This Agreement between Coors Brewing Company ("Coors") and LEGAL
NAME, DBA TYPE DBA NAME of MARKET AREA, STATE ("Distributor"), a
TYPE OF LEGAL ENTITY organized under the laws of the State of
___________________, is made effective as of January 1, 1997.
1. PURPOSE
1.1 This Agreement sets forth the respective obligations of
Coors and Distributor regarding the sale by Coors to Distributor
of only those Coors products listed on Exhibit A (the "Products")
and Distributor's resale of the Products to retailers. Coors may
amend Exhibit A from time to time to add new products. The
purpose of this Agreement is to support and promote the
acceptance and popularity of the Products with consumers
resulting in the success of Distributor and Coors.
1.2 Distributor and Coors agree that this Agreement includes by
reference the terms of the Coors Distributor Standards Manual
(the "Standards Manual"), as amended from time to time, but no
more frequently than annually, by Coors, and the terms of the
letter confirming the appointment of Distributor (the
"Appointment Letter"). The implementation, performance and
enforcement of the terms of this Agreement and the Standards
Manual shall be subject to the duty of good faith and fair dealing.
2. APPOINTMENT
2.1 Coors hereby appoints Distributor as its sole wholesale
distributor of, and grants Distributor the right to sell the
Products only in the Market Area described in Exhibit B (the
"Market Area"). The purpose of designating the Market Area is to
establish geographic boundaries within which Distributor is
accountable for quality control of Products and within which
Coors can evaluate Distributor's performance of its obligations
under this Agreement. Except as indicated below, Coors will not
grant to any other distributor the right to sell the Products in
the Market Area.
2.2 Distributor shall not sell, deliver or transfer any Product
to any retail account outside the Market Area or to any person
Distributor knows or has reason to believe will sell or transfer
any of the Products outside the Market Area. Notwithstanding the
foregoing and where permitted by law, Distributor may, with the
prior written approval of Coors, sell one or more Products
outside the Market Area to the extent and so long as Coors shall
authorize. Nothing herein shall prohibit Distributor from
selling Products to, or purchasing Products from, another Coors
distributor for the purposes of eliminating product shortages or
inventory imbalances. Distributor shall not supply Products to
any retail account that sells, delivers or transfers Products to
other retail accounts without Coors' prior written approval and
compliance with such conditions as Coors shall require.
2.3 If the exclusive rights granted in section 2.1 are or shall
become prohibited under federal law or the laws of the state in
which the Market Area is located, then such provision shall not
apply. In that event, Coors appoints Distributor as a non-
exclusive distributor of, and grants Distributor the right to
sell the Products in, the Market Area, which shall be
Distributor's primary area of responsibility for sale of the
Products. In the event applicable law shall require appointment
of Distributor pursuant to this provision, Distributor shall
provide to Coors all information required by the Standards Manual
for sales outside of Distributor's Market Area.
2.4 Distributor hereby accepts such appointment. Distributor
acknowledges that it has paid no consideration to Coors in
exchange for this appointment.
2.5 Notwithstanding the provisions of section 2.1, if
applicable, Coors may, after giving notice to Distributor, permit
another person or persons to sell, or Coors may sell one or more
Products within the Market Area to the extent and so long as
Distributor is unable or unwilling to provide uninterrupted
service to accounts within all or any part of the Market Area,
provided, where required, permission to do so is obtained from
the appropriate state regulatory authorities.
3. TERM
3.1 This Agreement shall continue in effect from the effective
date hereof until terminated or amended pursuant to the terms hereof.
3.2 Due to the advisability of changes being made in this
Agreement from time to time, this Agreement may be amended, as follows:
3.2.1 Concurrently with the submission of a proposed
amendment of this Agreement to the Distributor, Coors will submit
to all other Coors distributors in the United States that have
signed a distributorship agreement in substantially similar form,
an amendment identical to the amendment submitted to the
Distributor, except for any change necessary in Coors' opinion to
comply with the requirements of state law and the provisions
contained in any distributor's Appointment Letter.
3.2.2 Distributor shall indicate its acceptance of all of the
terms of the proposed amendment by signing and returning to Coors
four (4) copies of the executed amendment. If four (4) copies of
the executed amendment shall not have been received by Coors
within 90 days after receipt by the Distributor, this Agreement
shall automatically terminate and both Coors and the Distributor
shall have no further right or obligation hereunder, except under
those terms which explicitly survive the termination hereof.
4. DUTIES OF DISTRIBUTOR
Distributor shall actively and aggressively solicit business from
every licensed retail account in the Market Area in order to accomplish
the purposes of this Agreement and to achieve and maintain the highest
practicable distribution of the Products in the Market Area. In particular,
Distributor shall:
4.1 Diligently perform quality control practices and procedures
throughout the Market Area, in accordance with the Standards Manual.
4.2 Achieve such reasonable performance goals as Coors, with
input from Distributor, may establish for Distributor from time
to time and communicate in writing to Distributor.
4.3 Maintain wholesale inventories at levels recommended by Coors.
4.4 Maintain sufficient working capital to operate Distributor's business
so as to comply with Distributor's obligations under this Agreement.
4.5 Know and adhere to all local, state and federal laws and
regulations applicable to Distributor's business. Distributor
shall promptly report to Coors any notice of change, suspension
or expiration of any permit or license required by any federal,
state or municipal agency.
4.6 Provide accurate and timely Product forecasts in accordance
with the terms of the Standards Manual.
4.7 Actively promote and market all Coors recommended packages
of each Product by following such standards for Product
distribution and execution as Coors may from time to time
provide, as found in the Standards Manual, and by cooperating in
Coors' distributor sales and marketing promotions.
4.8 Provide adequate warehouse area to receive, ship and store
Products handled by Distributor, refrigerated to the standards
set forth in the Standards Manual; and implement and maintain
delivery procedures to minimize temperature increases of the Products.
4.9 Provide uninterrupted sales and services to all retail
accounts in the Market Area except as precluded by acts of God,
war or conditions of national, state or local emergencies.
Distributor shall diligently attempt to prevent any service
interruption and to restore service as quickly as practicable
after any interruption.
4.10 Furnish to Coors, as Coors may from time to time request
during the term of this Agreement, by a date specified by Coors
reasonably in advance, a detailed business/marketing plan, in the
form and covering the matters directed by Coors.
4.11 Maintain adequate information and records of sales and
service calls and deliveries; maintain sales and inventory
reports; and maintain such other books and records as requested
by Coors for purposes of internal operational control. Maintain
and submit to Coors such marketing and sales data, organizational
and other operational records and reports as may be requested by
Coors from time to time.
4.12 Maintain and submit to Coors at least annually, no later
than 120 days after the end of Distributor's fiscal year, and
more frequently as requested by Coors, complete and accurate
financial statements, including a balance sheet as of the end of
such year or other period and related statements of income and
cash flows for the year or other such period then ended. Such
statements shall be compiled, reviewed or audited by a certified
public accountant, shall be signed by an officer of Distributor,
which signature shall constitute a representation that to the
best of the officer's knowledge and belief, the statements fairly
and accurately reflect the financial condition of Distributor's
business as of the end of the fiscal year or other period and the
results of its operations for the year or other period then
ended; and to the extent practicable, shall be prepared in
accordance with generally accepted accounting principles. If
such financial statements are not signed by an officer of
Distributor, delivery of the statements to Coors shall constitute
Distributor's representation that the financial statements
conform to these standards. Upon request, Distributor shall
provide Coors with accurate financial statements in similar form
and with the same representations for any parent entity owning
an 80% or more interest in Distributor. Distributor recognizes
that provision of such information is based upon Coors'
continuing interest in the financial soundness and viability of
Distributor's business. Except when requested by Distributor,
Coors shall maintain in confidence all financial information
submitted by Distributor under this section, provided that Coors
may use such information internally and with its consultants,
provided said consultants similarly agree to maintain the
information in confidence. Coors may also use such information
in preparing composite financial information for groups of
distributors and such information may be disclosed to other
distributors, provided the identity of any distributor whose
financial information is a part of the composite shall not be
disclosed and is not ascertainable from the composite information.
All financial information submitted by Distributor under this
section shall be maintained in the Coors "Credit Department," in
Golden, Colorado. All requests to review such information shall be
presented for approval by the "Wholesaler Network Department." Any
such information released to a "Field Business Area" ("FBA") office
shall be given only to the Area Vice President ("AVP") or other FBA
employees at the "Director" level or above.
4.13 Permit Coors' representatives to inspect all aspects of
Distributor's operations relating to the Products, including all
books and sales records at such times as Coors may reasonably
request. Distributor shall respond promptly and in good faith to
all requests by Coors for the information required under sections
4.11 and 4.12 and such additional information as shall be
reasonably requested by Coors.
4.14 Maintain a "Coverage Ratio" of no less than 1.1 to 1, unless
in the reasonable opinion of Coors, based upon factors published
by Coors from time to time, there are sound operational or
financial reasons why such ratio need not be maintained. The
"Coverage Ratio," at any point in time, is defined to be earnings
before interest expense, taxes, dividends (or additional
salaries, if applicable, e.g., for S corporations), depreciation
and amortization, all for the 12-month period ending on the last
day of the preceding month, divided by the sum of interest
expense for such preceding 12-month period and capital lease and
principal payments on debt due during the next 12-month period
commencing on the first day of the current month; all as
determined from Distributor's annual or periodic financial
statements prepared in accordance with section 4.12.
5. REPRESENTATIONS AND WARRANTIES OF DISTRIBUTOR
5.1 The representations and warranties made by Distributor in
connection with its application for the distributorship rights
granted hereunder are material inducements upon which Coors has
relied in selecting Distributor for the appointment made pursuant
to this Agreement. Distributor hereby represents and warrants
that all information contained in its application and in the
Appointment Letter are true, complete and accurate. Distributor
shall promptly notify Coors in writing of any material change in
such information.
5.2 Coors shall continually rely upon the information referred
to in section 5.1 and upon the financial, sales, statistical and
other information previously and hereafter provided by
Distributor to Coors hereunder. Distributor warrants the
continuing accuracy and completeness of all such information.
5.3 Distributor represents that it has all federal, state and
municipal permits and licenses necessary to distribute the
Products in the Market Area as contemplated hereby.
6. TERMS OF SALE
6.1 Distributor shall have the sole and exclusive right to
establish the price for resale of the Products.
6.2 All sales of Products by Coors to Distributor shall be at
such prices and on such cash or credit terms as Coors shall
establish from time to time. Coors may, from time to time, in its
sole discretion, change prices and terms and conditions of sales,
delivery and payment.
6.3 Coors reserves the right to modify or discontinue the sale
of any Product, package or container on a national, regional,
state or other basis.
6.4 Coors shall have the right to place the Distributor on
allocation when the supply of any Product is for any reason
insufficient to meet the demands of all distributors. Coors
shall not be liable to Distributor for failure to make any
delivery to Distributor or delay in any delivery if caused by
lack of supply or by any circumstances beyond the reasonable
control of Coors.
6.5 Products sold to Distributor hereunder shall be shipped from
the locations designated by Coors from time to time, and Coors
may at any time change the designated source brewery.
7. CHANGES IN MANAGEMENT
7.1 The parties acknowledge that this is a personal services
contract entered into in reliance upon and in consideration of
the personal qualifications of the "Principal Manager,"
"Operating Manager," or any "Manager" identified in Distributor's
Appointment Letter. If any person so identified as a Principal
Manager, Operating Manager or any other Manager in Distributor's
Appointment Letter, or any other person hereafter approved as a
successor to such person, ceases to serve in that capacity or to
devote full time to that function, Distributor shall give
immediate written notice to the Coors' field sales office.
7.2 Coors may, in its discretion, disapprove any proposed
successor Principal Manager, Operating Manager, or Manager if, in
its reasonable judgment, the proposed successor does not meet the
management standards established and published by Coors from time
to time. Any failure by Coors to disapprove a proposed successor
Manager shall not be construed as Coors' determination with
respect to the qualifications of such successor. Distributor and
Coors shall cooperate to identify a person meeting the management
standards and accomplishing the purposes of this Agreement.
7.3 Distributor shall prepare and update, as applicable, a succession plan
for the ownership and management of Distributor's business.
8. CHANGES IN CONTROL AND OWNERSHIP OF DISTRIBUTOR
8.1 If Distributor is a corporation, limited liability company
("LLC"), partnership or other entity, Coors' written approval
shall be obtained prior to (A) any change in the record or
beneficial ownership of 10 percent or more of Distributor's
outstanding stock, membership interests, partnership interests or
other ownership or equity interests, determined on a cumulative
basis from the effective date of the last approved ownership
change of this Agreement; (B) any change in such ownership that
results in a change in majority control of Distributor; (C) any
change in any of Distributor's principal officers, directors or
managing partners (or managers if Distributor is an LLC); or (D)
any resignation, removal or admission of any additional or
substitute general partner of Distributor or of any general
partner of a Distributor partnership.
8.2 Distributor shall not, without the prior written approval of
Coors, assign, pledge, hypothecate or otherwise encumber this
Agreement or any rights hereunder. Distributor shall not cause
or permit the assignment, pledge, encumbrance or hypothecation of
any ownership interest in Distributor, whether in the form of
stock, membership interests or otherwise. In the event Distributor shall
assign, pledge or hypothecate this Agreement or the rights hereunder
without Coors' consent, such assignment shall be void.
8.3 Distributor shall not, without the prior written approval of
Coors, change the form of business entity or permit the
occurrence of any merger, consolidation or event or series of
events that have the effect of transferring the ownership,
control or management of Distributor.
8.4 Distributor may, without Coors' consent, acquire the rights
to sell other brands of beer or other beverages in the Market
Area or elsewhere, provided the transaction by which such brands
are acquired does not involve a transaction requiring Coors'
consent or review under sections 8.1, 8.2, 8.3, 8.5 or 8.6. The
acquisition of such other brands shall not reduce Distributor's
obligations to Coors. At least 30 days prior to the closing of
an acquisition relating to other brands or products, which
acquired brands or products are likely to result in Distributor
revenues greater than 25% of Distributor's prior year total
revenues from the sale of beer or other beverages, Distributor
shall provide the applicable Coors' AVP with information and
assurances for performance in efforts, resources and manpower
such that there will be no dilution of effort as to the Products.
8.5 The sale, transfer or disposition of any portion of
Distributor's business that includes the purchase and sale of
Products (the "Sale Transaction"), whether in the form of sale of
assets, stock, membership interests or partnership interests,
merger or otherwise, including transfers by operation of law,
except as provided in section 8.9, shall be subject to Coors'
prior approval of the prospective purchaser or successor as
provided in sections 8.6 and 8.7 and to the terms of this section 8.5.
8.5.1 If Distributor desires to pursue a Sale Transaction
regardless of the form of such proposed transaction, Distributor
shall meet with Coors to discuss Distributor's plans and shall
give Coors written notice (a "Sale Notice") of Distributor's
intent to effect a Sale Transaction prior to conducting
discussions with any third party, including another of Distributor's
suppliers. If Distributor receives an unsolicited offer for a Sale
Transaction, no meeting with or notice to Coors shall be required
unless and until Distributor has the intent to sell the business.
Coors shall not be obligated to review any request for approval of a
Sale Transaction under section 8.6 until Distributor meets with Coors
to discuss such matter, gives Coors a Sale Notice and permits Coors to
exercise its rights under section 8.5.2.
8.5.2 Upon receipt of a Sale Notice from Distributor, Coors
or any affiliate or assignee of Coors (for purposes of this
Article 8 referred to as "Coors") shall have the right to
negotiate exclusively with Distributor for a Sale Transaction
that is contemplated by a Sale Notice. If, for the most recent
prior year, the Products represent less than 20% of Distributor's
total revenues attributable to beverage sales, Coors may elect to
negotiate to purchase that portion of Distributor's business
relating to the sale of Products (the "Coors' Business"). In the
event that the proposed Sale Transaction shall have created a
right in another of Distributor's suppliers (or its assignee) to
purchase all or a portion of the Distributor's business that is
the subject of the proposed Sale Transaction (such that Coors
cannot purchase the entire Sale Transaction), Coors shall also
have the right to negotiate for the Coors' Business. Within 30
days after receipt of the Sale Notice, Coors shall notify the
Distributor in writing whether or not Coors will exercise its
right to negotiate exclusively for the Sale Transaction or the
Coors' Business. If Coors elects not to so negotiate, or if
Coors fails within such 30-day period to notify Distributor of
its intent to so negotiate, then Coors' right to negotiate
exclusively shall be deemed waived. If Coors notifies
Distributor of its intent to negotiate for the Sale Transaction
or only the Coors' Business, Distributor and Coors shall
negotiate exclusively and in good faith for a period of 120 days,
commencing on Distributor's receipt of Coors' notice of its
election to negotiate. If such negotiations result in an
agreement between Distributor and Coors, the parties shall
promptly consummate closing of the transaction pursuant to such
agreement. If Coors and Distributor fail to reach an agreement
to purchase within such 120-day period, or if Coors waives its
right to negotiate, then Distributor may proceed to negotiate
with a third party; provided, however, that if, for the most
recent prior year, the Products represent less than 20% of
Distributor's total revenues attributable to beverage sales or if
the third party is another of Distributor's suppliers (or its
assignee), Coors may elect to purchase (and close contemporaneously
with the closing of a third party Sale Transaction) the Coors' Business
at its fair market value, determined according to the appraisal process
set forth in section 8.5.3.1; and, provided that completion of any
such third-party transaction shall be subject to the terms of sections
8.5.3, 8.6 and 8.7. If the resulting Sale Transaction with a third
party does not close within one year after termination or waiver of the
120-day negotiation period, Coors shall be entitled to a new Sale
Notice under section 8.5.1 and the provisions of
this section 8.5.2 shall again apply.
8.5.3 If, after Distributor and Coors have negotiated as
provided in section 8.5.2, they have not reached an agreement
under such provision, and if, within a period of one year after
the termination of the 120-day negotiation period, Distributor
receives a bona fide offer for a Sale Transaction from a third
party and such offer is (A) at a purchase price that is valued as
provided herein at equal to or less than any purchase price
previously offered by Coors, in writing, pursuant to the
negotiations under section 8.5.2; or (B) for a Sale Transaction
that is substantially different, either in form or as to the
extent of the Distributor's business being sold, from the Sale
Transaction contemplated by the Sale Notice, then, for a period
of 30 days after receipt of Distributor's written request for
Coors' approval of the proposed transfer to such third party
under section 8.6 (the "Approval Request), Coors shall have the
right to purchase that portion of Distributor's business subject
to the proposed third party Sale Transaction at the purchase
price applicable to the proposed Sale Transaction. Coors may
exercise such right by giving written notice to Distributor
within such 30-day period (the "Exercise Period"), whereupon
Distributor shall promptly execute such documents as shall be
reasonably required by Coors to complete the Sale Transaction with Coors.
8.5.3.1 In the event that the terms of the Sale Transaction to
the third party provide for a portion of the purchase price to be
paid in property, services or other consideration other than cash
(the "Non-Cash Consideration"), then the purchase price shall be
calculated including the fair market value of such property,
services or other consideration. Failing agreement by
Distributor and Coors, the fair market value shall be determined
by a single independent appraiser appointed as hereafter
described. Within 30 days after the Approval Request,
Distributor and Coors shall each appoint an independent appraiser
knowledgeable as to the valuation of such property and within 15
days thereafter those two persons shall select the independent
appraiser. The independent appraiser shall promptly determine
the fair market value of the Non-Cash Consideration. The Non-Cash
Consideration shall be paid in cash at closing by Coors in the
event Coors shall exercise the right to purchase granted by
this section 8.5.3. The costs and expenses of the three
appraisers shall be shared equally by Distributor and Coors.
8.5.3.2 The Exercise Period shall be extended until 30 days
after the completion of the reports of the independent appraiser.
If Coors fails to exercise its purchase right within the Exercise
Period or extension thereof, Distributor may proceed with the
Sale Transaction to the third party, provided that completion of
such transaction shall be subject to the terms of sections 8.6
and 8.7. If the proposed third party Sale Transaction is not
closed within one year after the termination of Coors' right to
purchase under this section 8.5.3, Coors shall be entitled to a
new Sale Notice and the provisions of section 8.5.2 and this
section 8.5.3 shall again apply.
8.6 Prior to effecting any Sale Transaction, subject to the
other provisions of this Article 8, Distributor will submit to
Coors a copy of the proposed agreement for transfer and shall
cause the prospective purchaser to submit to Coors a completed
distributorship application and such other forms and information
as may be requested by Coors. Coors shall review the application
in light of the then current market conditions in the Market
Area. Completion of the Sale Transaction shall be effected only
after: Coors has approved, in writing to Distributor, the
prospective purchaser and the terms of the Sale Transaction; the
prospective purchaser has agreed in writing to assume all of the
terms and conditions of this Agreement; all accounts between
Distributor and Coors have been settled, or adequate security has
been posted by Distributor or Coors, as the case may be, to
secure any account that is disputed; and a complete and absolute
mutual release between Distributor and Coors, covering all
matters other than product liability, shall have been executed
and delivered by each party to the other in a form satisfactory
to Distributor and Coors.
8.7 Coors has the right to do business with persons of its own
choosing and shall have complete discretion to approve any
prospective purchaser of Distributor's business. From time to
time, Coors will promulgate guidelines regarding the criteria for
evaluation of distributor candidates.
8.8 If Coors disapproves a Sale Transaction under section 8.6,
then for a period of 30 days after it gives notice to Distributor
of such disapproval, Coors or its assignee shall have the right
to purchase that portion of Distributor's business relating to
the Sale Transaction at the purchase price of the disapproved
Sale Transaction. Non-Cash Consideration shall be valued under
the procedures set forth in section 8.5.3.1. In the event that
the sale transaction involves Non-Cash Consideration, the period
within which Coors may exercise its right to purchase shall be
extended until 30 days after the completion of the report of the
independent appraiser.
8.8.1 In the alternative, if, for the most recent prior year,
the Products represent less than 20% of Distributor's total
revenues attributable to beverage sales, Coors may elect within
the same 30-day period to purchase from Distributor the Coors
Business at fair market value determined according to the
appraisal procedures set forth in section 8.5.3.1. Coors may
purchase such other assets and portion of Distributor's business
as Coors and Distributor may agree.
8.8.2 Coors shall not be entitled to exercise the purchase
rights under this section if the proposed purchaser under the
Sale Transaction is a member of Distributor's immediate family
(as defined in section 8.9) and the proposed price is
substantially below fair market value as determined by the
appraisal process under section 8.5.3.1.
8.8.3 As promptly as practicable after notice of exercise of
the purchase rights under this section, Distributor shall execute
and deliver to Coors such documents as shall be required to
complete the Sale Transaction or alternate purchase transaction.
8.9 Notwithstanding any provision of this Article 8, no approval
by Coors shall be required for any transfer of ownership in the
distributorship upon the death or incompetence of the Distributor
or its principal owner to or for the benefit of a member of
Distributor's or such principal owner's immediate family. For
the purposes of this provision and section 8.8.2, immediate family
shall be limited to parent, spouse, sibling, adult child and adopted
adult child. The provisions of Article 7 shall apply to any change in
Manager regardless of the application of this section 8.9.
9. TRADEMARKS
9.1 Distributor acknowledges that the trademarks, trade names,
service marks and other trade designations Coors uses in
connection with all Products and other products sold or licensed
to be sold by Coors are and shall remain the sole and exclusive
property of Coors. Coors reserves all rights with respect
thereto, including without limitation the right to license the
use of its trademarks and trade names, designs, brand names,
labels, promotional slogans and service marks on merchandise,
goods, items and services.
9.2 Coors hereby grants Distributor, for the term of this
Agreement only, a limited, non-assignable and non-transferable
right to use those Coors' trademarks and trade names associated
with the Products in distributing, advertising and promoting the
sale of the Products. All such usage shall be in accordance with
the policies set forth in the Distributor Standard on Trademark
Licensing contained in the Standards Manual.
9.3 Unless Distributor was operating under a name including the
name "Coors" prior to July 1, 1989, Distributor shall not include
in its business or corporate name the name "Coors" or any other
trademark or trade name of Coors without Coors' prior written
consent. If any such name is used as part of Distributor's
business or corporate name, regardless of when such usage
commenced, upon termination of this Agreement, or sale of the
distributorship or sale of the rights granted under this
Agreement, Distributor shall, at its own expense, immediately
change its name and discontinue all use and display thereof.
Upon termination of this Agreement, upon sale of the
distributorship or sale of the rights granted under this
Agreement or upon written request from Coors, all rights
conferred under this Article 9 shall terminate and Distributor
shall discontinue the display and use of any trademark or trade
name of Coors or any other name resembling such trademark or
trade name. Prior to leasing, selling or transferring any
vehicle, facility, equipment, office supplies or other property
bearing any trademark or trade name of Coors, Distributor shall
remove or cause the removal of such trademark or trade name.
10. TERMINATION OF AGREEMENT
10.1 This Agreement may be terminated at any time by mutual agreement of the
parties or by Distributor upon 90 days' prior written notice to Coors.
10.2 Upon the occurrence of any of the following events, Coors
may, by giving written notice to Distributor, immediately
terminate this Agreement, without obligation to comply with the
provisions of section 10.3 and without paying any amount to
Distributor except with respect to the repurchase of
Distributor's inventory pursuant to section 10.5:
10.2.1 Revocation or non-renewal of Distributor's federal,
state or local license or permit to sell or distribute beer.
10.2.2 Suspension for a period of 14 calendar days of the
Distributor's federal, state or local license or permit to sell
or distribute beer.
10.2.3 The inability of Distributor to pay its debts as they
mature; or Distributor's liabilities exceed the fair market value
of its assets; or the filing by Distributor of a voluntary
petition seeking relief under any provision of any bankruptcy or
other law for the relief of debtors; or the filing of a petition
seeking to have distributor declared bankrupt or seeking any
reorganization or recapitalization of distributor, unless such
petition shall have been vacated within 30 days from the filing
thereof prior to the effective date of the termination of this
Agreement; or the appointment of a receiver or trustee for a
substantial portion of the property or assets of Distributor,
unless such appointment shall have been vacated within 30 days
from the date thereof and prior to the effective date of the
termination of this Agreement; or the execution by Distributor of
an assignment for the benefit of creditors; or the dissolution or
liquidation of Distributor.
10.2.4 Conviction of Distributor, any owner of Distributor or
any Manager of a felony or other crime that, in Coors' reasonable
judgment, may adversely affect the goodwill of Distributor or Coors.
10.2.5 Fraudulent conduct or misrepresentation on the part of Distributor,
any owner of Distributor, any Manager or any supervisory employee
of Distributor in dealing with Coors or the Products.
10.2.6 Distributor's failure to pay Coors for Products
purchased from Coors, when such payment is due under the terms
and conditions of sale established by Coors from time to time.
10.2.7 Intentional conduct by the managers or employees of
Distributor in permitting the Sale of Products outside the
quality standards set forth in the Standards Manual.
10.2.8 Completion of any transaction requiring Coors' prior
approval under Article 8 without obtaining such approval.
10.2.9 The cessation of the Distributor's business for five
consecutive days, unless such cessation is the result of acts of
God, war or conditions of national, state or local emergencies.
10.3 The following shall be considered "Deficiencies":
10.3.1 Failure by Distributor to comply with any of the
requirements of the Standards Manual;
10.3.2 The failure of any representation or warranty under
Article 5 hereof;
10.3.3 Failure by Distributor to comply with any of the
commitments of the Appointment Letter;
10.3.4 Failure by Distributor to achieve reasonable performance requirements
established pursuant to sections 4.1 and 4.2 of this Agreement and
the procedures set forth in the Standards Manual;
10.3.5 Failure by Distributor to make timely payment of any
other obligation owing to Coors;
10.3.6 Conduct unbecoming a reputable business person, which,
in the reasonable opinion of Coors, may adversely affect the
reputation of Coors or the reputation of the Products;
10.3.7 Failure by Distributor to submit to Coors a succession
plan, as provided in section 7.3;
10.3.8 Failure by Distributor to perform any of the other
obligations, duties or responsibilities under this Agreement.
10.4 Coors may, at any time, give Distributor written notice of a Deficiency.
10.4.1 If the Deficiency is the Distributor's failure to
achieve any sales performance requirement established by Coors
pursuant to section 4.2 and the system set forth in the Standards
Manual, then within 30 days of the Distributor's receipt of
notice thereof, a representative of Coors shall communicate with
the Distributor Manager(s) to discuss a process by which such
sales performance deficiency will be cured. Coors shall provide
assistance to the Distributor in formulating a plan and timetable
for corrective action, including participation by representatives
of Coors in the performance improvement plan described in the
Standards Manual. No later than 60 days after the initial
discussions with Coors following the notice of sales performance
deficiency, the Distributor shall provide to Coors a completed
plan, in form reasonably acceptable to Coors, describing the
process and timetable for corrective action. Thereafter, for the
duration of the time period of the cure process, Coors shall
provide special assistance to the Distributor pursuant to the
performance improvement plan described in the Standards Manual.
10.4.2 If the Deficiency relates to other than sales
performance, Coors shall specify the reasons for such notice, the
items to be corrected and the time period within which each
Deficiency must be corrected. To the extent that such Deficiency
cannot reasonably be corrected within 30 days of the receipt of
Coors' written notice of Deficiency, Distributor shall have a
period of 30 days from such notice to submit a detailed plan and
timetable of corrective action for Coors' review. Coors and
Distributor shall agree upon a reasonable timetable to correct to
Coors' satisfaction each Deficiency set forth in Distributor's
plan of corrective action, but in no event shall such period
exceed 120 days from Coors' notice of Deficiency. Distributor shall
not be permitted to cure any Deficiency which has been the subject of a
previous notice of deficiency and cure on two or more prior occasions
within the 24-month period prior to the subject deficiency.
10.4.3 If Distributor fails to cure any Deficiency set forth
in the notice from Coors under either section 10.4.1 or section
10.4.2 to Coors' reasonable satisfaction within the appropriate
period provided in section 10.4.1 or section 10.4.2 or if the
subject deficiency has been the subject of a previous notice of
deficiency and cure on two or more prior occasions within the
prior 24-month period, Coors may, by giving written notice to
Distributor, immediately terminate this Agreement. In lieu of
termination and notwithstanding the provisions of section 2.1,
Coors may elect to alter Exhibit B so as to reduce Distributor's
Market Area and/or alter Exhibit A so as to remove one or more of the
Products that the Distributor may buy and resell under this Agreement.
10.5 Promptly upon expiration or termination of this Agreement
for any reason, Distributor will sell and deliver to Coors, or as
directed by Coors, at Distributor's laid-in costs, Distributor's
inventory of Products complying with Coors' quality standards as
of the date of termination. "Laid-in costs" shall mean the
delivered purchase price paid by Distributor to Coors for such
Products, plus deposits, plus the amount of any state and local
taxes paid by Distributor in connection with the purchase of such
Products. Distributor shall separate all inventory not complying
with Coors' quality standards ("Noncomplying Inventory") and
follow Coors' instructions for disposition of such Products.
Payment by Coors shall be conditioned on Distributor's compliance
with the terms of this paragraph. All of Distributor's
Noncomplying Inventory shall be destroyed by Distributor. All
Products in the retail market more than 14 days "out of code"
shall also be destroyed and replaced by Distributor from
Distributor's remaining inventory or shall be repurchased from
the affected retailer by Distributor and destroyed, all at
Distributor's cost. If Distributor fails to locate and destroy
such Products in the retail market, Coors, at its option, may do
so and reduce the amount paid for Distributor's inventory by the
reasonable cost of such actions. Distributor shall immediately
surrender and deliver to Coors, or as directed by Coors, all
barrels, pallets, bottles, cases and supplies acquired by
Distributor from Coors, and Coors shall promptly refund
Distributor's deposits for such items to Distributor.
Distributor shall immediately surrender and deliver to Coors, or
as directed by Coors, all of Coors' signs and advertising
displays in Distributor's possession, and Coors shall reimburse
Distributor's actual costs, plus cost of delivery as directed by
Coors. Distributor and Coors shall, as promptly as practicable,
adjust all outstanding accounts, and Distributor or Coors, as the
case may be, shall immediately pay to the other any remaining
balances due. Upon termination, all unfilled orders placed by
Distributor shall be deemed canceled.
11. RESOLUTION OF DISPUTES
11.1 Except as set forth below, if any dispute between
Distributor and Coors shall occur, including without limitation a
dispute as to whether Coors has grounds to terminate this
Agreement, such dispute shall be submitted by Distributor for
informal mediation ("Mediation") of the dispute by the president
of Coors (or his designee) within 60 days of the date the dispute
shall first arise. Coors, but not Distributor, shall be bound by
the decision of the president of Coors (or his designee)
concerning the dispute. Mediation shall be a condition precedent
to Distributor's right to pursue any other remedy available under
this Agreement or otherwise available under law. Coors shall not
be required to mediate any claim against Distributor for
nonpayment of Distributor's outstanding account.
11.2 Any and all disputes between Distributor and Coors, except
nonpayment of Distributor's account, including without limitation
a dispute as to whether Coors has grounds to terminate this
Agreement, which disputes are not resolved by Mediation, shall be
submitted to binding arbitration in the city nearest to
Distributor in which there is a regional office of the American
Arbitration Association, before a single arbitrator, in
accordance with the Commercial Arbitration Rules and procedures
of the American Arbitration Association. Any and all disputes shall be
submitted to arbitration hereunder within one year from the date the
dispute first arose or shall be forever barred. Arbitration hereunder
shall be in lieu of all other remedies and procedures, provided that
either party hereto may seek preliminary injunctive relief prior to the
commencement of such Arbitration proceedings.
12. MISCELLANEOUS PROVISIONS
12.1 The provisions of this Agreement are subject to and shall be
governed by the laws of the State and other subordinate
jurisdictions in which Distributor's principal place of business
is located. The laws, rules and regulations of such jurisdiction
are hereby incorporated in this Agreement and made a part hereof
to the extent that such laws, rules and regulations are required
to be so incorporated and, to such extent, shall supersede any
conflicting provision of this Agreement, including, but not
limited to, the requirement for or length of any notice period.
12.2 The illegality or unenforceability of any provision of this
Agreement will not impair the legality or enforceability of any
other provision of this Agreement.
12.3 Failure by Coors or Distributor to enforce any term or
provision in this Agreement in any specific instance shall not
constitute a waiver by such party of any such term or provision,
and Coors and Distributor may enforce such term or provision in
any subsequent instance without limitation or penalty.
12.4 Unless otherwise indicated herein, any notice provided for
herein may be served by personal service upon either party or by
facsimile, followed by certified mail, if to Coors, to the
attention of its Senior Vice President of Sales or, should there
be a title change, the senior sales executive, at the address
indicated on the signature line hereof, and, if to Distributor,
to its Principal Manager or Operating Manager, at such address as
provided to Coors by Distributor's as its corporate address of record.
12.5 Except as stated herein, this Agreement may be amended only
by a writing executed by both parties, except that Coors may
unilaterally amend this Agreement at any time if such amendment
does not materially and adversely affect distributor and is
effective as to all distributors in its distributor network bound
by an agreement similar to this Agreement.
12.6 This Agreement, the Standards Manual, and the Appointment
Letter contain the entire agreement of the parties with respect
to the subject matter hereof; there are no other representations,
inducements, promises or agreements, oral or otherwise, between
the parties. In the event of an inconsistency between this Agree
ment and any document incorporated herein, the terms of this
Agreement shall control.
12.7 Nothing herein shall be construed to make Distributor the
joint venturer, partner, agent, servant or employee of Coors, and
Distributor shall not have the power to bind or obligate Coors
except as specifically set forth in this Agreement.
This Agreement is executed by Distributor on the ______ day of
__________________, 1997, effective as of January 1, 1997.
LEGAL NAME
DBA TYPE DBA NAME
By__________________________________
XXXXXX
Coors Brewing Company
000 00xx Xxxxxx - XX000
Xxxxxx, XX 00000
By__________________________________
Xxxx X. Xxxxxxxx
Senior Vice President, Sales
DISTRIBUTOR NO
