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EXHIBIT 10.5
IMPORT AND DISTRIBUTION AGREEMENT
This Agreement is made and entered into this 11th day of March, 1997 by
and between the SICA "les Chais du Prevot" 33670 Creon (Gironde - France) and,
R & R (Bordeaux) Imports, Inc. (or Assignees) a Florida, U.S.A. corporation,
with its principal place of business at 3201 West Griffin Road, Suite #201, Ft.
Lauderdale, Florida 33312-6900, U.S.A. ("Distributor").
RECITALS
WHEREAS, WINERY is engaged in the production and sale of wine and wishes
to expand the distribution of such product by having DISTRIBUTOR sell such
product in the territory described in Paragraph 3 hereof; and
WHEREAS, DISTRIBUTOR desires to market the wine products produced by
WINERY and be designated as the exclusive distributor of WINERY for the purpose
of selling such products in the territory assigned to it.
NOW, THEREFORE, for good and valuable consideration, the receipt of
which is hereby acknowledged by each party, the parties hereto agree as follows:
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1. APPOINTMENT.
(a) WINERY hereby appoints DISTRIBUTOR as its exclusive distributor for
the sale and promotion of the Products described in Paragraph 2 below in the
Territory described in Paragraph 3 below and agrees not to appoint other
distributors in the Territory. WINERY accepts that while this Agreement is in
effect, it will not sell Products to persons other that DISTRIBUTOR, who WINERY
has reason to believe will resell the Products in the Territory.
(b) DISTRIBUTOR hereby accepts such appointment subject to the terms and
conditions of this Agreement and agrees that it shall use its best efforts to
promote demand for and sale of the Products in the Territory and that in the
sale and promotion of the Products it shall at all times carry out to the best
of its ability a merchandising policy designed to promote and maintain the
excellence of quality and to preserve the goodwill which is associated with the
name and reputation of WINERY and its products.
(c) Notwithstanding the foregoing, should DISTRIBUTOR, commencing with
the 1999 calendar year, fail to meet the minimum annual purchase requirements
set forth in Section 4(c) of this Agreement, then DISTRIBUTOR shall become a
non-exclusive distributor of the Products.
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2. PRODUCTS.
The term "Products" as used in this Agreement shall mean any and all
wine styles and any other types brewed and produced by WINERY. WINERY shall have
the right to stop producing and selling any of the Products without incurring
any obligation or liability to Distributor.
3. TERRITORY.
The term "Territory" as used in this Agreement shall mean the Continent
of North America, and the Caribbean Islands. The Territory may be subsequently
enlarged, reduced or otherwise changed by agreement in writing of the parties
hereto.
4. SALES ACTIVITIES.
DISTRIBUTOR shall conduct the sales activities contemplated under this
Agreement by purchasing Products from WINERY for resale to DISTRIBUTOR'S
customers within the Territory. DISTRIBUTOR shall conduct its sales activities
in a lawful manner consistent with the highest standards of fair trade, fair
competition, and business ethics; shall cause all of its employee to do the same
and use its best efforts to ensure that its agents do the same; and in addition
shall be bound by the following duties and obligations:
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(a) Advertising. DISTRIBUTOR may undertake, at its own expense, such
advertising and promotional efforts as it may deem necessary to achieve a proper
recognition of the Products in the Territory. DISTRIBUTOR shall have the right
to use the names or any derivation thereof, or any other name or mark associated
with WINERY.
(b) Inventory. DISTRIBUTOR agrees to maintain at all times an inventory
of the Products sufficient to fill reasonably anticipated orders from its
customers and to deliver promptly all such orders.
(c) Minimum Purchases. During the calendar year beginning January 1,
1997, DISTRIBUTOR shall make a minimum annual total purchase of Products having
a net plant invoice value of $100,000 U.S. Commencing with calendar year
beginning January 1, 1998, DISTRIBUTOR shall make a minimum annual total
purchase of Products having a net plant invoice value of $150,000 U.S.
Commencing with calendar year beginning January 1, 1999, DISTRIBUTOR shall make
a minimum annual total purchase of Products having a net plant invoice value of
$400,000 U.S. For the following calendar years, DISTRIBUTOR shall maintain a
minimum annual total purchase of Products having at least the same net plant
invoice value as the 1999 calendar year and will aim if possible to increase it.
(d) Orders. DISTRIBUTOR shall in submitting orders describe the Products
in a clear and unambiguous manner and shall include precise instructions for
packaging, invoicing, and shipping.
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(e) Resale Prices. DISTRIBUTOR shall distribute the Products through all
available means, including restaurant accounts, store and market retail
accounts, or otherwise, which may be commensurate with good development of the
Territory. DISTRIBUTOR shall set resale prices for the Products at its own
discretion.
5. LIST PRICES.
(a) The prices to be paid by DISTRIBUTOR to WINERY for each
order of Products shall be WINERY's prices in effect on the date said order for
Products from time to time on thirty (30) days' written notice to DISTRIBUTOR to
compensate for increases in its cost of manufacturing Products due to changes in
currency exchange rates or increases in energy, labor, raw materials or
transportation costs or in duties or other French governmental charges,
impositions or assessments. No price increase shall effect the prices of Product
sold to DISTRIBUTOR pursuant to orders placed by DISTRIBUTOR and accepted by
WINERY prior to the effective date of such price increase.
(b) The prices will be reevaluated and DISTRIBUTOR will be
notified in writing annually thirty (30) days prior anniversary date (date of
signature agreement) by WINERY.
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6. PLACEMENT OF ORDERS AND SHIPMENT.
(a) Upon the placing of a written order for Products to WINERY by
DISTRIBUTOR, a binding agreement will be created whereby WINERY will agree to
sell and ship, and DISTRIBUTOR will agree to purchase and pay for, the Products
ordered under the terms of this Agreement.
(b) Any terms or conditions stated in DISTRIBUTOR'S order inconsistent
with this Agreement shall be null and void.
(c) WINERY shall ship the Products to DISTRIBUTOR in a 30 day period,
time necessary to obtain COFACE's preliminary agreement and prepare the order.
Shipping dates shall be approximate and shall be computed from the date of
receipt of the order by WINERY. Weights given shall be estimated weights. All
typographical and clerical errors shall be subject to correction.
(d) WINERY shall in no event be obligated to make any such shipment if
such shipment would, at the time thereof, constitute a violation of any laws,
regulations, or policies of the Territory or of the United States of America or
France.
(e) WINERY shall be fully obligated to maintain in its storehouses
Products available to the Carrier, named by DISTRIBUTOR, or shall forward such
Products to DISTRIBUTOR's designated place for a transportation cost; and
ownership, legal title, and all risk of loss or damage shall pass to DISTRIBUTOR
when the Products have been delivered to the carrier at WINERY'S place of
business.
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(f) DISTRIBUTOR shall be entitled to conduct a reasonable investigation
of the Products upon receipt thereof. All claims for defects in the Products or
shortages shall be made in writing by DISTRIBUTOR within twenty (20) days of the
receipt of the Products. Acceptance of the Products by DISTRIBUTOR for loss or
damage due to defects or shortages in the Products, or to delay in delivery of
Products.
(g) No Products shall be returned for credit without first obtaining the
written permission of WINERY to return such Products. In the event WINERY does
agree to accept goods and all such returned Products must be received by WINERY
in an unused condition for resale as new merchandise.
7. PAYMENTS.
(a) All terms of this Agreement, (including but not limited to
"cost", "payments", "amounts", "value", "discounts", "price", "credits",
"set-off", "dollars" or "$", shall be calculated and constructed in terms of
currency of the United States of America.
(b) In order to secure DISTRIBUTOR's obligation to accept and
purchase any Products ordered under the terms of this Agreement, upon order
DISTRIBUTOR shall effect a "SWIFT" transfer in the name of WINERY for an amount
corresponding to this order with a 2% discount.
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8. CONFIDENTIAL INFORMATION.
DISTRIBUTOR and WINERY shall not use or disclose to third party any
confidential information concerning the business, affairs, or the products of
the other party which it may acquire in the course of its activities under this
Agreement and shall take all necessary precautions to prevent any such
disclosure by any of its employees, officers, or affiliated persons and
entities. For purposes of this Article, confidential information shall include
trade secrets and other unpatentable information.
9. SUB-DISTRIBUTORS.
DISTRIBUTORS shall have the right to appoint sub-distributors for the
sale and promotion of the Products in the Territory. Additionally, DISTRIBUTOR
shall have the right to enter into alliances and cooperative arrangements for
the sale, promotion and distribution of the Product in the Territory.
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10. CONSEQUENTIAL DAMAGES INDEMNITY.
(a) The parties hereto acknowledge that the ability of WINERY to
comply with the terms of this Agreement is of the utmost importance to the
business operations of DISTRIBUTOR. As a result, the parties understand that
should WINERY breach any provision of this Agreement (except if mandatory French
law overrules), that it shall be liable to DISTRIBUTOR for all damages which
consequentially occur as a result of said breach including, but not limited to,
lost goodwill, lost resale profits, and lost customers of DISTRIBUTOR.
(b) DISTRIBUTOR shall indemnify WINERY and hold it harmless from
any claims, demands, liabilities, suits, or expenses of any kind arising out of
DISTRIBUTOR's business, and these provisions shall survive the termination of
this Agreement.
11. PRODUCT WARRANTY.
WINERY warrants to DISTRIBUTOR that shall be of merchantable
quality at the time title there passes to DISTRIBUTOR in accordance with this
Agreement. WINERY at its option, shall replace any which fail to comply
with such warranty or shall refund the purchase price paid by DISTRIBUTOR
therefor. Further, WINERY hereby agrees to indemnify DISTRIBUTOR for any claims
for liabilities made against DISTRIBUTOR arising out of personal injuries or
death or damage
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to property caused by defective , unless such defect is created by
DISTRIBUTOR's handling the .
12. RELATIONSHIP BETWEEN PARTIES.
DISTRIBUTOR agrees that in all matters relating to this Agreement it is
and shall be acting as an independent contractor and shall bear all of its
expenses in connection with this Agreement. It shall not have any authority to
assume or create any obligation, express or implied, on behalf of WINERY.
DISTRIBUTOR shall not make quotations or write letters in the name of WINERY but
in every instance shall use its own name.
13. EFFECTIVE DATE AND DURATION.
(a) This Agreement shall and will remain effective for three (3)
years from the effective date, and shall be automatically renewed, unless
written notice of non-renewal by either party is given nine (9) months prior to
the end of the initial or any renewal term.
(b) This Agreement may be terminated prior to the expiration of
the initial term of this Agreement, or any renewals thereof, by either party if
the other party:
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(i) breaches any material provision of this Agreement, and such
breach is not cured within ninety (90) days written notice thereof;
(ii) insolvency or bankruptcy of either party under applicable
law, and/or the appointment of a trustee or receiver for either party; or
(iii) any inability or prospective failure of either party to
perform its obligations hereunder.
14. SUSPENSION CLAUSE.
Enforcement of this Agreement between DISTRIBUTOR and WINERY shall only
be effective after COFACE's agreement.
15. RIGHTS AND OBLIGATIONS UPON TERMINATION.
Upon expiration or termination of this Agreement for any reason, all
orders received from DISTRIBUTOR but not shipped by WINERY prior to the
effective date of termination shall be shipped by WINERY, and DISTRIBUTOR agrees
to accept shipment of and make payment for any such orders shipped by WINERY.
16. NO ASSIGNMENT.
This Agreement shall not be assigned by either party, either by
operation of law or by contract, without the prior written consent of the other
party hereto, and any attempt to assign without such consent shall be null and
void. Nothing herein contained, however, shall prevent DISTRIBUTOR from
assigning this Agreement to any subsidiary, an affiliate, sister, or parent
corporation of DISTRIBUTOR.
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17. GOVERNMENT REGULATION.
(a) DISTRIBUTION agrees to obtain at its own expense import
license, foreign exchange permit, or other permit or approval it may need for
the performance of its obligations under this Agreement, and in essence, to
comply at its own expense with all applicable laws, regulations, and orders of
the government(s) of the Territory, the United States or any instrumentality
thereof.
(b) DISTRIBUTOR agrees to furnish annually to WINERY, by
affidavit or other reasonable means at WINERY's request, and the reasonable
satisfaction of WINERY, assurances that the appointment of DISTRIBUTOR
hereunder, its activities under this Agreement, and the payment to WINERY of any
monies or consideration contemplated hereunder are proper and lawful under the
law in force in the Territory and in the United States of America. DISTRIBUTOR
further represents that no person employed by it is an official of any
government agency or a corporation owned by the governments of the Territory,
the United States of America, or any State thereof and that no part of any
monies or considerations paid hereunder shall accrue for the benefit of any such
official.
18. FORCE MAJEURE.
This Agreement and WINERY's and DISTRIBUTOR's performance hereunder are
subject to all contingencies beyond their reasonable control, including but not
limited to force majeure,
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strikes; lockouts; labor disputes; flood; civil commotion; riot; acts of God;
rules, laws, orders, restrictions, embargoes, quotas or actions of any
government, foreign or domestic or any agency or subdivision thereof;
casualties; fires; accidents; shortages of transportation facilities; detention
of the by custom authorities; or losses of the Products in public or
private warehouses. In any such event, the party not subject to force majeure
shall have the right, in its sole discretion and without any liability to the
other party, to (a) cancel all or any portion of this Agreement, or (b) require
performance of this Agreement within a reasonable time after the causes for
nonperformance or delay have terminated.
19. SEPARABILITY.
If any provision to this Agreement is found by any court of competent
jurisdiction to be invalid or unenforceable, the invalidity of such provision
shall not affect the other provisions of this Agreement and all provisions not
affected by such invalidity or unenforceability shall remain in full force and
effect.
20. WAIVER.
The waiver by either party hereto of a breach or default in any of the
provisions of this Agreement by the other party not be
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construed as a waiver of any succeeding breach of the same or other provisions;
nor shall any delay or omission on the part of either party to exercise or avail
itself of any right, power, or privilege that it has or may have hereunder
operate as a waiver of any breach of default by the other party.
21. LANGUAGE.
This Agreement is written in French and English in two counterparts in
each language. One copy of each language text shall be retained by each party.
French and English texts shall have equal validity and legal effect, provided
however that in case of disagreement, the English language text shall prevail.
22. NOTICES.
(a) Unless otherwise specifically provided, all notices, demands, or
requests required or permitted by this Agreement shall be in writing and in
French and sent a letter form or by telex, facsimile (facsimile to be
accompanied by a telex notice requesting confirmation of receipt), telegraph or
cable to the address of the parties first set forth hereinabove, or to such
other address as may from time to time be designated by any party through
notification to the other party at its address as in effect from time to time.
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The dates on which notices shall be deemed to have been effectively
given shall be determined as follows:
(a) Notices given by personal delivery shall be deemed
effectively given on the date of personal delivery;
(b) Notices given in letter form shall be deemed effectively
given on the tenth day after the date mailed (as indicated by the postmark) by
registered airmail; postage prepaid, or the fourth day after delivery to an
internationally recognized courier service;
(c) Notices given by telex, telegraph or cable shall be deemed
effectively given on the second business day following the date of transmission,
as indicated on the document in question; and
(d) Notices given by facsimile shall be deemed effectively given
on the first business day following the date of transmission of a telex notice
requesting confirmation of receipt as indicated on the telex in question.
Nothing contained herein shall justify or excuse failure to give oral
notice for the purpose of informing the other party thereof when notification is
appropriate, by such oral notice shall not satisfy the requirement of written
notice.
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23. GOVERNING LAW.
The formation, validity, execution, amendment and termination of this
Agreement shall be governed by international judicial laws, principles and
practices.
24. RESOLUTION OF DISPUTES.
(a) Any dispute, controversy or claim arising out of or relating to this
Agreement, or the interpretation, breach, termination or validity hereof, shall
be resolved through friendly consultation. Such consultation shall begin
immediately after one party has delivered to the other party a written request
for such consultation. If within thirty (30) days following the date on which
such notice is given the dispute cannot be resolved, one dispute shall be
submitted to arbitration upon the request of one party with notice to the other
party.
(b) Any arbitration to be conducted pursuant to the terms of this
Agreement shall be conducted in Stockholm, Sweden under the auspices of the
Arbitration Institute of the Stockholm Chamber of Commerce (the "Institute").
There shall be three arbitrators. Each party shall select one arbitrator within
thirty (30) days after giving or receiving the demand for arbitration. Such
arbitrators shall be freely selected, and the parties shall not be limited in
their selection to any prescribed
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list. The President of the Institute shall select the third arbitrator. If the
other party does not appoint an arbitrator who has consented to participate
within thirty (30) days after the selection of the first arbitrator, the
relevant appointment shall be made by the President of the Institute.
(c) The arbitration proceedings shall be conducted in English. The
arbitration tribunal shall apply the Arbitration Rules of the United Nations
Commission on International Trade Law in effect at the time of arbitration.
However, if such rules are in conflict with the provisions of this Section 23,
including the provisions concerning the appointment of arbitrators, the
provisions of this Section 23 shall prevail.
(d) Each party shall cooperate with the other in making full disclosure
of and providing complete access to all information and documents requested by
the other party in connection with such proceeding, subject only to any
confidentiality obligations binding on such party.
(e) The award of the arbitration tribunal shall be final and binding
upon the parties, and either party may apply to a court of competent
jurisdiction for enforcement of such award.
25. ENTIRE AGREEMENT; MODIFICATIONS AND WAIVERS.
This Agreement is the entire agreement of the parties with respect to
the subject matter described in this Agreement and all oral and written prior
negotiations and agreements and any conflicting prior course of dealing or trade
usage are superseded
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hereby. The parties hereto agree that no other representations have been made,
and that this Agreement does not rely upon any representations, except as
specifically stated in this Agreement. This Agreement may be modified only by a
document signed by both parties.
IN WITNESS WHEREOF, and intending to be legally bound hereby,
DISTRIBUTOR and WINERY have each caused this Agreement to be delivered and
executed by their proper and duly authorized officers on this 11th day of
March, 1997.
WINERY agrees to sign the exact copy of this Agreement in English within
10 days after receiving it, failing to do so will render this Agreement null and
void.
WINERY: LES CHAIS DU PREVOT S.I.C.A. (stampl)
33670 CREON
March 11, 1997
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By: Dominique Porcher, DATE
Managing Director
DISTRIBUTOR: R & R (Bordeaux)
Imports, Inc.
ROBERT K. WALKER 3/11/97
- ---------------------------------- ------------------------------------
By: Robert K. Walker, President DATE
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