfer or assignment shall be
subject to the assignee's agreement in writing to assume and perform all of the
transferor's duties and obligations hereunder.
(b) In the event of the death of the Licensee or if the Licensee is a
corporation or similar entity, then in the event of the death of any
stockholder, investor or similar person of Licensee, Licensor shall not
unreasonably withhold its consent to a transfer or assignment of Licensee's
interest herein, or if Licensee is a corporation, the transfer of the deceased
stockholder's stock in such corporation to a descendant, heir or legatee of the
decedent, who shall in the sole judgment of Licensor be capable of performing
the duties and obligations of Licensee hereunder, or to a responsible bona fide
purchaser acceptable
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to Licensor. Any approval by Licensor of such transfer or assignment shall be
subject to the assignee's agreement in writing to assume and perform all of the
transferor's duties and obligations hereunder.
(c) In the event that a sale, assignment, transfer or conveyance of the
stock of Licensee by the shareholder of Licensee is approved in accordance with
Section 4.8(a) above, Licensor will (i) amend this Agreement to delete (A) the
provisions of Section 7.2 hereof pertaining to defaults caused by ShoLodge and
(B) all other references to ShoLodge, including, without limitation, those in
Sections 6.1, 6.2, 6.4, 6.5, and 7.3 hereof, and to make conforming amendments
in connection with such deletions, and (ii) terminate and cancel the Guaranty
Agreement except for obligations guaranteed by ShoLodge thereunder relating to
events occurring prior to the effective date of such sale, assignment, transfer
or conveyance.
Section 4.9. Miscellaneous.
(a) Whenever this Agreement requires Licensee to require any action or
inaction on the part of any of its franchisees, Licensee shall not be required
to require such action or inaction on the part of its franchisee if the license
agreement between Licensee and its franchisee does not allow Licensee to require
such action or inaction of the franchisee; provided, however, this shall not
excuse Licensee if Licensee, without the consent of Licensor, has amended or
modified (through conduct or otherwise) such license agreement to delete
Licensee's ability to impose such requirement.
(b) Whenever Licensor's consent is required under this Agreement, a
request for consent shall be made by Licensee in writing addressed to the
Secretary of Licensor and written approval may be given by the Secretary,
Treasurer or Chief Financial Officer of Licensor.
V. RELATIONSHIP WITH SHOLODGE AND SECURITY
FOR OBLIGATIONS
Section 5.1. Ownership of Licensee. Effective as of the date of this
Agreement, ShoLodge is the owner of all of the issued and outstanding voting
equity securities of Licensee.
Section 5.2. Guaranty of ShoLodge. ShoLodge has executed a Guaranty
Agreement (as amended, the "Guaranty Agreement"), guaranteeing the obligations
of Licensee under this Agreement.
VI. REPRESENTATIONS AND WARRANTIES.
Section 6.1. Corporate Existence. ShoLodge and Licensee will cause to be
done at all times all things necessary to maintain and preserve the corporate
existence, rights, and franchises of ShoLodge and Licensee, and subject to the
provisions of
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Section 4.8, ShoLodge will continue to own and hold, directly or indirectly,
free and clear of all security interests, all of the outstanding shares of
capital stock of Licensee.
Section 6.2. Qualification. ShoLodge and Licensee will do and cause to
be done at all times all things necessary to be duly qualified to do business
and be in good standing as foreign corporations in each jurisdiction where the
nature of their business makes such qualification necessary and where the
failure to so qualify might have a material adverse effect on the operations of
ShoLodge or Licensee.
Section 6.3. Business Activities. Licensee shall not engage in any
business activity except the business of operating and franchising restaurants
and motels and such other activities as its Board of Directors reasonably
determines to be incidental or related thereto. Licensee further acknowledges
that the Shoney's Inn System (which means the distinctive system of opening and
operating limited service motor hotel operations providing the traveling public
and others with a motor hotel service, including lodging and other
accommodations, of a distinctive (three of the distinguishing features of which
are its non--suite/"room only" service, its lack of food service and its price
point in the marketplace) and high quality and provided under the name of
"Shoney's Inn", which has been developed at a great expenditure of time, effort
and money) has been developed for the benefit of Licensor and includes trade
secrets of Licensor; and all material or other information regarding the
Shoney's Inn System is to be held in confidence, and Licensee has no right to
disclose any part of it to anyone who is not an employee of Licensor, Licensee
or franchisees of Licensee, and shall take reasonable measures to protect the
confidentiality thereof. Licensee understands and acknowledges the difficulty of
ascertaining monetary damages and the irreparable harm that would result from
breach of these covenants. Licensor shall be entitled to obtain an injunctive
relief in addition to any other legal or equitable remedies it may have if
Licensee fails to comply with the provisions contained herein.
Section 6.4. Compliance with Law. ShoLodge and Licensee will exercise
all due diligence in order to comply with the requirements of all applicable
laws, rules, regulations and orders of any governmental authority, noncompliance
with which might have a material adverse effect on the operations of ShoLodge or
Licensee.
Section 6.5. Liquidation, Dissolution, etc. ShoLodge and Licensee will
not wind-up, liquidate, or dissolve themselves (or suffer any thereof),
consolidate or amalgamate with or merge into or with any other corporation or
any other person, or purchase or otherwise acquire all or substantially all of
the assets of any person (or of any division thereof) or convey, sell, transfer,
lease or otherwise dispose of all or any part of their assets (including,
without limitation, any stock or receivables), in one transaction or a series of
transactions, to any person or persons, unless such transaction may occur
without violating the provisions of Section 4.8 hereof.
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VII. TERMINATION
Section 7.1. If Licensee shall:
(a) Fail to perform any of the terms and conditions contained in this
Agreement and such default shall continue for thirty (30) days after Licensor
gives written notice of such default to Licensee or if the default cannot be
reasonably corrected within such thirty (30) day period, then if the default is
not corrected within such additional time as may be required assuming Licensee
proceeds with reasonable diligence; provided, however, that such written notice
and a reasonable time to correct defaults shall not be required if Licensee
repeatedly fails to perform the same covenant or agreement in accordance with
the terms and conditions contained herein; or
(b) File a petition under any bankruptcy or reorganization laws, become
insolvent, or have a trustee or receiver appointed by a court of competent
jurisdiction for all or substantially all of Licensee's property; or
(c) Seek to effect a plan of liquidation, reorganization, composition or
arrangement of Licensee's affairs, whether or not the same shall be subsequently
approved by a court of competent jurisdiction, it being understood that in no
event shall this Agreement or any right or interest hereunder be deemed an asset
in any insolvency, receivership, bankruptcy, composition, liquidation,
arrangement or reorganization proceeding; or
(d) Have an involuntary proceeding filed under any bankruptcy or
reorganization laws or any other similar laws and not have such proceeding be
dismissed within ninety (90) days thereafter; or
(e) Make a general assignment for the benefit of creditors; or
(f) Knowingly falsify any document required to be furnished to Licensor
hereunder; or
(g) Commit any acts of fraud or intentional misrepresentation with
respect to the activities relating to any of the Licensed Marks; or
(h) Conduct its business in a manner likely to impair Licensor's
reputation, goodwill or name (including, without limitation, any of the Licensed
Marks) and such conduct shall continue for thirty (30) days after Licensor gives
written notice to Licensee to cease such conduct;
Then, and in any of such events, Licensor, at its sole option and
without prejudice to any and all of the other rights and remedies it may have
hereunder or which may be provided by law, may terminate this Agreement by
written notice to Licensee, and, except as expressly provided in this Agreement
to the contrary, all rights of Licensee hereunder shall cease, and Licensee
shall pay to Licensor all sums then due, together
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with any other damages suffered by Licensor as a result of such default, and,
except as expressly provided in this Agreement to the contrary, Licensee shall
have no further rights or claims hereunder. Licensee shall pay to Licensor in
addition to any amounts found to be due and owing, all expenses incurred by
Licensor as a result of any such default, including reasonable attorneys' fees.
Such termination, however, shall not affect the obligation of Licensee hereunder
to take action or abstain from taking action after the termination hereof.
Section 7.2. If ShoLodge shall:
(a) Fail to perform any of the terms and conditions contained in this
Agreement or the Guaranty Agreement and such default shall continue for thirty
(30) days after Licensor gives written notice of such default to ShoLodge or if
the default cannot be reasonably corrected within such thirty (30) day period,
then if the default is not corrected within such additional time as may be
required assuming ShoLodge proceeds with reasonable diligence; provided,
however, that such written notice and a reasonable time to correct defaults
shall not be required if ShoLodge repeatedly fails to perform the same covenant
or agreement in accordance with the terms and conditions contained herein; or
(b) File a petition under any bankruptcy or reorganization laws, become
insolvent, or have a trustee or receiver appointed by a court of competent
jurisdiction for all or substantially all of ShoLodge's property; or
(c) Seek to effect a plan of liquidation, reorganization, composition or
arrangement of ShoLodge's affairs, whether or not the same shall be subsequently
approved by a court of competent jurisdiction, it being understood that in no
event shall this Agreement or any right or interest hereunder be deemed an asset
in any insolvency, receivership, bankruptcy, composition, liquidation,
arrangement or reorganization proceeding; or
(d) Have an involuntary proceeding filed under any bankruptcy or
reorganization laws or any other laws and not have such proceeding be dismissed
within ninety (90) days thereafter; or
(e) Make a general assignment for the benefit of creditors; or
(f) Commit any acts of fraud or intentional misrepresentation with
respect to Licensor; or
(g) Conduct its business in a manner likely to impair Licensor's
reputation, goodwill or name (including, without limitation, any of the Licensed
Marks) in any material respect and such conduct shall continue for thirty (30)
days after Licensor gives written notice to Licensee to cease such conduct;
Then, and in any of such events, Licensor, at its sole option and
without prejudice to any and all of the other rights and remedies it may have
hereunder
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<PAGE> 15
or which may be provided by law, may terminate this Agreement by written notice
to Licensee, and, except as expressly provided in this Agreement to the
contrary, all rights of Licensee and/or ShoLodge hereunder shall cease, and
Licensee shall pay to Licensor all sums then due, together with any other
damages suffered by Licensor as a result of such default, and, except as
expressly provided in this Agreement to the contrary, Licensee shall have no
further rights or claims hereunder. Licensee shall pay to Licensor in addition
to any amounts found to be due and owing, all expenses incurred by Licensor as a
result of any such default, including reasonable attorneys' fees. Such
termination, however, shall not affect the obligation of Licensee hereunder to
take action or abstain from taking action after the termination hereof.
Section 7.3. Certain Matters Not Defaults. The terms "plan of
liquidation, reorganization, composition or arrangement" as used in Sections
7.1(c) and 7.2(c) shall not be construed to include a cessation of corporate
existence resulting either from a merger or consolidation or a dissolution,
winding up or liquidation following a transfer of all or substantially all of
ShoLodge's or Licensee's assets in their entirety, or any other reorganization
or arrangement under the conditions permitting such actions contained in Section
6.5 hereof.
Section 7.4. Effect of Termination.
(a) On termination of this Agreement, whether by reason of lapse of
time, default in performance or other cause or contingency, all of Licensee's
rights hereunder shall immediately cease and Licensee shall (1) forthwith return
to Licensor all material furnished by Licensor containing trade secrets,
operating instructions or business practices, methods or procedures, (2)
discontinue all use of the trade names, trademarks and service marks which are
owned by Licensor and connected with the Shoney's Inn System (including, without
limitation, the Licensed Marks), and the use of any and all signs and paper
goods bearing such trade names, trademarks and service marks, or any reference
whatever thereto, (3) not thereafter (i) operate or do business under any name
or in any manner that might tend to give the general public the impression that
this Agreement is still in force or that Licensee is connected in any way with
Licensor, or has any right to use the Shoney's Inn System or the trade names,
trademarks or service marks owned by Licensor and connected with the Shoney's
Inn System; (ii) make use of or avail itself of any of the trade secrets of, or
confidential information received from, Licensor or disclose or reveal any such
confidential information or any portion thereof to anyone not employed by
Licensor or its licensees; or (iii) assist anyone not licensed to use the
Shoney's Inn System in the construction or equipping of any premises
incorporating the distinctive features Licensor has originated and developed and
which are identifying characteristics of businesses using the Shoney's Inn
System; and (4) execute any and all documents required by Licensor which are
necessary or appropriate to effectuate termination of Licensee's license and
interest in and to the use of any and all trade names, trademarks or service
marks connected with the Shoney's Inn System (including, without limitation,
assignment of the Shoney's Inn 1-800 number).
(b) The exercise of the right of termination shall not have the effect
of waiving any damages to which Licensor might otherwise be entitled.
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(c) Upon termination of this Agreement, for any cause whatsoever,
Licensee shall duly account to Licensor and transfer to it all rights which it
may have to the Licensed Marks granted pursuant to the terms of this Agreement.
VIII. MISCELLANEOUS.
Section 8.1. Relationship of the Parties. It is the express intention of
the parties hereto that Licensee is and shall be deemed an independent
contractor under this Agreement, and no partnership, joint venture or fiduciary
relationship shall exist between Licensee and Licensor. This Agreement does not
constitute Licensee as the agent, legal representative, or employee of Licensor
for any purpose whatsoever, and Licensee is not granted any right or authority
to assume or create any obligation for or on behalf of, or in the name of
Licensor or in any way to bind Licensor. Licensee agrees not to incur or
contract for any debt or obligation on behalf of Licensor, or commit any act,
make any representation or advertise in any manner which may adversely affect
any right of Licensor, or be detrimental to its reputation, goodwill or name.
Section 8.2. Successors. This Agreement and the covenants, restrictions
and limitations contained herein shall be binding upon and shall inure to the
benefit of Licensor and its permitted successors and assigns and shall be
binding on and inure to the benefit of Licensee and its permitted successors and
assigns.
Section 8.3. Entire Agreement. This Agreement contains the entire
agreement between the parties with respect to the subject matter hereof and
there are no representations, inducements, promises, agreements, arrangements or
undertakings, oral or written, between the parties other than those set forth
herein. Without limiting the foregoing, Licensee acknowledges that Licensor has
made no representations to Licensee regarding the amount of profits Licensee may
realize as a result of the operation and franchise of the Motels under the
Licensed Marks. No agreement of any kind relating to the matters covered by this
Agreement shall be binding upon any party unless and until the same is made in
writing and executed by all interested parties.
Section 8.4. Construction. All terms and words used in this Agreement,
regardless of the number and gender in which they are used, shall be deemed and
construed to include any other number, and any other gender, as the context or
sense of this Agreement or any provision hereof may require, as if such words
had been fully and properly written in the appropriate number and gender.
Section 8.5. Headings. Captions and section headings are used herein for
convenience only. They are not part of this Agreement and shall not be used in
construing it.
Section 8.6. Notices, Payments. Whenever notice is required or permitted
to be given under the terms of this Agreement, it shall be given in writing, and
be delivered personally or by certified or registered mail or overnight delivery
service, postage
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prepaid, addressed to the party for whom it is intended. All notices and any
payments of any sums due hereunder shall be addressed to the party to be
notified at the respective addresses set forth below, or at such other address
or addresses as the parties may from time to time designate in writing.
TO LICENSEE:
ShoLodge Franchise Systems, Inc.
130 Maple Drive North
Hendersonville, Tennessee 37075
Attention: Leon Moore, President
WITH A COPY TO:
Boult Cummings Conners & Berry, PLC
Suite 1600, Bank of America Plaza
Nashville, TN 37219
Attention: Patrick L. Alexander
TO LICENSOR:
Shoney's, Inc.
1727 Elm Hill Pike
Nashville, Tennessee 37210
Attention: Secretary
WITH A COPY TO:
Dinsmore & Shohl LLP
Suite 1100, Bank of America Plaza
Nashville, TN 37219
Attention: Gary M. Brown
TO SHOLODGE:
ShoLodge, Inc.
130 Maple Drive North
Hendersonville, Tennessee 37075
Attention: Leon Moore, President
Section 8.7. Applicable Law. The terms of this Agreement shall be
interpreted and construed in accordance with the laws of the State of Nevada.
Section 8.8. Waiver. No waiver, delay, omission or forbearance on the
part of the Licensor to exercise any right, option, duty or power arising from
any default or breach by Licensee shall affect or impair the rights of Licensor
with respect to any subsequent default of the same or a different kind.
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Section 8.9. Severability. If any term, restriction or covenant of this
Agreement is deemed invalid or unenforceable, all other terms, restrictions and
covenants and the application thereof to all persons and circumstances subject
hereto shall remain unaffected to the extent permitted by law; and if any
application of any term, restriction or covenant to any person or circumstance
is deemed invalid or unenforceable, the application of such terms, restriction
or covenant to other persons and circumstances shall remain unaffected to the
extent permitted by law.
Section 8.10. Counterparts. This Agreement may be executed
simultaneously in two (2) or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the undersigned have executed this agreement all as
of the day and date first above written.
LICENSOR: LICENSEE:
SHONEY'S, INC. SHOLODGE FRANCHISE SYSTEMS, INC.
By: Ted R. Habermann By: John C. Buttolph
Title: Assistant Secretary Title: President
SHOLODGE, INC.
By: Jim Grout
Executive Vice President
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EXHIBIT A
TO
AMENDED AND RESTATED
LICENSE AGREEMENT
SERVICE MARK REGISTRATIONS
(Section 1.3)
<PAGE> 20
EXHIBIT B
TO
AMENDED AND RESTATED
LICENSE AGREEMENT
(Page 1 of 3)
EXCLUSIONS FROM TERRITORY
(Section 1.4)
There is hereby excluded from the Territory the following areas:
1. In the State of Tennessee: Carter County, Cocke County, Greene County,
Hawkins County, Johnson County, Sullivan County and Washington County.
2. In the State of Virginia:
(a) Gloucester County, Isle of Wight County, James City County, Mathews
County, Northampton County, Smyth County, Southampton County, Surry
County, Sussex County, Washington County, Wythe County and York County.
(b) City of Chesapeake, City of Hampton, City of Newport News, City of
Norfolk, City of Portsmouth, City of Saluda, City of Suffolk, City of
Virginia Beach, City of West Point, City of Williamsburg and City of
Yorktown.
Otherwise, the Territory consists of the entire United States of
America, subject to the rights of Licensee's franchisees and licensees and
subject to the rights, if any, of the parties to the following agreements:
1. Reserved Area Agreement dated April 9, 1982 among Shoney's, Inc.,
Shoney's Lodging, Inc. and Leon Moore for the development and operation
of Shoney's Inns to be located in the Mobile, Alabama Metropolitan
Area, specifically Mobile and Baldwin Counties, as amended by letters
dated April 9, 1982 and April 15, 1982, and assigned by instrument
dated August 31, 1987, from Leon Moore to Gulf Coast Development, Inc.
2. Reserved Area Agreement dated April 9, 1982 among Shoney's, Inc.,
Shoney's Lodging, Inc. and Leon Moore for the development and operation
of Shoney's Inns to be located in the Nashville, Tennessee Metropolitan
Area, including Davidson, Sumner, Wilson, Williamson and Rutherford
Counties, as amended by letters dated April 9, 1982 and April 15, 1982,
and assigned by instrument dated August 31, 1987, from Leon Moore to
Gulf Coast Development, Inc.
3. Reserved Area Agreement dated April 9, 1982 among Shoney's, Inc.,
Shoney's Lodging, Inc. and Leon Moore for the development and operation
of Shoney's Inns to be located in the Baton Rouge, Louisiana
Metropolitan Area, specifically East Baton Rouge and West Baton Rouge
Parishes, as amended by letters dated
<PAGE> 21
EXHIBIT B
TO
AMENDED AND RESTATED
LICENSE AGREEMENT
(Page 2 of 3)
April 9, 1982 and April 15, 1982, and assigned by instrument dated
August 31, 1987, from Leon Moore to Gulf Coast Development, Inc.
4. Reserved Area Agreement dated April 9, 1982 among Shoney's, Inc.,
Shoney's Lodging, Inc. and Leon Moore for the development and operation
of Shoney's Inns to be located in the Kansas City, Missouri/Kansas,
Metropolitan Area, within a 20-mile radius of downtown Kansas City,
Missouri, as amended by letters dated April 9, 1982 and April 15,
1982,and assigned by instrument dated August 31, 1987, from Leon Moore
to Gulf Coast Development, Inc.
5. Reserved Area Agreement dated April 9, 1982 among Shoney's, Inc.,
Shoney's Lodging, Inc. and Leon Moore for the development and operation
of Shoney's Inns to be located in the State of Mississippi Gulf Coast
Area (Gulfport, Biloxi and Pascaquela, Mississippi), as amended by
letters dated April 9, 1982 and April 15, 1982, and assigned by
instrument dated August 31, 1987, from Leon Moore to Gulf Coast
Development, Inc.
6. Reserved Area Agreement dated April 9, 1982 among Shoney's, Inc.,
Shoney's Lodging, Inc. and Leon Moore for the development and operation
of Shoney's Inns to be located in the Charleston, South Carolina
Metropolitan Area, within a 20-mile radius of downtown Charleston,
South Carolina, as amended by letters dated April 9, 1982, April 15,
1982 and May 1, 1986, and assigned by instrument dated August 31, 1987,
from Leon Moore to Gulf Coast Development, Inc.
7. Reserved Area Agreement dated April 9, 1982 among Shoney's, Inc.,
Shoney's Lodging, Inc. and Leon Moore for the development and operation
of Shoney's Inns to be located in the Columbia, South Carolina
Metropolitan Area, within a 15-mile radius of downtown Columbia, South
Carolina, as amended by letters dated April 9, 1982, April 15, 1982 and
May 1, 1986, and assigned by instrument dated August 31, 1987, from
Leon Moore to Gulf Coast Development, Inc.
8. Reserved Area Agreement dated April 9, 1982 among Shoney's, Inc.,
Shoney's Lodging, Inc. and Leon Moore for the development and operation
of Shoney's Inns to be located in the St. Louis, Missouri/Illinois
Metropolitan Area, within a 25-mile radius of downtown St. Louis,
Missouri, as amended by letters dated April 9, 1982 and April 15, 1982,
and assigned by instrument dated August 31, 1987, from Leon Moore to
Gulf Coast Development, Inc.
<PAGE> 22
EXHIBIT B
TO
AMENDED AND RESTATED
LICENSE AGREEMENT
(Page 3 of 3)
9. Letter, dated August 17, 1984, from Shoney's Lodging, Inc. to Bernie
Barnard assigning primary area rights in: (a) South Carolina, except
Charleston and Hilton Head; (b) Georgia, except Atlanta; and (c) that
part of Florida North of I-4 and East of Tallahassee.
10. Letter, dated November 12, 1984, from Shoney's Lodging, Inc. to Bill
Darter assigning primary area rights for: (a) Williamsburg, Virginia;
(b) Norfolk, Virginia; (c) Newport News, Virginia; (d) Hampton,
Virginia; (e) Chesapeake, Virginia; (f) Portsmouth, Virginia; (g)
Fayetteville, North Carolina; (h) Orlando, Florida; (i) Vero-Ft.
Pierce, Florida; (j) West Palm, Florida; (k) Boca Raton, Florida; and
(l) Ft. Lauderdale, Florida.
11. Letter, dated May 31, 1988, from Shoney's Lodging, Inc. to Sam Ingram
granting right of first refusal to develop Shoney's Inns in the State
of Colorado.
12. Letter, dated September 12, 1989, from Shoney's Lodging, Inc. to
McKibbon Brothers, Inc. granting exclusive right to McKibbon Brothers,
Inc. to develop Shoney's Inns within a five mile radius of the Shoney's
Inn then under construction at Perimeter Road in Perry, Georgia.
LIENS AND SECURITY INTERESTS
(Section 2.1)
The Licensed Marks are subject to a security interest in favor of BANK
OF AMERICA, N.A. (the "Administrative Agent"), acting in its capacity
as administrative agent for the various financial institutions (the
"Lender Parties") now or hereafter parties to the Amended and Restated
Credit Agreement, dated as of September 6, 2000, as heretofore modified
and/or amended (the "Credit Agreement"), among Licensor, the
Administrative Agent, the Lender Parties and Bank of America
Securities, Inc., securing Licensor's obligations under the Credit
Agreement.
<PAGE> 23
EXHIBIT C
TO
AMENDED AND RESTATED
LICENSE AGREEMENT
The above service marks will be displayed only in the colors black, white or red
or any combination thereof. In the event that Shoney's, Inc. makes a permanent
change in the style and font in which it displays the SHONEY'S trademark and
service mark, Licensee may display the above-referenced marks in such new style
and font.
