Exhibit 10.1



 


Exhibit
10.1


 


BUSINESS
DEVELOPMENT AND LICENSE AGREEMENT


 


This
Agreement (the “Agreement”) is made effective the 1st day of July, 2014 and entered into by and between Smoky Market
Foods, Inc. (“Smoky”), and Mary Ann’s Specialty Foods, Inc., a (“Manufacturer”).


 


RECITALS


 


Smoky
desires to engage Manufacturer to develop, manufacture and distribute products (the “Products”) under the trademarks
and trade names owned by Smoky and provided to Manufacturer (the “Marks”) and to process sales (i.e., invoicing and
collection) of the Products to customers pursuant to the terms and conditions described below.


 


AGREEMENT


 


In
consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:


 


1.
Product Development.


 


(a) Smoky
hereby engages Manufacturer to develop, manufacture, label, package, store, and distribute to customers or end-users the Products
in accordance with good manufacturing practices prevailing in the industry, including without limitation, purchasing all raw materials
from suppliers to cover sales orders, purchase all packaging materials, maintaining minimum inventory of Products being sold as
dictated by sales ordering needs, producing and distributing Products, and invoicing and collecting all sales receivables of Products.


 


(b) Smoky’s
engagement of Manufacturer under this Agreement is exclusive as to Smoky and Smoky agrees that it shall not engage any other manufacturer
to develop, manufacture, package, store or ship to customers any of its products, including without limitation any products identified
by the Marks. For purposes of clarification, Smoky agrees and acknowledges that Manufacturer is not being engaged to produce Products
exclusively for Smoky and that Manufacturer may continue, in its sole and absolute discretion, to develop, produce, or distribute
products for itself or any third-party whether or not competitive with the Products.


 


(c) Smoky
hereby grants Manufacturer a non-exclusive, non-transferable license as to the Marks for the purpose of allowing Manufacturer
to perform its obligations under this Agreement.


 


(d)
Smoky shall be responsible for generating sales, which sales shall be invoiced and collected by Manufacturer.
Manufacturer may in its discretion broker additional sales of Products to existing or new Manufacturer customers
(“Brokered Sales”). Smoky agrees that during the term of this Agreement, Smoky will not collect any payment for
Products from any purchaser thereof and will use best efforts to ensure that all such Product payments are processed through
Manufacturer. Notwithstanding the foregoing, nothing herein shall be deemed to limit or prohibit Manufacturer from selling
any inventory of Products at any time.


 




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3. Pricing
and Compensation.


 


(a) Product
pricing shall be by mutual agreement of Smoky and Manufacturer and shall be the sum of the following amounts: Manufacturer costs
(“Costs”) plus Manufacturer overhead (“OH:) plus Manufacturer standard anticipated profit (“Profit”),
plus Smoky percentage mark-up (“Smoky Percentage”). All sales of Product, regardless of source of sale, will be paid
to Manufacturer,


 


(b) Manufacturer
shall be responsible for all costs of manufacture of the Products and shall be entitled to retain all gross receipts from the
sale of Products. Upon all sales for which payment is actually received, Manufacturer will pay to Smoky the Smoky Percentage monthly
by the tenth day of the calendar month following the calendar month in which invoice payment is received by Manufacturer. Provided,
however, and notwithstanding the foregoing, as to any Brokered Sales, Manufacture will retain from the Smoky Percentage an additional
amount equal to four percent (4%) of the Product sale price.


 


(c) As
additional consideration to induce Manufacturer to enter into this Agreement and support initial product development, manufacturing
and sales, Smoky will, upon the execution of this Agreement, issue in the aggregate Five Million Shares of its common stock (“Shares”)
to the individuals and in the quantities designated on the attached Schedule A. The Shares shall be unrestricted and free trading
under the United States Securities Act of 1933 (15 U.S.C. §77 et seq.) not later than twelve (12) months after the date hereof.


 


4. Representations
and Warranties.


 


(a) Manufacturer
hereby represents to Smoky that:


 


(i) Manufacturer
has the full legal right, power and authority to enter into this Agreement.


 


(ii) This
Agreement is the legal, valid, and binding obligation of Manufacturer, enforceable against Manufacturer in accordance with its
terms, except as enforceability may be limited by bankruptcy, insolvency, or other similar laws of general application or by general
principles of equity.


 


(iii) Manufacturer
has the necessary capacity and resources to support the manufacturing and distribution of Products to customers and end-users
in quantities sufficient to generate accounts receivable in excess of Six Hundred Fifty Thousand Dollars ($650,000), assuming
a reasonable sales price.


 


(b) Smoky
hereby represents to Manufacturer that:


 


(i) Smoky
has the full legal right, power and authority to enter into this Agreement.


 


(ii) Smoky
is the exclusive owner of the Marks, that it has the right to grant the non-exclusive license described above, that it has not
granted or agreed to grant any assignment, license, right or privilege which conflicts with the express provisions of this Agreement.


 




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(iii) This
Agreement is the legal, valid, and binding obligation of Smoky, enforceable against Smoky in accordance with its terms, except
as enforceability may be limited by bankruptcy, insolvency, or other similar laws of general application or by general principles
of equity.


 


(iv) The
signing and delivery of this Agreement by Smoky and the performance by Smoky of all of Smoky’s obligations under this Agreement
will not breach any agreement to which Smoky is a party, or give any person the right to accelerate any obligation of Smoky; violate
any law, judgment, or order to which Smoky is subject; or require the consent, authorization, or approval of any person, including
but not limited to any governmental body.


 


5. Indemnification.


 


(a) Smoky
agrees to defend, indemnify and hold harmless Manufacturer, its directors, officers, agents and employees from and against any
and all damages, losses, liabilities, claims, suits, costs and expenses (including attorney fees) (collectively, “Claims”)
resulting from or relating to any breach by Smoky of any provision, warranty or covenant, or any nonfulfillment of any obligation
by Smoky, under this Agreement. Smoky further agrees to indemnify and hold harmless Manufacturer and its officers, directors and
agents, from and against any and all damages, loss, cost, liability or expense (including attorney fees and costs) incurred by
any such party in connection with any complaints, demands, claims, or legal actions alleging illness, injury, death, or damage
as a result of the consumption or use of any Product that independent investigation
shows was caused by a defect in the Product that originated after the Product left the custody of Manufacturer.


 


(b) If
either party becomes aware of any incident involving potential contamination of any Product sold hereunder, the party shall provide
immediate telephone notice to the other party, and the parties shall cooperate with each other to identify and remove from sale
any Products suspected of contamination; provided, however, that Manufacturer reserves the right to direct any such investigation
and to determine the actions to be taken in response to the investigation.


 


6. Term.


 


(a) This
Agreement shall run for a period of one (1) year from the date hereof. This Agreement shall renew automatically each year for
a period of one (1) year unless either party provides written notice of non-renewal to the other party at least thirty (30) days
prior to the expiration of the then-current term.


 


(b) Manufacturer
may terminate this Agreement immediately:


 


(i) If
the Shares are not free trading twelve (12) months after the date hereof;


 


(ii) If
Smoky fails to perform any other obligation under this Agreement within 30 days of notice from Manufacturer specifying such failure,
or if such failure cannot be cured within such 30-day period, then Smoky shall not be in default hereunder so long as Smoky commences
cure within such 30-day period and diligently pursues such cure to completion; or


 




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(iii)
If Smoky becomes insolvent, a receiver is appointed to the possession of all or substantially all of Smoky’s property, Smoky
makes a general assignment for the benefit of creditors or files a voluntary petition in bankruptcy, or Smoky is the subject of
an involuntary petition in bankruptcy and such involuntary petition is not dismissed within one hundred twenty (120) days of filing.


 


(c) Smoky
may terminate this Agreement immediately:


 


(i) If
Manufacturer fails to perform or meet any material term or condition hereof and has failed to correct same within 30 days after
written notice of such failure by Smoky, or if such failure cannot be cured within such 30-day period, then Manufacturer shall
not be in default hereunder so long as Manufacturer commences cure within such 30-day period and diligently pursues such cure
to completion.


 


(ii) If
Manufacturer ceases to do business as a going concern or ceases to conduct its operations in the normal course of business, becomes
insolvent, a receiver is appointed to the possession of all or substantially all of Manufacturer’s property, Manufacturer
makes a general assignment for the benefit of creditors or files a voluntary petition in bankruptcy, or Manufacturer is the subject
of an involuntary petition in bankruptcy and such involuntary petition is not dismissed within one hundred twenty (120) days of
filing.


 


(iii) If
Smoky purchases all then existing materials, inventory and accounts receivables.


 


(d) Following
any termination, (i) Manufacturer shall have the right to sell Products to the extent of existing inventory, (ii) Smoky shall
reimburse Manufacturer for Manufacturer’s actual cost for any Products delivered to Smoky, and (iii) Smoky shall reimburse
Manufacturer for Manufacturer’s actual cost for any unused raw materials or ingredients ordered specifically for Products,
to the extent that such raw materials or ingredients are not otherwise used by Manufacturer in its operations. The conveyance
of Shares will not be reversed upon termination of this Agreement, provided, however, that in the event Smoky terminates this
Agreement for cause under Section 6(c)(i) above within six (6) months after the date hereof, said Shares shall remain restricted
and not transferable unless and until the Agreement is reinstated.


 


7.
Confidentiality.


 


(a) “Confidential
Information” means this Agreement and all confidential or otherwise proprietary business and technical
information relating to the Parties and their respective businesses, including, without limitation, ideas, know-how, trade
secrets, production, manufacturing and sales techniques, financial statements and data, recipes and formulas, sources of
supply, advertising, actual and prospective customers, pricing, costing, and accounting procedures. Confidential Information
does not include information that is in the public domain at the time of disclosure by the disclosing Party; that enters the
public domain after disclosure by the disclosing Party through no fault of the receiving Party; that was or is separately
disclosed to the receiving Party by a third party not itself subject to an obligation of confidentiality to the disclosing
Party with respect to such information; or that was in the receiving Party’s possession at the time of disclosure by
the disclosing Party.




 



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(b)Each
Party agrees to maintain the Confidential Information in strict confidence and, except to the extent expressly permitted in this
Agreement or otherwise consented to in writing by the other Party, that the Confidential Information will not be disclosed by
it or its “Representatives” (defined to include affiliates, directors, shareholders,
officers, employees, agents, subcontractors, consultants, members, managers, advisors, or other representatives including
legal counsel, accountants and, in the case of Smoky, its Distributors) to any “Person” (defined to include individuals,
partnerships, companies, limited liability companies, entities, corporations, or agents thereof) except with the specific
prior written consent of the other.


 


(c)Both
Parties agree that during the term of this Agreement and for a period of one (1) year after the termination hereof, unless otherwise
agreed by the Parties, that each party and its employees and agents shall not contact, solicit, seek or in any way enter into
an employment relationship with any employee of the other party as of the date of termination.


 


8.
Miscellaneous.


 


(a)Relationship
of Parties. Manufacturer and Smoky are independent contractors for the purpose of this Agreement. Neither the execution,
delivery nor performance of this Agreement will be construed to constitute either party as an agent or representative of the other
for any purpose. Neither the execution, delivery nor performance of this Agreement will be deemed to establish a joint venture
or partnership between the Parties. Except as otherwise provided herein, neither Party has the authority to (i) bind the other
Party by or to any contract, representation, understanding, act or deed, (ii) represent that either Party is an agent of the other
Party, or (iii) represent that either Party is responsible for the acts or omissions of the other Party.


 


(b)Impossibility.
The Parties shall not be responsible for any failure to perform due to unforeseen circumstances or causes beyond their reasonable
control, including but not limited to acts of God, war, riot, embargoes, acts of civil or military authorities, fires, floods,
accidents, strikes, or shortages of transportation, facilities, fuel, energy, labor, or materials. In the event of any such delay,
the Parties may defer performance hereunder for a period equal to the time of such delay.


 


(c)Severability.
If any provision of this Agreement shall be prohibited or unenforceable by any applicable law, the provision shall be ineffective
only to the extent and for the duration of the prohibition or unenforceability, without invalidating any of the remaining provisions.


 


(d)Waiver.
The temporary, limited, or specific waiver of any term, provision, or condition of this Agreement or a breach thereof will not
be considered a waiver of any other term, provision, or condition, or of any subsequent breach of the same term, provision, or
condition.


 




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(e)Entire
Agreement. This Agreement embodies the entire understanding of the Parties and shall supersede all previous communications,
representations or understandings either oral or written between the Parties relating to the subject matter hereof.


 


(f)Assignability.
This Agreement shall be binding upon and be for the benefit of the Parties and their legal representatives, successors, and assigns.
Neither party may assign this Agreement without the prior written consent of the other.


 


(g)Choice
of Laws. This Agreement shall be interpreted and construed in accordance with the laws of the state of Iowa, without
giving effect to choice of law rules. The Parties consent to jurisdiction and venue in the state and federal courts located in
Polk County, Iowa.


 


(h)Notice.
All notices shall be made in writing and may be given by personal delivery, via overnight courier requiring a signature for delivery,
or by certified or registered mail, return receipt requested. Bills and payments may be made by regular mail. Notices, bills and
payments sent by mail should be addressed as follows:


 


	To
    Manufacturer:	Mary
    Ann’s Specialty Foods, Inc.
	 	1511
    East 2nd Street
	 	P.O.
    Box 696
	 	Webster
    City, IA 50595
	 	Attention:
    William Korleski
	 	 
	To
    Smoky:	Smoky
    Market Foods, Inc.
	 	1511
    East 2nd Street
	 	P.O.
    Box 696
	 	Webster
    City, LA 50595
	 	Attn:
    Ed Feintech



 

and
when so addressed shall be deemed given 5 days after deposited in the U.S. mail, first class, postage prepaid, and postmarked.
In all other instances notices, bills, and payments shall be deemed given at the time of actual delivery. Changes may be made
in the names and addresses of the person to whom notices, bills, and payments are to be given by giving notice pursuant to this
section.


 


(i)
Construction. Section headings are included for convenience, but shall not
form a part of the Agreement or affect the interpretation of any part hereof. The word “including” is used in this
Agreement in a non-exclusive sense and, unless otherwise expressly set forth, shall be interpreted as being illustrative and not
limiting.


 


(j)
Expenses. Each party shall bear its own expenses.


 


(k)
Signatures. This Agreement may be signed in counterparts. A fax transmission
of a signature page will be considered an original signature page. At the request of a party, the other party will confirm a fax-transmitted
signature page by delivering an original signature page to the requesting party.


  


(1)
Amendment. This Agreement may be amended only by a written document signed
by the party against whom enforcement is sought.


 


[Signature
Page Follows]


 




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IN
WITNESS WHEREOF, the parties have executed this Business Development Agreement and License on the date first written above.


 


	 	SMOKY MARKET FOODS, INC.
	 	 
	 	By:	/s/
    Edward C. Feintech
	 	 	Edward
    C. Feintech, Chairman & CEO
	 	 	 
	 	MARY ANN’S SPECIALTY FOODS, INC.
	 	 	 
	 	By:	/s/
    William Korleski
	 	 	William
    Korleski, President



 



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