Exhibit 99.2
DISTRIBUTORSHIP AGREEMENT
This Agreement made this 4th day of April, 1995.
BETWEEN:
TASTY FRIES, INC.
000 Xxxxxx Xxxxxxx, Xxxxx Xxx
Xxxx Xxxx, XX, X.X.X, 00000
(hereinafter referred to as "TFI")
AND:
CANADIAN TASTY FRIES, INC.
#0 Xxxx Xxx Xxxxx Xxxxxx, Xxxxx #000
Xxxxxxxxx, XX, X.X.X. 00000
(hereinafter referred to as "Distributor")
WITNESSETH:
WHEREAS, TFI owns rights to manufacture, distribute and sell a fully
automated french fry vending machine;
WHEREAS, TFI is the owner of a distinctive type of marketing,
preparation and vending machine sale of TFI french fry food products; and;
WHEREAS, TFI has developed and adopted for its own use and for the
use of its Distributors a unique system of TFI product preparation and
vending machine sale, consisting in part of the unique french fry vending
machines, distinctive advertising, signs, food presentation and formula
secret recipes (collectively the "Products"); and
WHEREAS, in addition to valuable goodwill, TFI owns the valuable
trade name and design of TFI in addition to various patents, trademarks,
service marks, copyrights, tradenames, slogans, designs, insignia, emblems,
symbols, package designs, logos and other proprietary characteristics
(collectively, the "TFI Marks") used in relation to and in connection with
the Products; and
WHEREAS, Distributor wishes, upon the terms and conditions
hereinafter set forth, to enter into the business of distributing TFI
Products on an exclusive basis in the Territory herein defined and more
particularly described in Schedule "A" attached hereto and forming part of
this Agreement (the "Territory") and to benefit from the expertise of TFI in
its field; and
WHEREAS, TFI is willing to permit Distributor to use TFI Marks as
aforesaid together with the retail sale of TFI French Fry Vending Machine and
it products upon the terms and conditions hereinafter set forth; and
WHEREAS, TFI is willing to permit Distributor to register the TFI Marks
to secure their exclusive use in that Territory.
NOW, THEREFORE, the parties hereto, in consideration of the mutual
covenants herein contained and promises herein expressed for other good and
valuable consideration, receipt whereof is hereby acknowledged, do hereby agree
as follows:
ARTICLE I
DISTRIBUTORSHIP AGREEMENT
A. Subject to the provisions of this Agreement and the performance of its
covenants and obligations, TFI hereby grants Distributor an exclusive right and
license to distribute all present and future TFI Products and to use the TFI
Marks in the retail sale thereof within the territorial boundaries set forth as
described in Schedule "A" attached hereto (the "Territory") for a term of ten
(10) years.
The parties specifically acknowledge and agree that the restriction of
operation to the Territory identified herein is an essential and indispensable
term of this Agreement.
DISTRIBUTOR'S SPECIFIC TERRITORIAL RIGHTS
1. The Distributor shall have the exclusive right in its Territory to sell
the TFI French Fry Vending Machine and TFI attendant Products to all users in
the Territory.
2. The Distributor shall have the right to subdivide its Territory as
Distributor in its sole discretion sees fit and to grant additional
distributorships for these subdivided areas on similar terms as contained in
this Agreement and all compensation for said additional distributorships shall
be for the benefit of Distributor without any fee, royalty or deduction to be
paid to TFI.
ARTICLE II
OBLIGATIONS OF TFI
TFI agrees to assist Distributor in distributing Products by way of
retail sale in the following manner:
A. TFI will conduct, at no charge, certain sales and maintenance
training programs in its headquarters training school which Distributor and
one key employee may attend and up to two individuals from each additional
distributorship granted by Distributor in its Territory may attend.
B. TFI agrees to provide to Distributor, as it is available from time to
time, exchange of information relating to the Products and additional types
of products as may be authorized by TFI from time to time for sale pursuant
to this Agreement, and which, when authorized, will also
constitute "Products" for all purposes herein, at such times and in such
detail as TFI shall deem appropriate.
C. TFI will take all steps necessary to ensure the Products meet the
standards of the Territory for import and resale therein and if necessary will
license the Products in the Territory for that purpose.
ARTICLE III
CONFIDENTIAL INFORMATION
A. The parties hereto covenant and agree that any Confidential Information
disclosed to the Distributor relating directly or indirectly to the vending
machines and their component parts of the ingredients, preparation or sale of
any of the Products will remain the property of TFI at all times and will, if
disclosed in any tangible format, be returned to TFI upon demand and, in any
event, UPON TERMINATION OF THIS AGREEMENT.
B. It is expressly understood and agreed by Distributor that the
Confidential Information described above constitutes highly confidential trade
secrets and Distributor agrees that neither he nor any of his employees will
reveal or reproduce any of such Confidential Information except as is necessary
to describe the operations to employees and staff and additional distributors
within the Territory so they can safely use the vending machines and Products.
Such employees, staff and additional Distributors shall be required to execute
appropriate confidentiality agreements.
ARTICLE IV
STANDARDS OF OPERATION
AND SUPERVISION BY TFI
A. Distributor agrees to conduct its business in a manner consistent with
the standards set forth in this Agreement. It is understood that these standards
may change from time to time, and are in addition to and not in substitution for
any standard as set forth in this Agreement.
B. In order to preserve the value and goodwill of TFI and related goodwill
of other TFI Distributors and to promote the purpose of this Agreement, the
parties hereto agree as follows:
1. Distributor will use and distribute the Products as herein
contemplated strictly in accordance with the terms of this Agreement.
2. Unless approved in writing by TFI, Distributor will not develop,
produce, sell, advertise for sale or give away any products under the
TFI Marks which might reasonably compete with the Products and all food
Products WILL be prepared in accordance with the specific formulas or
utilizing the ingredients purchased from or specified by TFI.
3. TFI may from time to time offer guidance to Distributor relative
to retail prices for Products offered for retail sale that in TFI's
judgment constitute good business practice.
4. Distributor will use its best efforts to see it that its
customers maintain suitable signs (which signs shall be approved by
TFI), at, on or near the front of any premises within
which its french fry vending machines are located, describing the
premises having Products available for retail sale.
Any translation from the English language or deviation from TFI
approved designs contained in such sign shall required the prior written
approval of TFI.
5. It is the Distributor's responsibility to ensure that all food
products sold by Distributor hereunder will be of the highest and safest
quality, and the service relating to any such sale hereunder will comply
with the instructions and standards provided by TFI in preparing the
food Products, or with any other further written requirements of TFI as
they are communicated to Distributor from time to time.
6. It is the Distributor's responsibility to ensure that it will
maintain all french fry vending machines by which its business is
conducted in conformity with the high quality, style and cleanliness
required of similar french fry vending machines now operated in
connection with the TFI Marks, component parts, equipment and signs.
Distributor shall see that its customers comply with all applicable
ordinances, health and safety regulations, laws and statutes governing
the operation of such premises and the sale of products, including all
criminal and quasi-criminal laws and regulations.
C. TFI or TFI's supervisory personnel shall have the right to enter upon
any premises in which Distributor conducts its business at any reasonable time
for the purposes of examining, conferring with Distributor's employees,
inspecting and checking perishable and non-perishable food supplies, vending
machines, and other equipment and in determining whether the distribution of
Product is being conducted in accordance with the aforesaid standards and within
the terms of this Agreement.
ARTICLE V
COMMENCEMENT OF BUSINESS
A. Distributor agrees to obtain, prior to commencement of its distribution
business, pursuant to this Agreement, all licenses, approvals, inspections,
permits or any other certification which may be required by any competent public
authority for the lawful operation of its business and to keep the same in good
standing during the term hereof.
ARTICLE VI
USE OF TFI NAME, MARKS AND ADVERTISING
A. During the term of this Agreement, and any renewals hereof, Distributor
shall advertise sale of the Products under the trade name "Tasty Fries" and will
diligently promote and make every reasonable effort to steadily increase sale of
the Products by proper use of all advertising media.
B. No design, advertisement, sign or form of publicity, including form,
color, number, location and size, shall be used by Distributor in connection
with sale of the Products unless the same shall have been first submitted to TFI
and approved in writing.
C. All printed materials, including, but not limited to, product
carrying bags, product wrapping, cups, napkins, posters or other printed
material used in connection with the distribution
by retail sale of the Products shall bear TFI Marks as suggested by TFI, and
such use will indicate that TFI Marks are registered Marks.
D. Distributor shall act prudently and in conformity with all laws,
regulations, ordinances, or other requirements which may affect the
utilization of the TFI Marks to ensure that the Marks are not jeopardized,
diminished or damaged in any manner and Distributor agrees to indemnify and
save harmless TFI for any damage or expense occasioned directly or indirectly
by Distributor's improper use of said Marks.
E. Any contractual arrangement of any kind for advertising under the
trade name "Tasty Fries" or utilizing the TFI Marks, entered into by
Distributor shall expressly provide for termination with no greater than ten
(10) days written notice.
ARTICLE VII
TFI MARKS
A. TFI hereby grants to Distributor for the term of this Agreement the
exclusive night to register the TFI Marks for use by the Distributor in the
Territory but only in connection with the distribution of TFI Products which
Distributor is permitted to sell hereunder, and the extent and manner of use
of the TFI Marks shall be subject to TFI approval. The cost of such
registration to be born by the Distributor.
B. TFI hereby agrees to provide all necessary consents and original
artwork for the TFI Marks to assist the Distributor in the registration
thereof in the Territory.
C. Upon registration of the TFI Marks by Distributor, Distributor shall
be responsible for pursuing any counterfeiting or infringement of the TFI
Marks which may come to Distributor's attention.
ARTICLE VIII
UNIFORMITY OF PRODUCTS
A. Distributor agrees that all food Products offered for sale in the
vending machines and paper goods, supplies and other materials utilized in
connection with the food products shall be purchased directly from TFI or
suppliers specified by TFI.
B. In order to establish uniformity of taste and quality of the
Products, TFI has developed and will continue to develop recipes and formulas
of ingredients, which ingredients will be made available to Distributor. Such
Products will be purchased by Distributor at the prevailing prices from time
to time, and will be utilized by Distributor exclusively as specified by TFI.
TFI may from time to time agree with Distributor on an alternate supplier of
Products, in which case, TFI shall be entitled to a reasonable royalty on any
Products so produced to compensate TFI for loss of profit.
C. Distributor agrees that he will not offer any food product or utilize
any paper goods, supplier or other materials, or any equipment, signage,
display cases or other items under the TFI Marks which may compete with the
Products and which are not purchased from TFI or any supplier that is not
currently approved by TFI.
D. Should at any time TFI be unable to supply the Products to Distributor
as contemplated in this Agreement and as required by Distributor to conduct its
business, Distributor shall be entitled with the consent of TFI, such consent
not to be unreasonably withheld, to arrange for its own alternate supply of the
Products, in which case, TFI shall be entitled to a reasonably royalty on any
Products so produced to compensate it for loss of profit.
ARTICLE IX
FEES AND FINANCIAL OBLIGATIONS
A. In consideration of the right to distribute Products granted herein, and
subject to TFI satisfying the requirements of Article 11 C. herein concerning
acceptability of the Products for import and resale in the Territory and further
subject to the Distributor being able to register the TFI Marks for exclusive
use in the territory, Distributor shall purchase from TFI, and TFI supply to
Distributor, a minimum number of french fry vending machines upon the terms and
conditions set forth on Schedule "B" attached hereto and forming a part of this
Agreement.
B. Unless otherwise specified herein, all amounts stated herein or payments
to be made to TFI under this Agreement shall be in U.S. Dollars.
ARTICLE X
DISTRIBUTOR
A. Distributor acknowledges that the TFI Products are unique and
distinctive and have been developed by TFI at great effort, time and expense;
that Distributor has regular and continuing access to valuable and confidential
information, training and trade secrets regarding the products; and that
Distributor recognizes his obligation to fully develop its Territory for sales
of the Products and accordingly agrees as follows:
I. During the term of this Agreement and any renewal thereof,
Distributor shall not, in any capacity whatsoever, either directly or
indirectly, individually or as a member of any business organization,
except with the prior written consent of TFI, engage in the sale of any
french fries vending machine or supplies therefore, other than TFI's.
2. During the terms of this Agreement, or upon expiration or
termination of this Agreement, divulge any aspect of the Products
whether expressly stated to be confidential or otherwise to any person.
ARTICLE XI
TRANSFER OF WHOLE INTEREST
A. This Agreement shall enure to the benefit of the successors of TFI and
may be so assigned at any time.
B. For purposes of clarity, the provisions of this Article XI apply solely
to the transfer by Distributor or its personal representatives of the whole of
the Distributor's interest in this Agreement and shall have no application to
the granting of additional distributorships by
Distributor for subdivided areas thin its Territory, as previously
described in Article 11 paragraph 2.
C. TFI shall not unreasonably withhold its consent to any transfer or
assignment which is subject to the restrictions of this Article, provided,
however, that TFI shall not be required to give its consent unless, in addition
to the requirements of Article IV hereof, the following conditions are met prior
to the effective date of the assignment:
1. For all proposed transfers or assignments:
(a) Distributor shall not be in default under any provision
of the terms of this Agreement or any other agreement ancillary to this
Agreement, and shall have continuously distributed products for a period
of not less than three (3) months;
(b) Distributor has executed a general release in a form
prescribed by TFI of any and all claims against TFI;
(c) The proposed assignee executes such other documents as
TFI may require in order to assume all of the obligations of this
Agreement, to the same extent, and with the same effect, as previously
assumed by Distributor;
(d) A transfer fee has bee paid to TFI in an amount equal to
five percent (5%) of the aggregate cash or cash valued consideration
paid by the assignee to assignor for the distribution rights, to defray
its reasonable costs and expenses in connection with the transfer,
including without limitation, the cost of legals and accounting fees,
credit and investigation charges, evaluations, retraining and additional
supervision. It is agreed that the original cost of the Territory will
be deducted.
D. Upon the death or permanent incapacity of a Distributor the following
shall apply:
1. TFI shall have the right, within thirty (30) days of the date
upon which TFI is notified of such death or incapacity (if consistent
with applicable local laws) to purchase the interest or any part thereof
for cash at the appraised value, such purchase to be completed within
sixty (60) days.
2. If TFI declines to elect to purchase the interest, within thirty
(30) days of the date upon which TFI is notified of such death or
incapacity, the interest may be transferred within a further sixty (60)
days by sale to a third party meeting TFI's then current criteria for
new distributors, provided that the requirements of paragraph D of this
Article are met. If a transfer to an approved transferee cannot be
effected within a further one hundred and twenty (120) days, this
Agreement shall terminate automatically.
3. No sale or transfer of the interest shall be approved by TFI
unless the incapacitated Distributor or personal representative has
agreed to reimburse TFI for the reasonable costs and expenses it has
incurred or may Incur in providing (at TFI's option) one or more interim
Distributors to manage the business until a transfer of the interest is
effected, if TFI
determines, in its discretion, that such supervision is necessary or
desirable.
E. TFI's consent to a transfer of any interest subject to the
restrictions of this Article shall not constitute a waiver by TFI of
the right to distribute Products granted herein, nor shall it be deemed a
waiver of TFI's right to demand exact compliance with any of the terms of
this Agreement by the assignee. The document effecting the transfer or
assignment of any interest subject to the restrictions of this Article shall
specifically provide that Distributor's obligations hereunder shall continue
in full force and effect notwithstanding any such disposition.
F. If Distributor has received and desires to accept any bona fide
offer to purchase his or its distribution rights hereunder, Distributor or
such person shall notify TFI in writing of the purchase price and terms of
such offer, and TFI shall have the right and option (subject to any
limitations of applicable local laws exercisable within thirty (30) days
after receipt of such written notification), to send written notice to
Distributor or such persons that TFI or its assignee intend to purchase
Distributor's interest on the same terms and conditions offered by the third
party.
Any material change in the terms of any offer prior to closing shall
result in a new notification as in the case of the initial offer. TFI's
failure to exercise the option afforded by this paragraph F of this Article
shall not constitute a waiver of any other provision of this Agreement,
including any of the requirements of this Article with respect to the
proposed transfer.
G. Provided always that TFI's consent shall be required, not to be
unreasonably withheld, and no fee shall be chargeable in respect of a
transfer to:
(a) a subsidiary or affiliate;
(b) a corporate successor resulting from merger, amalgamation,
consolidation or other corporate re-organization.
ARTICLE XII
DEFAULT
A. In addition to those events hereinbefore stated to be events of
default, it is agreed that the rights granted to Distributor to this
Agreement may be terminated forthwith with notice upon the happening of any
one or more of the following events, except that TFI must be in compliance
with the terms and conditions of this Distribution Agreement:
I. If the Distributor fails to comply with any of the terms and
conditions of this Distributorship Agreement and such failure to comply
continues for a period of thirty (30) days after written notice thereof
has been given to the Distributor.
2. If the Distributor fails to comply with any of the terms and
condition of any other agreements entered into pursuant to or collateral
to this agreement and such failure to comply continues for a period of
thirty (30) days after written notice thereof has been given to the
Distributor.
3. If the Distributor shall be adjudicated a bankrupt or become
insolvent, or if a receiver or other person with like powers shall be
appointed (whether temporary or permanent) to take charge of all or
substantially all of the Distributor's assets, or if the
Distributor shall make a general assignment for the
benefit of creditors or a proposal under the Bankruptcy Act (or any
similar or successor Act), or commence any proceedings to wind-up,
liquidate, or dissolve the Distributor's business.
4. If the Distributor knowingly falsifies any statement or report
furnished to TFI or otherwise deliberately provides false information to
TFI; or if the Distributor is convinced of a felony or other crime or
impairs the goodwill associated with the TFI Marks.
5. If the Distributor does not order and complete the purchase of
the french fry vending machines it is required to purchase pursuant to
the terms of this Agreement in the manner and at the time therein
specified or pay the cash payment required in lieu thereof as set out in
Schedule B hereto.
6. Distributor will pay all attorney's fees as between an attorney
and his own client, accounting fees and court fees incurred by TFI in
the event of a violation by Distributor of this Agreement.
7. In case of a breach of the terms of this Agreement by
Distributor, TFI shall, in addition to any other remedy it may have, and
notwithstanding any other provision hereof, be entitled to an injunction
restraining Distributor from committing or continuing to commit any
breach of this Agreement, without showing or providing any actual
damaged sustained by TFI, which damage is hereby conclusively
acknowledged.
8. If the Distributor fails to continuously and actively operate
its distributorship throughout the Territory.
ARTICLE XIII
RIGHTS AND OBLIGATIONS OF PARTIES
ON TERMINATION OR EXPIRATION
A. Upon termination or expiration of this Agreement for any reason
whatsoever, Distributor will immediately discontinue use of all trade names,
trade marks, signs, forms of advertising, printed material and all other indicia
of operation as a TFI Distributor from it operations.
B. TFI may retain all fees paid pursuant hereto.
C. Any and all obligations of TFI to Distributor under this Agreement shall
immediately cease and terminate.
D. In no event shall termination or expiration of this Agreement for any
reason whatsoever affect Distributor's obligation to take or abstain from taking
action in accordance with this Agreement.
E. It is understood by Distributor that rights in and to the TFI Marks and
any part thereof or addition thereto and the use thereof shall be and remain the
property of TFI and Distributor shall further assign, transfer and convey to TFI
all additional rights which may be acquired, if any, by
Distributor's own expense in the Territory, if requested to assign the rights
to the xxxx to TFI during the term and under the conditions set forth in this
Agreement, TFI will compensate Distributor for all its costs of registration,
protection, defense and maintenance of the TFI Marks in the Territory.
F. TFI shall have the option to purchase, at Distributor's cost less
twenty-five (25) percent, all or any portion of inventory of any kind bearing
the TFI Marks, including, but not limited to, french fry vending machines,
equipment, vehicles, and any other items Distributor may have in stock at the
time of such termination or expiration.
G. Distributor shall cause immediate discontinuance of all advertising or
other public display or publication of the words "Tasty Fries" and, in the event
that such action is not taken by Distributor and after a period of six (6)
months has elapsed, Distributor hereby constitutes irrevocably TFI as
Distributor's attorney to carry out such acts at Distributor's sole expense.
H. Distributor will immediately pay any and all amounts owing to TFI and
its subsidiaries and affiliates.
I. Distributor shall not, in any capacity whatsoever, either directly or
indirectly, individually or as a member of any business organization, engage in
the preparation or sale of any TFI or other approved TFI Product, or have any
employment or interest in a firm engaged in the preparation or sale of such
products within the Territory or within thirty (30) miles of any other
Distributor's exclusive or nonexclusive territory for a period of three (3)
years following such termination. Distributor acknowledges and agrees that this
restriction upon subsequent activities is necessary in view of the Confidential
Information and expertise Distributor will acquire pursuant to the terms of the
Agreement and will cause TFI irreparable and substantial damage in the event of
breach of these provisions.
ARTICLE XIV
INSURANCE
A. Distributor agrees to place and keep in effect during the life of this
Agreement with an insurance company approved by TFI, public liability in amounts
no less than ONE MILLION DOLLARS ($1,000,000.00) U.S., in case of damage or
injury to one person, no less than ONE MILLION DOLLARS ($1,000,000.00) U.S., in
case if damaged or injury to more than one person, property damage insurance of
ONE MILLION DOLLARS ($1,000,000.00) U.S. in case of damage or injury to one
person (proof of insurance coverage shall be furnished to TFI prior to the
delivery of the first machine).
B. It is specifically agreed that insurance coverage required to be kept in
effect by the terms of this paragraph shall be subject to review by TFI in order
to ensure adequate insurance protection throughout the term of this Agreement.
TFI may, from time to time, and in its sole discretion, require Distributor upon
thirty (30) days notice to obtain reasonable amounts of additional insurance
beyond the aforementioned requirements of this paragraph.
ARTICLE XV
INDEMNIFICATION OF COMPANY
A. Distributor agrees to protect, indemnify, and save TFI, its affiliates,
subsidiaries, partners, stockholders, directors, officers and employees of its
partners harmless from any and all loss, damages, liability, expenses,
attorney's fees and costs incurred by any of them because of any action, matter,
thing, or conduct relating to Distributor and Distributor's business or its
agents, servants, employees, customers and guests in, on, or connected with the
preparation, cooking and sale of Products.
B. TFI agrees to protect, indemnify and save Distributor its stockholders,
directors, officers and employees harmless from any and all loss, damage,
liability expenses, attorney's fees and costs incurred by any of them as a
result of any defect in the design, construction or operation of any of the
french fry vending machines supplied by TFI or as a result of any defect in and
of the other Products supplied by TFI.
ARTICLE XVI
APPEARANCE OF MACHINES
Distributor shall see to it that all machines in the Distributor's
Territory are in good repair, and shall refurbish, tidy, and maintain each TFI
french fry vending machine as necessary or as required by TFI in order to ensure
that at all times a first class, safe and reputable Product is provided to the
public.
ARTICLE XVII
RENEWAL OF AGREEMENT
Unless terminated as herein otherwise provided, Distributor shall have
the option, pursuant to such procedures as may be required by TFI at the
expiration of the initial term of this Agreement, to renew the license granted
hereunder at each ten (10) year expiration date as long as all contractual
conditions are met hereof by executing TFI's then-current form of
Distributorship Agreement provided that:
I. Distributor gives TFI written notice of its election to renew no
less than three (3) months nor more than nine (9) months prior to the
expiration of the then current term and, Distributor executes a general
release under seal, in a form prescribed by TFI, of any and all claims
against TFI, its affiliates, stockholders, directors, officers and
employees; and
2. Distributor at the time of notice of election to renew and at
the end of the then current term is not in default of any of the terms
or conditions of this Agreement or any other Agreement between
Distributor and TFI or its affiliates, and has substantially complied
with the terms and conditions of all such agreements during the term of
this Agreement; and
3. All of the Distributor's accrued monetary obligations to TFI and
its subsidiaries and affiliates have been satisfied prior to renewal,
and timely met throughout the terms of this Agreement.
Upon renewal of this Agreement, no additional distributorship
fee will be due. However, it is specifically agreed that Distributor
will, upon renewal, be charged by TFI a
sum which shall be equal to TFI's estimated costs incurred in
connection with such renewal plus an administrative fee equal
to fifteen (15%) percent of such costs. Furthermore, Distributor
the terms of the TFI's then acknowledges current form of
Distributorship Agreement.
XVIII
RELATIONSHIP OF PARTIES
A. TFI and Distributor are not and shall not be considered as joint
venturers, partners, or agents of each other, or anything other than
Manufacturer and Distributor and neither shall have the power to bind or
obligate the other than as set forth in this Agreement.
B. The parties further agree that their relationship created by this
Agreement is not a fiduciary relationship.
ARTICLE XIX
DISTRIBUTOR'S RESPONSIBILITY
A. Distributor acknowledges that his success in the distribution of
products contemplated to be undertaken by Distributor pursuant to this
Agreement is speculative and depends primarily upon the ability of
Distributor as an independent business organization. Distributor acknowledges
that neither TFI nor any other person has guaranteed or warranted that
Distributor will succeed in the operation of this business venture.
B. Distributor further acknowledges that there have been no
representations, promises, or guarantees or warranties of any kind made by
TFI or its agents or representatives to induce Distributor to execute this
Agreement, except as specifically set forth in this Agreement and further
that Distributor has received all information which he has requested
concerning the business operation of TFI which, in the opinion of Distributor,
is necessary to decide whether to enter into this Agreement.
ARTICLE XX
NOTICES
A. All notices to TFI required by the terms of this Agreement shall be
sent to TFI at its office at:
TASTY FRIES, INC.
000 Xxxxxx Xxxxxxx, Xxxxx Xxx
Xxxx Xxxx, XX, X.X.X. 00000
(or such other address as TFI shall designate in writing) or by telefax,
telecopy, or other electronic means of communication to such address.
B. All notices to Distributor required by the terms of this Agreement shall
be sent to Distributor at its office at:
CANADIAN TASTY FRIES, INC.
#0 Xxxx Xxx Xxxxx Xxxxxx, Xxxxx #000
Xxxxxxxxx, XX, X.X.X. 00000
(or such other address as Distributor shall designate in writing) or by telefax,
telecopy, or other electronic means of communication to such address.
C. All notices to either party required by the terms of the Agreement shall
be deemed to have been received;
(i) in the case of hand delivery or telefax, telecopy or other
electronic communication, upon actual receipt thereof (and not the date of
receipt of confirming mail); and
(ii) in the case of notice sent by registered mail, ten (10) business
days after the date of mailing.
ARTICLE XXI
INTERPRETATION AND EXECUTION
OF AGREEMENT
A. This Agreement shall be construed and interpreted in accordance with the
laws of the state of Florida.
B. This instrument contains the entire Agreement of the parties and no
representation, inducements, promises, or agreement, oral or otherwise, not
embodied herein, were made by TFI and none shall be of any force or effect.,
C. Nothing in this Agreement shall bar or restrict TFI's right to obtain
injunctive relief under applicable law.
ARTICLE XXII
SEVERABILITY AND CONSTRUCTION
A. Each section, part, term and provision of this Agreement, and any
portion thereof shall be considered severable, and if for any reason, any
portion of this Agreement is determined to be invalid to or in conflict with
any applicable present or future law, rule, or regulation in a final
unappealable ruling issued by any court, agency, or tribunal with valid
jurisdiction in a proceeding to which TFI is a party, that ruling shall not
impair the operation of, or have any other affect upon, such other portions
of this Agreement as may remain otherwise intelligible (all of which shall
remain binding on the parties and continue to be given full force and
agreement as of the date upon which the ruling becomes final).
ARTICLE XXIII
WRITTEN APPROVALS AND WAIVERS
A. TFI shall not be deemed to have waived or impaired any right, power
or option reserved by this Agreement (including, without limitation, its
rights to demand Distributor's exact compliance with every term, condition,
and covenant herein, or to declare any breach thereof a default and to
terminate this license prior to the expiration of its term), by virtue of any
custom or practice of the parties at variance with the terms hereof, any
failure by TFI to demand strict compliance with this Agreement, any
forbearance, delay, failure or omission by TFI to exercise any right, power
or
option, whether of the same, similar or different nature, against Distributor
or other, Distributorships, or the acceptance by TFI of any payments due from
Distributor after any breach of this Agreement.
AS WITNESS the hands and seals of the duly authorized representatives
of the parties hereto as of the day and year first above written.
TASTY FREES, INC.
/s/ illegible
-------------------------------- -----------------------------------
Authorized Signatory Witness
CANADIAN TASTY FRIES, INC.
/s/ illegible
-------------------------------- -----------------------------------
Authorized Signatory Witness
XXXXXX X. XXXXXXXX
BARRISTER & SOLICITOR
000 - 000 Xxxx Xxxxxx
Xxxxxxxxx, X.X. X0X 275
SCHEDULE "B"
TO THE DISTRIBUTORSHIP AGREEMENT
BETWEEN: TASTY FRIES, INC.
AND: CANADIAN TASTY FRIES, INC.
FEE PAYMENT SCHEDULE
ARTICLE IX
The purchase price for the grant of distributorship made in this Agreement is
$4,000,000.00 U.S to be paid as follows:
A. On the acceptance and signing of this Agreement by TFI $175,000.00;
B. (a) The balance of the purchase price shall be tied to the order and
delivery of french fry vending machines (the "Machines") which Machines the
Distributor shall be obliged to order in the quantity set out in Column II
below for each year specified in Column I below following the Start Date and
shall make the associated payment against the purchase price set out in
Column III below which payment is based on and paid at a rate of $500.00 per
Machine delivered:
COLUMN I COLUMN II COLUMN III
------- --------- ----------
MINIMUM
YEAR MINIMUM NO OF MACHINES PAYMENT
---- ------------------------ -------
1 400 $ 200,000
2-9 800 $ 400,000
10 850 $ 425,000
(b) The Start Date shall be the first day of the month immediately
following the first six month (180 day) period in which TFI delivers a
minimum of ten (10) Machines suitable for distribution in Europe to
Distributor.
(c) In any year that Distributor does not order the minimum number
of Machines set out in Column II above, Distributor shall make a cash
payment to TFI on the last day of that year equal to the shortfall from
the required payment set out in Column III above for that year.
(d) If in any year Distributor orders the required minimum number of
Machines but TFI is unable or fails to deliver the minimum number of
Machines to Distributor, then Distributor for that year shall only be
obliged to make a payment equal to $500.00 times the number of Machines
delivered to it. The balance of the payment for that year shall be made
on the basis of $500.00 per Machine when TFI finally delivers the
remainder of the minimum of Machines to Distributor.
SCHEDULE"A"
TO THE DISTRIBUTORSHIP AGREEMENT
BETWEEN: TASTY FRIES, INC.
AND: CANADIAN TASTY FRIES, INC.
DESCRIPTION OF TERRITORY
ARTICLE 1.
For the purposes of this Distributorship Agreement (the "Agreement") the
territorial boundaries to which this Agreement applied are the internationally
recognized boundaries of the countries listed herein (referred to in this
Agreement as the "Territory").
Denmark
Finland
France
Greece
Hungary
Italy
Norway
Portugal
Spain
Sweden
AMENDMENT TO DISTRIBUTION AGREEMENT
BETWEEN TASTY FRIES, INC. AND
CANADIAN TASTY FRIES, INC.
DATED APRIL 5, 1995
WHEREAS, Tasty Fries, Inc. and Canadian Tasty Fries, Inc. desire to
amend the Distributorship Agreement dated April 5, 1995 (the "Distributorship
Agreement) to include additional European countries in the defined Territory;
NOW, THEREFORE, the parties hereto for good and valuable consideration,
receipt whereof is hereby acknowledged, do hereby agree to amend the
Distributorship Agreement as follows:
1. Schedule "A" to the Distributorship Agreement, attached thereto
and made a part thereof, is amended as follows:
SCHEDULE "A"
TO THE DISTRIBUTORSHIP AGREEMENT
BETWEEN: TASTY FRIES, INC.
AND: CANADIAN TASTY FRIES, INC.
DESCRIPTION OF TERRITORY
ARTICLE 1.
For the purposes of this Distributorship Agreement (the "Agreement") the
territorial boundaries to which this Agreement applies are the internationally
recognized boundaries of the countries listed herein (referred to in this
Agreement as the "Territory").
Bulgaria
Czechoslovakia
Denmark
Finland
France
Greece
Hungary
Italy
Norway
Poland
Portugal
Romania
Spain
Sweden
Turkey
2. Schedule "B" to the distributorship Agreement, attached
thereto and made a part thereof, is amended to include a new paragraph B.(a)
to read as follows:
(a) TFI agrees to use its best efforts to maintain a 12%
xxxx-up on all machines it delivers for distribution in
Europe to Distributor.
IN WITNESS WHEREOF, the undersigned have executed this Amendment on the
date written above.
TASTY FRIES, INC.
BY:________________________________________
Xxxxxx X. Xxxxx, President
CANADIAN TASTY FRIES, INC.
BY:_________________________________________
Xxx Xxxxxxx, President
March 17, 1995
VIA FACSIMILE
(000) 000-0000
Xxx X. Xxxxxxx, President
Canadian Tasty Fries, Inc.
Xxxxx 000
000 Xxxx Xxxxxx
Xxxxxxxxx, X.X. X0X0X0
RE: DISTRIBUTION RIGHTS FOR SCANDINAVIAN COUNTRIES
Dear Ian:
This letter will act as formal notification that Tasty Fries, Inc. will sell the
distribution rights for the Scandinavian Countries of Denmark, Finland, Norway,
and Sweden to Canadian Tasty Fries, Inc. Time constraints did not allow the
inclusion of this business in the recently signed distribution rights contract
between our respective companies.
We will establish the sale price of these territories by using our existing
Distributors / agreement dated March 16,1995 which calls for a total value of
$4,000,000. Based on the population of these territories a pro rata formula will
dictate sale price.
I will call you next week.
Thank you for your assistance and I look forward to working with you and your
associates.
Best regards,
TASTY FRIES, INC
/s/ Xxxxxx X. Xxxxx
-----------------------------
Xxxxxx X. Xxxxx, President
