EXCLUSIVE MARKETING AND SALES AGREEMENT

 

 

This Marketing and Sales Agreement (the "Agreement") is made effective as of
June 27, 2014 between Kush Bottles, Inc (Kush)/ DANK Bottles LLC (Kush Bottles
Colorado, and Hollister & Blacksmith Inc. 3457 Ringsby Ct. Unit 111 Denver, CO
80216-4900 (H&B).

 

In the Agreement, H&B who is providing the Product, [fully described in Exhibit
"A" attached hereto] will be referred to as "H&B", and Kush Bottles Inc and Dank
Bottles llc who are receiving the right to exclusively sell the child-resistant
drawstring exit bag [define Product], will be referred to as "Kush."

 

The parties agree as follows:

 

I. RIGHT TO SELL. H&B hereby grants an exclusive right within the 50 United
States and its territories to Kush to sell the Product. In accordance with this
Agreement, H&B grants Kush an exclusive right to sell the Product under the
terms of this Agreement. H&B agrees to deliver the stated quantities to Kush in
a timely manner. Prices and terms of sale shall be determined in this Agreement.

 

II. PERFORMANCE TERMS: H&B agrees to deliver a total of 500,000 Product units
each term, within no more than 180 days total from the date of a Purchase Order
from Kush to H&B, to be delivered in three separate deliveries of full
individual containers of 170,000 units per container with the final (third)
container to be 160,000 units. Kush will pay to H&B $150,000, upon execution of
PO and a balance of set forth in the table Exhibit A ). Kush will inspect and
confirm the content of each shipping within 5 business days. Deliveries will be
FOB Denver, CO. Payment shall be in the United States dollars and shall be
presented per direction of H&B in Denver; CO. Kush deposit to H & B Inc for
$150,000.00 provided as Exhibit B. This money will be used to secure the
material and the manufacturer to get “The Satchel” into production for a 6-8
week delivery time frame. ACC will put up as collateral to the above named
company 200,000 shares of Brazil Interactive Media (BIMI parent of H & B) stock.
Once delivery of the 500k bags, is in Kush Colorado’s warehouse in Denver the
collateral is released, . Once the 500k units have been bought per this
agreement, ACC will assign 20,000 shares of BIMI stock to Kush Bottles Inc. H&B
has the right to claw back all shares from Kush Bottles Inc. if the payment
terms set forth in Exhibit A are not fully fulfilled.

 

II.a Force Majeure. If either party is prevented, hindered or delayed from
performing any of its obligations under this Agreement (other than an obligation
to pay money) by an event of force majeure, then so long as that situation
continues, that party shall be excused from performance of such obligations to
the extent it is so prevented, hindered, or delayed, and the time for
performance of such obligations shall be extended accordingly. A party affected
by an event of force majeure shall notify the other party within seven (7) days
after its occurrence and its effect of likely effect and shall use all
reasonable endeavors to minimize the effect of the event of force majeure and to
bring it to an end; provided that no party shall be obligated to settle any
strike or other labor actions, labor disputes or labor disturbances of any kind,
except on terms wholly satisfactory to it. For purposes of this Agreement, an
event of force majeure means a delay in performance due to fire, strike, war,
act of God or any other cause beyond reasonable control of either party.

 

II.b Exclusivity. Kush exclusivity will be based on ordering a minimum volume of
500k units within a 12 month period starting 6/27/14, If 500k units are not
ordered within a 12 month period H&B reserves the right terminate this Agreement
and sell the drawstring bag (Product).

 

III. TITLE TO MERCHANDISE. Merchandise shall be delivered FOB Denver, CO
(Delivery), at the Kush address set forth above. H&B shall be responsible for
all shortages, loss, or damage, until inspection and acceptance by Kush and H&B
shall be responsible for any and all shortages, loss, damage or defects in the
merchandise through Delivery and inspection by Kush. Kush shall, within seven
days after Delivery, notify H&B of any shortage, damaged or defective product
delivered by H&B under this agreement and such product shall be promptly
replaced or credited on future orders.

 

IV. WARRANTIES. Neither party makes any warranties with respect to the use, sale
or other transfer of the Product; except that H&B covenants and warrants that
the Product shall be suitable for its intended purpose of meeting the
requirements and standards of the Title 16 C.F.R 1700.20 (1995) and ASTM
classification standard D3475-12.

   

 

V. TRANSFER OF RIGHTS. This Agreement shall be binding on any successors of the
parties. Neither party shall have the right to assign its interests in this
Agreement unless the prior written consent of the other party is obtained.

 

VI. TERMINATION. This Agreement may not be terminated unless a material breach
of the Agreement is made, with the non-breaching party giving 7 days written
notice to the other party, and the other party having 30 days thereafter to cure
any such alleged breach. (i) If Kush causes a material breach of this agreement,
Kush will have 90 day to cure, if within 90 day Kush has not cured material
breach, H&B will have the right to terminate the agreement and sell the Product.

 

VII. OPTION. Kush , at its sole and exclusive discretion, shall have the right
to renew this Agreement upon written notice to H&B for subsequent full
containers orders of the Product (payment terms set forth in Paragraph II), for
up to 10 YEARS from the date of this Agreement. Each option shall be for a full
container of 170,000 units, at the unit price agreed upon per unit in Exhibit A,
with all other terms and conditions of this Agreement applicable as set forth in
Paragraph II.

 

VIII. ENTIRE AGREEMENT. This Agreement contains the entire agreement of the
parties with respect to the subject matter of this Agreement and there are no
other promises or conditions in any other agreement, whether oral or written.
This Agreement supersedes any prior written or oral agreements between the
parties with respect to the subject matter of this agreement.

 

IX. AMENDMENT. This Agreement may be modified or amended, if the amendment is
made in writing and is signed by both parties.

 

X. SEVERABILITY. If any provision of this Agreement shall be held to be invalid
or unenforceable for any reason, the remaining provisions shall continue to be
valid and enforceable. If a court finds that any provision of this Agreement is
invalid or unenforceable, but that by limiting such provision it would become
valid or enforceable, then such provision shall be deemed to be written,
construed, and enforced as so limited.

 

XI. WAIVER OF CONTRACTUAL RIGHT. The failure of either party to enforce any
provision of this Agreement shall not be construed as a waiver or limitation of
that party's right to subsequently enforce and compel strict compliance with
every provision of this Agreement.

 

XII. APPLICABLE LAW. This Agreement shall be governed by the laws of the State
of Colorado.  In any action to enforce its rights, the prevailing party shall be
entitled to recover from the other party its reasonable attorney's fees and
costs incurred as a result of the other party's breach of this Agreement. 

 

XIII. SIGNATORIES. This Agreement shall be executed on the behalf of Kush
Bottles, Incby Ben Wu, its CEO, Dank Bottles, LLC by Greg Gamet, a member, and
on behalf of H&B by Corey Hollister, its CEO.

 

XIV. INTELLECTUAL PROPERTY.

 

a. “Intellectual Property” (IP) means all present and future United States and
foreign patents (including, without limitation, design patents, industrial
designs and utility models) and patent applications (including, without
limitation, docketed patent disclosures awaiting filing, reissues, divisions,
continuations and extensions), and inventions, processes, designs, formulae,
trade secrets, know-how, confidential information, trademarks, copyrights,
service marks, domain names, computer software, data and documentation, and all
similar intellectual property rights including, without limitation, technology
underlying patents and patent applications, tangible embodiments of any of the
foregoing and licenses of the foregoing regarding the Product [defined as
child-resistant exit bag].

 

b. “Ownership”.  All Intellectual Property regarding the Product shall be the
exclusive property of H&B. Kush shall be required to and shall require any
employees, consultants, assistants, aides and the like who conceived, developed,
or otherwise invented any Newly Developed IP regarding child resistant exit bag
] regarding the Product or participated in the conception, development, or
invention of any Newly Developed IP of the Product to execute an agreement
assigning all of its rights, title and interest in any Newly Developed IP
regarding the Product to H&B.

   

 

c. Protection of Newly Developed IP.  Kush will be available and cooperate, and
will ensure that its employees, assistants, aides and the like will also assist
and cooperate, with H&B to secure the intellectual property rights in the Newly
Developed IP regarding the Product, and to aid H&B with any patent, trademark or
copyright applications undertaken by H&B, at H&B’s expense.

 

d. Notice of Infringements.  Kush shall promptly notify H&B of any and all
infringements of Existing H&B and Newly Developed IP that may come to Kush
attention regarding the Product and shall provide such assistance to H&B to
enforce H&B’s rights as H&B shall reasonably require, at H&B’s expense.

 

XV. Confidentiality.

 

a. Protection of Confidential Information.  Each party acknowledges that during
the engagement it will have access to and become acquainted with various trade
secrets, inventions, innovations, processes, information, records and
specifications or other confidential or proprietary information of or licensed
by the other and/or used by the other in connection with the operation of their
respective businesses or contemplated businesses, including, without limitation,
product processes, methods, customer lists, accounts and procedures
(collectively, along with any analysis or reports embodying or derived from the
foregoing the “Confidential Information”). Each party agrees that it will not
disclose any of the other’s Confidential Information, directly or indirectly, or
use any of it in any manner, either during the term of this Agreement or at any
time thereafter, except as required in the course of this engagement. The
Confidential Information shall remain the exclusive property of the discloser. 
The receiving party shall not retain any copies of the Confidential Information
without the discloser’s prior written permission.  Upon the expiration or
earlier termination of this Agreement, or whenever requested by the discloser,
the receiving party shall immediately deliver to the disclosing party all such
files, records, documents, specifications, information, and other items in its
possession or under its control, and shall destroy any electronic records
embodying or derived from the Confidential Information.  Each party shall
maintain the Confidential Information in a reasonably secure location and employ
precautions to restrict access to and to protect the confidentiality of the
Confidential Information that, in the aggregate, are no less protective than the
precautions it uses to protect the confidentiality of its own comparable
confidential information and, in any event, no less than reasonable precautions.

 

b. As used in this Agreement, “Confidential Information” means any information,
technical date, or know-how (either oral, written or digital) provided by ether
party to the other party(including any director, officer, employee, manager,
agent, or representative of either party or obtained by either party (including
any director, officer, employee, agent, or representative of the other)
including but not limited to information related to: (1) any financial,
engineering, business, planning, research, operations, services, products,
technical information and/or know-how, patents owned or assigned, organization
charts, prototypes, formulas, production,  marketing, pricing, sales, profit,
personnel, customer, prospective customer, supplier, or other lists or
information; (2) any papers, data, records, processes, techniques, systems,
models, samples, devices, equipment, customer lists, or documents; (3) any
confidential information or trade secrets of any third party provided in
confidence or subject to other use or disclosure restrictions or limitations;
and (4) any other information, written, oral or electronic, whether existing now
or at some time in the future, which pertains to either party’s affairs or
interests or with whom either party does business.  “Confidential Information”
does not include information that lawfully is or has become generally or
publicly known, other than through the unlawful or improper act or omission of
any person that has or had an obligation of non-disclosure or non-use with
respect to such information, including without limitation my breach of this
Agreement. 

 

c. Notice of Compulsory Disclosure; Cooperation Limiting Disclosure.  Except as
provided in otherwise herein, if either party or any of its employees, agents,
officers or directors is requested or becomes compelled by law or legal process
to disclose or is required by a regulatory body to disclose any of the
Confidential Information, such party shall notify the other party promptly and
shall reasonably assist the other party to obtain a protective order or other
remedy of the other party's election.  Each party shall furnish only that
portion of the Confidential Information that is legally required to furnish,
exercise reasonable efforts to obtain reliable assurance that the Confidential
Information shall be held in confidence, and allow the other party a reasonable
opportunity of prior review of such disclosure to the extent possible under such
circumstances.

   

 

d. Injunctive Relief.  Given the nature of the Confidential Information and the
competitive damage that would result to each party upon unauthorized disclosure,
use or transfer of Confidential Information to any third party, the parties
hereto agree that monetary damages would not be a sufficient remedy for any
breach of this Agreement.  In addition to all other remedies, each party agrees
that the other party shall be entitled to specific performance and injunctive
and other equitable relief as a remedy for any breach or threatened breach of
this Agreement.  Each party agrees to waive any requirement for the securing or
posting of any bond or the showing of actual monetary damages in connection with
such remedy hereunder.  Notwithstanding the foregoing, it is not the agreement
or intent of the parties for this Agreement to be construed as a limitation or
waiver of each party's right to pursue any remedies at law or in equity.

 

XVI.  Non-Competition; Non-Circumvention.

 

(a)Kush expressly covenants and agrees that during the term of this Agreement 8
month immediately following the termination of the agreement for any
reason, other than a breach of contract by Hollister & Blacksmith, Kush will not
engage directly or indirectly, whether individually, or as a shareholder,
partner, member, owner, manager, employee, agent, consultant or creditor of any
business (which includes owning, managing, operating, controlling, being
employed by, acting as a consultant to, giving financial assistance to,
participating in or being connected in any material way with any business or
person so engaged) anywhere in the United States, including its territories in
the distribution of child-resistant exit bags; except as permitted in XVI (b).

(b)Kush agrees to sell the drawstring bag (the satchel) as the preferred
child-resistant exit bag solution to the end customer in each of the 50 states
and territories. If Kush carries a competing child-resistant exit bag solution,
90% of sales must be the satchel. H&B reserves the right to request detail to
ensure this standard is being honored on a quarterly basis.

 

XVII. Notices. All notices under this Agreement shall be tendered via overnight
delivery by Federal Express or UPS, with tracking and confirmation of receipt,
to the party at the address set forth below.

 

If notice to: Kush Bottles, Inc.

Ben Wu, CEO

1800 Newport Circle

Santa Ana, CA 92705

 

DANK Bottles, LLC

Greg Gamet, Member

3831 Eudora Way

Denver, CO 80207

 

 

 

If notice to: Hollister & Blacksmith, Inc

Corey Hollister, CEO

3457 Ringsby Ct. #111

Denver, CO. 80

 

 

 

 

 

 

 

 

 

 

Remainder of this page left blank

Signature page to follow

   

 

 

 

Kush Bottles, Inc. and DANK Bottles, LLC

 

By: /s/ Ben Wu

Ben Wu

Kush Bottles, Inc., CEO

 

 

/s/ Greg Gamet

Greg Gamet

DANK Bottles, LLC, CEO

 

 

Hollister & Blacksmith Inc.

 

By: /s/ Corey Hollister

Corey Hollister, CEO

 

 

 

Exhibit A

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[SPECIFY APPROXIMATE DELIVERY WINDOWS FOR CONTAINERS 1, 2 and 3]