EXHIBIT 10.14
PLEASE NOTE THAT WE HAVE REQUESTED CONFIDENTIAL TREATMENT FOR CERTAIN PORTIONS
OF THIS EXHIBIT, WHICH PORTIONS HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 OF THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED. A [*] INDICATES THE PLACES IN THIS EXHIBIT
WHERE MATERIAL HAS BEEN OMITTED.
WAREHOUSING AND DISTRIBUTION PURCHASE AGREEMENT
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BY AND BETWEEN
CHATTEM CONSUMER PRODUCTS
---------------------------
AND
MILITARY RESALE GROUP
Military Resale Group ("Distributor"), located at 0000 Xxxxxxx Xxxxx, Xxxxxxxx
Xxxxxxx, XX 00000 and Chattem Consumer Products (3530) ("Manufacturer") located
at , enter into this Warehousing and Distribution Agreement
("this Agreement") in Colorado Springs, Colorado this 27 day of March 2002.
1. Manufacturer appoints Distributor to warehouse and deliver
Manufacturer's product ("Product") to the military commissaries and
exchanges ("the Military") listed in Schedule A, which is attached to
and made part of this agreement.
2. Distributor shall purchase, for resale by Manufacturer to the Military,
authorized Products from Manufacturer at Manufacturer's published
Distributor list prices and will attempt to maintain sufficient
inventory levels necessary to meet the daily order requirements of the
Military. Manufacturer agrees to ship all products on a "shipper sort
and segregate by SKU at customer dock" basis. The terms for purchases
under this provision are [*].
3. Manufacturer and/or its representative is solely responsible for
soliciting and obtaining orders for the sale of Products to the
Military, except for orders transmitted electronically the Military
resale employees participating in the Frequent Delivery Program.
Distributor assumes no sales responsibilities under this Agreement,
and all Product purchased by Distributor is on a guaranteed sales
basis with floor stock protection provided by the Manufacturer.
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Distributor shall rotate stock and notify Manufacturer and/or its
representative if any Product shows no movement for sixty (60) days.
If Manufacturer is unable to arrange for the sale of any Product to
the Military within the thirty (30) days of notice of any such Product
or any excess product quantities as identified by the Distributor, at
its sole discretion the Distributor shall invoice the Manufacturer and
the Manufacturer shall pay Distributor the full cost of the Product
including Distributor's storage and handling fee and remove such
Product from Distributor's warehouse(s) at the Manufacturer's expense
Manufacturer authorizes Distributor to sell to any third party without
public notice any such product remaining in its warehouse more than
thirty (3) days after notice given to Manufacturer and/or its
authorized agent. Any net funds received will be applied first to
applicable storage and handling fees and then to recovery of product
cost. Any funds in excess of that owed to Distributor will be remitted
to Manufacturer, any balance due to Distributor will be subject to
interest charges and collection fees and procedures as provided for in
Paragraph 5.
4. Manufacturer or its representative, immediately upon receipt of an
order from the Military, shall telephone, fax or mail to Distributor
all information regarding such order to permit Distributor at least
(24) hours to prepare and deliver the Product ordered (48 hours for
outlying destination destinations). Shelf stocking of delivered Product
at the Military installations shall be the sole responsibility of the
Manufacturer. Distributor shall product a bi-monthly roll-up detailing
deliveries to and acceptance of Product by the Military for
manufacturers participating in the Frequent Delivery Program, and shall
maintain signed delivery documents recording such deliveries.
5. Distributor shall invoice Manufacturer for any delivered Product at
the price shown on the Manufacturer's published Distributor price list
plus Distributor's storage and handling fee as specified in Schedule
C, which is attached to and made a part of this Agreement. Distributor
agrees to transmit via established EDI Transaction sets all invoices.
If paper copies of such invoices and supporting delivery documents are
required by the Manufacturer and/or its representative, they will be
provided as an additional billable serviced at the price agreed to and
detailed on Schedule C. Terms of payment to Distributor are net
fifteen (15) days, and Distributor's right to receive payment from
manufacturer is not conditioned upon the timing of payment by the
Military to the Manufacturer. Distributor pricing is structured with
the understanding that on-hand inventory requirements shall not exceed
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three (3) weeks average movement. Manufacturer agrees to pay interest
at the rate of twelve percent (12%) per annum on any invoice not paid
when due, and agrees to pay all costs of collection, including
twenty-five percent (25%) of the principal balance claimed as
attorney's fees if the account is placed in the hands of an attorney
for collection.
6. If the Distributor receives damaged Product, it shall notify
Manufacturer within ten (10) days of receipt, and Manufacturer shall
remove such Product from Distributor's warehouse(s) at Manufacturer's
expense and shall reimburse Distributor the full cost of its storage
and handling fee. If Product is rejected by the Military for any
reason. Manufacturer shall take possession of such Product and shall
reimburse Distributor the full cost of the Product including
Distributor's storage and handling fee. Distributor shall not be liable
for incidental and consequential damages whether foreseeable or
otherwise.
7. Manufacturer may/may not recoup the amount of its invoices for Product
shipped to distributor against the amount of distributor's invoices
for Product delivered to the Military, and Distributor may/may not
recoup the amount of its invoices for Product delivered against the
amount of Manufacture's invoices for Product sipped to Distributor. If
recoupment is permitted, any account receivable remaining after such
deduction shall be paid by the party owing same fifteen (15) days
after written demand made by the other party. The parties acknowledge
that this Agreement is intended to be the sole contract between the
parties and that successive sales, purchases and delivery of Product
constitutes a single, continuing transaction. If either parry declares
or is adjudicated bankruptcy or insolvent, the other party shall have
the right of recoupment against the bankrupt or insolvent party,
regardless of whether the claim by either party arose pre or
post-petition or pre or post-adjudication.
8. This Agreement constitutes the entire understanding of the parties and
all prior representations or agreements not contained in this Agreement
are of no effect. This Agreement cannot be altered or varied except by
written document signed by both parties.
9. This Agreement may be canceled by either party upon thirty (30) days
written notice. After notice, Manufacturer shall promptly remove any
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remaining Product from Distributor's warehouse(s) at Manufacturer's
expense and shall pay Distributor its storage and handling fee for such
Product.
In witness whereof, the parties have executed this Agreement the day and year
first above written.
CHATTEM, INC MILITARY RESALE GROUP
----------------------------------------------
(Manufacturer's Full Corporate or Firm Name
By: /S/ XXXXXXX X. XXXXXXXX By: /S/ XXXXX X. XXXXX
------------------------------------------ --------------------------
Signature Signature
XXXXXXX X. XXXXXXXX XXXXX X. XXXXX
--------------------------------------------- -------------------------
Name - please print Name - please print
VICE PRESIDENT, SALES PRESIDENT
--------------------------------------------- -------------------------
Title Title
5/2/02 4-15-2002
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Date Date
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SCHEDULE A
Bases assigned for service:
Xxxxxxxxx AFB
F.E. Xxxxxx
Xxxxxxx A.F.B.
Ft. Xxxxxx
Xxxxxxxx AFB
USAF Academy
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SCHEDULE C
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Drayage Rate by Military Customer Categories and by Product Type
Product Type:
Dry [*]% Stencil Charges
-------
Frozen Pallet Charges
Chill By-Pass Fee
Other Alaska Freight*
*Only applies to Alaska commissaries
BACKHAUL
Backhaul Available
Pick-Up Location Backhaul Rate Contact Person/Phone
____________ ______________ ___________
____________ ______________ ___________
____________ ______________ ___________
SCHEDULE D
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In order to properly service your Military accounts and conform to your
requirements, we request, in writing, the following information:
1. Name of Manufacturer and Broker:
Domestic [ ] Import [ ]
Vendor: Broker:
---------------------------- -----------------------
Sales/Name: Sales/Name:
------------------------ -------------------
Address: Address:
--------------------------- ----------------------
Phone: Phone:
----------------------------- ------------------------
Fax: Fax:
------------------------------- --------------------------
Email: Email:
----------------------------- ------------------------
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2. Mailing Address for Billing:
MILITARY RESALE GROUP, INC. Contact Name: XXXX XXXXXX
------------------------------------------ ---------------
0000 XXXXXXXXX XXXXXX Phone: 000-000-0000
------------------------------------------ ----------------------
XXXX. XXXXXXX, XX 00000 Fax: 000-000-0000
Email:
----------------------
3. Reports - Month to Date Sales [ ] Inventory Activity [ ]
Send via- Email [ ] Diskette [ ]
Send to the following individuals(s)
-------------------------------- -----------------------
-------------------------------- -----------------------
ATTN: ATTN:
-------------------------------- ------------------------
Email: Email:
------------------------------- ---------------------
4. Order Desk (our placement of orders with you)
Vendor Rep [ ] Broker Rep [ ]
Customer Svc Rep: XXXX XXXXXX Are you EDI capable? YES
------------------------ -----
Phone: 000-000-0000 EXT. 105 Paperless EDI? YES
------------------------------------ -------
Fax: 000-000-0000
PIIN:
-----------------------------------
SB#:
------------------------------------
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5. Distributor Center Information
Servicing Military Resale Group
Pick-up Address:
--------------------------------
Phone:
---------------------------------
Pick Up Min:
---------------------------------
Delivered Min:
---------------------------------
Brackets Offered:
-----------------------------
Lead Time:
------------------------------------
Special Instructions:
-------------------------
6. Product Information: Frozen [ ] Dry [X] Chill [ ]
[X] Please attach a current military price list for all applicable
locations.
{X] Please attach item specifications to include: weight, cube,
pallet pattern, case dimensions, shelf life (how to read code
dates on cases and items).
7. Military Resale Group Commissary Division drayage fee commission:
a. [*]%
b. per case plus earned cash discount of ___ %
8. Vendor cash terms [*] % [*] days, net [*]
[*]% [*] DAYS, NET [*]
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