MASTER SALES AGREEMENT
THIS
MASTER SALES AGREEMENT is made and entered into this 9th day of December, 2005,
by and between Xxxx’x Inc., a Delaware corporation (“Luby’s”), on the one hand,
and Xxxxxx Restaurants, Inc. (a Texas corporation) and Xxxxxx Partners, L.P.
(a
Texas limited partnership), on the other hand (such Xxxxxx entities being
collectively referred to herein as the “Xxxxxx Entities”).
W
I T N E S S E T H:
WHEREAS,
Luby’s is in the business of owning and operating food cafeterias and other food
purveying businesses;
WHEREAS,
the Xxxxxx Entities are in the business, among other things, of designing and
fabricating restaurant equipment and furnishings and have developed skills
and
expertise in such regards over many years of operation;
WHEREAS,
the Xxxxxx Entities desire from time to time to sell certain of their products
on a non-exclusive basis to Luby’s and Luby’s desires from time to time to
purchase certain products from the Xxxxxx Entities;
WHEREAS,
Luby’s and the Xxxxxx Entities desire to set up a mechanism and master agreement
among them for purposes of facilitating the placement and fulfillment of orders
for products;
NOW,
THEREFORE, in consideration of the premises, the mutual agreements contained
herein and other good and valuable consideration, the receipt and sufficiency
of
which are hereby acknowledged by the parties, the parties hereby agree as
follows:
ARTICLE
I
DEFINITIONS
1.1. Definitions.
For the
purposes of this Agreement, in addition to the terms defined
elsewhere
herein, the following terms shall have the following meanings:
(a) “Affiliate”
means any Person that controls, is controlled by or is under common control
with
any other Person;
(b) “Agreement”
means this Master Sales Agreement, as the same may subsequently be amended,
modified or supplemented in accordance with its terms;
(c) “Encumbrance”
means any mortgage, pledge, lien, claim, encumbrance, charge or other security
interest, option, defect or other right of any third Person of any nature
whatsoever, other than inchoate mechanic’s, materialmen’s and similar liens
arising in the ordinary course of business;
(d) “Party”
means either Luby’s, on the one hand, or the Xxxxxx Entities, on the other, and
“Parties” means both Luby’s and the Xxxxxx Entities;
(e) “Person”
means a natural person or any entity of any kind, including (without limitation)
joint stock companies, corporations, partnerships, limited liability companies,
governmental entities and any other entity organized or formed under the law
of
any jurisdiction;
(f) “Product”
means any product manufactured or sold by the Xxxxxx Entities as may be agreed
upon by the Parties in writing from time to time;
(g) “Purchaser”
means Luby’s, and includes all subsidiaries and Affiliates thereof;
and
(h) “Seller”
means the Xxxxxx Entities and includes all subsidiaries and Affiliates
thereof.
1.2 Other
Definitional Provisions.
(a) The
words
“hereof”, “herein” and “hereunder” and words of similar import when used in this
Agreement shall, unless a specific provision is expressly referenced, refer
to
this Agreement as a whole and not to any particular provision of this document,
and Article references contained in this Agreement are references to the
Articles in this Agreement, unless otherwise specified.
(b) All
words
used herein in the singular shall extend to and include the plural, and all
words used herein in the plural shall extend to and include the
singular.
(c) All
words
used in any gender shall extend to and include all genders.
ARTICLE
II
SALE
AND PURCHASE
2.1 Sale
and Purchase Obligations.
(a) Seller
agrees to sell to Purchaser, only upon Purchaser’s order (after compliance with
the terms of Section 2.3 hereof), and Purchaser thereafter agrees to purchase
from Seller, any Product of Seller offered to Purchaser at any time during
the
term of this Agreement and in accordance with the terms and provisions
hereof.
(b) If
Seller
is unable, for any reason other than a volitional declination to do so, to
supply Purchaser with Purchaser’s requirements for any Product within the time
period specified for delivery of such Product in an order from Purchaser, then
the obligations to purchase and sell hereunder shall cease in respect of such
order and shall be of no further effect or force.
(c) No
provision of this Agreement shall be construed to impair Seller’s right to
supply any Product to any person other than Purchaser. No provision of this
Agreements shall be construed to impair Purchaser’s right to purchase any
Product from any person other than Seller.
2.2 Orders
and Deliveries.
All
orders, processing and deliveries of any Product shall be made in accordance
with customary and routine handling of orders, processing and deliveries for
fabricated restaurant equipment and furnishings to third parties in respect
of
the particular Product or type of Product, unless otherwise agreed in writing
by
both Parties.
2.3 Pricing
and Payment.
(a) The
Product(s), and the purchase price payable by Purchaser for each unit of the
Product, shall be agreed upon between the Parties as set forth in the proposed
order with respect to the Products identified therein. The proposed order shall
be presented to a board committee of Purchaser for review and approval which
does not include any person affiliated with the Xxxxxx Entities or shall
otherwise be handled in accordance with a procedure devised by such a committee.
Only after review and approval by such committee, or in accordance with the
procedure devised by such committee, may any order be placed by Purchaser or
honored by Seller.
(b) As
reasonably requested from time to time, Seller shall provide Purchaser
reasonable information to allow Purchaser to confirm Seller’s approximate costs
of manufacturing or purchasing, as the case may be, any Product offered to
Purchaser by Seller.
(c) Purchaser
shall be responsible for the payment of all taxes related to the sale and
purchase of the Products.
(d) Seller
shall send Purchaser an invoice within 30 days after the delivery of Products
pursuant to any order setting forth the types and quantities of Products shipped
by Seller to Purchaser during the previous month. Within 30 days after the
receipt of such invoice, Purchaser shall remit payment for such Products to
Seller.
2.4 Inspection
and Rejection.
(a) Purchaser
reserves the right to reject or revoke acceptance of any shipment of Product
as
a result of any defect or nonconformity thereof. If any Product is rejected
or
its acceptance is revoked, Purchaser shall notify Seller of such rejection
or
revocation of acceptance within 30 days of receipt of such Product, specifying
with particularity the grounds for its rejection or revocation of
acceptance.
(b) Seller
shall immediately replace any such Product or immediately refund the price
therefor, at Purchaser’s option. If Seller is unable to replace any such Product
within 90 days of Purchaser’s rejection or revocation of acceptance for any
reason other than volitional declination to do so, then the obligations to
sell
and purchase in respect of such Product shall cease and be of no further effect
or force.
(c) All
rejected Products shall be returned by Purchaser to Seller, at Seller’s sole
cost, promptly after Purchaser’s rejection or revocation of acceptance of such
Products.
Warranties
of Seller.
2.5 Warranties
of Seller.
(a) SELLER
EXTENDS TO PURCHASER THE ORDINARY AND CUSTOMARY WARRANTY OF FITNESS FOR PURPOSE,
AS DESCRIBED IN AN ORDER, IN RESPECT OF EACH PRODUCT SOLD BY SELLER TO PURCHASER
AS IF PURCHASER WERE A THIRD PARTY, BUT THERE ARE NO OTHER EXPRESS OR IMPLIED
WARRANTIES.
(b) Seller
warrants to Purchaser that the Products, at the time of delivery to Purchaser,
will be free from any Encumbrances.
2.6 Risk
of Loss.
The
risk of loss from any casualty to the Products, regardless of the cause, shall
be on Seller until the time of receipt of the Products by Purchaser at
Purchaser’s delivery destination and until Purchaser has completed any proper
receipt inspection.
2.7 Indemnification.
Seller
agrees to defend, indemnify and hold harmless Purchaser, and it affiliates
and
their respective directors, officer, employees, agents, successor and assigns
from and against any and all claims, losses, damages, liabilities, reasonable
counsel fees and costs incident thereto incurred by or asserted against
Purchaser as a result of damage to the property of Purchaser or others, or
personal injuries to or injuries resulting in the death of any person or
persons, including directors, officers, employees and agents of Purchaser
relating to the Products; provided, however, Seller shall not have any liability
(whether direct or indirect, in contract, tort or otherwise) to Purchaser
unless, if contested, such claims, losses, damages, liabilities, counsel fees
or
costs are determined, in a final judgment by a court of competent jurisdiction
(not subject to further appeal), to have resulted primarily and directly from
the gross negligence or willful misconduct of Seller or its officers, employees
or agents.
ARTICLE
III
TERM
AND TERMINATION
3.1 Term.
The
term of this Agreement shall commence on January 1, 2006 and continue through
August 31, 2008, unless terminated in whole or in part by either party upon
not
less than 10 days written notice.
3.2 Effect
of Termination.
Termination by either Party shall not relieve (a) Seller from its obligation
to
complete and deliver any unfinished order; (b) Seller from the warranty, risk
of
loss or indemnification provisions of Sections 2.5, 2.6., and 2.7; (c) Purchaser
from its obligation to pay for unfinished orders or for Products received and
accepted but not yet paid for; and (d) either Party from the provisions of
Articles 4, 5, 6 and 7.
3.3 Termination
Not Exclusive Remedy.
The
termination of this Agreement shall not release either Party from its liability
to the other Party under this Agreement arising from a breach of this Agreement
or under Section 2.7 hereof.
3.4 Survival.
Each of
the Parties’ obligations under this Agreement shall survive the expiration or
termination of this Agreement to the extent such obligations should have been
performed during the term of this Agreement and were not so performed.
Notwithstanding the expiration or termination of this Agreement, this Agreement
shall remain in full force and effect until each Party has discharged all of
its
obligations hereunder.
ARTICLE
IV
CONFIDENTIAL
INFORMATION
4.1 Non-disclosure.
Either
Party may from time to time provide to the other Party certain advice, technical
information, know-how and other proprietary data and information with respect
to
Products or the use or configuration thereof. Inasmuch as various of these
materials and advice (all of which will herein be referred to as the
“Confidential Information”) contain confidential information and trade secrets,
it is hereby agreed that any Confidential Information that one Party discloses
to the other is valuable, proprietary property belonging to the disclosing
Party, and the receiving Party agrees that it will neither use nor disclose
to
any third party (except in the performance of its duties hereunder) any
Confidential Information, except on prior written consent of the other
Party.
4.2 Return
of Information.
The
Parties agree, either upon the termination of this Agreement or upon request,
to
surrender to the other all documentary material including Confidential
Information, price lists, catalogues, drawings, designs, technical literature,
sales literature, samples and any other documents, papers or other properties
of
the other Party, however previously supplied.
4.3 Survival
of Article.
The
obligations of the Parties pursuant to this Article shall continue in full
force
and effect after the termination of this Agreement regardless of how this
Agreement is terminated.
ARTICLE
V
GOVERNING
LAW
The
Parties agree that this Agreement shall be construed in accordance with, and
all
disputes hereunder shall be governed by, interpreted and enforced in accordance
with the laws of the State of Texas without regard to the laws of such state
relating to conflict of laws.
ARTICLE
VI
ARBITRATION
The
Parties agree that any and all disputes arising in connection with this
Agreement including, but not limited to, the validity of this provision or
the
performance by either Party of any obligations, commitments or promises
hereunder, which cannot be resolved through good faith negotiations to the
mutual satisfaction of both Parties within thirty (30) calendar days (or such
longer period as may be mutually agreed upon by the Parties) after the
complaining Party has notified the other Party of the complaint, shall be
submitted to final and binding arbitration. Any such dispute, claim or
disagreement subject to arbitration pursuant to the terms of this paragraph
shall be resolved by arbitration in accordance with the Commercial Arbitration
Rules of the American Arbitration Association (the “AAA Rules”). An arbitrator
shall not have any authority to award consequential, exemplary or punitive
damages. The Parties agree that the decision of the arbitrator selected
hereunder will be final and binding on both Parties. The place of arbitration
shall be Houston, Texas, and each Party shall pay its individual costs and
fees
arising therefrom. Judgment upon the award resulting from arbitration may be
entered in any court having jurisdiction for direct enforcement, or any
application may be made to a court for a judicial acceptance of the award and
an
order of enforcement, as the case may be.
ARTICLE
VII
GENERAL
PROVISIONS
7.1 Notices.
To be
effective, all notices, consents or communications required (other than routine
orders and invoices for Products, which shall be delivered in the customary
manner as in the case of orders and invoices to third parties) shall be in
writing and shall be delivered by hand or sent by first-class prepaid certified
or registered mail, return receipt requested, overnight delivery service or
facsimile (confirmed by first-class prepaid letter sent within 24 hours of
dispatch) to the Parties at their respective addresses or facsimile numbers
and
to the attention of the persons set forth below. Any Party may change its
address or facsimile number for purposes hereof by notice to all other Parties
in the manner provided above. Notice will be effective upon
receipt.
Luby’s:
Xxxx’x, Inc.
00000
Xxxxxxxxx Xxxxxxx
Xxxxx
000
Xxxxxxx,
Xxxxx 00000
Attention: Chairman
of the Finance and Audit Committee
and
to:
Xxxxxxxx
Xxxx Xxxxxxxxxx Xxxxxx
Xxxxxxx
Xxxxxx & Xxxxxx Incorporated
000
X.
Xx. Mary’s Street, Suite 600
San
Antonio, Texas 78205
Attention: Xxxx X.
Xxxxxx, Xx.
Telephone: (000)
000-0000
Facsimile: (000)
000-0000
Xxxxxx
Entities:
Xxxxx
Xxxxxxx
Controller
000
Xxxx
Xxxxxxx,
Xxxxx 00000
with
a
copy to:
Fulbright &
Xxxxxxxx L.L.P.
0000
XxXxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxx 00000-0000
Attention: Xxxxxxx X.
Still
and
shall
become effective upon receipt.
7.2 Severability.
Should
any provision of this Agreement be held unenforceable or invalid, then the
Parties hereto agree that such provision shall be deemed modified to the extent
necessary to render it lawful and enforceable, or if such a modification is
not
possible without materially altering the intention of the Parties hereto, then
such provision shall be severed from this Agreement. In such case the validity
of the remaining provisions shall not be affected and this Agreement shall
be
construed as if such provision were not contained herein.
7.3 Headings.
All
headings used herein are for the convenience of reference only, do not
constitute substantive provisions of this Agreement, and shall not be used
in
construing the meaning or intent of the terms or provisions hereof.
7.4 Assignment.
This
Agreement and the rights granted hereunder shall not be assigned in whole or
in
part, either voluntarily, by operation of law or otherwise, without the prior
written consent of both Parties, except that his Agreement may be assigned
to
Affiliates of a Party without prior written consent from the other Party. Any
attempt to make an assignment without the consent required hereunder shall
be
null and void and may be treated by the other Party as a breach of a material
provision of this Agreement.
7.5 Beneficiaries.
This
Agreement shall be binding on and inure to the benefit of the Parties and their
respective successors and permitted assigns. This Agreement is intended solely
for the benefit of Purchaser and Seller and their respective successors and
permitted assigns.
7.6 Entire
Agreement.
This
Agreement constitutes the entire agreement between Purchaser and Seller
concerning the subject of this Agreement. This Agreement supersedes all prior
and contemporaneous agreements, communications, statements, representations
and
understandings, whether oral or written, on this subject.
7.7 Amendments.
Purchaser and Seller, by mutual agreement in writing, may amend, modify or
supplement this Agreement. No modification or amendment of this Agreement is
effective unless made in writing and signed by the Party to be bound, with
such
written modification or amendment stating the expressed intent to modify this
Agreement. A course of dealing or performance is not a modification unless
expressed in an appropriate written document and signed by the Party to be
bound.
7.8 No
Waiver of Rights.
A
Party’s failure in one or more instances to exercise or enforce any right
provided by this Agreement or by law does not waive its right to exercise the
right in any later instance. No waiver of any breach of this Agreement shall
be
held to constitute a waiver of any other or subsequent breach. To be effective,
a waiver must be expressly written and signed by the Party to be bound. A course
of dealing or performance is not a waiver unless ratified in writing by the
Party to be bound.
7.9 Counterparts.
This
Agreement may be executed in two or more counterparts, all of which shall be
considered one and the same agreement, and shall become a binding agreement
when
one or more counterparts have been signed by each Party and delivered to the
other Party. Delivery of this Agreement by a Party may be effected by sending
the other Party a facsimile copy of this Agreement as executed by the delivering
Party.
IN
WITNESS WHEREOF, Luby’s and the Xxxxxx Entities have executed this Agreement as
of the date first written above.
XXXX’X,
INC.
By: ______________________________
Xxxxxx
Xxx
Chairman
of the Board
THE
XXXXXX ENTITIES
By: ______________________________
Name: ______________________________
Its: ______________________________
