Exhibit 10.6
MD Enterprises, Inc.
0000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx Xxxx, Xxxxxx 00000
______________________________
MARKETING & DISTRIBUTION AGREEMENT
ACCOUNT INFORMATION:
Name: Bravo! Foods International Corp.
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Address: 11300 U. S. Xxxxxxx 0, Xxxxx 000
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City: North Palm Beach State: Florida Zip: 33408
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Contact Name: Xx. Xxx X. Xxxxxx Title: Chief Executive Officer
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Telephone: 000-000-0000 E-Mail: xxx.xxxxxx@xxxxxxxxxxx.xxx
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Nature of Bravo! Foods:
[ ] Individual/Sole Proprietorship
X Corporation [ ] Limited Liability Company [ ] Partnership
[ ]Other:
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RECITALS:
1. MD Enterprises, Inc., a Kansas corporation ("MD Enterprises"),
has certain rights relating to the solicitation of third
parties to manufacture certain food and beverages bearing the
trademark MOONPIE (the "Trademark"), which trademark is the
exclusive property of Chattanooga Bakery, Inc., a Tennessee
corporation ("Chattanooga Bakery"); and
2. Bravo! Foods International, Corp. ("Bravo! Foods") desires to
receive from MD Enterprises, and MD Enterprises, Inc. desires to
grant to Bravo! Foods, the exclusive right to manufacture,
distribute, market and sell the Product in the Territory on the
terms and conditions contained in this Marketing & Distribution
Agreement and all exhibits and schedules to this agreement (this
"Agreement"). Capitalized terms not defined in these recitals
have the meanings ascribed them in Section 1 of this Agreement.
SIGNATURES:
By signing below, the undersigned certify that they have read and
understand, and agree to be legally bound by, the terms and conditions set
forth on the attached pages.
BRAVO! FOODS INTERNATIONAL, CORP. MD ENTERPRISES, INC.
By: By:
------------------------------- --------------------------------
(Authorized Signature) (Authorized Signature)
Name: Xxx X. Xxxxxx Name: Xxxx X. Xxxxx
----------------------------- ------------------------------
(Print) (Print)
Title: CEO Title: President/CEO
---------------------------- -----------------------------
Date: Date: October 6, 2003
----------------------------- ------------------------------
MARKETING & DISTRIBUTION AGREEMENT
STANDARD TERMS AND CONDITIONS
===========================================================================
SECTION 1. DEFINITIONS
For purposes of this Agreement, the following terms shall have the meanings
indicated below:
"Brand Extension Agreement" means the Brand Extension Agreement entered
into by and between Chattanooga Bakery and MD Enterprises on February 28,
2002.
"Confidential Information" shall mean any data or information, oral or
written, treated as confidential that relates to MD Enterprises' past,
present, or future research, development or business activities, including
any unannounced product(s) and service(s), and including any non-public
information relating to the Product or to developments, inventions,
processes, plans, formulas, financial information, customer and supplier
lists, forecasts, and projections. Confidential Information shall also
include the terms of this Agreement. Notwithstanding the foregoing,
Confidential Information shall not include information that: (i) is or
becomes publicly known without violation by Bravo! Foods of this Agreement;
(ii) is already known to Bravo! Foods without restrictions at the time of
its disclosure by MD Enterprises, as evidenced by the written records of
Bravo! Foods; (iii) is made known to Bravo! Foods without restrictions as
to use by a third party having the right to do so; (iv) is legally required
to be disclosed by Bravo! Foods pursuant to a judicial order from a court
of competent jurisdiction (provided that Bravo! Foods promptly informs MD
Enterprises of the required disclosure and affords MD Enterprises a
reasonable opportunity to contest the required disclosure) or as may be
required by applicable state and federal securities laws, or rules and
regulations promulgated thereunder; or (v) is legally required to be
disclosed by Bravo! Foods to its independent auditors for the limited
purpose of their reports on Bravo! Foods financial statements.
"Effective Date" has the meaning set forth in Section 4.1 of this
Agreement.
"Flavor Ingredients" mean ingredient formulas and actual flavors for use in
conjunction with the production of the Products.
"Intellectual Property Rights" shall mean the intangible legal rights or
interests evidenced by or embodied in (a) any idea, design, concept,
formula, technique, invention, discovery, or improvement, regardless of
patentability, but including patents, patent applications, trade secrets,
and know-how; (b) any work of authorship, regardless of copyrightability,
but including copyrights and any moral rights recognized by law; (c) any
trademark, trade names, trade secrets or service marks; and (d) any other
similar rights, in each case, on a worldwide basis.
"Product" shall mean the product identified in Part I of Exhibit A attached
hereto.
"Territory" shall mean the geographic area described in Part III of Exhibit
A attached hereto.
"Term" has the meaning set forth in Section 4.1 of this Agreement.
"Trademark" has the meaning set forth in the recitals.
SECTION 2. APPOINTMENT OF BRAVO! FOODS
2.1 Appointment. MD Enterprises hereby appoints Bravo! Foods as an
exclusive authorized party during the Term to manufacture, distribute,
market and sell the Product in the Territory, and Bravo! Foods hereby
accepts this appointment and covenants that it shall use its reasonable
best efforts during the Term to manufacture and sell Products within the
Territory during the Term. Bravo! Foods shall pay MD Enterprises a royalty
on sales of Products (the "Royalty) calculated in accordance with Part V of
Exhibit A hereto. Bravo! Foods agrees not to: (i) operate a business under
the name of "MD Enterprises" or "Chattanooga Bakery, Inc.," or (ii)
manufacture, market, distribute or sell the Product in any way that would
disparage or injure the Trademark or the reputations of MD Enterprises or
Chattanooga Bakery
2.2 Grant of License. MD Enterprises grants to Bravo! Foods a
nontransferable, exclusive license to use the Trademark in the Territory
during the Term for the manufacture, marketing and sale of the Product.
Bravo! Foods understands that other persons have been granted certain
licenses to use the Trademark in connection with the manufacture and sale
of products other than the Product and that the license granted to Bravo!
Foods pursuant to this Agreement is exclusive as to the Product only. The
parties recognize the validity of the Trademark and the goodwill associated
therewith. The parties acknowledge that the Trademark and all the rights
therein, and goodwill attached thereto, belong exclusively to Chattanooga
Bakery. The parties covenant that they shall not, during the Term or
thereafter, attack or put in issue the title or any rights of Chattanooga
Bakery in and to the Trademark, apply to register or claim ownership in the
Trademark, or attempt to create a security interest or other property right
in the Trademark, and this covenant shall survive the termination of this
Agreement. Nothing contained in this Agreement shall be construed as an
assignment or grant to the Bravo! Foods of any right, title or interest in
or to the Trademark, it being understood and acknowledged by Bravo! Foods
that all rights relating to the Trademark are the exclusive property of
Chattanooga Bakery. The only right that Bravo! Foods shall have concerning
the Trademark is a license to display the Trademark on packaging materials
containing the Product and on materials promoting the Product, all of which
must be approved in advance by MD Enterprises and Chattanooga Bakery.
Bravo! Foods shall not copy, reverse
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engineer or modify the Product. The Trademark shall not be altered or
modified by MD Enterprises or by Bravo! Foods in any manner. No artwork or
design shall be used in connection with the Trademark without the prior
written approval of Chattanooga Bakery, which approval may be withheld by
Chattanooga Bakery in its sole and absolute discretion. All right, title
and interest in and to all artwork and designs used in connection with the
Trademark and all reproductions thereof, notwithstanding their development,
creation, invention or use by MD Enterprises or Bravo! Foods, are vested
in, and are acknowledged to be the exclusive property of Chattanooga
Bakery.
2.3 Conduct of Business. Bravo! Foods shall conduct the business of
manufacturing, marketing, distributing and selling the Product as a
principal for its own account and at its own expense and risk. This
Agreement does not in any way create the relationship of principal and
agent, or any similar relationship, between MD Enterprises and Bravo!
Foods. Bravo! Foods and its employees or other representatives shall not
make any representation or warranty regarding the Product on behalf of MD
Enterprises or Chattanooga Bakery and shall not assume or create any
obligation or responsibility, express or implied, on behalf of or in the
name of MD Enterprises or Chattanooga Bakery, it being expressly understood
and agreed that Bravo! Foods has no power or right to assume or create any
obligation or responsibility on behalf of MD Enterprises or Chattanooga
Bakery. MD Enterprises shall have no control over the day-to-day
operations of Bravo! Foods.
2.4 Subdistributors. Bravo! Foods shall require all subdistributors or
agents to provide it with information on a quarterly basis sufficient to
allow MD Enterprises and Bravo! Foods to calculate the Royalty due MD
Enterprises pursuant to this Agreement. Bravo! Foods shall be entirely
responsible for the performance of its subdistributors and/or agents, and
nothing in this Section shall be deemed to create the relationship of
principal and agent or distributor, or any similar relationship, between MD
Enterprises and such subdistributor and/or agent.
2.5 Reserved Rights. All rights to the Product not specifically granted
to Bravo! Foods hereunder, including all goodwill pertaining thereto, are
reserved by MD Enterprises and Chattanooga Bakery. Except for the license
granted to Bravo! Foods pursuant to Section 2.2 above, MD Enterprises does
not convey any Intellectual Property Rights to Bravo! Foods.
SECTION 3. OBLIGATIONS OF BRAVO! FOODS
3.1 Manufacture of Product. Bravo! Foods agrees to purchase all Flavor
Ingredients for the manufacture of the Products directly from MD
Enterprises at such prices and terms as are set forth in Schedule 3.1
attached to this Agreement. Bravo! Foods shall conform the manufacture of
the Products to formulations and flavor profiles as are agreed upon by the
parties. In all events, Bravo! Foods shall have the right to reject the
Flavor Ingredients supplied by MD Enterprises that are not in conformity
with the agreed upon flavor profile.
3.2 Packaging of Product. Suppliers of packaging for the Product are
selected by Bravo! Foods' third party processors. MD Enterprises may buy or
produce Product packaging for consideration by such third party processors,
at the sole discretion of such third party processors. Bravo! Foods shall
be responsible for the design and placement of all artwork (including
personalizing artwork such as NLEA and plant number), logos, pictures and
packaging for the Product; provided, however, that Bravo! Foods shall use
no artwork, logos, pictures or packaging in connection with the Product
that has not been approved in advance in writing by both MD Enterprises and
Chattanooga Bakery, which approval may be withheld in their absolute
discretion.
3.3 Marketing and Sale of Product. Bravo! Foods shall use its best
reasonably commercial efforts to market and sell the Products in the
Territory. Bravo! Foods may develop and use its own advertising,
promotional and/or marketing materials to offer and sell the Product in the
Territory, provided that such materials are approved in advance in writing
by both MD Enterprises and Chattanooga Bakery, which approval may be
withheld in their absolute discretion.
3.4 Bravo! Foods Employees. Bravo! Foods shall have full and sole
responsibility for the acts and omissions of its employees, agents,
representative and subcontractors, and for all matters relating to their
conditions of employment or retention, and shall indemnify and hold MD
Enterprises harmless from and against any claims or allegations, and costs
arising from such acts, omissions or matters including, but not limited to,
all attorneys fees and costs related thereto. The foregoing includes,
without limitations: (a) any act or omission contrary to applicable law,
rule or regulation, or violative of the rights of any third parties, (b)
responsibility for compensation, including (without limitation) all payroll
matters, withholdings, taxation and tax status, (c) workplace matters
including (without limitation) discrimination in employment and harassment,
and (d) job-related injury or illness including (without limitation) all
worker's compensation insurance and claims handling matters.
3.5 Expenses. Bravo! Foods shall have full and sole responsibility for
its own expenses and those of its employees, agents, representatives and
subcontractors, including, without limitation, all advertising, slotting,
placement, sales and related costs.
3.6 Additional Bravo! Foods Obligations. Bravo! Foods shall provide (at
its expense) the additional services, if any, described in Part VI of
Exhibit A hereto.
SECTION 4. TERM AND TERMINATION
4.1 Term. This Agreement shall remain in effect for a period of two (2)
years following the later of the dates on which it is executed by the
parties ("Effective Date"). At the end of the initial two (2)-year period
of this Agreement, this Agreement shall automatically renew for an
additional period of two (2) years unless either party notifies the other
at least ninety (90) days prior to the expiration of the initial two (2)-
year period of this Agreement that it shall not so renew. References in
this
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Agreement to "Term" mean and include the initial two (2)-year period of
this Agreement and the additional two (2)-year period of this Agreement, if
any. This Agreement may be terminated prior to the expiration of the Term
for the reasons set forth in Section 4.2 below.
4.2 Termination. MD Enterprises may immediately terminate this Agreement
prior to the expiration of the Term if any of the following events occur:
(a) the accrued Royalty as of the twelve (12) month anniversary of the
Effective Date is less than the amount as determined by Bravo! Foods and MD
Enterprises pursuant to the provisions of Schedule 4.2 attached to this
Agreement; (b) a significant change occurs in the nature, control, or
ownership of Bravo! Food's business, whether voluntarily or by operation of
law; (c) Bravo! Foods shall commence a voluntary case concerning itself
under the Bankruptcy Code in Title 11 of the United States Code (as
amended, modified, succeeded or replaced, from time to time (the
"Bankruptcy Code")) or an involuntary case is commenced against Bravo!
Foods under the Bankruptcy Code and the petition is not controverted within
ten (10) days, or dismissed within sixty (60) days, after commencement of
the case; or a custodian (as defined in the Bankruptcy Code) is appointed
for, or takes charge of all or substantially all of the property of Bravo!
Foods; or Bravo! Foods commences any other proceeding under any
reorganization, arrangement, adjustment of the debt, relief of creditors,
dissolution, insolvency or similar law of any jurisdiction whether now or
hereafter in effect relating to Bravo! Foods; or there is commenced against
Bravo! Foods any such proceeding which remains undismissed for a period of
sixty (60) days; or Bravo! Foods is adjudicated insolvent or bankrupt; or
any order of relief or other order approving any such case or proceeding is
entered; or Bravo! Foods suffers appointment of any custodian or the like
for it or for any substantial part of its property to continue unchanged or
unstayed for a period of 60 days; or Bravo! Foods makes a general
assignment for the benefit of creditors; or any corporate action is taken
by Bravo! Foods for the purpose of effecting any of the foregoing; (f) any
statute or regulation, or any proposed or threatened action by state or
federal regulatory authorities which would render this Agreement or any of
the obligations of either party hereunder illegal, or otherwise would
materially and negatively affect the business interests of MD Enterprises
as it applies to this Agreement; or (g) Bravo! Foods shall fail or neglect
to perform, keep or observe any representation, warranty or covenant
contained in this Agreement (other than a representation, warranty or
covenant specified in Section 4.2 (a) through (f) above) and the breach of
such covenant, representation or warranty is not cured to MD Enterprises'
satisfaction within fifteen (15) days after the sooner to occur of Bravo!
Foods' receipt of notice of such breach from MD Enterprises or the date on
which such breach becomes known to Bravo! Foods; provided, however, that
such notice and opportunity to cure shall not apply in the case of any
failure to perform, keep or observe any covenant, representation or
warranty which is not capable of being cured at all or within such 15-day
period or which is a willful and knowing breach by Bravo! Foods or which is
of a type for which a prior notice and opportunity to cure has already been
afforded Bravo! Foods.
4.3 Consequences and Survival. Upon termination of this Agreement, (a)
Bravo! Foods shall immediately cease all manufacturing, distribution,
marketing and sales of the Product except as provided in this Section. Any
Products that have been manufactured by Bravo! Foods prior to the
termination of this Agreement, or which were in the process of manufacture,
or were required to fill purchase orders from customers accepted by Bravo!
Foods on or prior to the termination of this Agreement, may be sold by
Bravo! Foods during the one hundred (120) day period next following the
date of termination, provided that:
(i) the quantity of such Product in inventory at the time of such
termination is not in excess of a reasonable quantity, taking
into consideration sales requirements for said Product;
(ii) Bravo! Foods shall furnish MD Enterprises within thirty (30)
days after the effective date of the termination of the
Agreement a written statement of inventory as of the effective
date of termination;
(iii) The Royalty on sales of Products shall continue to accrue and
shall be paid to MD Enterprises at the times specified in this
Agreement. The final Royalty shall be paid to MD Enterprises
within thirty (30) days following the end of said one hundred
twenty (120)-day sell-off period.
Bravo! Foods shall return to MD Enterprises, all property, formulas and all
other confidential or proprietary information of MD Enterprises and all
copies thereof within thirty (30) days of the termination of this
Agreement.
SECTION 5. WARRANTY
5.1 Scope of Warranty. MD Enterprises warrants that, to its knowledge,
the sale of the Products pursuant to the terms of this Agreement will not
violate or infringe upon any Intellectual Property Rights of any third
party.
5.2 Disclaimer. EXCEPT AS OTHERWISE PROVIDED HEREIN, THE WARRANTY STATED
IN SECTION 5.1 IS MD ENTERPRISES'S SOLE AND EXCLUSIVE WARRANTY PERTAINING
TO THE PRODUCTS, AND MD ENTERPRISES HEREBY DISCLAIMS ANY OTHER WARRANTY,
EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR ANY WARRANTY
REGARDING PRODUCTS.
5.3 Exclusion of Consequential Damages. IN NO EVENT SHALL MD ENTERPRISES
BE LIABLE TO BRAVO! FOODS OR ANY CUSTOMER FOR ANY INDIRECT, SPECIAL, OR
CONSEQUENTIAL DAMAGES, INCLUDING, WITHOUT LIMITATION, LOST PROFITS OR
LIABILITIES TO THIRD PARTIES ARISING FROM ANY SOURCE, EVEN IF MD
ENTERPRISES IS ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
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5.4 Limitation of Liability. IN THE EVENT THAT, NOTWITHSTANDING SECTION
5.2 OR 5.3 HEREOF, MD ENTERPRISES IS FOUND LIABLE FOR DAMAGES, ITS
AGGREGATE LIABILITY SHALL NOT EXCEED THE AMOUNTS PAID BY BRAVO! FOODS TO MD
ENTERPRISES DURING THE THEN PRECEDING TWELVE (12)-MONTH PERIOD, WHICH BOTH
PARTIES AGREE TO BE A REASONABLE LIMITATION.
SECTION 6. RELATIONSHIP OF THE PARTIES
6.1 Relationship of the Parties. The relationship of MD Enterprises and
Bravo! Foods established by this Agreement shall be solely that of
independent contractors, and nothing herein shall create or imply another
relationship. Nothing in this Agreement shall be construed to give either
party the power to direct or control the daily activities of the other
party. MD Enterprises does not xxxxx Xxxxx! Foods the power or authority
to make or give any agreement, statement, representation, warranty, or
other commitment on behalf of MD Enterprises, or to enter into any contract
or otherwise incur any liability or obligation, express or implied, on
behalf of MD Enterprises, or to transfer, release, or waive any right,
title, or interest of MD Enterprises.
6.2 Expenditures. Bravo! Foods acknowledges and agrees that any expenses
it incurs in furtherance of this Agreement are voluntary in nature and are
made with the knowledge that this Agreement may be terminated as provided
herein. Therefore, Bravo! Foods shall make no claim against MD
Enterprises, and MD Enterprises shall not be liable, with respect to the
recoupment of any expenditures or investment made by Bravo! Foods in
anticipation of the continuation of this Agreement.
SECTION 7. CONFIDENTIALITY AND INDEMNIFICATION
7.1 Confidential Information. During the course of performance of this
Agreement, MD Enterprises may disclose certain Confidential Information to
Bravo! Foods solely to assist Bravo! Foods with the performance of its
obligations under this Agreement. Bravo! Foods shall maintain the secrecy
of all such Confidential Information and disclose to its employees on a
need-to-know basis only. Bravo! Foods shall not use, disclose or otherwise
exploit any Confidential Information for any purpose not specifically
authorized by MD Enterprises in this Agreement. All formulas, files,
lists, records, documents, drawings and specifications that incorporate or
refer to any Confidential Information shall be returned or destroyed by
Bravo! Foods promptly upon termination of this Agreement.
7.2 Indemnification. Each party shall indemnify, defend and hold harmless
the other party and its directors, officers, employees, agents,
consultants, distributors and sublicensees from and against all claims,
actions, liabilities, losses, expenses, damages and costs (including
reasonable attorneys' fees), that may at any time be incurred by reason of
any third party claim arising out of or relating to: (i) any breach of the
representations, warranties, covenants, agreements or obligations contained
in this Agreement; and (ii) any negligence or willful misconduct of a
party, its agents, employees and representatives, in connection with the
performance of any obligations under this Agreement.
SECTION 8 - REPRESENTATIONS AND WARRANTIES OF MD ENTERPRISES
MD Enterprises represents and warrants as follows:
(i) MD Enterprises has the right to xxxxx Xxxxx! Foods the license
described in Section 2.2 above pursuant to the Brand Extension
Agreement.
(ii) The terms of this Agreement do not contravene the terms of the
Brand Extension Agreement.
(iii) MD Enterprises is not in default of its covenants,
representations or warranties under the Brand Extension
Agreement.
(iv) MD Enterprises shall notify Bravo! Foods promptly after the
occurrence of any default by MD Enterprises under the Brand
Extension Agreement.
(v) MD Enterprises shall notify Bravo! Foods promptly after the
termination of the Brand Extension Agreement.
(vi) Chattanooga Bakery has approved the terms and conditions of
this Agreement.
(vii) During the Term, MD Enterprises shall not license any person
other than Bravo! Foods to use the Trademark in connection with
the Product in the Territory.
SECTION 9. REPRESENTATIONS AND WARRANTIES OF BRAVO! FOODS; ADDITIONAL
INDEMNIFICATION
9.1 Representations and Warranties. MD Enterprises represents and
warrants that all Flavor Ingredients shall be merchantable and fit for the
purpose for which they are manufactured; of first-quality; free of defect;
and manufactured, packaged, and labeled in conformity with all applicable
laws or regulations. Bravo! Foods represents and warrants that all
Products shall be merchantable and fit for the purpose for which they are
manufactured; of first-quality; free of defect; and manufactured, packaged,
and labeled in conformity with all applicable laws or regulations.
9.2 Indemnification of Bravo! Foods. MD Enterprises shall defend,
indemnify and hold harmless Bravo! Foods and its directors, officers,
employees, agents, consultants, distributors and licensees from and against
all claims, actions, liabilities,
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losses, expenses, damages and costs (including reasonable attorneys' fees)
arising out of:
(i) any alleged defect in Flavor Ingredients supplied by MD
Enterprises, their containers, packaging or labeling, or the
use or condition of Flavor Ingredients supplied by MD
Enterprises or their containers, packaging or labeling,
including any claim that any of the Flavor Ingredients supplied
by MD Enterprises or their containers, packages or labels (a)
were not merchantable or fit for the particular purpose for
which they were used; (b) failed to meet any industry standard
or guideline; (c) failed to meet any specifications; (d) were
defective in their design, manufacture or material; (e) failed
to comply with any applicable law or regulation;
(ii) any alleged infringement of any person's Intellectual Property
Rights arising out of or as a result of Bravo! Foods' use of
the Trademark in accordance with and pursuant to the terms of
this Agreement; or
(iii) any default by MD Enterprises in any of the terms and
conditions set forth in the Brand Extension Agreement.
9.3 Indemnification of MD Enterprises. Bravo! Foods shall defend,
indemnify and hold harmless MD Enterprises and its directors, officers,
employees, agents, consultants, distributors and licensees from and against
all claims, actions, liabilities, losses, expenses, damages and costs
(including reasonable attorneys' fees) arising out of:
(i) any alleged defect in the Products, their containers, packaging
or labeling, or the use or condition of the Products or their
containers, packaging or labeling, including any claim that any
of the Products or their containers, packages or labels (a)
were not merchantable or fit for the particular purpose for
which they were used; (b) failed to meet any industry standard
or guideline; (c) failed to meet any specifications; (d) were
defective in their design, manufacture or material; (e) failed
to comply with any applicable law or regulation; or
(ii) any alleged infringement or unauthorized use of any patents,
copyrights, trademark (other than the Trademark) or any other
proprietary rights owned, used or controlled by third parties
arising under or in conjunction with the manufacture, sale
and/or use of any Product.
9.4 Indemnification of Chattanooga Bakery. Bravo! Foods and MD
Enterprises, jointly and severally, shall defend, indemnify and hold
harmless Chattanooga Bakery and its directors, officers, employees, agents,
consultants, distributors and licensees from and against all claims,
actions, liabilities, losses, expenses, damages and costs (including
reasonable attorneys' fees) arising out of:
(i) any alleged defect in the Products, their containers, packaging
or labeling, or the use or condition of the Products or their
containers, packaging or labeling, including any claim that any
of the Products or their containers, packages or labels (a)
were not merchantable or fit for the particular purpose for
which they were used; (b) failed to meet any industry standard
or guideline; (c) failed to meet any specifications; (d) were
defective in their design, manufacture or material; (e) failed
to comply with any applicable law or regulation; or
(ii) any alleged infringement or unauthorized use of any patents,
copyrights, trademark (other than the Trademark) or any other
proprietary rights owned, used or controlled by third parties
arising under or in conjunction with the manufacture, sale
and/or use of any Product.
SECTION 10. GENERAL PROVISIONS
10.1 Entire Agreement; Amendment. This Agreement, including any exhibits
and schedules hereto, constitutes the entire agreement of the parties with
respect to the subject matter hereof and supersedes all prior agreements,
both oral and written, with respect to the subject matter hereof. No
amendment or modification of this Agreement or any provision or attachment
of this Agreement shall be effective unless in writing and signed by both
parties.
10.2 Multiple Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, and it shall not
be necessary in making proof of this Agreement, or the terms hereof, to
produce or account for more than one of such counterparts.
10.3 Severability. If any term or provision of this Agreement shall be
held to be invalid, illegal or unenforceable, the remaining terms and
provisions of this Agreement shall remain in full force and effect, and
such invalid, illegal or unenforceable term or provision shall be deemed
not to be part of this Agreement.
10.4 Governing Law; Venue. This Agreement shall be governed by and shall
be construed, interpreted, and enforced in accordance with the laws of the
State of Kansas, without reference to principles of conflicts of law. The
parties agree that the sole and exclusive jurisdiction and venue for all
disputes arising between the parties shall be in any trial court located in
Xxxxxxx County, Kansas.
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10.5 Notices. Any notice shall be delivered by hand, by courier service,
or by certified mail (return receipt requested, postage prepaid). Notices
to Bravo! Foods shall be addressed to the address given on the "Account
Information" block on the first page of this Agreement. Notices to MD
Enterprises shall be addressed to:
MD Enterprises, Inc.
0000 Xxxxxxx Xxx. Xxx. #000
Xxxxxxxx Xxxx, XX 00000
Attn: Xxxx X. Xxxxx
Title: President, Chief Executive Officer
Fax: (000) 000-0000
Either party may change its address for giving notices by notice to the
other party.
Notices shall be effective: (a) as of the date personally delivered if by
hand or (b) for notices sent by certified mail, five (5) business days
after so deposited in the United States mails with sufficient postage to
assure delivery to the addressee, or (c) upon receipt if sent by courier
service such as Federal Express, U.P.S., or DHL. Notices also may be
delivered by facsimile (but must be confirmed in writing as above) and
notices so delivered shall be effective upon actual receipt by electronic
transmission.
10.6 Survival. The provisions of Sections 5 through 10 of this Agreement
and all other representations, warranties or covenants that are expressly
stated to survive the termination of this Agreement shall survive the
termination of this Agreement and remain in full force and effect
thereafter.
10.7 Remedies. Bravo! Foods acknowledges and agrees that a breach of the
provisions of this Agreement will cause MD Enterprises irreparable injury
and damage. Bravo! Foods, therefore, expressly agrees that MD Enterprises
shall be entitled to injunctive and other equitable relief to prevent a
breach of this Agreement, or any part thereof by Bravo! Foods, or by Bravo!
Food's partners, agents, representatives, members, servants, employers,
employees and/or any and all persons acting directly or indirectly, and to
secure its enforcement, in addition to any other remedy to which MD
Enterprises might be entitled. Bravo! Foods and MD Enterprises expressly
waive the posting of any bond or surety required prior to the issuance of
an injunction hereunder. However, in the event that the court refuses to
honor the waiver of bond hereunder, Bravo! Foods and MD Enterprises hereby
expressly agree to a bond in the amount of One Hundred Dollars ($100.00).
Any and all of MD Enterprises remedies for the breach of this Agreement
shall be cumulative and the pursuit of one remedy shall not be deemed to
exclude any and all other remedies with respect to the subject matter
hereof.
10.8 Waiver. Except as specifically provided in a written waiver signed
by a duly authorized officer of the party seeking enforcement, the failure
to enforce or the waiver of any term of this Agreement shall not constitute
the waiver of such term at any time or in any circumstances and shall not
give rise to any restriction on or condition to the prompt, full and strict
enforcement of the terms of this Agreement.
10.9 Assignment and Benefit. Without the consent of the other party in
writing, neither party may assign this Agreement; provided, however, that
MD Enterprises may, with the written consent of Chattanooga Bakery, assign
the Agreement in connection with the sale or disposition of the business
operations relating to the Product. Bravo! Foods may not delegate its
duties hereunder without the prior written consent of MD Enterprises Any
attempt by Bravo! Foods to assign any of its rights or delegate any of its
duties shall be null and void. This Agreement shall be binding upon and
shall inure to the benefit of Bravo! Foods and MD Enterprises and their
permitted successors and assigns.
10.10 Third-Party Beneficiary. The parties acknowledge and agree that
Chattanooga Bakery is an intended third-party beneficiary of this Agreement
and that Chattanooga Bakery may enforce the rights of MD Enterprises under
this Agreement in the event it does not do so. In the event Chattanooga
Bakery resorts to litigation to enforce its rights or the rights of MD
Enterprises under this Agreement, the sole, proper and exclusive venue for
such litigation shall be within the County of Xxxxxxxx, State of Tennessee.
10.11 Interpretation. In this Agreement, unless a clear contrary
intention appears: (a) the singular number includes the plural number and
vice versa; (b) reference to any person includes such person's successors
and assigns but, if applicable, only if such successors and assigns are not
prohibited by this Agreement; (c) reference to any gender includes each
other gender; (d) reference to any agreement, document or instrument means
such agreement, document or instrument as amended or modified and in effect
from time to time in accordance with the terms thereof; (e) "hereunder,"
"hereof," "hereto," and words of similar import shall be deemed references
to this Agreement as a whole and not to any particular Section or other
provision hereof; (f) "including" (and with correlative meaning "include")
means including without limiting the generality of any description
preceding such term; (g) "or" is used in the inclusive sense of "and/or";
(h) with respect to the determination of any period of time, "from" means
"from and including" and "to" means "to but excluding"; and (i) references
to documents, instruments or agreements shall be deemed to refer as well to
all addenda, exhibits, schedules or amendments thereto. Both parties
participated in the drafting and negotiation of this Agreement;
accordingly, no provision of this Agreement will be construed against
either party on the ground that it was the draftsman of this Agreement.
7
EXHIBIT A
---------
Part I. PRODUCTS
-----------------
MoonPie(R) Milk
PART II. PAYMENT SCHEDULE AND TERMS:
-------------------------------------
Net 30
PART III: DESCRIPTION OF TERRITORY
-----------------------------------
Bravo! Foods shall have the exclusive right to manufacture, market,
distribute and sell the Product in the United States. Bravo! Foods
may not manufacture, market, distribute and sell the Product in any
other location without the prior written consent of MD Enterprises
PART IV: TRADEMARK
-------------------
Moon Pie(R) is a registered trademark of Chattanooga Bakery, Inc.
PART V.: ROYALTY SCHEDULE
-------------------------
Bravo! Food shall pay the Royalty to MD Enterprises on a quarterly basis.
Payments shall be made to MD Enterprises within 30 days of the close of the
previous quarter. Unit volume verifications shall be the responsibility of
Bravo! Foods International, Corp. Royalty shall be defined as the
percentage of the wholesale price of one unit of volume of milk.
Royalty Payment Schedule:
Units of Volume* Royalty**
---------------- ---------
0-12 MM ***%
12-24 MM ***%
24 MM+ ***%
* Unit of volume is one container of milk (e.g., 11.2 oz. container, 16
oz. container, etc.)
** Royalty is the percentage set forth in the preceding schedule of the
net wholesale price of one unit of volume of milk shipped, net of
reclamation. Bravo! Foods International will be responsible for
providing data regarding volume per stock keeping unit by purchasing
location.
Volume Projections:
Annual Volume Projection
----------------------------------
Year Q1 Q2 Q3 Q4 Total
---- -- -- -- -- -----
2004 ***
2005 ***
Annual Volume Projection/SKU
----------------------------------
SKU Q1 Q2 Q3 Q4 Total
--- -- -- -- -- -----
***
PART VI: ADDITIONAL OBLIGATIONS OF BRAVO! FOODS
------------------------------------------------
With each Royalty payment, Bravo! Foods shall provide MD Enterprises with
such information as MD Enterprises shall reasonably request to enable MD
Enterprises to verify Bravo! Foods' calculation of the Royalty. Such
information shall include, but shall not be limited to, marketing
information regarding the sale of the Products, such as IRI data or
contributing data defining the progress of the sales and marketing of the
Product, and number of stock keeping units sold.
Schedule 3.1
Pricing
Costs(1) per gallon of Units per gallon of Flavor Ingredients
Flavor Ingredients Flavor Ingredients costs per 16 oz unit
---------------------- ------------------- --------------------
Chocolate $*** $*** $***
Banana $*** $*** $***
--------------------
Flavor Ingredients costs shall be fixed through March 31, 2004.
Thereafter, an increase in Flavor Ingredients costs may be
implemented by MD Enterprises, Inc. only upon 30 days' written notice
to Bravo! Foods. In additions, the costs of Flavor Ingredients to
Bravo! Foods are subject to reduction if the costs of Flavor
Ingredients to MD Enterprises decrease, or if MD Enterprises sources
Flavor Ingredients through a less expensive supplier. Costs of
Flavor Ingredients to Bravo! Foods shall not increase unless the
costs of such Flavor Ingredients to MD Enterprises increases in
excess of three percent (3%) from the then current costs of Flavor
Ingredients to MD Enterprises.
Schedule 4.2
Royalty Threshold
The accrued Royalty threshold amount applicable to Section 4.2 (a) of
the Agreement shall be determined by the written agreement of Bravo! Foods
and MD Enterprises within six (6) months subsequent to the first shipment
of the Product by Bravo! Foods to wholesale customers. In determining the
Royalty threshold amount, the parties shall give due consideration to the
Royalty earned by and payable to MD Enterprises under this Agreement during
the aforesaid six (6) months subsequent to the first shipment of the
Product by Bravo! Foods.
