Are City Publications franchisees responsible for the cost of their insurance coverage?

costs. Franchisor shall not be liable to Franchisee for loss or damage to Franchisee's property for any reason while same is in the possession of the Franchisor. Franchisee shall keep a copy of all materials submitted to Franchisor.

SECTION 16. INSURANCE

A. Types & Amounts of Coverage

Franchisee shall procure, at its sole expense and maintain in full force and effect during the term of this Agreement, the following insurance naming Franchisor as additional insured and/or loss payee, in addition to any other insurance that may be required by applicable law, any lender or landlord. In addition, each insurance policy shall contain a waiver of all subrogation rights against Franchisor and its successors and assigns.

• 1. Comprehensive general public liability insurance against claims for bodily and personal injury, death and property damage caused by or occurring in conjunction with the operation of the Franchised Business, or Franchisee's conduct of business pursuant to this Agreement providing minimum liability coverage for claims, as specified by Franchisor from time to time; currently the minimum is One Million Dollars ($1,000,000.00).
• 1. "All Risk" coverage insurance on all contents including inventory, furniture, fixtures, equipment, supplies and other property used in the operation of the Franchised Business for full "replacement cost" coverage.
• 1. Workers' Compensation that complies with the statutory requirements of the state in which the Franchised Business is located and employer liability coverage with a One Hundred Thousand Dollar ($100,000.00) minimum limit or, if greater, the statutory minimum limit if required by state law.
• 1. Automobile Liability Insurance for owned, hired and non-owned vehicles with a combined single limit of at least One Million Dollars ($1,000,000.00).
• 1. General property damage insurance, including fire and extended coverage, vandalism and malicious mischief insurance.
• 1. Such insurance as necessary to provide coverage under the indemnity provisions set forth in Section 22.B. of this Agreement.
• 1. Such trucking, shipping, freight or F.O.B. insurance coverage as is necessary to provide coverage for any loss or damage to direct mail advertisement pieces in transit. Franchisor and its Affiliates are not liable for losses resulting from the damage to or loss of materials or services provided in excess of the replacement costs of the materials or services.
• 1. Business interruption insurance in amounts and with terms acceptable to Franchisor.

B. Carrier Standards

Such policy or policies shall be written by an insurance company licensed in the state in which Franchisee operates and having at least an "A" Rating Classification as indicated in A.M. Best's Key Rating Guide in accordance with standards and specifications set forth in the Manual.

C. Evidence of Coverage

Franchisee's obligation to obtain and maintain the foregoing policy or policies shall not be limited in any way by reason of any insurance which may be maintained by Franchisor, nor shall Franchisee's performance of that obligation relieve it of liability under the indemnity provisions set forth in Section 22.B of this Agreement. Franchisee agrees to provide annually a certificate of insurance showing compliance with the foregoing requirements. Such certificate shall state that said policy or policies shall not be canceled or altered without at least thirty (30) days prior written notice to Franchisor and shall reflect

proof of payment of premiums.

D. Failure to Maintain Coverage

Should Franchisee, for any reason, not procure and maintain such insurance coverage as required by this Agreement, Franchisor shall have the right and authority (without, however, any obligation to do so) to immediately procure such insurance coverage and to charge same to Franchisee, which charges, together with a reasonable fee for expenses incurred by Franchisor in connection with such procurement, shall be payable by Franchisee immediately upon notice.

**SECTION 17.

Source: Item 23 — RECEIPT (FDD pages 39–129)