AGREEMENT
This Agreement, made and entered into as of August 2, 2005 by and
between Cross Atlantic Commodities, Inc., 000 Xxxx Xxxxxx, 00xx Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, (hereinafter referred to as "Cross
Atlantic"), and Victoria Coffees Company (U) Limited, Xxxx 0, 0xx
Xxxxxx, Xxxxxxxxxx Xxxx, X.X. Xxx 00000, Xxxxxxx Xxxxxx, (hereinafter
referred to as "Victoria").
Recitals:
1. Victoria is engaged in the processing and sale of certain
commodities in the country of Uganda, including but not limited to,
coffee, cocoa, and tea.
2. Cross Atlantic is engaged in the business of the purchase of
these certain commodities of the type and quantity sold by Victoria for
distribution in North America.
3. The parties have agreed to enter into a purchase and sale
agreement, the terms of which are set forth herein, concerning the sale
of certain commodities by Victoria to Cross Atlantic (the "Agreement").
Now, therefore, for good and valuable consideration, the parties do
hereby covenant and agree as follows:
A. Purchase and Sale of Arabica Coffee Beans. Victoria agrees to
sell and Cross Atlantic agrees to purchase coffee beans, the
specifications of which would be set forth in a purchase order
submitted and sent to Victoria by Cross Atlantic subject to Victoria's
acceptance under the terms and specifications set forth in said
purchase order. The shipping schedule relative to the sale and purchase
as set forth above from Kampala, Uganda for the first year of the
Agreement is as follows:
i. 5 containers during the week of October 17, 2005.
ii. 5 containers during the week of November 14, 2005.
iii. 25 containers during the week of December 12, 2005.
iv. 25 containers during the week of January 16, 2006.
v. 25 containers during the week of February 13, 2006.
vi. 25 containers during the week of March 13, 2006.
vii. Shipments for the six months immediately following the
foregoing shipments shall be allocated by the parties hereto, with a
minimum of three hundred twenty four (324) total containers during the
one-year period from October 2005 through September 2006.
All shipments shall be in conformity with the Green Coffee Association
Contract Terms and Conditions except if varied by this Agreement, any
Cross Atlantic purchase order or any letter of credit issued pursuant
to any Cross Atlantic purchase order.
B. Sale of Additional Coffee. Victoria has the option to increase
the quantity per transaction after the 5th transaction set forth above
subject to the approval of Cross Atlantic.
C. Price and Terms of Payment. The price for the quantity to be
purchased and sold as set forth above is fixed at the CSCE "C" contract
future price minus a discount of 14 cents per pound FOB (Mombassa) for
the first two years under this agreement. Cross Atlantic shall be
surcharged for inland freight from Kampala to Mombassa in an amount to
be agreed upon between Cross Atlantic and Victoria as specified in each
purchase order. Payments shall be made by documentary letter of
credit.
D. Taxes. Victoria shall deliver all commodity shipments FOB
(Mombassa) free of all taxes, liens and encumbrances.
E. North American Joint Venture Value Added Coffee Distribution
Program. The parties agree, in accordance with the government of
Uganda's policy on exports, North American Joint Venture Value Added
Coffee Distribution Program shall be explored in good faith and
implemented by the parties on terms and conditions acceptable to both
parties. The program shall commence no later than the second year of
operation under this agreement unless otherwise mutually agreed. This
program shall include commodities referred to above for distribution in
North America.
F. Exclusive Right to Purchase. Cross Atlantic shall have the
exclusive right to purchase all of the coffee that Victoria has
available to sell for distribution in North America according to the
terms and conditions of this agreement. In the event that Cross
Atlantic fails to make a credit enhancement available to Victoria by
the conclusion of fourth shipment hereunder has been received and
accepted by Cross Atlantic in accordance with CSCE "C" contract
specifications, then and only in that event, Victoria shall, at its
option, convert this agreement into a non-exclusive agreement.
G. Title to Purchase Coffee. The transfer of title shall be FOB
Mombassa. Title to the purchased coffee shall be free of any liens,
security interest, encumbrances, or debts or obligations of Victoria or
any other party. Victoria expressly warrants that the coffee
contracted for shall conform to the purchase order approved and
accepted by Victoria and approved by the appropriate regulatory
department(s) of the country of Uganda.
H. Warranty. Victoria expressly warrants that the coffee
contracted for shall conform to the Cross Atlantic purchase orders
approved and accepted by Victoria, any letters of credit issued
pursuant thereto and approved by the appropriate regulatory
department(s) of the country of Uganda.
I. Claims. Cross Atlantic, upon receipt of actual knowledge of
any claim as a result of the quality of coffee or commodities or any
defect therein, shall exercise its best efforts and within a reasonable
time make any claims in writing by certified mail (copy to be sent by
facsimile), return receipt requested, addressed to Victoria at its
address set forth herein and may be accompanied by a sample of the
coffee alleged to be defective.
J. Rights of Victoria Upon Cross Atlantic's Default. Cross
Atlantic shall be in default of this agreement if Cross Atlantic shall
fail to make any payment to Victoria when due under the terms of the
purchase order. In the event that any uncured material default
(nonpayment) has occurred for a period of 10 days and has not been
cured, then Xxxxxxxx xxx by 10 days written notice thereof to Cross
Atlantic, terminate this agreement and exercise the right to claim loss
through arbitration as provided in this Agreement, provided, however,
that if Cross Atlantic cures such default within such 10 day period
such notice of termination shall be void and Victoria shall have no
claim for loss.
K. Rights of Cross Atlantic Upon Victoria's Default. Victoria
shall, without limitation, be in default of this Agreement if Victoria
shall fail to make deliveries which are not in conformity with any
purchase orders accepted pursuant to this agreement or letters of
credit issued pursuant thereto, in which event Cross Atlantic may by 10
days written notice to Victoria, terminate this agreement and may
exercise its right to claim damages through arbitration as provided in
this Agreement.
L. Arbitration. In the event there is any dispute or claim
between the parties with relation to, arising out of or in connection
with the terms and provisions of this agreement, the parties agree that
the matter shall be resolved through final and binding arbitration and
unless otherwise mutually agreed between the parties, the matter shall
be submitted for arbitration before a tribunal of the American
Arbitration Association, sitting in the City, County and State of New
York, in accordance with the terms and provisions of the AR Coffee
Association. The winner of any such arbitration shall be entitled to
an award of legal fees. Any arbitration award may be confirmed by a
court of competent jurisdiction in the City, County and State of New
York. Each of the parties hereto agrees that service of process by
certified mail shall be adequate service. Each of the parties hereto
waive the defense of forum non conveniens in any such New York action.
M. Applicable Law. This agreement shall be governed by the
provisions of the laws of the State of New York, without regard to any
conflict of laws provision.
N. Notices. All notices required or permitted under this
agreement shall be in writing and delivered or mailed, by certified
mail, return receipt requested, and addressed as follows:
If to Seller: Victoria Coffee (U) Limited
Xxxx 0, 0xx Xxxxxx Xxxxxxxxxx Xxxx
X.X. Xxx 00000
Xxxxxxx Xxxxxx
Facsimile: 256 41-254377
Email: xxxxx@xxxxxxx.xx.xx
If to Buyer: Cross Atlantic Commodities, Inc.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: 1 212 792 4001
Email: xx@xxxxxxx.xxx
O. Force Majeure. If a party is in default because of that
party's inability to perform or default has been caused by an event or
events beyond the control and without the fault of that party,
including (without limitation) acts of government, embargos, acts of
God or a public enemy, strikes, labor disputes, civil riots or
commotions, or the inability to procure necessary raw materials,
supplies or equipment, and therefore any default or failure to perform
due to the above cannot be the basis for termination of the agreement.
P. Term of Agreement. The term of this agreement shall be for a
period of 10 years unless otherwise terminated as set forth herein. It
is anticipated that a minimum of 324 containers CSCE "C" contract
coffee shall be delivered and purchased in accordance with purchase
orders executed in accordance with the terms of this agreement for each
of the first 2 years of the term of this agreement commencing upon its
mutual execution; however, the coffee price for the 3rd and subsequent
years shall be subject to negotiation based on price differentials in
the market. The minimum amount of coffee to be delivered and purchased
during years 3 through 10 shall be in quantities in excess of 324
containers CSCE "C" contract coffee per year. In addition, a specialty
coffee program shall be implemented on terms and conditions negotiated
in good faith and acceptable to both parties which shall commence
subsequent to the second year of the term of this agreement unless
otherwise mutually agreed upon by the parties. If any coffee or
commodities required and/or delivered are not in conformity with the
purchase order submitted pursuant to this agreement or any letter of
credit issued pursuant thereto, then Cross Atlantic reserves the right
to reject that shipment.
Q. Entire Agreement. The terms and conditions to this agreement
are specified herein and this agreement supercedes all prior
communications, representations, or agreements between the parties,
whether verbal or written. Any representation, promises or conditions
in connection with or with respect to the subject matter of this
agreement which are not incorporated herein are not binding upon either
party.
R. Modifications. No modifications, amendment, extension,
renewal, rescission, termination, or waiver of any of the provisions
contained herein, or any future representation, promise or condition in
connection with the subject matter hereof, shall be binding upon the
either party unless in writing and signed by an officer on its behalf.
In witness whereof, the parties hereto have caused this agreement to be
executed by their duly authorized officers as of the date first above
written.
Cross Atlantic Commodities, Inc. Victoria Coffees Company (U)
Limited
By: /s/Xxxxxxx Enemaerke By: /s/Xxxx Xxxxxxxx-Xxxxx
Xxxxxxx Enemaerke Xxxx Xxxxxxxx-Xxxxx
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