callan method organisation limited standard terms …

CALLAN METHOD ORGANISATION LIMITED

STANDARD TERMS AND CONDITIONS OF TERRITORIAL EXCLUSIVITY

Callan Method Organisation Limited Standard Terms and Conditions of Territorial Exclusivity Version 9.4

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CALLAN METHOD ORGANISATION LIMITED

STANDARD TERMS AND CONDITIONS OF TERRITORIAL EXCLUSIVITY

Definitions

1. Definitions and interpretation

1.1. The following words and expressions shall, wherever used in these Standard Terms and Conditions of Territorial Exclusivity, have the following meanings:-

“Affiliate” means a company, firm, partnership or individual that controls, is controlled by, or is under common control of CMO or Callan Education Group Limited.

“Business” means the teaching of the English language or any other languages using the Callan Method under the name of, or within the premises of, a Licenced School.

“Business Day” means any week day other than a bank holiday or public holiday in England.

“Business Hours” means between 09:00 and 17:30 GMT on a Business Day.

“Callan Accreditation” means the quality control scheme governed by CMO.

“Callan Accreditation Agreement”

means the agreement entered into, or to be entered into, between CMO and the Licensee in respect of each Licenced School of which the Standard Terms and Conditions of Callan Accreditation are a part. Each renewal of a Callan Accreditation Agreement will incorporate the latest version of the Standard Terms and Conditions of Callan Accreditation.

“Callan Accreditation Fees”

means the fees as defined in the Standard Terms and Conditions of Callan Accreditation.

“Callan Accredited School”

means a school which has entered into, and keeps current and in effect, a Callan Accreditation Agreement.

“Callan Companies” means Callan Method Organisation Limited, Callan Publishing Limited, Callan Works Limited, Callan School London Limited, Callan Online Limited, Callan Method International Limited, Callan Education Group Limited or any subsidiary company of the aforementioned.

“Callan Education Group Limited”

a company incorporated in the United Kingdom with company number 8072199 with is registered office at Ivy Dene, 43 Mill Way, Grantchester, Cambridge, CB3 9ND, United Kingdom.


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“Callan Logo”

“Callan Materials” means the “Callan Method Student's Books", the “Callan Method Teacher's Books" the “Callan for Business Student’s Books”, the “Callan for Business Teacher’s Books”, the “Callan Method Teacher’s Guide”, the “Teacher’s Handbook”, Callan eBooks, Demonstration Charts, Wall Charts, Training DVDs, and MP3 downloads and all other books, guides, manuals and materials together with other associated language teaching and study materials written or created by, or on behalf of, Mr. Callan or CMO or CWL in all revisions, editions, updates and replacements thereof and in all languages whether in written, printed, manuscript, tape, compact disc, digital or electronic form and howsoever delivered, for use when teaching or learning languages using the Callan Method all of which are protected by international copyright.

“Callan Method” means the rigorously structured and highly scripted programme of instruction, originally created and developed by Mr. Callan as a fast and effective system for the teaching of the English language to students who do not have English as their mother tongue (first language) and updated and extended by CMO from time to time.

“Callan Method Organisation Limited”

a company incorporated in the United Kingdom with company number 7247355 with its registered office at Ivy Dene, 43 Mill Way, Grantchester, Cambridge, CB3 9ND, United Kingdom.

“Callan Method Teaching Standards”

means the minimum standards for teaching languages using the Callan Method as set out in Appendix 1 of the Standard Terms and Conditions of Callan Accreditation as amended from time to time.

“Callan Name” means the word Callan or Callana or any similar local language derivation.

“Callan Online Limited” a company incorporated in the United Kingdom with company number 7886867 with its registered office at Ivy Dene, 43 Mill Way, Grantchester, Cambridge, CB3 9ND, United Kingdom.

“Callan Published Price List”

means the list of the prices, fees and minimum quantities published by CMO from time to time of which any changes thereto will be published at least thirty (30) Business Days in advance of any changes taking effect.

“Callan School London Limited

”

a company incorporated in the United Kingdom with company number 8063771 and with its registered office at Ivy Dene, 43 Mill Way, Grantchester, Cambridge, CB3 9ND, United Kingdom, occasionally trading under the name Callan School of English.

“Callan Shop” means www.callan.co.uk/book-shop

http://www.callan.co.uk/book-shop


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“Callan Student Practice Area”

means the restricted area of the CMO website which offers interactive learning materials to a Registered Student.

“Callan Style Guide” means the document issued from time to time by CMO which defines how and where the Callan Name, the Callan Trade Marks, and the term ‘a Callan Accredited School’, together with Callan identified marketing materials, can be used by the Licenced School.

“Callan Trade Marks” means the following Trade Marks:

CALLAN

and all other trade marks, historic, current and future, owned by CWL and exclusively licensed to CMO and all applications for or registrations of any of such trade marks anywhere in the world in the name of or on behalf of CMO and CWL, including without limitation International Registration 786236 CALLAN.

“Callan Websites” means the websites, whether they are archived, in development, current and future, that appear on the world wide web and which are owned by, in whole or part, the Callan Companies.

“Callan Works Limited” a company incorporated in the United Kingdom with company number 07310498 whose registered office is at Ivy Dene, 43 Mill Way, Grantchester, Cambridge, CB3 9ND, United Kingdom.

“Change of Control” means a change in more than 50% of: (a) the legal power to directly or indirectly control the

management; or (b) the right to select the majority of the directors (or their

equivalent); or (c) the ownership of the voting shares of the Business or a

Licenced School whether immediately or when measured over a two year period.


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a “Change of Control Fee” means the amount equivalent to two (2) times the sum of the

Licence Fee payable for the year in which the Change of Control takes place.

“CMO” means Callan Method Organisation Limited.

“CWL” means Callan Works Limited.

“Commencement Date” means the date on which the Parties enter into the Territorial Exclusivity Agreement.

“Existing Callan Accredited School”

means a school which is already established and in operation in the Territory and which is subject to a Callan Accreditation Agreement.

“Existing Non-Callan Accredited School”

means a school which is already established and in operation in the Territory but which is not yet subject to a Callan Accreditation Agreement.

“Force Majeure Event” means an event, or a series of related events, that is outside the reasonable control of the party affected (including but not limited to power failures, industrial disputes affecting any third party, non-performance by suppliers or contractors, changes to the law (to include the imposition of an export or import restriction), disasters, explosions, fires, floods, riots, terrorist attacks and wars).

“Guarantor” means the party detailed in Clause C of the Territorial Exclusivity Agreement.

“Inflation Index” means the change in the cost of living in the country where the Territory is located as measured by the movement in the weighted adjusted cost of a basket of retail goods and services over a period of time and expressed as an index as published by the government of the country or, in the absence of such a publication, by a recognised body or authority renowned for its opinions on this matter.

“Initial Term” means a term of 5 years from the Commencement Date.

“Intellectual Property Rights”

means all intellectual property rights wherever in the world, whether registerable or unregisterable, registered or unregistered, including (but not limited to): any application or right of application for such rights, copyright and related rights, moral rights, database rights, algorithms, software programmes, software source documents, formulae, business and software processes, confidential information, trade secrets, know-how, business names, trade names, trade marks, service marks, passing off rights, unfair competition rights, patents, petty patents, utility models, semi-conductor topography rights and rights in designs, which belong to the Callan Companies.


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“Licensee” means the party detailed in Clause B of the Territorial Exclusivity

Agreement.

“Licence Fees” means the fees payable by the Licensee to CMO in respect of the right to exclusivity in the Territory, the amount of which is set out in the Territorial Exclusivity Agreement.

“Licenced School” means each physical school operated, or to be operated, in the Territory by the Licensee to teach languages using the Callan Method as set out in the Territorial Exclusivity Agreement.

“Minimum Quantities” means the minimum number of Callan Method Student’s Books to be purchased each year by the Licensee as set out in the Territorial Exclusivity Agreement.

“Mr. Callan” means the late Robin Keith Terrance Callan formerly of Orchard House, 45-47 Mill Way, Grantchester, Cambridge, CB3 9ND, United Kingdom.

“New School” means a school which is in the process of being established in the Territory.

“Parties” means the Parties as defined in the Territorial Exclusivity Agreement.

“Registered Student” means a student who has paid, or who is enrolled with, a Licenced School to attend a Callan Method language course.

“Renewal Date” means the date upon which the Initial Term and any Renewal Term ends and a new Renewal Term begins.

“Renewal Term” means a term of 5 years commencing on the Renewal Date.

“Restricted Terms” means the term “Callan School”, “Callan School London” and “Callan London”.

“Services” means language teaching services using the Callan Method.

“Standard Terms and Conditions of Callan Accreditation”

means the Standard Terms and Conditions of Callan Accreditation as amended from time to time by CMO and available at www.callan.co.uk.

“Standard Terms and Conditions of Territorial Exclusivity”

means the Standard Terms and Conditions of Territorial Exclusivity as appended to the Territorial Exclusivity Agreement.

“Termination Date” means the date the Territorial Exclusivity Agreement ends in accordance with the provisions of Clause 17.

http://www.callan.co.uk/


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“Territory” means the territory and geographical area specified in the Territorial Exclusivity Agreement.

“Territorial Exclusivity Agreement”

means the agreement entered into between the Parties of which the Standard Terms and Conditions of Territorial Exclusivity and the Callan Accreditation Agreement form a part. Each renewal of a Territorial Exclusivity Agreement will incorporate the latest version of the Standard Terms and Conditions of Territorial Exclusivity.

“Year” means a period of 365 days (or 366 days if there is a 29th February during the relevant period).

1.2. In these Standard Terms and Conditions of Territorial Exclusivity:

1.2.1. a reference to a statute or statutory provision includes a reference to:

1.2.1.1. that statute or statutory provision as modified, consolidated and/or re-enacted from time to time; and

1.2.1.2. any subordinate legislation made under that statute or statutory provision.

1.2.2. the clause headings do not affect the interpretation of these Standard Terms and Conditions of Territorial Exclusivity.

1.2.3. “persons” include companies, partnerships, limited liability partnerships, unincorporated associations and trusts.

1.2.4. unless the context otherwise requires, words in the singular shall include the pleural and words in the pleural shall include the singular.

2. Application

2.1. These Standard Terms and Conditions of Territorial Exclusivity apply to the Territorial Exclusivity Agreement entered into between CMO and the Parties. They are without prejudice to, and do not amend or change, any specific undertaking or other written agreement which CMO may have entered into with any of the Parties in connection with any other particular transaction or service or series of transactions or services.

2.2. These Standard Terms and Conditions of Territorial Exclusivity together with the Territorial Exclusivity Agreement and the Callan Accreditation Agreement (when executed) form the legal agreement between the Parties.

2.3. In the event of any conflict between these Standard Terms and Conditions of Territorial Exclusivity and the Territorial Exclusivity Agreement and any other document which forms part of the Territorial Exclusivity Agreement, the Territorial Exclusivity Agreement will take precedence. In the event, and only to the extent, of any conflict arising between the Territorial Exclusivity Agreement and any referenced or attached document other than these Standard Terms and Conditions of Territorial Exclusivity, the Territorial Exclusivity Agreement will again take precedence.

3. Appointment and exclusivity


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3.1. CMO grants to the Licensee an exclusive licence to teach languages using the Callan Method in physical schools in the Territory subject always to:

3.1.1. the terms set out in the Territorial Exclusivity Agreement; and

3.1.2. these Standard Terms and Conditions for Territorial Exclusivity.

4. Obligations of the Licensee

4.1. The Licensee undertakes to CMO that they will:

4.1.1. in the case of a New School:

4.1.1.1. open, keep open, operate and maintain a Licenced School from each of the places set out in the Territorial Exclusivity Agreement with the Licensee being able to change, move or substitute the premises of a Licenced School within the Territory or open another Licenced School in the Territory as the needs of the business dictate.

4.1.1.2. apply for Callan Accreditation within six (6) months, and achieve Callan Accreditation within twelve (12) month, of the Commencement Date for each Licenced School in the Territory .

4.1.2. in the case of an Existing Non-Callan Accredited School:

4.1.2.1. operate, maintain and keep open a Licenced School from each of the places set out in the Territorial Exclusivity Agreement with the Licensee being able to change, move or substitute the premises of a Licenced School within the Territory or open another Licenced School in the Territory as the needs of the business dictate.

4.1.2.2. apply for Callan Accreditation within three (3) months and achieve Callan Accreditation within six (6) months ,of the Commencement Date for each Licenced School in the Territory.

4.1.3. in the case of an Existing Callan Accredited School:

4.1.3.1. operate and maintain a Licenced School from each of the places set out in the Territorial Exclusivity Agreement with the Licensee being able to change, move or substitute the premises of a Licenced School within the Territory or open another Licenced School in the Territory as the needs of the business dictate.

4.1.4. provide all management, teachers and employees necessary to operate and maintain each Licenced School.

4.1.5. operate each Licenced School to such a standard, and in such a manner, as will enable the Licensee (if they have not already done so) to enter into and, once in existence, to keep in place a Callan Accreditation Agreement for each Licenced School throughout the Initial Term and any Renewal Term.

4.1.6. provide all funding, finances and management for the marketing and operation of the Licenced School within the Territory.


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4.1.7. provide, maintain and keep in place for each Licenced School suitable physical teaching space to allow the Callan Method to be properly taught and the Business to be properly administered to meet customer demand in the Territory.

4.1.8. ensure that its teaching staff are:

4.1.8.1. fully trained in the teaching of the Callan Method; and

4.1.8.2. provided with the necessary Callan Materials in order to teach languages with the Callan Method to the standard as set out in the Callan Method Teaching Standards.

4.1.8.3. are paid in full on the due dates for payment of their wages or salary;

4.1.8.4. are well-presented, clean and polite;

4.1.8.5. uphold professional standards of behaviour at all times when present in a Licenced School.

4.1.9. ensure that not less than 50% of its teaching staff have attended a CMO approved Callan Method teacher training course within one (1) year of the Commencement Date and within three (3) years of any Renewal Date.

4.1.10. in the event that CMO, at its sole discretion, considers that any of the teaching staff at a Licenced School require training or additional training in the teaching of the Callan Method, select, book, and pay for a training course from the dates offered by CMO within three (3) months of being notified of the need for training even if such a training course does not take place in the Territory or the country in which the Territory is located.

4.1.11. use all reasonable endeavours to advertise, market, promote and sell the Callan Method language courses provided by each Licenced School and only in accordance with the Callan Style Guide.

4.1.12. maintain a website and all appropriate digital media for the purpose of promoting the Licenced School.

4.1.13. have the Callan Logo prominently displayed on the inside, and if possible on the outside, of the Licenced School premises.

4.1.14. promptly inform CMO if there is any change in the key personnel of the Licensee which will or may affect the Licensee's performance of its obligations under the Territorial Exclusivity Agreement.

4.1.15. administer each Licenced School including securing all necessary licences and permissions.

4.1.16. pay the Licence Fees, the Change of Control Fee, and any other sums due under the terms of the Territorial Exclusivity Agreement, and the Callan Accreditation Fees due under the terms of the Callan Accreditation Agreement, no later than the due dates specified in those agreements respectively.

4.1.17. ensure that each Licenced School:


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4.1.17.1. registers, and keeps registered on the Callan Student Practice Area., each and every student enrolled on a Callan Method language course.

4.1.17.2. makes the Callan Student Practice Area available to Registered Students by supplying the relevant log in details to them.

4.1.17.3. operates its own account on the Callan Shop with its own unique CMO customer number , which is a separate and distinct account from any other Licenced School, using only its account to purchase its own stock of Callan Materials to sell to its Registered Students.

4.1.17.4. makes purchases from CMO not less than the Minimum Quantities.

4.1.17.5. maintains sufficient stock of the Callan Materials to ensure that each Registered Student is able to purchase the relevant Callan Materials as they require on demand and without delay.

4.1.17.6. only resells the Callan Materials to Registered Students.

4.1.18. comply with all applicable laws and regulations in the conduct of the Licenced School including the payment on the due dates of all taxes, payroll taxes, employment taxes, duties, levies, sales taxes, value added taxes, national taxes, federal taxes, local taxes, property taxes and other such government, local, municipal, professional or commercial charges together with any penalties and interest thereon.

4.1.19. prepare and keep appropriate, accurate and up-to-date accounts and business records.

4.1.20. provide CMO with such reasonable information about the Business including, where appropriate, copies of the annual financial statements relating to the Business.

4.1.21. promptly inform CMO (providing full details) of any improvements or modifications it makes or considers making to the Business.

4.1.22. promptly implement any improvements to the Callan Method or modifications to the Business as notified to the Licensee by CMO .

4.1.23. promptly pass on to CMO any enquiries it receives from third parties relating to the Business.

4.1.24. give notice to CMO upon there being any Change of Control of the Licensee.

4.1.25. immediately notify CMO in writing of any physical school it opens in the Territory to teach languages using the Callan Method.

4.1.26. keep CMO updated and informed as to its business address and the address of each Licensed School together with all contact details including telephone numbers, fax numbers, web addresses and email addresses.

4.2. The Licensee undertakes to CMO that they will not:

4.2.1. teach languages using any other method than the Callan Method except where CMO does not offer an equivalent product.


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4.2.2. represent to any person that it is an agent of CMO.

4.2.3. pledge or purport to pledge CMO's credit.

4.2.4. commit or purport to commit CMO to any contracts.

4.2.5. otherwise incur any liability or potential liability on behalf of CMO.

4.2.6. use Callan Name in the company name, business name or name of the Licenced School, unless specifically authorised by CMO to do so.

4.2.7. use the Restricted Terms in all forms of advertising, to include any internet search terms, adverts, ad words or meta tags.

4.2.8. unless otherwise agreed in writing by CMO, work with or engage any third party agents or enrol any students at the Licenced School from third party agents, who:

4.2.8.1. operate any website with a domain name that includes the Callan Name, the Restricted Terms and the words ‘Callan Method’ or any translation in any language of the aforementioned.

4.2.8.2. operate any social media account with a username that includes the Callan Name, the Restricted Terms and the word ‘Callan Method’ or any translation in any language of the aforementioned.

4.2.8.3. breach the Callan Trade Marks in any way.

4.2.8.4. pass themselves off, or attempt to pass themselves off, as Callan School London or act in any way which might cause confusion to a student and lead them to believe they are booking an English language course with Callan School London directly as opposed to through an agent.

4.2.8.5. are conducting their business in a way which, it is reasonable to assume, is having or will have a negative impact on the Callan brand or any of the Callan Companies.

5. Obligations of CMO

5.1. CMO will:

5.1.1. confer on the Licensee for the duration of the Initial Term and any Renewal Term within the Territory and for the sole purpose of operating and marketing the Business the exclusive licence to use the Callan Name and Callan Trade Marks as specified within the Callan Style Guide and to purchase the Callan Materials except nothing herein shall confer on the Licensee the right to:

5.1.1.1. print, photocopy, publish or otherwise produce their own copies of the Callan Materials;

5.1.1.2. reproduce or copy, either in whole or in part, the Callan Websites (other than permitted herein);

5.1.1.3. sub-licence the right to use the Callan Trade Marks to any third party whatsoever, including but not limited to any agents of the Licenced School.


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5.1.2. provide the Callan Materials to the Licensee at its wholesale prices plus packaging, distribution, delivery, sales taxes, value added taxes, duties and similar levies.

5.1.3. provide training to the teachers of each Licenced School at training courses run by CMO at the discounted price published for Callan Accredited Schools.

5.2. CMO will not:

5.2.1. grant any other agreement to a third party on similar terms in the Territory as the Territorial Exclusivity Agreement.

5.2.2. actively assist, whether directly or indirectly, a third party to provide the Services in the Territory.

5.2.3. licence or give any permission to any other person to open or operate a Licenced School in the Territory other than those schools already known to CMO as at the date of the Territorial Exclusivity Agreement and whose details are set out in the Territorial Exclusivity Agreement.

5.2.4. appoint any other person as a Licensee for the provision of the Services in the Territory.

5.2.5. directly supply the Services in the Territory.

5.2.6. sell or distribute the Callan Materials to any third party for resale in the Territory other than:

5.2.6.1. to those schools/persons included in the Territorial Exclusivity Agreement with whom CMO may deal with, use or otherwise treaties with in any way they shall decide; and

5.2.6.2. as set out in the Exclusions in Clause 6 below.

6. Exclusions

6.1. The following business and activities are excluded from the Territorial Exclusivity Agreement. They are reserved for the exclusive ownership and use of CMO who may deal with, use or otherwise treaties with in any way they shall decide:

6.1.1. The delivery of Callan Materials in digital form.

6.1.2. Any business operating an online language teaching school using the Callan Method in the Territory.

6.1.3. Any students originating in the Territory taking online language lessons using the Callan Method where the delivery of the teaching is outside of the Territory.

6.1.4. Any students originating in the Territory taking online language lessons using the Callan Method which is being delivered through the Callan Online Limited web platform.


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6.1.5. Any Registered Student (as differentiated from a business or school) of any school within the Territory who is purchasing directly from CMO for their personal use using the school’s own unique CMO customer number .

6.1.6. The activities of those schools listed in the Territorial Exclusivity Agreement to which CMO was supplying and delivering Callan Materials prior to the date of the Territorial Exclusivity Agreement.

6.1.7. The supply of the Callan Materials to any of those persons or entities listed in the Territorial Exclusivity Agreement.

6.1.8. The supply of Callan Materials to those companies or persons CMO has appointed to provide distribution services of the Callan Materials who are based in the Territory and who distribute the Callan Materials outside the Territory (as well as to Licensee in the Territory and any schools/persons listed in the Territorial Exclusivity Agreement).

6.1.9. The use of the Intellectual Property Rights, but excluding therefrom the Licensee’s authorised use of Callan Name and Callan Trade Marks under the terms of the Territorial Exclusivity Agreement.

7. Trade Mark licence

7.1. Otherwise than provided in the Territorial Exclusivity Agreement and with the specific exception of those schools/persons set out in the Territorial Exclusivity Agreement, CMO grants to the Licensee an exclusive licence to use the Callan Trade Marks in the Territory during the Initial Term and any Renewal Term solely in connection with the Business provided that the use conforms to other terms of the Territorial Exclusivity Agreement, the Callan Accreditation Agreement and the Callan Style Guide as amended from time to time except nothing herein shall restrict, hinder or fetter the use of the Callan Trade Marks by CMO in the operation of its business.

7.2. The Licensee will ensure that:

7.2.1. all Callan Materials are marketed and sold under the relevant Callan Trade Marks.

7.2.2. no products or services, other than Callan Method language courses, are marketed or sold under or in relation to any of the Callan Trade Marks without the consent of CMO.

7.2.3. the symbol ® will always be used by them in conjunction with the Callan Trade Marks

that are registered in the Territory; and

7.2.4. the symbol ™ will always be used by them in conjunction with the Callan Trade Marks that are not registered in the Territory.

7.3. The Licensee acknowledges that all goodwill and other rights in the Callan Trade Marks will exclusively accrue to CMO, and the Licensee will do all such acts and execute all such documents as may be reasonably required by CMO to vest these rights in CMO.

7.4. Promptly following receipt of a written request from CMO, the Licensee will:

7.4.1. execute or sign any document that is reasonably necessary to enable CMO to register,


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record or protect its rights in the Callan Trade Marks in the country in which the Territory is situated; and

7.4.2. provide reasonable assistance to CMO in relation to any application to register a Callan Trade Mark in the country in which the Territory is situated.

8. Protection of the Callan Name, Callan Materials and Callan Trade Mark

8.1. The Licensee will immediately notify CMO in writing giving full particulars if any of the following matters comes to its attention:

8.1.1. any actual, suspected or threated infringement of the Callan Name, Callan Materials or Callan Trade Marks;

8.1.2. any actual or threatened claim that the Callan Trade Marks or any of the Intellectual Property Rights are invalid;

8.1.3. any actual or threatened opposition to the Callan Trade Marks;

8.1.4. any claim made or threatened that use of the Callan Name or Callan Trade Marks infringes the rights of any third party;

8.1.5. any person applies for, or is granted, a registered trade mark by reason of which that person may be, or has been, granted rights which conflict with any of the rights granted to the Licensee under the Territorial Exclusivity Agreement.

8.1.6. any other form of attack, charge, or claim to which the Callan Name, Callan Trade Marks and Callan Materials may be subject.

8.2. If any third party infringement of the Callan Name, Callan Trade Marks or Callan Materials occurs in the Territory, subject to receiving advice from experienced legal attorneys that infringement proceedings stand a reasonable chance of success, the Licensee may commence proceedings in the Territory and may require CMO to lend its name to such proceedings and provide reasonable assistance, subject to the Licensee giving CMO an indemnity in respect of all costs, damages and expenses that it may incur, including an award of costs against it directly resulting from CMO’s involvement in such proceedings. For the avoidance of doubt, CMO will not be liable for, or contribute to, any costs of any such legal action.

8.3. The Licensee shall keep CMO informed of the progress of all litigation which is undertaken.

8.4. If the Licensee has to register itself as an authorised user of the copyright or trade mark in order to litigate breaches of CMO’s Intellectual Property Rights then CMO may, at its sole discretion, appoint the Licensee as its agent solely for the purposes of bringing the litigation.

8.5. CMO will:

8.5.1. allow the Licensee the exclusive conduct of the proceedings and all related disputes, proceedings, negotiations and settlements; and

8.5.2. not admit liability in connection with the proceedings or settle the proceedings without the prior written consent of the Licensee.

8.6. Nothing in these Standard Terms and Conditions of Territorial Exclusivity shall stop, hinder, impede or preclude CMO from taking any legal proceedings it considers necessary to protect


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the Callan Name, Callan Trade Mark, Callan Materials or any of its other Intellectual Property Rights in the Territory.

9. Copyright

9.1. The Licensee acknowledges that the copyright in the Callan Materials, including any translations thereof, belongs exclusively to Callan Works Limited.

9.2. No changes, enhancements or modifications to the Callan Materials, including translations into other languages, may be made by the Licensee without CMO’s prior written consent.

9.3. If, whether permitted to do so or not by CMO, the Licensee, or any of their employees or teachers, does make any changes, enhancements or modifications to the Callan Materials, including translations into other languages, then the copyright in such changes, enhancements, modifications or translations shall belong jointly to CMO and the Licensee in equal and indivisible shares in the Territory, and shall belong solely and exclusively to CMO outside of the Territory, and the Licensee hereby grants to CMO an exclusive unrestricted worldwide perpetual licence to use such changes, enhancements, modifications or translations, without hindrance or limitation and without payment of a fee; it being agreed between the Parties that entering into the Territorial Exclusivity Agreement is sufficient consideration for the exclusive unrestricted worldwide perpetual licence (in favour of CMO) to use such changes, enhancements, modifications or translations.

9.4. The Licensee undertakes to ensure that the provisions in Clause 9.2 and 9.3 above are binding upon all and any of their employees and all and any of their teachers who teach using the Callan Materials.

10. Fees

10.1. The annual Licence Fee, payable by the Licensee to CMO, for each year of the Initial Term is set out in the Territorial Exclusivity Agreement.

10.2. The annual Licence Fee, payable by the Licensee to CMO, for each year of any Renewal Term will be:

10.2.1. For the first Renewal Term after the Initial Term, an amount equal to the Licence Fee payable in the Fifth Year of the Initial Term adjusted upwards only by the movement in the Inflation Index between the Commencement Date and the fifth anniversary of the Commencement Date.

10.2.2. For each and every subsequent Renewal Term, an amount equal to the annual Licence Fee paid in each year in the immediate preceding Renewal Term adjusted upwards only by the movement in the Inflation Index between the Renewal Date of the immediate preceding Renewal Term and the Renewal Date.

10.3. The annual Licence Fee will be paid immediately on the Commencement Date and on each anniversary of the Commencement Date.

10.4. The Licensee will pay to CMO the Change of Control Fee immediately upon there being a Change of Control.


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10.5. CMO will issue an invoice to the Licensee in respect of all sums due and payable by the Licensee to CMO under the Territorial Exclusivity Agreement, but any failure by CMO to raise an invoice will not be a reason or excuse for the Licensee not to have paid to CMO all amounts due on the due date.

10.6. All sums due and payable by the Licensee to CMO in respect of this Territorial Exclusivity Agreement will be paid by electronic bank transfer to the account of CMO specified on the invoice raised by CMO or if there is no invoice to the bank account specified on any previous invoice within fifteen (15) Business Days from the date of invoice..

10.7. The Licence Fees and Change of Control Fee will be paid in full within fifteen (15) Business Days from the date of invoice without deduction or withholding of any duties, levies, imposts, value added taxes, sales taxes, income taxes, corporation taxes, withholding taxes or any other similar tax charges or duties that may be imposed in the country of the Territory, the objective being that the amount of money paid into CMO’s bank account after all deductions for any reason shall not be less than the amount stated on the relevant invoice.

10.8. The amounts of the Licence Fee and Change of Control Fee are quoted net of United Kingdom Value Added Tax. Where CMO has an obligation to charge Value Added Tax on any Licence Fee or Change of Control Fee then such tax will be charged in full unless:

10.8.1. the Licensee is both outside of the UK and of one of countries of the European Union which operate Value Added Tax; or

10.8.2. the Licensee is registered for Value Added Tax with a country within the European Union and in these circumstances provides CMO with their appropriate Value Added Tax registration number.

10.9. If the Licensee does not pay any amount properly due to CMO under or in connection with the Territorial Exclusivity Agreement, CMO will charge the Licensee interest on the overdue amount at the rate of 10% per year above the base rate of HSBC Bank Plc from time to time (which interest will accrue daily and be compounded quarterly) until the date of actual payment of the amount due and the accrued interest.

11. Minimum Quantities

11.1. The Licensee agrees to purchase from CMO:

11.1.1. during each year of the Initial Term, the minimum number of Callan Method Materials as specified in the Territorial Exclusivity Agreement; and

11.1.2. during each year of any Renewal Term, the number of Callan Method Materials as specified as the Minimum Quantity for the Fifth Year of the Initial Term in the Territorial Exclusivity Agreement.

12. Warranties

12.1. The Licensee warrants to CMO that:

12.1.1. it has the legal right and authority to enter into and perform its obligations under the Territorial Exclusivity Agreement;

12.1.2. it will perform its obligations under the Territorial Exclusivity Agreement and provide


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the Business with reasonable care and skill;

12.1.3. it will comply with all applicable laws, rules and regulations in the Territory relating to, and must obtain all licences, permits and approvals required in relation to:

12.1.3.1. the marketing, promotion and advertising of the Business;

12.1.3.2. the import of the Callan Materials.

12.1.3.3. the distribution, sale, supply and delivery of the Callan Materials and the provision of the Business;

12.1.4. it has notified CMO of, and undertakes to keep CMO reasonably notified of, all applicable laws, rules and regulations in the Territory affecting:

12.1.4.1. the design, composition and manufacture of the Callan Materials;

12.1.4.2. the packaging and labelling of the Callan Materials; and

12.1.4.3. the teaching of languages to children, young persons and adults in the Territory.

12.1.5. it has the legal right to disclose all personal data that it does in fact disclose to CMO under the Territorial Exclusivity Agreement, and that the processing of that personal data by CMO for the purposes of and in accordance with the terms of the Territorial Exclusivity Agreement will not breach any applicable laws of the Territory.

12.2. CMO warrants to the Licensee that:

12.2.1. it has the legal right and authority to enter into and perform its obligations under the Territorial Exclusivity Agreement;

12.2.2. it will perform its obligations under the Territorial Exclusivity Agreement with reasonable care and skill; and

12.2.3. it will promptly and in any event within fifteen (15) Business Days, fully respond to all reasonable enquiries and complaints by the Licensee relating to the quality, performance and durability of the Callan Materials.

13. Licensee indemnity

13.1. The Licensee hereby indemnifies, and undertakes to keep indemnified, CMO against any losses, damages, claims, obligations, liabilities, costs and expenses (including legal fees and costs and expenses incurred in investigating, preparing, defending or prosecuting any litigation, claim, proceedings or demand) arising out of or in connection with any breach by the Licensee of the Territorial Exclusivity Agreement.

14. Limitations and exclusions of liability

14.1. Nothing in the Territorial Exclusivity Agreement will:

14.1.1. limit or exclude the liability of a Party for death or personal injury resulting from negligence;


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14.1.2. limit or exclude the liability of a Party for fraud or fraudulent misrepresentation by that Party;

14.1.3. limit or exclude any liability of a Party in any way that is not permitted under applicable law;

14.1.4. exclude any liability of a Party that may not be excluded under applicable law.

14.2. CMO will not be liable to the Licensee in respect of:

14.2.1. any loss of profits, income, revenue, use, production or anticipated savings of the Licensee;

14.2.2. any loss of business, contracts or commercial opportunities of the Licensee;

14.2.3. any loss of or damage to goodwill or reputation of the Licensee;

14.2.4. any loss or corruption of any data, database or software of the Licensee;

14.2.5. any special, indirect or consequential loss or damage of the Licensee;

14.2.6. any losses of the Licensee arising out of a Force Majeure Event.

14.2.7. any claim made against the Licensee for loss or unauthorised disclosure of data.

14.2.8. any claim made against the Licensee relating to the Business or otherwise, including but not limited to, any claim brought by a Registered Student.

14.2.9. any costs incurred by the Licensee in their defending any claim, or any damages the Licensee must pay in respect of any claim.

14.2.10. any loss or damages to the Licensee:

14.2.10.1. arising from the irregular, improper or illegal use of the Callan Websites, by the Licensee or any third party, including but not limited to CMO’s Shop, the Callan Student Practice Area and the Callan Accredited Schools Area; or

14.2.10.2. as a result of the transmission or download of any computer viruses from the Callan Websites.

14.3. CMO’s aggregate liability to the Licensee under the Territorial Exclusivity Agreement, including any collateral contracts, in relation to any event or series of related events, will not exceed the greater of the total amount paid or payable by the Licensee to CMO under the Territorial Exclusivity Agreement in respect of the Licence Fees during the thirty-six (36) month period immediately preceding the event or events giving rise to the claim, except that the amount shall be unlimited in respect of fraud or wilful neglect or default of CMO.

14.4. The Licensee’s aggregate liability to CMO under the Territorial Exclusivity Agreement, including any collateral contracts, in relation to any event or series of related events, will not exceed £50,000 (fifty thousand pounds sterling), except that the amount shall be unlimited in respect of the fraud or wilful neglect or default of the Licensee.


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15. Term

15.1. The Territorial Exclusivity Agreement will come into force on the Commencement Date, and will continue in force for:

15.1.1. the Initial Term; and

15.1.2. if a renewal, for the Renewal Term.

15.2. The Territorial Exclusivity will renew automatically at the end of the Initial Term or relevant Renewal Term, unless it is terminated earlier in accordance with Clause 17 of the Standard Terms and Conditions of Exclusivity.

16. Renewal

16.1. Where the Territorial Exclusivity Agreement is renewed then the Licensee will release and hereby does release CMO from all and any claims and rights of action the Licensee may have at the Renewal Date against CMO under or relating to the Territorial Exclusivity Agreement.

16.2. Any Territorial Exclusivity Agreement which is renewed will incorporate the latest version of the Standard Terms and Conditions of Territorial Exclusivity published at the Renewal Date and the Standard Terms and Conditions of Callan Accreditation available at www.callan.co.uk.

17. Termination

17.1. Either Party may terminate the Territorial Exclusivity Agreement immediately by giving written notice to the other Party if the other Party:

17.1.1. commits any material breach of any term of the Territorial Exclusivity Agreement which is not remediable;

17.1.2. commits any material breach of any terms of the Territorial Exclusivity Agreement which is remediable, and they fail to remedy the breach within thirty (30) Business Days of receipt of a written notice requiring it to do so;

17.1.3. persistently breaches the terms of the Territorial Exclusivity Agreement;

17.1.4. is dissolved;

17.1.5. ceases to conduct all (or substantially all) of its business;

17.1.6. is or becomes unable to pay its debts as they fall due;

17.1.7. is or becomes insolvent or is declared insolvent;

17.1.8. convenes a meeting or makes or proposes to make any arrangement or composition with its creditors;

17.1.9. has an administrator, administrative receiver, liquidator, receiver, trustee, manager or similar appointed over any of its assets;

17.1.10. has an order made for the winding up, or passes a resolution for its winding up (other than for the purpose of a solvent company reorganisation where the resulting entity will assume all the obligations of the other Party under the Territorial Exclusivity

http://www.callan.co.uk/


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Agreement); or

17.1.11. being an individual dies, or as a result of illness or incapacity becomes incapable of managing his or her own affairs, or is the subject of a bankruptcy petition or order.

17.2. CMO may terminate the Territorial Exclusivity Agreement by giving written notice of termination to the Licensee within forty five (45) Business Days following each anniversary of the Commencement Date if the Licensee has failed to purchase the Minimum Quantities during the relevant year of the Initial Term or any Renewal Term.

17.3. CMO may terminate the Territorial Exclusivity Agreement immediately at any time by giving written notice to the Licensee if:

17.3.1. the Licensee fails to pay in full and on their due dates any amount due to CMO whether due under the Territorial Exclusivity Agreement, the Callan Accreditation Agreement or otherwise; or

17.3.2. there is a Change of Control of the Licensee or any parent undertaking or holding company of the Licensee; or

17.3.3. the Licensee or any officer, partner or key employee of the Licensee is convicted of any criminal offence.

17.3.4. the Licensee fails to enter in to and/or maintain an Callan Accreditation Agreement within the specified timescales; or

17.3.5. the Callan Accreditation Agreement is terminated for any reason.

17.4. The Licensee may terminate the Territorial Exclusivity Agreement by giving one year’s notice in writing such notice not capable of being given before the fourth anniversary of the Commencement Date.

18. Effects of termination

18.1. Upon termination, all the provisions of the Territorial Exclusivity Agreement will cease to have effect, save that any provision of the Territorial Exclusivity Agreement that expressly or by implication is intended to come into or continue in force on or after termination or expiry of the Territorial Exclusivity Agreement shall remain in full force and effect;

18.2. Termination of the Territorial Exclusivity Agreement will not affect either Party’s accrued liabilities or obligations or rights (including accrued rights to be paid) up to the Termination Date, including the right to claim damages in respect of any breach of the Territorial Exclusivity Agreement which existed at or before the Termination Date.

18.3. Within thirty (30) Business Days following the termination of the Territorial Exclusivity Agreement, the Licensee will:

18.3.1. cease to trade under and stop using the Callan Name and the Callan Trade Marks;

18.3.2. cease to hold itself out as an operator of the Business;

18.3.3. have rebranded the Business;

18.3.4. have removed the Callan Logo from each of the Licenced School premises;


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18.3.5. have destroyed all marketing materials which have on them the Callan Name or Callan Trade Marks which are either in its possession or under its direct or indirect control;

18.3.6. have removed from all websites and all digital media which are either in its possession or under its direct or indirect control the Callan Name and Callan Trade Marks;

18.3.7. return to CMO, or dispose of as CMO may instruct, all documents provided by CMO to the Licensee relating to the Business or containing any Callan Trade Marks excluding:

18.3.7.1. correspondence between the parties; and

18.3.7.2. the Callan Materials purchased and paid for by the Licensee.

18.3.8. subject to all applicable privacy and data protection laws in the Territory, provide to CMO a list of all students attending courses as at the Termination Date and a list of all employees employed as at the Termination Date including their names and all contact details (addresses, email addresses and telephone numbers); and

18.3.9. pay all amounts owing to CMO under the Territorial Exclusivity Agreement, which shall include the amount which would be paid between the Termination Date and the end of the Initial Term if there had been no early termination.

18.3.10. repay all amounts owing to the customers of the Business.

18.4. For a period of twelve (12) months following the termination of the Territorial Exclusivity Agreement, the Licensee will pass all enquiries and details of potential customers of the Business to CMO.

18.5. The Licensee will indemnify, and keep indemnified, CMO in respect of any loss, cost or expense arising upon the termination of the Territorial Exclusivity Agreement from any claims made by employees of the Business howsoever arising including but not limited to any civil or statutory liabilities.

18.6. Upon termination there will be no obligation of CMO to return or refund any of the Licence Fees, Callan Accreditation Fees, Change of Control Fee or any other amounts paid to CMO by the Licensee under any other agreement.

19. Guarantee of Performance

19.1. The Guarantor hereby jointly and severally:

19.1.1. guarantees the performance of the Licensee’s obligations under the Territorial Exclusivity Agreement;

19.1.2. acts as surety to all of the Licensee’s liabilities and obligations under the Territorial Exclusivity Agreement;

19.1.3. agrees that they will immediately make such payments as are due to CMO by the Licensee within ten (10) Business Days of them being called upon by CMO in writing to do so;


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19.1.4. undertakes to procure that the Territorial Exclusivity Agreement shall be binding upon any company, partnership, corporate entity or individual which shall succeed to the Business of the Licensee and shall indemnify CMO against any failure of the Licensee or successor to the Licensee to comply with or perform any obligations under the Territorial Exclusivity Agreement until such time as the Licensee has paid the Change of Control Fee in full;

19.1.5. agrees, legally binding their employees, affiliates, associates, assigns, third party consultants, and their heirs and successors that either separately or together they will not in any way whatsoever circumvent, avoid, bypass, obviate, reduce or negate, or attempt to circumvent, avoid, bypass, obviate, reduce or negate their obligations under the Territorial Exclusivity Agreement by dealing, or entering into negotiations, either directly or indirectly, with another party the consequences, or one of the consequences, of which would result in CMO receiving less than they otherwise might have received under the Territorial Exclusivity Agreement.

20. Data Protection

20.1. The Licensee will:

20.1.1. comply with all Data Protection legislation of the country in which the Territory is situated.

20.1.2. state in its terms and conditions of business that it will supply CMO with the names and email addresses of all Registered Students when registering them on the Students Practice Area.

20.1.3. where necessary obtain the Registered Student’s consent to the provision of their email address to CMO explaining that its purpose is to provide log in access to the Callan Student Practice Area.

20.2. CMO will:

20.2.1. comply with all Data Protection legislation in England.

20.2.2. not use the email addresses of Registered Students provided by the Licensee for any reason whatsoever, unless and until notice has been given that the Territorial Exclusivity Agreement will be terminated.

21. Governing Law and Dispute Resolution

21.1. The Territorial Exclusivity Agreement and any dispute or claim arising out of or in connection with it or its subject matter or formation (including non-contractual disputes or claims) will be governed by and construed in accordance with the laws of England.

21.2. The Parties irrevocably agree that the Courts of England will have exclusive jurisdiction to adjudicate any dispute or claim arising out of or in connection with the Territorial Exclusivity Agreement or its subject matter or formation (including non-contractual disputes or claims).

21.3. Any controversy or claim arising out of or relating to the Territorial Exclusivity Agreement, or breach thereof, and which is not amicably settled between the Parties will first be submitted to arbitration with the President of the Chartered Institute of Arbitrators in the United Kingdom


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appointing one or more Arbiters who will act in accordance with the rules and procedures of the Chartered Institute of Arbitrators who shall have the ability to:

21.3.1. rule on their own competence;

21.3.2. rule on the validity of the Territorial Exclusivity Agreement to be submitted to arbitration;

21.3.3. make a decision on the amount of compensation which is to be paid by the Party in default to the Party that has been aggrieved.

21.3.4. make a decision on the amount to be paid by the Party in default to the Party that has been aggrieved in compensation for all of its legal and professional expenses, travel and accommodation and any other expenses in connection with the arbitration hearing.

21.4. All arbitration hearings will take place in London, United Kingdom.

21.5. In the event that either Party does not accept and act upon the decision of the Arbiter within the time set by the Arbiter then either Party shall have the right to take the matter to legal trial bringing to the attention of the Court the findings and rulings of the Arbiter.

21.6. The Parties irrevocably waive trial by jury in any action or proceedings relating to the Territorial Exclusivity Agreement.

21.7. The Party found in default by a Court Judgement shall compensate in full the aggrieved Party for all of its legal and professional expenses, travel and accommodation and any other expenses in connection with both the arbitration hearings and the legal action notwithstanding any other provisions of the judgement.

22. Force Majeure Events

22.1. It is clearly understood and agreed that a Party cannot be considered or adjudged to be in violation of the Territorial Exclusivity Agreement when the violation is involuntary, i.e. due to situation(s) beyond his/her/their control, such as Force Majeure Events (as stated by the ICC, Geneva, Switzerland).

22.2. Where a Force Majeure Event gives rise to a failure or delay in either Party performing its obligations under the Territorial Exclusivity Agreement (other than obligations to make payment) those obligations will be suspended for the duration of the Force Majeure Event. The time for performance of those obligations will be extended by an amount of time equivalent to the duration of the Force Majeure Event.

22.3. A Party who becomes aware of a Force Majeure Event which gives rise to, or which is likely to give rise to, any failure or delay in performing its obligations under the Territorial Exclusivity Agreement will:

22.3.1. forthwith notify the other; and

22.3.2. will inform the other of the period for which it is estimated that such failure or delay will continue.


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22.4. The affected Party will take reasonable steps to mitigate the effects of the Force Majeure Event.

23. General

23.1. The Territorial Exclusivity Agreement will constitute the entire agreement between the Parties in relation to the subject matter of the Territorial Exclusivity Agreement, and supercedes all previous agreements, arrangements and understandings between the Parties in respect of that subject matter. No other terms concerning the subject matter of the Territorial Exclusivity Agreement will be implied in to it or any related contract.

23.2. Neither Party will have any remedy in respect of any innocent or negligent misrepresentation (whether written or oral) made to it upon which it relied in entering into the Territorial Exclusivity Agreement.

23.3. Neither Party will have any liability other than pursuant to the express terms of the Territorial Exclusivity Agreement.

23.4. The Parties agree that no failure by either Party to enforce the performance of any provision in the Territorial Exclusivity Agreement shall constitute a waiver of the right to subsequently enforce that provision or any other provision. Such failure shall not be deemed to be a waiver of any preceding or subsequent breach and shall not constitute a continuing waiver.

23.5. If any clause of the Territorial Exclusivity Agreement is determined by any court or other competent authority to be unlawful and/or unenforceable, the other clauses will continue in effect. If any unlawful and/or unenforceable clause would be lawful or enforceable if part of it were modified, it shall be deemed modified to the minimum extent necessary to make the clause valid, legal and enforceable. If such modification is not possible, the relevant provision or part provision shall be deemed deleted and the rest of the clause will continue in effect (unless that would contradict the clear intention of the Parties, in which case the entirety of the relevant clause will be deemed to be deleted).

23.6. Nothing in the Territorial Exclusivity Agreement is intended to or will constitute a partnership, joint venture, agency relationship or contract of employment between the Parties.

23.7. Save as set out in Clause 16.2, the Territorial Exclusivity Agreement may not be varied except by a written document signed by or on behalf of each of the Parties.

23.8. Save as expressly provided in the Territorial Exclusivity Agreement, neither Party may without the prior written consent of the other Party assign, transfer, charge, sub-licence, sub-contract or otherwise dispose of or deal in the Territorial Exclusivity Agreement or any rights or obligations under it.

23.9. CMO may freely assign all of its rights and/or obligations under the Territorial Exclusivity Agreement without the Licensee's consent to any Affiliate, or any successor to all or a substantial part of the business, of CMO from time to time.

23.10. Each Party agrees to execute (and arrange for the execution of) any documents and do (and arrange for the doing of) any things reasonably within that Party’s power which are necessary to enable the Parties to exercise their rights and fulfil their obligations under the Territorial Exclusivity Agreement.

23.11. The Territorial Exclusivity Agreement is made for the benefit of the Parties, and is not intended


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to benefit any third party or be enforceable by any third party. The rights of the Parties to terminate, rescind, or agree any amendment, waiver, variation or settlement under or relating to the Territorial Exclusivity Agreement are not subject to the consent of any third party.

23.12. The Territorial Exclusivity Agreement is drafted in the English Language. If it is translated into any other language, the English language version shall prevail.

24. Notices

24.1. Any notice given under the Territorial Exclusivity Agreement must be:

24.1.1. in writing and in English; and

24.1.2. delivered personally, sent by pre-paid first class post, or prepaid airmail or prepaid courier post, or by email (provided that when an email is sent an email acknowledgement has been received within 48) for the attention of the relevant person, and to the relevant address or email address as set out in the Territorial Exclusivity Agreement (or as subsequently notified by one Party to the other).

24.2. A notice will be deemed to have been received at the relevant time set out below (or where such time is not within Business Hours, when Business Hours next begin after the relevant time set out below):

24.2.1. where the notice is delivered personally, at the time of delivery;

24.2.2. where the notice is sent by first class post, 2 Business Days after posting;

24.2.3. where the notice is sent by airmail, 10 Business Days after posting;

24.2.4. where the notice is sent by courier, at the time of delivery; or

24.2.5. where the notice is sent by email (providing the sending Party retains written evidence of the transmission), on receipt of the email acknowledgement by the other Party.

End of document Callan Method Organisation Limited

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