Agreement made this 18 day of July, 2003, by and between Xxxxx Records
Group, Inc. d/b/a Xxxxx Distribution Group c/a Xxxx Xxxxx, 00 Xxxx Xxxxx Xxxxx,
Xxxxxxx, Xxx Xxxxxx, 00000 (sometimes referred to a "BDG" and sometimes "we ")
on the one hand, and Blue Moon Group, Inc., c/o 0000 Xxxxxxx Xxxxxx Xx, Xxxxx,
XX 00000 (sometimes referred to as "Grantor" and sometimes as "you"). For good
and valuable consideration, the parties hereby jointly and severally agree as
follows:
1. Term. The Term will commence on the date hereof and continue for a
period of two (2) years.
2. Territory. The United States, Canada, their territories,
possessions and military bases wherever situated.
3. Distribution and License
(a) (i) Grantor irrevocably grant(s) to BDG, for the Term and in
the Territory, the exclusive right, under copyright and otherwise, to be the
sole and exclusive distributor of all Product (as such term is defined herein
below) on Records, in any and all media, whether now known or hereafter
developed, including, without limitation, sales through normal and alternative
retail channels, book stores and book distributors, telephone, retail music and
video chains, wholesale clubs, one-stops and rack jobbers, and to consumers via
satellite, point-of-sale manufacturing, or any other means of direct digital
and/or non-digital transmission or other forms of Records now known or hereafter
devised. The rights granted to BDG hereunder include the right to publicly
perform and to authorize the public performance of Recordings and Records
hereunder, and the right to fully publicize, exploit and advertise all rights
granted to BDG hereunder. Grantor acknowledges that BDG's trademark and/or logo,
and the trademarks or logos of its affiliates, licensees or distributors, may be
included on Records distributed hereunder, provided, BDG's logo will not be used
with greater prominence than your logo. The RED name and/or logo will be
included in packaging of Records hereunder so long as RED is BDG's distributor,
with the size and placement of such logo to be determined or approved by RED,
and to be no more prominent than Grantor's logo. For purposes of this Agreement,
the terms (A) "Product" shall mean (I) all of the Recordings currently owned or
controlled by Grantor or Affiliates as of the date hereof, directly or
indirectly, and (any future Recordings owned or controlled by Grantor or
Affiliates during the Term or to which Grantor or Affiliates shall acquire the
right to distribute or exploit during the Term, including, without limitation,
all existing and future Recordings; (B) "Recordings" shall mean every recording
of sound, whether or not coupled with a visual image, by any method and on any
substance or material, or in any other form or format, whether now or hereafter
known, which is used or useful in the recording, production, manufacture,
distribution and/or transmission of Records; (C) "Records" shall mean all forms
of reproductions, transmissions or communications of Recordings now or hereafter
known, manufactured, distributed, transmitted or communicated primarily for home
use, school use, jukebox use or use in means of transportation, including,
without limitation, Records embodying or reproducing sound alone and audiovisual
Records; (D) "Album" shall mean one (1) or more audio-only Records, at least
thirty-five (35) minutes in playing time, and embodying at least eight (8)
Recordings of different Compositions sold in a single package, and (E)
"Affiliates" means persons or entities owning, controlling, owned by, controlled
by or under common control with Grantor or any of them.
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(ii) (A) You agree to deliver to BOG no fewer than two (2)
Albums per year during the Term for distribution hereunder.
(B) BDG and its licensees shall have a `sell-off period"
dispose of its inventory of Records at the end of the Term for a period of six
(6) months following the expiration of the Term. BOG will not sell any of its
inventory during such period as "cut-outs".
(iii) (A) You and BDG acknowledge that as of the date hereof,
RED is BDG's distributor in the territory. In the event during the Term RED is
no longer BDG's distributor of Records hereunder, if you notify BDG that you
wish to terminate the Term of this agreement, the Term will be terminated as of
the date forty- five (45) days after BDG's receipt of such termination notice
(without limiting the second sentence of section 3(a)(ii)). (All sell-off
provisions and other provisions of this agreement which apply post-termination
xxxx apply with respect to such termination.)
(B) BDG will advise you in writing: (I) upon receipt of
notice from RED claiming any breach of BDG's agreement with RED which, if
proven, would result in a termination of BDG's agreement with RED, and ( if BDG
and RED agree any change in their relationship which would materially impair
BDG's ability to perform its obligations hereunder. Inadvertent failure to so
advise you in writing will not constitute a breach of BDG obligations.
(iv) BDG shall have the rights to use the names and likeness
of artists, performers, producers and all other persons whose performances are
contained in or who performed services with respect to the Products and
biographical material concerning them for the purposes of advertising and
promoting the products hereunder, and Grantor hereby grants BDG such rights.
(b) (i) BDG shall distribute Records in the Territory by
soliciting orders for Records on behalf of Grantor and fulfilling such orders in
the same manner as are applied to other third party Recordings distributed by
BDG.
(ii) BDG shall process customer returns of Records in
accordance with its customary policies and practices, BDG will not be required
to refurbish singles or non-album products that are returned, and may elect,
with Grantor's approval to scrap same upon receipt; if Grantor does not so
approve, BDG will return such Singles or non-Album products to Grantor at
Grantor's expense. With respect to returns that BDG refurbishes, at Grantor's
request, and returns to inventory the refurbishing cost to be charged to Grantor
shall be the amount of BDG's out-of-pocket costs of such refurbishing as charged
by BDG's distributor (currently RED) (See Schedule B for current charges)
Following the termination or expiration of the Term, BDG will not be obligated
to accept or process returns and they shall be Grantor's responsibility.
Notwithstanding the preceding sentence, during the above specified sell-off
period, BDG shall accept returns of Records distributed hereunder, at Grantor's
sole expense, provided Grantor and BDG agree in good faith on an amount to be
paid by Grantor to BDG upon the expiration of the Term sufficient to cover costs
of such returns reasonably anticipated by BDG, and an all events sufficient
collateral remains available to BDG under subparagraph 5(b) below (in the event
BDG and Grantor determine not to require that Grantor pay such amount upon the
expiration of the Term)
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to cover the cost of such returns. Grantor shall cause its next distributor of
Records to accept from customers all returns of Records hereunder and issue full
credit to such customers. If BDG accepts such returns (which BDG has the option
to do), Grantor will reimburse BDG for the costs thereof at the full price
credited to the customer, plus the expenses of returns set forth herein. After
the Term, Grantor shall have a period of fifteen (15) business days in which to
elect whether to destroy such inventory of returns on hand at the end of the
Term or request their delivery to Grantor or Grantor's designee. (With respect
to returns accepted by BDG after expiration of the Term, Grantor shall make such
election within five (5) business days after each notice thereof from BDG.) If
Grantor requests such delivery, then provided that Grantor has paid the costs of
such returns, and pays the cost of such delivery, BDG will deliver such Records
to the place designated. If Grantor has not notified BDG of its election within
that fifteen- (15) or five- (5) day period (as applicable), BDG may destroy such
inventory
(iii) BDG shall have the option to scrap defective Records in
accordance with its policies. All costs of such scrapping shall be chargeable to
Grantor as charged to BDG by its distributor (currently RED) (See Schedule B for
current charges); if Grantor does not so approve, BDG will return such Records
to Grantor or Grantor's designee at Grantor's expense.
(iv) With regard to excess inventory which is not defective or
otherwise scrapped in accordance with BDG's own policies, BDG may notify Grantor
that BDG does not wish to hold such excess inventory and Grantor shall have
thirty (30) days to elect whether (A) to pick up such inventory at its own
expense, or (B) to agree to pay BDG a reasonable warehousing fee to reimburse
BDG for holding such inventory, or (C) instruct BDG to destroy such inventory,
the expense of which shall be borne by Grantor. If BDG has not been so
instructed within such thirty-day period, BDG may elect to destroy such
inventory or apply the applicable warehousing charge at Grantor's expense. Any
inventory on hand, which exceeds the prior six-month's sales of such particular
product, shall automatically be deemed excess inventory.
(v) Grantor's Records shall be subject to the same sales, free
goods and promotional programs, as approved by Grantor, as its distributor
(currently REO) applies to comparable products distributed by BDG.
(c) Notwithstanding anything to the contrary contained herein, BDG
shall have the right, in its reasonable judgment, to decline to distribute (or,
if distribution has commenced, discontinue to distribute) Products on the
grounds of advocacy of illegal activity, obscenity, patent offensiveness, rights
of privacy or publicity and/or defamation or other violation of law or
infringement on the rights of any person or entity including without limitation
rights of copyright and trademark, or if such release constitutes a breach of
any warranty representation or covenant contained herein. In addition, BDG shall
have the right to decline to distribute Products in excess of five (5) Albums
per year. With respect to any Product which BDG so declines to distribute,
Grantor shall then have the right to seek distribution elsewhere.
(d) Subject to subparagraph 3(c) above, BDG will release or
distribute each Album hereunder in the Territory within one hundred twenty (120)
days after your delivery of such Album to BDG together with all required
artwork, consents and inventory required for the distribution of Album Record
units of such Album and your and BDG's approval of the marketing plan for such
Album.
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4. Intentionally omitted without implication
5. Further Understandings
(a) Grantor shall arrange, at its own expense, for the manufacture
of all Products hereunder and their delivery to BDG's warehouses and Grantor
shall be responsible for the costs of such manufacture and delivery. Grantor
shall assure that the outside packaging of each of the Products will contain
printed text in the following form "Manufactured by.. ." followed by the name of
Grantor. Without limiting the foregoing (or any of Grantor's other obligations
hereunder) Grantor will take any and all other actions which may be required to
comply with any applicable statutes and regulations relating to so-called
"consumer protection" or otherwise.
(b) Grantor hereby grants to BDG, as collateral security for all
fees and other amounts payable to BDG by Grantor hereunder, or any portion
thereof, all of Grantor's right, title and interest in and to Grantor's
inventory of Records that is in BDG's possession at anytime, the master
recordings that are embodied on such Records or are otherwise subject to this
agreement, and the proceeds thereof (the "Collateral"). Grantor shall execute
UCC-1 financing statements, security agreements, and any other documents which
are legally necessary to carry out the purposes and effects contemplated by this
agreement. Grantor hereby irrevocably appoints BDG to execute any such documents
or instruments in Grantor's name as Grantor's attorney-in-fact, such appointment
being coupled with an interest, and BDG may file such documents in any
jurisdiction where BDG deems it appropriate, In addition, Grantor will assign to
the benefit of BRG, one hundred thousand (100,000) publicly-traded shares of
Blue Moon Group, Inc. ("Surety Shares") to ensure payment to BRG in the event
Grantor's account is in a negative balance and Grantor fails to make payment to
BDG in accordance with Paragraph 8(c). During the Term, to the extent that the
per-share value of the Surety Shares falls below Two Dollars ($2.00) per share
for fifteen (15) consecutive days, Grantor shall promptly deliver to BRG such
additional shares as may be necessary to increase the aggregate value of the
Surety Shares to Two Hundred Thousand Dollars ($200,000) and those additional
shares shall also be deemed Surety Shares. The Surety Shares will be returned to
Grantor after the later of the end of the Term and the reconciliation of
Grantor's account hereunder to the extent that they have not been depleted in
accordance with the provisions of this agreement.
(c) Subject to the provisions of paragraph 8(c) below, Grantor
shall determine the selling price of the Products to customers, provided that
the selling price of each of the Products as so determined by Grantor shall be
reasonably consistent with BDG's standard selling prices in similar price
categories. Grantor shall also determine the price category designation (i.e.,
top-line, mid-line, budget, etc.) of the Products and/or the suggested retail or
other basic price category for sales of its Products hereunder, provided such
selection is among the categories of pricing offered by BDG for its other
distributed records, and the applicable wholesale pricing and discounts will
apply to such Products as applied by BDG to its other records. In addition, in
the event that Grantor has selected one such price for a particular product but
later wishes to change same (in accordance with the provisions hereof) Grantor
must give BDG at least sixty days' prior notice of such change. Grantor
acknowledges that it is BDG's policy, in the case of any such price reductions,
to credit customers for a differential payment based on the lower price for
sales during a reasonable period prior to price change.
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(d) Grantor shall also be responsible for all costs and expenses
incurred in connection with credits issued to customers for "defective" Products
pursuant to its defective products policy and the costs and expenses of "sales
plans" which Grantor wishes to offer customers (it being understood that BDG
shall nevertheless have the right to approve such plans if they require special
handling or expense on the part of BDG). Grantor will be responsible for the
costs of "special dating" (it being understood that BDG shall nevertheless have
the right to approve such special dating if they require special handling or
expense on the part of BDG) at the interest accrued on the aggregate price of
all Products sold that are subject to "special dating" at an assessed rate equal
to two percent over the then current ninety day Treasury xxxx rate for
government bonds on the close of each month's sales, as quoted by The Wall
Street Journal and applied to the period of time that BDG's standard terms are
extended for such special dating.
(e) Grantor will consult with BDG to select the release dates for
Products hereunder. Grantor shall, reasonably prior to release, provide BDG with
five so called "advance" copies (with complete packaging) of each of the
Products to be distributed hereunder for each format of release.
(f) Grantor shall, at its own cost and expense, procure from a
nationally recognized insurance carrier, and maintain in full force and effect
at all times during the Term, a liability (errors and omissions) insurance
policy naming BDG as an additional insured; such insurance policy shall have a
limit of at least one million dollars per claim and three million dollars in the
aggregate, covering claims arising in connection with BDG's distribution or
exploitation of Products hereunder. Grantor shall deliver to BDG upon execution
of this agreement, but in no event later than Grantor's initial delivery to BDG
of Products hereunder, evidence satisfactory to BDG of such insurance coverage
in the form of valid insurance certificates. The foregoing policy must cover
claims, regardless of when raised, based on occurrences relating in any way to
the Products and shall not be canceled or modified without BDG's prior written
consent. Without limiting BDG's rights, Grantor's failure to accomplish the
foregoing shall give rise to a right of termination by BDG.
(g) BDG shall place so-called "co-op" advertisements with respect
to Grantor's Products solely subject to Grantor's approval. Any materials
supplied by BDG with respect to Grantor's Products for inclusion in such "co-op"
advertisements will consist of materials supplied by or approved by Grantor.
Grantor shall be solely responsible for the costs of all advertising with
respect to Grantor's Products including such "co-op' advertising. Such
advertising will be charged to Grantor on the statement in the same month it is
credited to BDG customer. Grantor shall reimburse BDG therefor, or (at BDG's
election) BDG may deduct such sums from other payments hereunder. BDG shall have
the right of reasonable approval over any advertising in excess of BDG's plans
or which BDG otherwise feels would create unreasonable financial exposure for
Grantor or BDG.
6. Reserves
(a) BDG will be entitled to hold reasonable reserves against
returns as follows: With respect to Albums in any configuration, reserves will
not exceed 25% of gross sales during each year, including the last year, of the
Term; with respect to
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singles, EP or other Products which are not Albums, reserves will not exceed 40%
of gross sales. Each reserve will be established in the month in which BDG is
paid for such sales. Notwithstanding the foregoing, in the event BDG's
distributor is entitled to hold reserves in excess of the maximum amounts
prescribed above, BDG will be entitled to hold such reserves hereunder.
(b) Reserves will be liquidated on the following schedule: 50% of
each reserve will be liquidated within twelve (12) months after such reserve is
established. The balance of each such reserve will be liquidated within eighteen
(16) months after it is established. However, with respect to sales during the
last twelve (12) months of the Term, the liquidations will be not be made until
eighteen (18) month's after the end of the Term. Notwithstanding the preceding
sentence, in the event that Grantors' new distributor post-Term is a major
national distributor and agrees to accept future returns, reimburse BDG and give
BDG appropriate assurances, then BDG will liquidate reserves six (6) months
after the end of the Term.
(c) Reserves will also be offset against other monies owed by
Grantor such as (without limitation) advertising reimbursements.
(d) Without limiting any of BDG's other rights and remedies under
this Agreement, Grantor shall reimburse BDG for any additional amounts due BDG
in excess of reserves held within five (5) business days of BDG's rendering of
its final statement. BDG may, in its discretion, continue accepting returns
authorized prior to the end of the Term after the Term and shall have the right
to offset those returns and any attendant fees against reserves being held.
Without limiting any of BDG's other rights and remedies under this Agreement, if
the amounts being held by BDG are not sufficient to cover the amount owed by
Grantor, or if reserves have already been liquidated by BDG, then Grantor shall
reimburse BDG for any additional amounts due BUG within five (5) business days
after BDG's rendering a statement selling forth the amount so owed.
7. Distribution Fee, Service Fees and Expenses
(a) (i) BDG will charge and retain for itself a distribution fee
of (A) twenty-eight percent (28%) of net sales (i.e., gross sales net only of
actual returns and credits) in the United States, and (B) thirty percent (30%)
of such net sales in Canada, in excess of zero.
(ii) With respect solely to net sales in the United States,
the distribution fee with respect to net sales of Products in the United States
in excess of Two Million Five Hundred Thousand Dollars ($2,500,000) during any
calendar year period will be reduced by one percent (1%) for each incremental
Two Million Five Hundred Thousand Dollars ($2,500,000) in net sales during that
one-year period, solely on such excess sales (e.g. the distribution fee on net
sales of Products in excess of Five Million Dollars ($5,000,000) but less than
Seven Million Five Hundred Thousand Dollars ($7,500,000) during any calendar
year period will be 26%), provided, in no event will the distribution fee be
less than twenty-four percent (24%) of net sales.
(b) With respect to any other expenses BDG incure in connection
with its activities hereunder at Grantor's request or with Grantor's approval
(provided, any expenses which do not exceed a budget approved by Grantor will be
deemed approved). BDG shall charge Grantor (and/or deduct from proceeds
hereunder) such
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list of certain charges to which BDG is currently subject is attached hereto as
Schedule "B". If BDG undertakes the performance of a service, which is normally
a third party expense, then BDG shall only charge a fee commensurate with such
third party expense or, in the absence of such a figure, then the fee generally
charged by BDG in connection with such services for its other distributed
products. To the extent that such expenses are incurred for a variety of
products, not all of which are Products hereunder, then a reasonable allocation
shall be made.
8. Proceeds
(a) BDG will report sales or exploitations of Records one hundred
and ten (110) days following the month in which such sale or exploitation is
concluded and reported to BDG.
(b) Proceeds of sales received by BDG shall be paid as follows:
(i) BDG will compute such proceeds of sale, less actual
returns and reserves, and further deduct there from distribution fees and
manufacturing charges and all other costs or expenses incurred by BDG in
connection with Products or other offsets owed to BDG, and the balance shall be
payable to Grantor.
(c) In the event that in any particular month charges and/or
returns exceed proceeds available to cover same, Grantor shall make payment to
BDG of such deficiency within twenty (20) days after BDG's request therefor.
Notwithstanding anything to the contrary contained herein, and without limiting
any of BDGs other rights and remedies under this Agreement, the Uniform
Commercial Code or otherwise, in the event that Grantor fails to pay BDG any or
all of any such deficiency within such twenty (20) day period, then BDG shall
have the right without further notice to Grantor to sell Product in such market
channels, to such accounts, at such prices and subject to such policies and
discounts which in BDG's sole business judgment will enable BDG to recover some
or all of such deficiency, fully as if BDG held full legal title to such
Product.
9. Accountings
(a) Any statements rendered by BDG to Grantor shall be binding
upon Grantor and not subject to any objection by Grantor for any reason unless
specific objection in writing, stating the basis thereof, is given to BDG within
two (2) years from the date rendered. Failure to make specific objection within
said time period shall be deemed approval of such statement.
(b) Grantor shall have the right at Grantor's own expense to
examine BDG's books and records as the same pertain to sales under this
agreement. Grantor may make such an examination for a particular statement only
once and only once per statement, and only within two (2) years after the
statement is rendered. Such examination shall be conducted during BDG's usual
business hours, and at the regular place of business where BDG keeps the books
and records to be examined. Such examination shall be conducted by an
independent certified public accountant or other professional advisor approved
by BDG. Grantor will not have the right to bring an action
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against BDG in connection with any accountings or payments hereunder unless
Grantor commences the suit within three (3) years from the date such statement
was rendered.
(c) Grantor acknowledges that BDG's books and records contain
confidential trade information. Neither Grantor nor its representatives shall at
any time communicate to others or, professional advisors approved by BDG or by
direction of a judicial court, or use on behalf of any person or entity any
facts or information obtained as a result of such examination of BDG's books and
records or any other activity hereunder.
10. Additional Obligations. BDG shall have no obligations hereunder
except as stated herein. Specifically, and without limitation, Grantor shall be
solely responsible for and shall pay all costs and expenses incurred in the
production, manufacture, creation or acquisition of Recordings, Records and
Products, including without limitation the packaging therefor; any and all
freight and delivery charges, insurance costs or other costs in connection with
the shipment of Products; the costs and expenses of artwork preparation and
reproduction; costs of preparing and or compiling packaging, sleeves and
containers; costs and expenses of advertising, marketing and promoting products;
royalties, payments or fees to artists, producers, performers, copyright
proprietors, songwriters, publishers, musicians, unions, guilds, studios,
engineers and any other third parties in connection with the Products; and all
sales, use, property or any other taxes levied on any amounts hereunder or on
the sale of Products, if any. If Grantor requests and BDG elects to manufacture
Products hereunder, Grantor will supply to BDG finished artwork and packaging
with respect to the Products hereunder and shall pay for all reproduction of
same, unless BDG elects to pay same on Grantor's behalf and charge such costs
against proceeds hereunder. The payment of manufacturing costs, and production
costs of masters, records and artwork, shall be Grantor's responsibility. If BDG
shall make expenditures of manufacturing costs (which it may refuse to do at its
discretion) or other costs, all such costs incurred by BDG at the request of
Grantor shall be reimbursable by Grantor within twenty (20) business days
following invoice therefor, BDG may, without limiting its other rights and
remedies, deduct same from proceeds otherwise payable to Grantor.
11. Warranties and Representations
(a) Grantor warrants and represents that:
(i) Materials embodied on the Products and the packaging
therefor will not violate any law or infringe upon the rights of any party. As
used herein "Material" shall mean and include, without limitation, all musical
compositions, all performances, and dramatic, artistic, musical and literary
material embodied on Recordings and Products and the names, biographical
materials and likeness, ideals and intellectual properties, and all other
materials contained on the packaging thereof and advertising therefor, and the
trademarks and logos used in connection therewith.
(ii) No agreement of any kind heretofore or hereafter entered
into by Grantor or its principals, officers, shareholders, directors,
representatives, agents or other parties deriving rights from Grantor, will
interfere in any manner with the complete performance of this agreement.
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(iii) Grantor possesses all right and power to enter into and
fully perform this Agreement.
(iv) The exercise of BDG's rights hereunder shall not obligate
BDG to make payment to any third party or obtain consents from any third party.
(v) Grantor has not sold, assigned, transferred, leased,
conveyed or granted a security interest, or otherwise disposed of, and will not
sell, assign, transfer, lease, convey or grant a security interest in and to the
Recordings or Products.
(vii) Intentionally omitted without implication
(viii) Grantor is a Corporation duly organized, existing and
in good standing under the laws of Florida.
(ix) Grantor agrees to and does hereby indemnify, save and
hold BDG harmless from and against any and all claims, damages, liabilities,
costs and expenses (including without limitation legal expenses and counsel
fees) arising out of any breach of Grantor's warranties, representations or
agreements made herein, or its failure to perform in accordance with this
agreement, as reduced to a final non-appealable adverse judgment, and will
reimburse BDG on demand for any costs incurred by BDG in respect of any claim or
liability to which the foregoing indemnity relates or (at its election) deduct
such amounts from payments hereunder.
(b) (i) BDG represents and warrants that, pursuant to its
agreement with RED ("RED") as of the date hereof and otherwise, it possesses all
right and power to enter into and fully perform this agreement and to perform
all of the terms hereof, and this agreement will not violate any third party
rights in performance of services hereunder.
(ii) BDG agrees to and does hereby indemnify, save and hold
Grantor harmless from and against any and all claims, damages, liabilities,
costs and expenses (including without limitation legal expenses and counsel
fees) arising out of any breach of BDG's warranties, representations or
agreements made herein, or its failure to perform in accordance with this
agreement, as reduced to a final non-appealable adverse judgment, and will
reimburse Grantor on demand for any costs incurred by Grantor in respect of any
claim or liability to which the foregoing indemnity relates or (at its election)
deduct such amounts from payments hereunder.
12. Notices All notices required to be given to BDG shall be sent to
BDG at its address first mentioned herein, and all statements and any and all
notices to Grantor shall be sent to Grantor at its address first mentioned
herein, or such other address as each party respectively may hereafter designate
by notice in writing and (except for royalty statements), shall be sent by
registered or certified mail, return receipt requested, and the day of mailing
of any such notice shall be deemed the date of the giving thereof (except
notices of chance of address, the date of which shall be the date of receipt by
the receiving party). BDG shall endeavor to send courtesy copies of each such
notice to Grantor to Xxxxx Xxxxxxx, Esq., 000 Xxxxxxx Xxxxxx, 00 Xxxxx, Xxx
Xxxx, XX 00000, provided, however, that any inadvertent failure by BDG to send
such courtesy copies shall not be deemed a breach of this agreement or impair
the effectiveness of the notice
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concerned. All notices to BDG shall be served upon BDG to the attention of Xxxx
Xxxxx, at the above address, with a copy to Xxxxxxx Xxxxxxx, 000 Xxxx 00 Xxxxxx,
Xxxxx 0X, Xxx Xxxx, XX 00000.
13. Miscellaneous
(a) Grantor recognizes that the sale of Records is speculative and
agrees that the judgment of BDG with regard to any matter affecting the sale,
distribution and exploitation of such Records shall be binding and conclusive
upon Grantor.
(b) BDG may assign this agreement or any of its rights hereunder,
including without limitation to its distributors or licensees, provided that it
remains secondarily liable. Grantor may assign its right to receive monies under
this agreement, provided Grantor has provided documentation of such assignment,
including without limitation a letter of direction on BDG's standard form,
reasonably satisfactory to BDG, reflecting such assignment.
(c) Neither party shall be entitled to take action by reason of
any alleged breach by the other party of its obligations hereunder, unless the
breaching party has failed to remedy such breach within a reasonable time
following receipt of the other party's notice thereof.
(d) If at any time during the Term, by reason of any act of God,
fire, earthquake, flood, explosion, strike, labor disturbance, civil commotion,
act of government, its agencies or officers, any order, regulation, ruling or
action of any labor union affecting BDG, or any shortage of or failure or delays
in the delivery of materials, supplies, labor or equipment, or any other cause
or causes beyond BDG's control (each, a "Force Majeure Event") the performance
of any of BDG's obligations hereunder is delayed, interrupted or prevented, then
the performance of such ob shall be excused to the extent so delayed,
interrupted or prevented and the Term hereof extended for the duration of such
Force Majeure Event. If such delay exceeds six (6) months, either party shall
have the right to terminate upon sixty (60) written notice.
(e) This writing sets forth the agreement between the parties with
respect to the subject matter hereof and supersedes any and all prior
agreements, and no modification, amendment, waiver, termination or discharge of
this agreement shall be binding upon either party unless confirmed by a written
instrument signed by all parties hereto. The captions of the paragraphs in the
Agreement are included for convenience only and will not affect the
interpretations of any provision hereof
(f) In entering into this agreement, Grantor and BDG each have and
shall have the status of an independent contractor and nothing herein contained
shall contemplate or constitute one as agent or principal or employee or partner
of the other.
(g) This agreement shall be construed in accordance with the laws
of the state of New Jersey applicable to contracts to be wholly performed
therein. The parties agree that any action, suit or proceeding based upon any
matter, claim or controversy arising hereunder or relating hereto shall be
brought, solely in the state or federal courts in the county of Monmouth, except
that in the event BDG is sued or joined in any other court or in any other forum
in respect of any matter which may give rise to a claim by BDG hereunder and BDG
wishes to join Grantor in such action, Grantor
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consents to the jurisdiction of such court or forum over any such claim which
may be asserted by BDG thererin. Any process in any action, suit or proceeding
arising out of or relating to this agreement may, among other methods permitted
by law, be served upon Grantor by delivering or mailing the same in accordance
with paragraph 12 hereof.
(h) Grantor shall execute such additional documents and
instruments of transfer as BDG may reasonably request regarding the rights
granted to BDG hereunder.
(i) In resolving any dispute or construing any provision
hereunder, there shall be no presumptions made or inferences drawn because the
attorneys for one of the parties drafted the agreement, because the drafting
history of the agreement, or because of the inclusion of a provision not
contained in a prior draft or the deletion of a provision contained in a prior
draft.
(j) The headings used herein are intended for reference only and
shall not be deemed part of this agreement.
IN WITNESS WHEREOF, the parties have executed this agreement as of the date
first above written.
BRODY RECORDS GROUP, INC. BLUE MOON GROUP, INC.
By: /s/Xxxx Xxxxx By: /s/Xxxxxxx Xxxxx
------------- ----------------
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SCHEDULE "B"
Attached to Agreement dated
As of July 18, 2003 between
Blue Moon Group, Inc.
And Brody Distribution Group
The following are the current fees charged by RED to BRG for the performance of
certain services to BRG., which fees are subject to change. Fees for services
not listed herein will be assessed at the same rate that RED charges to BRG.
Returns Handling: Two percent (2%) of the applicable wholesale price
Refurbishing Fee: $0.25 for each unit of Product returned for
credit and refurbished and recycled into
inventory.
Scrapping Fee: $0.10 for each unit of Product returned for
credit and scrapped
Excess Inventory- $0.00333 per month for each unit of Product
held in inventory in excess of six months, to
be calculated on a rolling net basis
Excess Freight Charges- All freight charges incurred by or on behalf of
RED for shipping of units of Products at
BRG's written request other than as regular
bulk freight
Shipments to Non-RED
Customers: $0.30 per unit (plus all applicable freight
charges) for units of Products sold directly to
non-RED customers by a BRG Entity and
shipped from RED locations, or shipped from
RED locations to a BRG Entity's warehouse
or elsewhere at BRG's direction. Such units
shall only be sent in box lot quantities.
Shipments Outside
Territory: $0.15 per unit (plus all applicable freight
charges) for orders of product shipped from RED
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