Distribution Refusal Clause Samples
The Distribution Refusal clause grants a party the right to withhold or deny the distribution of certain goods, funds, or information under specified circumstances. Typically, this clause outlines the conditions under which distribution may be refused, such as non-compliance with contractual obligations, regulatory concerns, or failure to meet quality standards. Its core practical function is to protect the distributing party from potential risks or liabilities by allowing them to halt distribution when necessary, thereby ensuring compliance and safeguarding interests.
Distribution Refusal. 4.6.1. If, after the Distributor Negotiation Process provided for in Sections 4.1 above, including MEL’s good faith effort to meet and confer with the applicable Distributor to resolve any differences (a) a Proposed Distributor fails to deliver a Distribution Commitment or, in breach of its agreement with ▇▇▇, a KO/▇▇▇ Distributor, at any time thereafter, otherwise refuses to distribute or to continue to distribute substantially all Monster Energy Drink/s, as the case may be, designated by ▇▇▇ in good faith for sale in the Applicable Sub-Territory, (b) KO has not provided consent (to the extent required) to such KO Distributor to distribute substantially all Monster Energy Drink/s, as the case may be, designated by ▇▇▇ in good faith for sale in the Applicable Sub-Territory, (c) KO has not provided consent (to the extent required) to an applicable KO Distributor to distribute substantially all Other Monster Drinks or Other Products included in the Products, as the case may be, designated by ▇▇▇ in good faith for sale in the applicable Sub-Territory or (d) KO has provided such consent to such KO Distributor’s distribution of Other Monster Drinks or Other Products but such KO Distributor refuses to distribute or to continue to distribute substantially all such Other Monster Drinks or Other Products, as the case may be (each, as to such category of Monster Energy Drinks, Other Monster Drinks or Other Products subject to such refusal, a “Distribution Refusal”), ▇▇▇ shall have the right, subject to Section 4.6.5, to market, distribute and sell, and/or to continue to market, distribute and sell, directly or through a third party distributor, to the exclusion of KO or such KO/▇▇▇ Distributor, as the case may be, all or substantially all of the Product SKUs (including the declined Products), of such applicable category of Products subject to such Distribution Refusal (i.e., Monster Energy Drinks, Other Monster Drinks or Other Products, as the case may be), so designated for sale by ▇▇▇ in the Applicable Sub-Territory, upon forty-five (45) days written notice to KO (with a copy to the Chief Executive Officer and Chief Financial Officer of KO) of its intention to do so; provided that such Distribution Refusal continues to exist after such forty-five (45) day period. In such event, the KO Distribution Agreement with such KO/▇▇▇ Distributor may be terminated by the KO/▇▇▇ Distributor if substantially all of the Products under such KO Distribution Agreement are distribu...