EXHIBIT 10.24
MARKETING AGREEMENT
This Marketing Agreement (the "Agreement") dated as of May 12, 1998 is
between CGH SALES, INC. ("CG"), a Delaware corporation whose address is 0000
Xxxx Xxxxxx Xxxx 00, Xxxx Xxxxxx, Xxxxxxxx 00000, and GREENVER, S.A. de C.V.
("Greenver"), a corporation organized and existing under the laws of the United
Mexican States, whose address is Blvd. Culiacan 2580-7, Plaza Santa Xxxx,
Culiacan, Sinaloa C.P. 80100, Mexico.
RECITALS
A. Pursuant to Subscription Agreement of even date herewith (the
"Subscription Agreement"), Colorado Greenhouse Holdings, Inc. ("CGH"), the owner
of all the outstanding capital stock of CG, has purchased 25% of the outstanding
capital stock of Grupo Xxxxx CGH S.A. de C.V., the owner of 90% of the
outstanding capital stock of Greenver.
B. Pursuant to the terms of the Subscription Agreement, CGH and Holdings
have agreed to cause CG and Greenver to enter into this Agreement.
AGREEMENT
1. Sale. Greenver shall deliver to CG and CG shall accept and use all
----
reasonable efforts to sell all of the "acceptable" agricultural or horticultural
products, of the varieties specified in EXHIBIT A (the "Products"), grown by or
---------
for Greenver at its current and future facilities in Baja Mexico, together with
any other facilities built or acquired by (i) Greenver, or an Affiliate of
Greenver, or (ii) any other entity in which both CG, or an Affiliate of CG, and
Greenver, or an Affiliate of Greenver, have contributed funds. Products shall
be deemed "acceptable" for all purposes hereunder if in the sole discretion of
CG such product is of a quality and grade consistent with the other products
grown or marketed by CG or any of its Affiliates. Set forth on Exhibit A
attached hereto and made a part hereof (which exhibit may be amended or
supplemented from time to time by the mutual agreement of the parties) are
specifications and descriptions of the various quality and grades of Products.
As used herein "Affiliate" shall mean any person or entity directly or
indirectly controlling, controlled by, or under common control with such person
or entity. A person or entity shall be deemed to control another person or
entity if such person or entity possesses, directly or indirectly, the power to
direct or cause the direction of the management and policies of such person or
entity, whether through ownership of voting securities, by contract or
otherwise.
2. Exclusive Dealings. Greenver warrants that it has not heretofore
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contracted to sell, market, consign, or deliver any of such products to any
person, firm, or corporation, except as noted on the annexed schedule. Any
products covered by such existing contract shall be excluded from the terms of
this agreement for the period and to the extent noted. Greenver shall not
directly, or indirectly through a third party other than CG, sell any of its
export quality products in the United States, Canada , Europe, or other agreed
upon territory.
3. Term. The term of this Agreement shall commence at the start of the
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new 1998/1999 crop season, estimated to begin in October 1998, and subject to
Paragraph 4 shall extend for the greater of (i) ten years or (ii) for as long as
CG, or any Affiliate of CG, shall hold 25% or more of the stock issued to CG by
Grupo Xxxxx CGH, S.A. de C.V., pursuant to the Subscription Agreement, unless
mutually agreed to be terminated sooner.
4. Performance Review: There shall be a performance review of the
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Agreement at the end of five years, at which time Greenver shall have the right
to terminate based on a set of mutually agreeable performance criteria, notice
and cure periods, with no less than 180 days notice provided before termination.
5. Payment. CG shall be entitled to a 10% commission (the "Commission")
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on the gross proceeds of all Products sold in the United States, Canada, Europe
or other agreed-upon territory. Payment for all sales will be collected by CG
and remitted, net of Commissions, advances and other reimbursable expenses
expressly authorized herein to Greenver on an as collected basis, subject to the
following provisions:
a. Greenver will pay the cost of freight to a receiving warehouse in
the San Diego area to be selected by CG.
b. "In and out" costs at the warehouse will be paid by CG.
c. CG will initially pay "pick and pack" each week for the product
received in the previous week. Amounts so paid will be deducted from gross
receipts of sales of Production. The pick and pack amount will be agreed to
between Greenver and CG prior to the beginning of each Product season as a part
of the budgeting process set forth in Article 30, Section 1 of Bylaws of Grupo
Xxxxx CGH, S.A. de C.V.
d. Liquidation of sales proceeds from CG to Greenver to be within 28
days from date of sales.
e. CG has a responsibility to Greenver to collect all accounts
receivables and any uncollected receivables shall be an expense borne by CG.
f. Transportation costs from San Diego area warehouse to final
destination on non-FOB sales will be included in the invoice and CG will be
entitled to reimbursement of such costs. However, the Commission will be paid
on an amount that excludes freight costs and pallet charges.
g. In addition to any advance payments (including, without
limitation, the pick and pack payments, materials charges and delivery costs) CG
will deduct its 10% Commission before remitting proceeds to Greenver on each
liquidation.
h. CG will be responsible for all advertising, marketing and
promotion and other sales expenses not otherwise expressly allocated hereunder.
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i. To the extent insurance covering damage during transportation and
storage plus general calamity insurance covering the Product is not obtained by
Greenver, CGH may obtain such insurance and deduct the cost thereof before
remitting proceeds to Greenver, provided that Greenver shall be a loss payee on
any such policy.
6. Sale and Pricing. CG may contract in advance for the sale of all or
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part of Greenver's products; fix a fair and reasonable price or prices at which
such products or by-products may be sold and below which none shall be sold;
determine the manner of sale; and fix whatever terms and conditions it deems
advisable; provided, however, in no event may CG sell any Products at prices
less than those received by CG or its Affiliates for its products of equivalent
quality in all respects. Any determination of quality as provided in the prior
sentence shall be made by the senior sales officer of CG in consultation with
the Management Committee and with reference to the specifications set forth in
Exhibit A.
7. Management Committee. A management committee (the "Management
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Committee") composed of four members will be created to supervise the activities
conducted pursuant to this Agreement. Greenver shall be entitled to have two
representatives on the Management Committee. The initial members of the
Management Committee shall be Xxxxx X. Xxxxxxx, Xxxx Xxxxxxxxxxx, Xxxx Xxxxx
Xxxxxxx and Xxxxx Xxxxxxxxx Xxxxx Xxxxxxx.
8. Warranties. All products delivered hereunder by Greenver shall be
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free from damage and in good marketable and merchantable condition and shall be
delivered to CG, as directed. CG may make rules and regulations and provide
inspectors to standardize the quality, method, and manner of harvesting,
handling, packing, and shipping of such products or for any particular purpose.
Greenver shall observe and perform all such rules and regulations. All products
delivered to or at the order of CG shall be of the standard and conform to the
regulations as to quality and otherwise that are prescribed by state and federal
authorities and by CG. Any deduction, allowance, or loss that CG may make or
suffer on account of inferior quality or standard, or condition at delivery,
shall be charged against Greenver and be deducted from its net returns
hereunder.
9. Packaging. Greenver shall ship and return all boxes, delivered to it
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for its use and convenience, as agreed upon by the parties. If Greenver fails
to do so, it shall pay CG CG's actual cost of each box that is not shipped or
returned as ordered. CG may deduct all such charges from Greenver's net returns
under this Agreement. All Products covered hereby shall be packaged and shipped
in cartons approved by CG and such Products shall have only those marks or
labels as may be approved by CG.
10. Chemicals Use. Greenver shall insure that no substance shall be
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introduced or applied (including, without limitation, chemicals, pesticides or
growth regulators) to the Products, or on the land on which the Products are to
be grown, which will be in violation of established toxic tolerance levels set
by the United States Food and Drug Administration, by the United States
Department of Agriculture, or by any other applicable federal, state or local
law, or which are not authorized by CG for the Products being grown. Greenver
will provide to CG for its review and approval prior to each harvesting season a
list of all chemicals used on the
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Products together with the rate of application for each such Chemical. CG shall
have the right to cause the Products to be residue tested.
11. Additional Products. If during the term hereof Greenver produces any
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agricultural or horticultural products that come within the scope of CG's
activities as established by contracts or acquires or owns an interest in them,
CG shall have the right to market all such products pursuant to the terms of
this Agreement.
12. Indemnity. Each party (the "Indemnifying Party") agrees to indemnify
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and hold harmless the other party, and its officers, directors, employees,
agents and consultants (collectively the "Indemnified Party") from and against
any and all claims, liabilities, costs and expenses arising from or relating to
the negligent actions or omissions of the Indemnifying Party and its employees,
agents and consultants.
13. Personnel. CG agrees to hire all appropriate personnel necessary to
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market the Products and otherwise perform its obligations hereunder. At the
option of Greenver, such personnel shall include an employee designated by
Greenver, provided that the terms of such employment shall be compatible with
those prevalent in the relevant industry. CG agrees that it shall provide or
shall cause its Affiliates to provide all necessary technical assistance to
Greenver to assist Greenver in reaching the goal of producing the maximum yield,
highest quality and most effective packing and distribution of the Products. If
deemed necessary by CG, CG or its Affiliates will have the right to place on
site at Greenver's facilities, such personnel as it deems necessary to perform
the functions described in this paragraph. Any costs of such personnel shall be
paid by Greenver to CG on a monthly basis, provided that such costs shall be
reasonable and are reflected in the annual budgets prepared pursuant to the
Subscription Agreement.
14. Trade Names. All trade names and marketing campaigns used will be at
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the sole discretion of CG and shall remain the property of CG without any
implication and there shall not be deemed to be an implied license to use such
marks.
15. Marking. All Product sold will identify point of origin on its
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shipping containers and point of purchase displays as specified by applicable
laws and by CG.
16. Information/Forecast. Greenver will provide to CG all information
--------------------
deemed necessary by CG to effectively market the product including, among other
things, production forecasts and daily inventory and shipping forecasts on a
form to be provided by CG.
17. Arbitration. Except as provided for in Paragraph 18, and herein, any
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dispute or claim in law or equity arising out of this Agreement or any resulting
transaction shall be decided by neutral binding arbitration in accordance with
the rules of the CCI, and not by court action except as provided by Colorado law
for judicial review of arbitration proceedings. There shall be three
arbitrators, with each party choosing one arbitrator and those two picking the
third. Unless otherwise agreed by the parties all arbitration hereto shall be
conducted in San Diego, California. Arbitration shall be conducted in the
English language. Judgment upon the award rendered by the arbitrator(s) may be
entered in any court having jurisdiction thereof. The parties shall have
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the right to discovery. The filing of a mechanic's lien or a judicial action to
enforce a mechanic's lien or to enable the recording of a notice of pending
action, for order of attachment, receivership, injunction, or other provisional
remedies, shall be allowed but shall not constitute a waiver of the right to
arbitrate under this paragraph.
18. Remedies. If either party breaches any material provision hereof,
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the non-breaching party shall, upon instituting a proper action, be entitled to
an injunction to prevent further breach and a decree for specific performance of
this Agreement according to its terms.
19. Force Majeure. Neither party to this Agreement shall be required to
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perform, or be liable for failure to perform, its obligations under this
Agreement during any period in which non-performance is caused by (i) strikes,
work stoppages, labor shortages or inability to procure labor, (ii) shortages of
equipment, materials, or supplies, (iii) shortages or lack of cooling or
processing facilities, (iv) car or truck shortages, or other transportation
difficulties, (v) war, hostilities, or national emergencies, (vi) acts of God,
the elements, mechanical breakdowns, or power failure, or (vii) causes beyond
the control of the party unable to perform. The non-performing party will
exercise reasonable due diligence to correct any correctable cause of non-
performance and will resume performance as soon as possible.
20. Binding Effect. This Agreement is binding upon and shall inure to the
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benefit of both parties and their respective heirs, legal representatives,
successors, and assigns.
21. Non-Waiver. No delay or failure by either party to exercise any right
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hereunder, and no partial or single exercise of such right, shall constitute a
waiver of that or any other right, unless otherwise expressly provided herein.
22. Headings. Headings in this Agreement are for convenience only and
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shall not be used to interpret or construe its provisions.
23. Governing Law. This Agreement shall be construed in accordance with
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and governed by the laws of the State of Colorado (as applied to contracts
entered into wholly within such state).
24. Counterparts. This Agreement may be executed in two or more
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counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
25. Time of Essence. Time is of the essence of this Agreement.
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26. Entire Agreement; No Modification. This Agreement constitutes the
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sole agreement between the parties hereto with regarding to the subject matter
hereof and supersedes all prior agreements between the parties concerning the
same. It may not be amended or modified other than by an instrument signed by
both parties or their duly authorized representatives.
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27. Notices. All notices hereunder shall be in writing and delivered
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personally or mailed by certified mail, postage prepaid, addressed to the
parties at their last known addresses.
28. Joint Venture. This Agreement is not and nothing contained herein
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shall be deemed to constitute a joint venture, partnership, agency or similar
arrangement between the parties hereto.
29. Successor Agreement. In the event this Agreement is terminated and
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Joya or any of its Affiliates sells or intends to sell, directly or indirectly,
Products in the United States, Europe or Canada through a marketing company
("Newco") to be formed by Joya or its Affiliate, then CG shall have the option
to acquire a minimum of 25% and a maximum of 50% of the outstanding capital
stock of Newco for the same consideration per share as is paid or contributed by
Joya or its Affiliate.
CGH SALES, INC., a Delaware corporation
By:/s/Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx, Chief Executive Officer
GREENVER, S.A. de C.V., a Mexican corporation
By:/s/ Xxxxx Xxxxxxxxx Xxxxx Xxxxxxx
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Xxxxx Xxxxxxxxx Xxxxx Xxxxxxx,
attorney-in-fact
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ANNEX "A"
QUALITY STANDARDS
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Exportable volumes of produce will be utilized on pallets and labeled per
Colorado Greenhouse specifications with grade, size and color and will be
classified into the following categories:
A) BEEFSTEAK TOMATOES
1. All Beefsteak ("Beef") tomatoes will be washed, hand placed into
preformed plastic liners (inserts) placed in corrugated 40cm x 60cm
cartons per Colorado Greenhouse specifications on design, construction
and printing with each tomato uniformly labeled after packing. Each
carton must have a net weight of not less than 15.4 lbs at the point of
delivery in the USA.
2. a. All Beef tomatoes will be sorted by size, color and grade. Only
one grade or color or size is permitted in any one box, and only like
boxes are permitted on the same pallet.
b. Boxes will be palletized 2/3 on a 48" x 40" class A, four way entry
hardwood pallet stacked 15 to 20 high per instructions from Colorado
Greenhouse. Each pallet will be unitized with four cardboard corner
boards and three horizontal evenly spaced plastic bands.
3. All Beef tomatoes will be sorted into one of the following sizes:
a. Premium MXL and Standard MXL and #2.
18, 20, 22, 25, 28 and 32 count tomatoes per tray.
b. Premium XL and Standard XL
35 and 39 count tomatoes per tray.
c. Premium L and Standard L
45 count tomatoes per tray.
d. Premium S
52 count tomatoes per tray (min. 110 grams each).
4. All Beef tomatoes will be harvested at color stage 3 or more and will be
sorted into one of the following colors according to the Kleur-Stadia
Tomaten color chart: 3, 4, 5 & 6. Tomatoes color range 7 or more will NOT
be exported to the USA but sold elsewhere by Greenver, S.A. de C.V. Only
one color is permitted on a pallet.
5. All Beef tomatoes for export will be sorted in Premium, Standard US #1
and US #2 grades.
a. Premium grade tomatoes must meet the following minimum quality
levels:
Shape: Round, smooth shoulder, no flat spots or indentations. Well
formed, smooth blossom end may be indented but not more than
1/16".
A-1
Calyx: In place, trimmed and not damaged.
Appearance: Must be free from all scars, marks, cuts, bruises,
blotchy ripening and translucent or soft conditions.
Cleanliness: Must be free from all contaminates such as dirt, dust
or other residues from any source.
Russeting: Only minor amounts of russeting is permitted in the
area 1/2" from the center of the calyx and none beyond
that.
Punctures: Must be free from any skin punctures or breaks.
b. Standard US #1 and US #2 grade tomatoes are qualified by the same
criteria with defect levels allowable per "U.S. Standards for Grades
of Greenhouse Tomatoes," a copy of which is attached hereto and
expressly made a part hereof.
B) VINE CLUSTER TOMATOES
1. All Vine Cluster tomatoes will be washed, hand placed into net bags with
closures, both per Colorado Greenhouse specifications. Bags with a loose
tail of less than 2" long will be placed into cartons that meet the
specifications of Colorado Greenhouse in size, design, construction and
printing. Each carton must have a net weight of not less than 11.3 lbs. at
the point of delivery in the USA.
2. All Vine tomatoes will be sorted and graded by size and quality.
a. Only premium (same standards previously defined) will be exported to
the USA.
b. Only tomatoes with a minimum weight of 100 grams can be packed in
this category.
c. Only clusters with a minimum of 3 tomatoes may be packed in this
category.
d. All tomatoes must be color stage 3 or more. In each package, one
tomato must be color state 7.
3. All vine tomatoes will be palletized per instructions from Colorado
Greenhouse and with the palletizing specifications in A2b.
4. Depending on market demand, vine tomatoes may also be required to be
packed as loose pack and the specifications will be developed for this
form of packing as required.
A-2
C) PREPACK TOMATOES (CONSUMER PACK)
1. All Prepack tomatoes will be washed, graded and packed according to the
premium standards. Any tomatoes that fail to grade "Premium" will be
packed as US#1 or US#2 grades.
2. Prepack tomatoes will be packed according to size specifications form
Colorado Greenhouse in container specified by Colorado Greenhouse.
3. Prepack tomato containers will be packed into master cartons meeting
Colorado Greenhouse specifications in size, construction and printing.
4. Prepack master cartons will be unitized according to the specifications
in A2b.
A-3
COLORADO GREENHOUSE TOMATO GRADING STANDARDS
The following document is designed to provide a brief description of the quality
requirements for all of the products that are grown, packed and shipped by
Colorado Greenhouse.
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RUSSETING
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GRADING TOLERANCES
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PREMIUM (MXL,XL,PREPACKS) STANDARD GRADE (MXL,XL) SUBSTANDARD (no2/15, TRASH
45ct OR LARGER
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RUSSETING: Premium tomatoes (#1) can Standard grade tomatoes Russeting in Russeting
---------- only have minor levels of (#2) can contain russeting Substandard (#3) may which
Russeting refers russeting confined to an levels extending between not exceed 1.5 inches extends
to "micro" area extending 1/2 inch from 1/2 inch and 1 inch from the from the calyx. beyond
cracking of the center of the calyx. calyx. 1.5 inches
tomato skin. from the
The severity calyx is
and severe and
susceptibility to must be
decay varies culled.
greatly from Severe
tomato to russeting is
tomato and associated
variety to with
variety. "greyness,
dullness,
softness and
wrinkling."
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A-4
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STEM PUNCTURES AND SKIN BREAKS
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GRADING TOLERANCES
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PREMIUM (MXL,XL, PREPACKS) STANDARD GRADE (MXL,XL) SUBSTANDARD (no2/15, TRASH
45ct OR LARGER
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STEM NO TOLERANCE: Any tomato Stem punctures and skin Stem punctures and ALL
PUNCTURES AND containing a skin break or breaks must be small (pea skin breaks must be FRESH/WET
SKIN BREAKS puncture must be sized or smaller) closed less than 1 cm, closed SKIN BREAKS
(open and downgraded to standard ("healed/dry/scarred over) ("healed/dry/scarred MUST BE
Closed) must be grade or substandard and minimal (one or less per over") and minimal CULLED!!!!
minimized due (no2/15) if the break is box). Larger rates result (one or less per box).
to the extreme healed or scarred over. from improper handling and Larger rates result
potential for the source should be from improper
bacterial growth ALL FRESH/WET SKIN BREAKS corrected. handling and the
and decay. MUST BE CULLED!!!!! source should be
ALL FRESH/WET SKIN BREAKS corrected.
MUST BE CULLED!!!!!
ALL FRESH/WET SKIN
BREAKS MUST BE
CULLED!!!!!
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A-5
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GROWTH CRACKS
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GRADING TOLERANCES
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Premium (mxl,xl, prepacks) Standard Grade (mxl,xl) Substandard (no2/15, Trash
45ct or larger
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NO TOLERANCE: All Single cracks that are less Single or multiple Any tomato
tomatoes with growth than 1/2 cm are acceptable. cracks which do not with a
cracks must be downgraded exceed 1cm are growth crack
or culled. acceptable. which
All products with deep exceeds
growth cracks (greater than 1 cm.
4mm must be discarded). All products with deep
growth cracks (greater
than 4mm must be All products
discarded). with deep
growth
cracks
(greater than
4mm must
be
discarded).
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A-6
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BLOSSOM END ROT
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GRADING TOLERANCES
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QUALITATIVE PREMIUM (MXL,XL, PREPACKS) STANDARD GRADE (MXL,XL) SUBSTANDARD (NO2/15) TRASH
ISSUES BLOSSOM
END ROT: NO TOLERANCE: All NO TOLERANCE: All Single or multiple Any tomato
Tomatoes with tomatoes exhibiting black tomatoes exhibiting black cracks which do not with a
this condition scars must be downgraded scars must be downgraded exceed 1cm are growth crack
are to substandard if the to substandard if the acceptable. which
characterized by affected area is less than affected area is less than exceeds
dark black scars 1 centimeter. 1 centimeter. 1 cm.
and/or All products with deep
indentations on growth cracks (greater
the blossom If black scars are greater than 4mm must be All products
end, in some than 1 cm the tomato must discarded). with deep
cases, the be culled. growth
border of the cracks
scarred area Products with inflamed (greater than
appears to be scars of any size must be 4mm must
inflamed. culled. be
discarded).
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A-7
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PUSHERS
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GRADING TOLERANCES
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QUALITATIVE PREMIUM (MXL,XL, PREPACKS) STANDARD GRADE (MXL,XL) SUBSTANDARD (NO2/15) TRASH
ISSUES
"Pushers" are The affected area must be The affected area must be Tomatoes which have All tomatoes
blemishes less than 1/2 cm and must be less than 1/2 cm and must be an opaque, tan, scar-like with opaque
which occur on nearly translucent so that nearly translucent so that appearance must be blemishes
the blossom end the overall premium the overall premium downgraded to which
of a tomato. appearance of the tomato is appearance of the tomato is substandard or culled if exceed 1 cm.
The color (light not compromised. not compromised. the blemish exceeds
and translucent, 1 cm.
light tan,
opaque tan) and Tomatoes which have an Tomatoes which have an
size of the opaque, tan, scar-like opaque, tan, scar-like
affected area appearance must be appearance must be
can vary greatly downgraded to substandard downgraded to substandard
from tomato to or culled if the blemish or culled if the blemish
tomato. exceeds 1 cm. exceeds 1 cm.
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A-8
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SOFTNESS
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GRADING TOLERANCES
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QUALITATIVE PREMIUM (MXL,XL, PREPACKS) STANDARD GRADE (MXL,XL) SUBSTANDARD (NO2/15) TRASH
ISSUES
In order to NO TOLERANCE: soft NO TOLERANCE: soft NO TOLERANCE: soft All soft
reach the tomatoes are not acceptable tomatoes are not acceptable tomatoes are not tomatoes
retailers in any grade and must be in any grade and must be acceptable in any grade must be
shelves, all culled. culled. and must be culled. culled
CGH products
must be firm.
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A-9
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DECAY AND MOLD
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GRADING TOLERANCES
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QUALITATIVE PREMIUM (MXL,XL, PREPACKS) STANDARD GRADE (MXL,XL) SUBSTANDARD (NO2/15) TRASH
ISSUES
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Decay and mold NO TOLERANCE NO TOLERANCE NO TOLERANCE All tomatoes
on the fruit or with signs of
calyx due to post decay and
harvest conditions mold.
is not tolerated in
any product and
must be culled.
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A-10
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PITS
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GRADING TOLERANCES
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QUALITATIVE PREMIUM (MXL,XL, PREPACKS) STANDARD GRADE (MXL,XL) SUBSTANDARD (NO2/15) TRASH
ISSUES
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Pits, NO TOLERANCE. All NO TOLERANCE. All Small pits (less than All tomatoes
indentations or tomatoes with pits must be tomatoes with pits must be 1 centimeter wide and with
openings which downgraded to Substandard downgraded to Substandard openings less than 1/2 openings
usually occur or culled depending on the or culled depending on the cm deep can be which
near the size and severity of the size and severity of the salvaged in the exceed 1 cm
blossom end of opening. opening. substandard grade. in width and
the tomato and Pits which exceed 1/4 cm in
may be these parameters must depth.
characterized by be culled.
seed visibility.
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A-11
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SCARS
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GRADING TOLERANCES
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QUALITATIVE PREMIUM (MXL,XL, PREPACKS) STANDARD GRADE (MXL,XL) SUBSTANDARD (NO2/15) TRASH
ISSUES
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Scars are Single, small (less than 1/2 These tomatoes can have up More pronounced Severely
superficial cm in diameter) affected to 2 scarred areas which are scarring is acceptable deformed
blemishes or areas are acceptable as long small (1 cm or less). as long as shelf life and fruit.
marks on as the overall appearance is taste are not affected.
tomatoes which premium ("relatively" Severely deformed
detract from the blemish free). fruit resulting from
overall fruit scarring should be
appearance culled.
without
affecting shelf
life or taste.
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A-12
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SIZE
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GRADING TOLERANCES
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QUALITATIVE PREMIUM (MXL,XL, PREPACKS) STANDARD GRADE (MXL,XL) SUBSTANDARD (NO2/15) TRASH
ISSUES
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Sorting by size Uniform Uniform Uniform
must be uniform
within each box
and all cells in a
box must be
filled.
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A-13
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SHAPE
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GRADING TOLERANCES
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To fit in the Only slight variations Qualitative Issues Premium
premium from a circular fruit are (mxl,xl,
grade all tomatoes acceptable in this grade. prepacks)
must be round. Oval shaped fruit must be
downgraded to substandard.
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A-14
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COLOR STAGE AT HARVEST
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GRADING TOLERANCES
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QUALITATIVE PREMIUM (MXL,XL, PREPACKS) STANDARD GRADE (MXL,XL) SUBSTANDARD (NO2/15) TRASH
ISSUES
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All fruit should Uniformity per box and Uniformity per box and Uniformity per box
be picked pallet is crucial for all pallet is crucial for all and pallet is crucial for
between stage 5 grades. grades. all grades.
and 6 as
depicted on a 12
color chart.
Quality
problems
stemming from
russetting and
storage can be
minimized if the
target color is
maintained.
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A-15
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CALYX
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GRADING TOLERANCES
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QUALITATIVE ISSUES PREMIUM (MXL,XL, PREPACKS) STANDARD GRADE (MXL,XL) SUBSTANDARD (NO2/15) TRASH
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The calyx is a Calyx retention is Calyx retention is Calyx retention is
feature imperative. A box which imperative. A box which imperative. A box
recognized by contains more than three contains more than three which contains more
consumers as an tomatoes without a calyx tomatoes without a calyx than three tomatoes
indication of indicates possible picking indicates possible picking without a calyx
premium quality. problems and should be problems and should be indicates possible
corrected. When packing, corrected. When packing, picking problems and
all tomatoes without a all tomatoes without a calyx should be corrected.
calyx should be made less should be made less visible When packing, all
visible by lacing them by lacing them along the tomatoes without a
along the outer perimeter outer perimeter of each box. calyx should be made
of each box. less visible by lacing
them along the outer
Prepacks which are covered perimeter of each box.
Prepacks which are in plastic wrap must be
covered in plastic wrap packed without the calyx
must be packed without due to potential stem mold Prepacks which are
the calyx due to potential covered in plastic
stem mold wrap must be packed
without the calyx due
to potential stem mold
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A-16
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LABELING
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GRADING TOLERANCES
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QUALITATIVE ISSUES PREMIUM (MXL,XL, PREPACKS) STANDARD GRADE (MXL,XL) SUBSTANDARD (NO2/15) TRASH
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All tomatoes Premium labels (4 color) Garden Fresh boxes require No labels
must be labeled are required. the generic label.
on the shoulder
with the
appropriate label Labels must be uniformly Standard grade tomatoes in
except for oriented on each tomato the CGH box require the
prepack tomatoes within each box. two color standard grade
which are labeled label (CGH) or the generic
on the container. label.
Labeling on the calyx is
preventable and should
not be tolerated. Labeling on the calyx is
preventable and should not
be tolerated.
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A-17
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BOX CODES
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GRADING TOLERANCES
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QUALITATIVE ISSUES PREMIUM (MXL,XL, PREPACKS) STANDARD GRADE (MXL,XL) SUBSTANDARD (NO2/15) TRASH
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Legible box Box codes depicting the Box codes depicting the Box codes depicting
codes depicting harvest date and site are harvest date and site are the harvest date and
the harvest date required for all finished required for all finished site are required for all
and site are goods. goods. finished goods.
required for all
finished goods.
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A-18
TO COME
