Document:

Exhibit 4.32

 

BOTTLER’S AGREEMENT

 

THIS AGREEMENT, made and entered into with effect October 4, 2017, by and between THE COCA-COLA COMPANY, a corporation organized and existing under the laws of the state of Delaware, United States of America, with principal offices at One Coca-Cola Plaza, N.W., Atlanta, Georgia 30313, United States of America (hereinafter the “Company”); and RIO DE JANEIRO REFRESCOS LTDA. established and existing according to the laws of Brazil, with principal offices at Rua André Rocha 2299, Jacarepaguá, Rio de Janeiro, Brazil (hereinafter  the “Bottler”).

 

WITNESSETH:

 

WHEREAS,

 

A.                   The Company is engaged in the manufacture and the sale of beverage bases, essences, and other ingredients and a beverage base concentrate (hereinafter referred to as the “Concentrate”), the formula for which is an industrial secret of the Company, from which a non-alcoholic beverage syrup or powder (hereinafter referred to as the “Syrup”) is prepared, and is also engaged in the manufacture and sale of the Syrup, which Concentrate or Syrup is used in the preparation of a non-alcoholic beverage product (hereinafter referred to as the “Beverage”) for sale in bottles and other containers and in other forms or manners;

 

B.                  The Company is the owner of the trademarks including “Coca-Cola” and “Coke” that distinguish the Concentrate, the Syrup, and the Beverage, the trade mark consisting of a Distinctive Bottle in various sizes in which the Beverage has been marketed for many years, the depict ion of the Distinctive Bottle, the Dynamic Ribbon device, and the intellectual property embodied in the distinctive trade dress, other design devices and packaging elements associated with the Concentrate, the Syrup and the Beverage (said trademarks ‘‘Coca-Cola”, “Coke”, the Distinctive Bottle, the depiction of the Distinctive Bottle, the Dynamic Ribbon dev ice, the intellectual property embodied in the distinctive trade dress, other design devices and packaging elements associated with the Concentrate, the Syrup and the Beverage, and any additional trademarks that the Company may adopt from time to time to distinguish the Concentrate, the Syrup and the Beverage being hereinafter referred to as the “Trade Marks”);

 

C.                       The Company has the exclusive right to prepare, package, distribute and sell the Beverage and the right to manufacture and sell the Concentrate and the Syrup in Brazil, among other countries;

 

D.                       The Company has designated and authorized certain third parties to supply the Concentrate to the Bottler (said third parties being hereinafter referred to as the “Authorized Suppliers”);

 

E.                         The Bottler has requested an authorization from the Company to use the Trade Marks in connection with the preparation, packaging, distribution and sale of the Beverage in and

 

 

throughout a territory as defined and described in this Agreement;

 

F.                          The Company is willing to grant the requested authorization to the Bottler under the terms and conditions set forth in this Agreement.

 

NOW, THEREFORE, the parties agree as follows:

 

I.                                        OBJECT OF THE AGREEMENT

 

1.                   The Company hereby authorizes the Bottler, and the Bottler undertakes, upon the following terms and conditions, to prepare and package the Beverage in such containers as may be approved by the Company in writing from time to time (hereinafter referred to as “Approved Containers”) and to distribute and sell the same under the Trade Marks, in and throughout, but only in and throughout, the following territory (hereinafter referred to as the “Territory”):

 

RIO DE JANEIRO

 

An area in the State of Minas Gerais, limited by a line that starts and includes the city of NANUQUE; from there, in a Southwest course, until the division of the State of Espírito Santo; from there, in a Southwest/South course, always surrounded by the line dividing the State of Espírito Santo, until finding and including the town of ESPERA FELIZ in the State of Minas Gerais; from there in a Southeast course, until finding the division of the States of Espírito Santo and Rio de Janeiro; from there, in a Southwest course, always surrounded by the division of the State of Rio de Janeiro, until finding and excluding the city of ALÉM PARAÍBA; from there, in a Southwest course up to and excluding the city of TERESÓPOLIS; from there, in a straight line, in a Southwest course, up to and excluding the city of PETRÓPOLIS; from there, in a straight line, in a Northwest course, until and including the city of AVELAR; from there, in a Southwest course, up to and including the town of PATI DO ALFERES; from there, in a Southwest course, up to and including the city of MIGUEL PEREIRA; from there, in a straight line in a Southwest course, up to and including the town of GOVERNADOR PORTELA; from there, in a straight line, in a Southwest course, up to and excluding the city of ENGENHEIRO PAULO DE FRONTIM; from there, in a straight line, in a Southwest course, until and including the town of SEROPÉDICA; from there, in a straight line, in a Southwest course, until and including the city of MANGARATIBA; from there, in a Southeast/East/Northeast course, always accompanying ALL OF THE COASTAL AREA of the States of RIO DE JANEIRO and ESPÍRITO SANTO, until finding the coastal dividing line of the States of Espírito Santo and Bahía; from there, in a Northwest course, following the dividing line of “the States of Espírito Santo and Bahía, until and including the city of NANUQUE, in the State of Minas Gerais, initial point of the official territory; the islands of PAQUETÁ, BROCOIÓ, POMBEBA, DAS COBRAS, FISCAL, DE VILLEGAIGNON, DO FUNDAO, DO GOVERNADOR and MOCANGUE GRANDE are included in this description.

 

RIBEIRÃO PRETO

 

An area in the State of São Paulo, bounded by a line beginning at and including the city of

 

 

IGARAPAVA; from there, in a straight line in a Southwest direction up to and including the city of MIGUELOPOLIS; from there, in a straight line, to the South, including the city of MORRO AGUDO; from there, in a straight line in a Southwest direction, up to and including the city of PITANGUEIRAS; from there, in a straight line in a Southwest direction, up to and including the city of JABUTICABAL; from there, in a straight line in a Southwest direction, up to and including the city of SANTA ERNESTINA; from there, in a straight line to the South, up to and including the city of DOBRADA; from there, in a straight line in a Southwest direction, up to and including the city of MATAO; from there, in a straight line, in a Southeast direction, up to and including the city of ARARAQUARA; from there, in a straight line in to the East, up to and including the city of SÃO CARLOS; from there, in a straight line to the East, up to and including the city of PIRASSUNUNGA; from there, in a straight line to the East, up to and including the city of ESPÍRITO SANTO DO PINHAL; from there, in a straight line to the East, up to and including the city of ALBERTINA; from there, in a straight line, in a Northeast direction, up to and including the city of SENADOR BENTO; from there, in a straight line in a Northeast direction, up to and including the city of SERRANIA; from there, in a straight line in a Northeast direction, up to and including the city of AREADO; from there, in a straight line in a Northeast direction, up to and including the city of CAMPO DO MEIO; from there, in a straight line, in a Northeast direction, up to and EXCLUIDNG the city of AGUANIL; from there, in a straight line, in a Northwest direction, up to and EXCLUING the city of CRISTAIS; From there, in a straight line in a Northwest direction, up to and including the city of PIMENTA; from there, in a straight line, in a Northwest direction, up to and EXCLUDING the city of DORESÓPOLIS; from there, in a straight line, in a Northwest direction, up to and EXCLUDING the city of MEDEIROS; from there, in a straight line towards the West, up to and including the city of JAGUARINHO; from there, in a straight line towards the West up to the city of IGARAPAVA, the starting point of this official territory.

 

2.                   The Company or Authorized Suppliers will sell and deliver to the Bottler such quantities of the Concentrate as may be ordered by the Bottler from time to time, provided that the Bottler will order, and the Company or Authorized Suppliers will sell and deliver to the Bottler, only such quantities of the Concentrate as may be necessary and sufficient to implement this Agreement. In this regard, the Bottler covenants and agrees to buy Concentrate only from the Company or Authorized Suppliers.

 

3.                   The Bottler will use the Concentrate exclusively for the preparation of the Syrup and the preparation and packaging of the Beverage as prescribed from time to time by the Company. The Bottler undertakes not to sell or resell the Concentrate or the Syrup, nor permit the same to fall into the hands of third parties, without the prior written consent of the Company.

 

4.                   The Company retains the sole and exclusive right at any time to determine the formula, composition or ingredients for the Concentrate, the Syrup and the Beverage.

 

5.                   Except as may be provided herein and for the term of this Agreement, the Company will refrain from selling or distributing, or from causing the sale or distribution of, the Beverage in the Territory in Approved Containers. The Company reserves the rights, however to prepare and

 

 

package the Beverage in any container in the Territory for sale outside the Territory, and to prepare, package, distribute or sell, or authorize third parties to prepare, package, distribute or sell, the Beverage in the Territory in any container other than an Approved Container.

 

II.                               OBLIGATIONS OF THE BOTTLER RELATIVE TO THE MARKETING, PLANNING AND REPORTING

 

6.                                  The Bottler covenants and agrees with the Company:

 

(a)                             to make every effort and employ all practicable and approved means to promote, develop and exploit the full potential of the business of preparing, packaging, distributing, marketing and selling the Beverage throughout the Territory by creating, stimulating and expanding continuously the future demand for the Beverage and by satisfying fully and in all respects the current demand therefor;

 

(b)                             to prepare, package, distribute and sell such quantities of the Beverage as shall in all respects satisfy fully every demand for the Beverage within the Territory; however, with the prior written consent of the Company, the Bottler may purchase the Beverage in Approved Containers from parties designated in writing by the Company for resale by the Bottler within the Territory;

 

(c)                              to invest all the capital and to obtain and expend all the funds required for the organization, installation, operation, maintenance and replacement within the Territory of such manufacturing, warehousing, marketing, distribution, delivery, transportation and other facilities and equipment as shall be necessary for the Bottler to comply with its obligations under this Agreement;

 

(d)                             to provide competent and well-trained management and recruit, train, maintain and direct all personnel required, sufficient in every respect to perform all of the obligations of the Bottler under this Agreement;

 

(e)                              to deliver to the Company once in each calendar year a program or plan in writing acceptable to the Company as to form and substance and in accordance with the Bottler’s obligations under this Agreement, showing in detail the activities of the Bottler contemplated for the ensuing twelve-month period or such other period as the Company may prescribe, to prosecute such program or plan diligently, and to deliver to the Company upon its request written reports of the progress of the work in an acceptable form;

 

(f)                               to report to the Company accurate and current information on production, distribution and sales of the Beverage at such intervals, in such detail and in such form as may be requested by the Company; and

 

 

(g)                              to maintain accurate books, accounts and records and to provide to the Company such financial, accounting and other information as the Company may request to enable the Company to determine whether the Bottler is maintaining the consolidated financial capacity reasonably necessary to perform its obligations under this Agreement and in recognition of the Company’s interest in maintaining, promoting and safeguarding the overall performance, efficiency and integrity of the bottling, distribution and sales system.

 

7.                                  The Bottler must, for its own account, budget and expend such funds for advertising, marketing and promoting the Beverage as may be reasonably required by the Company to create, stimulate and sustain the demand for the Beverage in the Territory, provided that the Bottler shall submit all advertising, marketing and promotional projects relating to the Trade Marks or the Beverage to the Company for its prior approval, and shall use, publish, maintain or distribute only such advertising, marketing or promotional material relating to the Trade Marks or the Beverage as the Company shall approve and authorize. The Company may agree from time to time and subject to such terms and conditions as it shall stipulate in each case to contribute financially to the Bottler’s marketing programs. The Company may also undertake, at its own expense and independently from the Bottler, any additional advertising or sales promotion activities in the Territory it deems useful or appropriate.

 

8.                                  (a) The Bottler recognizes that the Company has entered into or may enter into agreements similar to this Agreement with other parties outside the Territory and accepts the limitations such agreements may reasonably impose on the Bottler in the conduct of its business under this Agreement. The Bottler further agrees to conduct its business in such a manner so as to avoid conflicts with such other parties, and, in the event of disputes nevertheless arising with such other parties, to make every reasonable effort to settle them amicably.

 

(b) The Bottler will not oppose any additional actions the adoption of which are considered by the Company as necessary and justified in order to protect and improve the sales and distribution system for the Beverage, including, but not limited to; those actions which might be adopted concerning the supply of large and/or special customers whose field of activity transcends the boundaries of the Territory, even if such actions should limit the Bottler’s rights under this Agreement.

 

9.                                  The Bottler, recognizing the important benefit to itself and all the other parties referred to in Clause 8(a) above, of a uniform external appearance of the distribution and other equipment and materials used under this Agreement, agrees to accept and apply the standards adopted and issued from time to time by the Company for the design and decoration of trucks and other delivery vehicles, cases, cartons, coolers, vending machines and other materials and equipment used in the distribution and sale of the Beverage.

 

 

10.                           The Bottler acknowledges and agrees that the broadest possible direct distribution and sale of the Beverage to retail outlets and final consumers in the Territory is an essential element in satisfying fully the demand for the Beverage pursuant to this Agreement. Notwithstanding the recognized advantages of direct distribution, the Bottler shall be authorized to distribute and sell the Beverage to wholesalers in the Territory who sell only to retail outlets in the Territory. Any other methods of distribution shall be subject to the prior written consent of the Company.

 

11.                           (a) The Bottler shall prevent the sale or distribution in any manner whatsoever of the Beverage outside the Territory.

 

(b)                             In the event any of the Beverage prepared, packaged, distributed or sold by the Bottler is found in the territory of another authorized bottler or authorized distributor (hereinafter referred to as the “Injured Bottler”), then, in addition to all other remedies available to the Company:

 

(1)                     the Company may, in its sole discretion, cancel forthwith the approval for the container(s) of the type which were found in the Injured Bottler’s territory;

 

(2)                    the Company may charge the Bottler an amount of compensation for the Beverage found in the Injured Bottler’s territory, to include all lost profits, expenses and other costs incurred by the Company and the Injured Bottler; and

 

(3)                    the Company may purchase any of the Beverage prepared, packaged, distributed or sold by the Bottler which is found in the Injured Bottler’s territory, and the Bottler shall, in addition to any other obligation it may have under this Agreement, reimburse the Company for the Company’s cost of purchasing, transporting and/or destroying such Beverage.

 

(c)                              In the event the Beverage prepared, packaged, distributed or sold by the Bottler is found in the territory of an Injured Bottler, the Bottler shall make available to representatives of the Company all sales agreements and other records relating to the Beverage and assist the Company in all investigations relating to the sale and distribution of the Beverage outside the Territory.

 

(d)                             The Bottler shall immediately inform the Company if at any time any solicitation or offer to purchase the Beverage is made to the Bottler by a third party which the Bottler knows or has reason to believe or suspect would result in the Beverage being marketed, sold, resold, distributed or redistributed outside the Territory in breach of this Agreement.

 

 

III.                           OBLIGATIONS OF BOTTLER RELATIVE TO THE TRADE MARKS

 

12.                           The Bottler will at all times recognize the validity and ownership of the Trade Marks by the Company and will not at any time put in issue the validity and ownership of the Trade Marks.

 

13.                            Nothing herein shall give the Bottler any interest in the Trade Marks or the goodwill attaching thereto or in any label, design, container or other visual representations thereof, or used in connection therewith; and the Bottler acknowledges and agrees that all rights and interest created through such usage of the Trade Marks, labels, designs, containers or other visual representations shall inure to the benefit and be the property of the Company. The Company and the Bottler agree and understand the Bottler under this Agreement is obligated, to use said Trade Marks, labels, designs, containers or other visual representations thereof, in connection with the preparation, packaging, distribution and sale of the Beverage in Approved Containers without the payment of any fee; said use to be in such manner and with the result that all goodwill relating to the same shall accrue to the Company as the source and origin of such Beverage, and the Company shall be absolutely entitled to determine in every instance the manner of presentation and such other steps necessary or desirable to secure compliance with this Clause 13.

 

14.                            The Bottler shall not adopt or use any name, corporate name, trading name, title of establishment or other commercial designation which includes the words “Coca-Cola”, “Coca”, “Cola”, “Coke”, or any of them, or any name that is confusingly similar to any of them, or any graphic or visual representation of the Trade Marks or any other trade mark or intellectual property owned by the Company, without the prior written consent of the Company.

 

15.                            The Bottler covenants and agrees during the term of this Agreement and in accordance with applicable laws:

 

(a)                     not to manufacture, prepare, package, distribute, sell, deal in or otherwise be concerned with any product associated with any trade dress or any container that is an imitation of a trade dress or container in which the Company claims a proprietary interest, or which is likely to be confused with or cause confusion or be perceived by consumers as confusingly similar to or be passed off as such trade dress or container;

 

(b)                     not to manufacture, prepare, package, distribute, sell, deal in or otherwise be concerned with any product associated with any trade mark or other designation which is an imitation or infringement of any of the Trade Marks or is likely to cause passing-off of any product which is intended to lead the public to believe that it originates with the Company because of the Bottler’s association with the business of manufacturing, preparing, packaging, distributing and selling the Beverage; without in any way limiting the generality of the foregoing, it is hereby expressly understood and stipulated that use of the word “Coca” or local language or

 

 

phonetic equivalent in any form or fashion, or any word graphically or phonetically similar thereto or in imitation thereof, on any product other than that of the Company would constitute an infringement of the trade mark “Coca-Cola” or be likely to cause passing-off;

 

(c)                     not to manufacture, prepare, package, distribute, sell, deal in or otherwise be concerned with any non-alcoholic beverage products other than those prepared, packaged, distributed or sold by the Bottler under authority of the Company, unless prior written consent from the Company is obtained;

 

(d)                    not to use delivery vehicles, cases, cartons, coolers, vending machines and other equipment bearing the Trade Marks for the distribution and sale of any products which are not identified by the Trade Marks without the prior written consent of the Company;

 

(e)                     not to manufacture, prepare, package, distribute, sell, deal in or otherwise be concerned with any other concentrate, beverage base, syrup, or beverage which is likely to be confused with or passed off for the Concentrate, Syrup or Beverage;

 

(f)                      not to manufacture, prepare, package, distribute, sell, deal in or otherwise be concerned with (i) any beverage put out under the name “cola” (whether alone or in conjunction with any other word or words) or any phonetic rendering of such a word, or (ii) any beverage put out under the name “cola” or otherwise which is an imitation of the Concentrate, Syrup or Beverage or is likely to be substituted therefore during the term of this Agreement and, in recognition of the valuable rights granted by the Company to the Bottler pursuant to this Agreement, for an additional period of two years thereafter; and

 

(g)                     not to acquire or hold, directly or indirectly, any ownership interest in, or enter into any contract or arrangement with respect to the management or control of any person or legal entity, within or outside of the Territory, that engages in any of the activities prohibited under this Clause 15.

 

The covenants herein contained apply not only to the activities with which the Bottler may be directly concerned, but also to activities with which the Bottler may be indirectly concerned through ownership, control, management, partnership, agreement or otherwise, and whether located within or outside of the Territory.

 

16.                           It is understood and agreed between the parties that in the event that either:

 

(a)                             a third party which is in the opinion of the Company directly or indirectly through ownership, control, management or otherwise, concerned with the manufacture, preparation, packaging, distribution or sale of any product specified in Clause 15 hereof shall acquire or otherwise obtain control or any direct or indirect influence on the management of the Bottler; or

 

 

(b)                             any person, firm or company having majority ownership or direct or indirect control of the Bottler or who is directly or indirectly controlled either by the Bottler or by any third party which has control or any direct or indirect influence in the opinion of the Company on the management of the Bottler, shall engage in the preparation, packaging, distribution or sale of any products specified in Clause 15 hereof; then the Company shall have the right to terminate this Agreement forthwith without liability for damages unless the third party making such acquisition referred to in subclause (a) hereof or the person, firm or company referred to in subclause (b) hereof shall, on being notified in writing by the Company of its intention to terminate as aforesaid, agrees to discontinue, and shall in fact discontinue, the manufacture, preparation, packaging, distribution or sale of such product(s) within a reasonable period not exceeding six (6) months from the date of notification.

 

17                              (a) If the Company for the purposes of this Agreement should require that, in accordance with applicable laws governing the registration and licensing of intellectual property, the Bottler be recorded as a registered user or licensee of the Trade Marks, then, at the request of the Company, the Bottler will execute any and all documents necessary for the purpose of entering, varying or canceling the required filing or record.

 

(b) Should the public authority having jurisdiction refuse any application of the Company or the Bottler for filing or record of the Bottler as a registered user or licensee of any of the Trade Marks in respect of the Beverage, then the Company shall have the right to terminate this Agreement forthwith.

 

IV.                           OBLIGATIONS OF BOTTLER RELATIVE TO THE PREPARATION AND PACKAGING OF THE BEVERAGE

 

18.                           (a) The Bottler covenants and agrees to use only the Concentrate in preparing the Syrup and the Syrup only for preparing and packaging the Beverage, in strict adherence to and compliance with the written instructions issued to the Bottler from time to time by the Company. The Bottler further covenants and agrees that, in preparing, packaging and distributing the Beverage, the Bottler shall at all times conform to the standards, including quality, hygienic, environmental and otherwise, established in writing from time to time by the Company and comply with all applicable legal requirements.

 

(b) The Bottler, recognizing the importance of identifying the source of manufacture of the Beverage in the market, agrees to use identification codes on all packaging materials for the Beverage, including Approved Containers and non-returnable cases. The Bottler further agrees to install, maintain and use the necessary machinery and equipment required for the application of such identification codes. The Company shall provide the Bottler, from time to time, with necessary instructions in writing regarding the forms of the identification codes to be used by the Bottler in that connection, and the production and sales records to be maintained by the Bottler.

 

 

(c) In the event the Company determines or becomes aware of the existence of any quality or technical problems relating to the Beverage or Approved Containers in respect of the Beverage, the Company may require the Bottler to take all necessary action to recall all of the Beverage or withdraw immediately any such Beverage from the market or the trade, as the case may be. The Company shall notify the Bottler by telephone, fax, e-mail or any other form of immediate communication with written confirmed receipt, of the decision by the Company to require the Bottler to recall the Beverage or withdraw such Beverage from the market or trade, and the Bottler shall, upon receipt of such notice, immediately cease distribution of such Beverage and take such other actions as may be required by the Company in connection with the recall of the Beverage or withdrawal of such Beverage from the market or trade.

 

(d) In the event the Bottler determines or becomes aware of the existence of quality or technical problems relating to the Beverage or Approved Containers in respect of the Beverage, then the Bottler shall immediately notify the Company by telephone, fax, e-mail or any other form of immediate communication with written confirmed receipt. This notification shall include: (1) the identity and quantities of the Beverage involved, including the specific Approved Containers, (2) coding data and (3) all other relevant data that will assist in tracing such Beverage.

 

The Bottler shall permit the Company, its officers, agents or designees, at all times to enter and inspect the facilities, equipment and methods used by the Bottler, whether directly or incidentally, in or for the preparation, packaging, storage and handling of the Beverage to ascertain whether the Bottler is complying with the terms of this Agreement, including, but not limited to Clauses 18 and 22. The Bottler also agrees to provide the Company with all the information regarding Bottler’s compliance with the terms of this Agreement, including, but not limited to, Clauses 18 and 22, as the Company may request from time to time.

 

19.                           The Bottler shall submit to the Company, at the Bottler’s expense, samples of the Syrup, the Beverage and of materials used in the preparation of the Syrup and the Beverage, in accordance with instructions that the Company may give from time to time.

 

20.                           (a) In the packaging, distribution and sale of the Beverage, the Bottler shall use only such Approved Containers and closures, cases, cartons, labels and other packaging materials approved from time to time by the Company, and the Bottler shall purchase such items only from manufacturers who have been authorized in writing by the Company to manufacture the items to be used in connection with the Trade Marks and the Beverage. The Company shall use its best efforts to approve two or more manufacturers of such items, it being understood that said approved manufacturers may be located within or outside of the Territory.

 

(b) The Bottler shall inspect Approved Containers and closures, cases, labels and other

 

 

packaging materials to be used in connection with the Beverage and shall use only those items which the Bottler has determined comply with both the standards established by applicable laws in the Territory and the standards and specifications prescribed by the Company. The Bottler shall assume independent responsibility in connection with the use of such Approved Containers, closures, cases, cartons, labels and other packaging materials which the Bottler has determined conform to such standards.

 

(c) The Bottler shall maintain at all times a sufficient stock of Approved Containers, closures, cases, cartons, labels and other packaging materials to satisfy fully the demand for the Beverage in the Territory.

 

21.                           (a) The Bottler recognizes that increases in the demand for the Beverage, as well as changes in the Approved Containers, may from time to time require modifications or other changes in respect of its existing manufacturing, packaging, delivery or vending equipment or require the purchase of additional manufacturing, packaging, delivery or vending equipment. The Bottler agrees to make such modifications to existing equipment and to purchase and install such additional equipment as necessary with sufficient lead time to enable the introduction of new Approved Containers and the preparation and packaging of the Beverage in accordance with the continuing obligations of the Bottler to develop, stimulate and satisfy fully every demand for the Beverage in the Territory.

 

(b) In the event the Bottler uses refillable Approved Containers in the preparation, packaging, distribution and sale of the Beverage, the Bottler agrees to invest the necessary capital and to appropriate and expend such funds as may be required from time to time to establish and maintain an adequate inventory of refillable Approved Containers. In order to ensure the continuing quality and appearance of said inventory of refillable Approved Containers, the Bottler further agrees to replace all or part of the inventory of refillable Approved Containers as may be reasonably necessary and in accordance with the obligations of the Bottler pursuant to this Agreement.

 

(c) The Bottler shall not use or permit the use of the Approved Containers, closures, cases, labels and other packaging materials referred to in this Agreement for any purpose, except in connection with the Beverage and shall not refill or otherwise reuse any non-refillable Approved Containers that have been previously used.

 

22.                           (a) The Bottler shall be solely responsible in carrying out its obligations herein for compliance with all laws, statutes, regulations, by-laws and other legal requirements issued by government or local authorities and applicable in the Territory and shall inform the Company forthwith of any provision thereof which would prevent or limit in any way strict compliance by the Bottler with its obligations herein.

 

(b)  Without limiting the generality of the foregoing, the Bottler covenants and agrees to

 

 

comply at all times with (i) all anti-bribery, environmental, and health and safety laws, regulations and other legal requirements issued by government authorities and applicable in the Territory and (ii) the Company’s environmental management standards and programs as issued from time to time in writing.

 

V.                                   CONDITIONS OF PURCHASE AND SALE

 

23.                           (a) The Company reserves the right, by giving written notice to the Bottler, to establish and to revise from time to time and at any time, in its sole discretion, the price of the Concentrate, the Authorized Supplier, the supply point and alternate supply points for the Concentrate, the conditions of shipment and payment, and the currency or currencies acceptable to the Company or the Authorized Suppliers.

 

(b)                                    If the Bottler is unwilling to pay the revised price in respect of the Concentrate, then the Bottler shall so notify the Company in writing within thirty (30) days from receipt of the written notice from the Company revising the aforesaid price. In such event, this Agreement shall terminate automatically without liability by either party for damages three (3) calendar months after receipt of the Bottler’s notification.

 

(c)                                     Any failure on the part of the Bottler to notify the Company in respect of the revised price of the Concentrate pursuant to subclause (b) hereof shall be deemed to be acceptance by the Bottler of the revised price.

 

(d)                                    The Company reserves the right, to the extent permitted by the law applicable in the Territory, to establish and to revise, by giving written notice to the Bottler, maximum prices at which the Beverage in Approved Containers may be sold. It is recognized in this regard that the Bottler may sell the Beverage to wholesalers and retailers and authorize the retail sales of the Beverage at prices which are lower than the maximum prices. The Bottler shall not, however, increase the maximum prices established or revised by the Company at which the Beverage in Approved Containers may be sold to wholesalers and retailers nor authorize an increase in the maximum retail prices for the Beverage without the prior written consent of the Company.

 

(e)                                     The Bottler undertakes to collect from or charge to retail or wholesale outlets, as applicable, for each refillable Approved Container and each returnable case delivered to retail or wholesale outlets, such deposits as the Company may determine from time to time by giving written notice to the Bottler, and to make all reasonably diligent efforts to recover all empty refillable Approved Containers and cases and, upon recovery, to refund or to credit the deposits for said refillable Approved Containers and returnable cases returned undamaged and in good condition.

 

 

VI.                DURATION AND TERMINATION OF AGREEMENT

 

24.                   (a)                                  This Agreement shall expire, without notice, on October 4, 2022, unless it has been earlier terminated as provided herein. It is recognized and agreed between the parties hereto that the Bottler shall have no right to claim a tacit renewal of this Agreement.

 

(b)                                   If the Bottler has fully complied with all the terms, covenants, conditions and stipulations of this Agreement throughout its term, and the Bottler is capable of the continued promotion, development and exploitation of the full potential of the business of the preparation, packaging, distribution and sale of the Beverage, the Bottler may request an extension of this Agreement for an additional term of five (5) years. The Bottler may request such extension by giving written notice to the Company at least six (6) months but not more than twelve (12) months prior to the expiration date of this Agreement. The request by the Bottler for such extension shall be supported by such documentation as the Company may request, including documentation relating to the Bottler’s compliance with the performance obligations under this Agreement and supporting the continued capability of the Bottler to develop, stimulate and satisfy fully the demand for the Beverage within the Territory. If the Bottler has, in the sole discretion of the Company, satisfied the conditions for the extension of this Agreement, then the Company may, by written notice, agree to extend this Agreement for such additional term or such lesser period as the Company may determine.

 

(c)                                    At the expiration of any such additional term, this Agreement shall expire finally without further notice, and the Bottler shall have no right to claim a tacit renewal of this Agreement.

 

25.                   (a)                                  This Agreement may be terminated by the Company or the Bottler forthwith and without liability for damages by written notice given by the party entitled to terminate to the other party:

 

(1)                                           if the Company, the Authorized Suppliers or the Bottler cannot legally obtain foreign exchange to remit abroad in payment of imports of the Concentrate or the ingredients or materials necessary for the manufacture of the Concentrate, the Syrup or the Beverage; or

 

(2)                                           if any part of this Agreement ceases to be in conformity with the laws or regulations applicable in the Territory and, as a result thereof, or as a result of any other laws affecting this Agreement, any one of the material stipulations herein cannot be legally performed or the Syrup cannot be prepared, or the Beverage cannot be prepared or sold in accordance with the instructions issued by the Company pursuant to Clause 18 above, or if the Concentrate cannot be manufactured or sold in accordance with the Company’s formula or the standards prescribed by it.

 

 

(b)                     This Agreement may be terminated forthwith by the Company without liability for damages:

 

(1)                                                             if the Bottler becomes insolvent, or if a petition in bankruptcy is filed against or on behalf of the Bottler which is not stayed or dismissed within one hundred and twenty (120) days, or if the Bottler passes a resolution for winding up, or if a winding up or judicial management order is made against the Bottler, or if a receiver is appointed to manage the business of the Bottler, or if the Bottler enters into any judicial or voluntary scheme of composition with its creditors or concludes any similar arrangements with them or makes an assignment for the benefit of creditors; or

 

(2)                                                             in the event of the Bottler’s dissolution, nationalization or expropriation, or in the event of the confiscation of the production or distribution assets of the Bottler.

 

26.                   (a)                                  This Agreement may also be terminated by the Company or the Bottler without liability for damages if the other party fails to observe any one or more of the terms, covenants or conditions of this Agreement, and fails to remedy such default(s) within sixty (60) days after such party has been given written notice of such default(s).

 

(b)                                  In addition to all other remedies to which the Company may be entitled hereunder, if at any time the Bottler fails to follow the instructions or to maintain the standards prescribed by the Company or required by applicable laws in the Territory for the preparation and packaging of the Syrup or the Beverage, the Company shall have the right to prohibit the production of the Syrup or the Beverage until the default has been corrected to the Company’s satisfaction, and the Company may demand the suspension of distribution and delivery of the Beverage and further demand the recall or withdrawal from the market or trade, at the Bottler’s expense, of the Beverage not in conformity with or not manufactured in conformity with such instructions, standards or requirements, and the Bottler shall promptly comply with such prohibition or demand. During the period of such prohibition of production, the Company shall be entitled to suspend deliveries of the Concentrate to the Bottler and to supply the Beverage or to arrange for others to supply the Beverage in the Territory. No prohibition or demand shall be deemed a waiver of the rights of the Company to terminate this Agreement pursuant to this Clause 26.

 

27.                   Upon the expiration or earlier termination of this Agreement:

 

(a)                     the Bottler shall not thereafter prepare, package, distribute, or sell the Beverage or make any use of the Trade Marks, Approved Containers, closures, cases, cartons, labels, other packaging material or advertising, marketing or promotional material used, or which are intended for use by the Bottler solely in connection with the preparation, packaging, distribution and sale of the Beverage;

 

 

(b)                     the Bottler shall forthwith eliminate all references to the Company, the Beverage and the Trade Marks from the premises, delivery vehicles, vending machines, coolers and other equipment of the Bottler and from all business stationery and all written, graphic, electromagnetic, digital or other advertising, marketing or promotional material used or maintained by the Bottler, and the Bottler shall not thereafter hold forth in any manner whatsoever that the Bottler has any connection with the Company, the Beverage or the Trade Marks;

 

(c)                      the Bottler shall forthwith deliver to the Company or a third party, in accordance with such instructions as the Company shall give, all of the Concentrate, Beverage in Approved Containers, usable Approved Containers bearing the Trade Marks or any of them, closures, cases, labels and other packaging materials bearing the Trade Marks and advertising material for the Beverage still in the Bottler’s possession or under its control, and the Company shall, upon delivery thereof pursuant to such instructions, pay to the Bottler a sum equal to the reasonable market value of such supplies or materials, provided that the Company will accept and pay for only such supplies or materials as are in first-class and usable condition; and provided further that all Approved Containers, closures, cases, cartons, labels and other packaging materials and advertising materials bearing the name of the Bottler and any such supplies and materials which are unfit for use according to the Company’s standards shall be destroyed by the Bottler without cost to the Company; and provided further that, if this Agreement is terminated in accordance with the provisions of Clauses 16, 23(b), 25(a), 26 or 28 or as a result of any of the contingencies provided in Clause 31 (including termination by operation of law), or if the Agreement is terminated by the Bottler for any reason other than in accordance with or as a result of the operation of Clauses 23(b) or 26, the Company shall have the option, but no obligation, to purchase from the Bottler the supplies and materials referred to above; and

 

(d)                     all rights and obligations hereunder, whether specifically set out or whether accrued or accruing by use, conductor otherwise, shall expire, cease and end, excepting all provisions concerning the obligations of the Bottler as set forth in Clauses 11 (b)(2) and (b)(3) and 12, 13, 14, 15(t), 17(a), 27, 32, 33, 34(a), 34(c) and 34(d), all of which shall continue in full force and effect, provided always that this provision shall not affect any rights the Company may have against the Bottler in respect of any claim for nonpayment of any debt or account owed by the Bottler to the Company or its Authorized Suppliers.

 

VII. OWNERSHIP AND CONTROL OF THE BOTTLER

 

28.                   It is recognized and acknowledged between the parties hereto that the Company has a vested and legitimate interest in maintaining, promoting and safeguarding the overall performance, efficiency and integrity of the Company’s international bottling, distribution and sales system. It is further recognized and acknowledged between the parties hereto that this

 

 

Agreement has been entered into by the Company intuitu personae and in reliance upon the identity, character and integrity of the owners, controlling parties and managers of the Bottler, and the Bottler warrants having made to the Company prior to the execution hereof a full and complete disclosure of the owners and of any third parties having a right to, or power of, control or management of the Bottler. It is therefore agreed between the parties hereto that notwithstanding the provisions of Clause 16 or any other provision of this Clause 28 in the event of any change, due to any cause, of the real persons or legal entities having direct or indirect ownership or control of the Bottler, including any changes of the share owner composition of such entities, the Company, in its sole discretion, may terminate this Agreement forthwith and without liability for damages. The Bottler, therefore, covenants and agrees:

 

(a)                     not to assign, transfer, pledge or in any way encumber this Agreement or any interest herein or rights hereunder, in whole or in part, to any third party or parties without the prior written consent of the Company;

 

(b)                     not to delegate performance of this Agreement, in whole or in part, to any third party or parties without the prior written consent of the Company;

 

(c)                      to notify the Company promptly in the event of or upon obtaining knowledge of any third-party action which mayor will result in any change in the ownership or control of the Bottler;

 

(d)                     to make available from time to time and at the request of the Company complete records of current ownership of the Bottler and full information concerning any third party or parties by whom it is controlled, directly or indirectly;

 

(e)                      to the extent the Bottler has any legal control over changes in the ownership or control of the Bottler, not to initiate or implement, consent to or acquiesce in any such change without the prior written consent of the Company; and

 

(f)                       if the Bottler is organized as a partnership, not to change the composition of such partnership by the inclusion of any new partners or the release of existing partners without the prior written consent of the Company.

 

In addition to the foregoing provisions of this Clause 28, if a proposed change in ownership or control of the Bottler involves a direct or indirect transfer to or acquisition of ownership or control of the Bottler, in whole or in part, by a person or entity authorized by the Company to manufacture, sell, distribute or otherwise deal in any beverage products and/or any trademarks of the Company (the “Acquiror Bottler”), the Company may request any and all information it considers relevant from both the Bottler and the Acquiror Bottler in order to make its determination  as to whether to consent to such change. In any such circumstances, the parties hereto, recognizing and acknowledging the vested and legitimate interest of the Company in

 

 

maintaining, promoting and safeguarding the overall performance, efficiency and integrity of the Company’s international bottling, distribution and sales system, expressly agree that the Company may consider all and any factors, and apply any criteria that it considers relevant in making such determination.

 

It is further recognized and agreed between the parties hereto that the Company, in its sole discretion, may withhold consent to any proposed change in ownership or other transaction contemplated in this Clause 28, or may consent subject to such conditions as the Company, in its sole discretion, may determine. The parties hereto expressly stipulate and agree that any violation by the Bottler of the foregoing covenants contained  in this Clause 28 shall entitle the Company to terminate this Agreement forthwith without liability for damages; and, furthermore, in view of the personal nature of this Agreement, that the Company shall have the right to terminate this Agreement without liability for damages if any other third party or parties should obtain any direct or indirect interest in the ownership or control of the Bottler, even when the Bottler had no means to prevent such a change, if, in the opinion of the Company, such change either enables such third party or parties to exercise any influence over the management of the Bottler or materially alters the ability of the Bottler to comply fully with the terms, obligations and conditions of this Agreement.

 

29.                   The Bottler shall, prior to the issue, offer, sale, transfer, trade or exchange of any of its shares of stock or other evidence of ownership, its bonds, debentures or other evidence of indebtedness, or the promotion of the sale of the above, or stimulation or solicitation of the purchase or an offer to sell thereof, obtain the written consent of the Company whenever the Bottler uses in this connection the name of the Company or the Trade Marks or any description of the business relationship with the Company in any prospectus, advertisement or other sales efforts. The Bottler shall not use the name of the Company or the Trade Marks or any description of the business relationship with the Company in any prospectus or advertisement used in connection with the Bottler’s acquisition of any shares or other evidence of ownership in a third party without the Company’s prior written consent.

 

VIII. GENERAL PROVISIONS

 

30.                   The Company may assign any of its rights and delegate all or any of its duties or obligations under this Agreement to one or more of its subsidiaries or related companies provided, however, that any such delegation shall not relieve the Company from any of its contractual obligations under this Agreement. In addition, the Company, in its sole discretion, may through written notice to the Bottler appoint a third party as its representative to ensure that the Bottler carries out its obligations under this Agreement, with full powers to oversee the Bottler’s performance and to require from the Bottler its compliance with all the terms and conditions of this Agreement.

 

31.                  Neither the Company nor the Bottler shall be liable for failure to perform any of their respective

 

 

obligations hereunder when such failure is caused by or results from:

 

(a)                    strike, blacklisting, boycott or sanctions imposed by a sovereign nation or supranational organization of sovereign nations, however incurred; or

 

(b)                    act of God, force majeure, public enemies, authority of law and/or legislative or administrative measures (including the withdrawal of any government authorization required by any of the parties to carry out the terms of this Agreement), embargo, quarantine, riot, insurrection, a declared or undeclared war, state of war or belligerency or hazard or danger incident thereto; or

 

(c)                     any other cause whatsoever beyond their respective control.

 

In the event the Bottler is unable to perform its obligations as a consequence of any of the contingencies set forth in this Clause 31, and for the duration of such inability, the Company and Authorized Suppliers shall be relieved of their respective obligations under Clauses 2 and 5; and provided that, if any such failure by either party shall persist for a period of six (6) months or more, either party hereto may terminate this Agreement without liability for damages.

 

32                               (a) The Company reserves the sole and exclusive right to institute any civil, administrative or criminal proceedings or actions, and generally to take or seek any available legal remedy it deems desirable, for the protection of its reputation, Trade Marks, and other intellectual property rights, as well as for the protection of the Concentrate, the Syrup and the Beverage, and to defend any action affecting these matters. At the request of the Company, the Bottler will render assistance in any such action. The Bottler shall not have any claim against the Company as a result of such proceedings or action or for any failure to institute or defend such proceedings or action. The Bottler shall promptly notify the Company of any litigation or proceedings instituted or threatened affecting these matters. The Bottler shall not institute any legal or administrative proceedings against any third party which may affect the interests of the Company without the prior written consent of the Company.

 

(b) The Company has the sole and exclusive right and responsibility to initiate and defend all proceedings and actions relating to the Trade Marks. The Company may initiate or defend any such proceedings or actions in its own name or require the Bottler to institute or defend such proceedings or actions either in its own name or in the joint names of the Bottler and the Company.

 

33.                            (a) The Bottler agrees to consult with the Company on all product liability claims, proceedings or actions brought against the Bottler in connection with the Beverage or Approved Containers and to take such action with respect to the defense of any such claim or lawsuit as the Company may reasonably request in order to protect the interests of the Company in the Beverage, the Approved Containers or the goodwill associated with the Trade Marks.

 

 

(b) The Bottler shall indemnify and hold harmless the Company, its affiliates and their respective officers, directors and employees from and against all costs, expenses, damages, claims, obligations and liabilities whatsoever arising from facts or circumstances not attributable to the Company including, but not limited to, all costs and expenses incurred in settling or compromising any of the same arising out of the preparation, packaging, distribution, sale or promotion of the Beverage by the Bottler, including, but not limited to, all costs arising out of the acts or defaults, whether negligent or not, of the Bottler, the Bottler’s distributors, suppliers and wholesalers.

 

(c) The Bottler shall obtain and maintain a policy of insurance with insurance carriers satisfactory to the Company giving full and comprehensive coverage both as to amount and risks covered in respect of matters referred to in subclause (b) above (including the indemnity contained therein) and shall on request produce evidence satisfactory to the Company of the existence of such insurance. Compliance with this Clause 33(c) shall not limit or relieve the Bottler from its obligations under Clause 33(b) hereof.

 

34.                              The Bottler covenants and agrees:

 

(a)                    that it will make no representations or disclosures to public or government authorities or to any other third party, relating to the Concentrate, the Syrup or the Beverage without the prior written consent of the Company;

 

(b)                    in the event that the Bottler is publicly listed or traded, it will disclose to the Company any financial or other information relating to the performance or prospects of the Bottler at the same time as the Bottler is required to disclose such information pursuant to the regulations of the stock exchange or the securities or corporations law applicable to the Bottler;

 

(c)                     that it will at all times, both during the continuance and after termination of this Agreement, keep strictly confidential all secret and confidential information including, without limiting the generality of the foregoing, mixing instructions and techniques, sales, marketing and distribution information, projects and plans, relating to the subject matter of this Agreement, which the Bottler may receive from the Company, or in any other manner, and to ensure that such information shall be made known only to those officers, directors and employees bound by reasonable provisions incorporating the secrecy obligations set out in this Clause; and

 

(d)                    that upon the expiration or earlier termination of this Agreement, it will forthwith hand over to the Company or to whomever the Company may direct all written or graphic, electromagnetic, computerized, digital or other materials comprising or containing any information subject to the obligation of confidentiality hereunder.

 

35.                  The Company and the Bottler recognize that incidents may arise which can threaten the reputation and business of the Bottler and/or negatively affect the good name, reputation and image of the Company and the Trade Marks. In order to address such incidents, including

 

 

but not limited to any questions of quality of the Beverage that may occur, the Bottler will designate and organize an incident management team and inform the Company of the members of such team. The Bottler further agrees to cooperate fully with the Company and such third parties as the Company may designate and coordinate all efforts to address and resolve an y such incident consistent with procedures for crisis management that may be issued to the Bottler by the Company from time to time.

 

36.                  In the event of any provisions of this Agreement being or becoming legally ineffective or invalid, the validity or effect of the remaining provisions of this Agreement shall not be affected; provided that the invalidity or ineffectiveness of the said provisions shall not prevent or unduly hamper performance hereunder or prejudice the ownership or validity of the Trade Marks. The right to terminate in accordance with Clause 25(a)(2) is not affected hereby.

 

37.                  (a) As to all matters and things herein mentioned, this Agreement, as may be amended or supplemented in writing from time to time, shall constitute the only agreement between the Company and the Bottler. All prior agreements of any kind whatsoever between the parties relating to the subject matter are cancelled hereby, save to the extent that the same may comprise agreements and other documents within the provisions of Clause 17(a) hereof; provided, however, that any written representations made by the Bottler upon which the Company relied in entering into this Agreement shall remain binding upon the Bottler.

 

(b)                    Any waiver or modification of, or alteration or addition to, this Agreement or any of its provisions, shall not be binding upon the Company or the Bottler unless same shall be executed by duly authorized representatives of the Company and the Bottler.

 

(c)                     All written notices given pursuant to this Agreement shall be by courier, telefax, hand or registered (air) mail and shall be deemed to be given on the date such notice is dispatched, such hand delivery is affected, or such registered letter is mailed. Such written notices shall be addressed to the last known address of the party concerned. Each party shall promptly advise the other party of any change in its address.

 

Company:

THE COCA-COLA COMPANY

One Coca-Cola Plaza, N.W.

Atlanta, Georgia 30313

United States of America

 

Bottler:

RIO DE JANEIRO REFRESCOS LTDA.

Rua André Rocha N° 2299, Jacarepaguá

Rio de Janeiro, Brasil

 

 

38.                  Failure of the Company to exercise promptly any right herein granted, or to require strict performance of any obligation undertaken herein by the Bottler, shall not be deemed to be a waiver of such right or of the right to demand subsequent performance of any and all obligations herein undertaken by the Bottler.

 

39.                  The Bottler is an independent contractor and is not an agent of, or a partner or joint venturer with, the Company. The Bottler agrees that it will neither represent, nor allow itself to be held out as an agent of, or partner or joint venturer with the Company.

 

40.                  The headings herein are solely for the convenience of the parties and shall not affect the interpretation of this Agreement.

 

41.                  This Agreement shall be interpreted, construed and governed by and in accordance with the laws of Brazil, without giving effect to any applicable principles of choice or conflict of laws.

 

IN WITNESS WHEREOF, the Company at Atlanta, Georgia, United States of America, and the Bottler in Brazil have caused these documents to be executed in triplicate by the duly authorized person or persons in their behalf on the dates indicated below.

 

	
THE COCA-COLA COMPANY
    	
RIO DE JANEIRO REFRESCOS LTDA.
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    	
By:
    	
 
    
	
 
    	
Authorized Representative
    	
 
    	
Authorized Representative
    
	
 
    	
 
    	
 
    	
 
    
	
Date:
    	
 
    	
 
    	
Date:
    	
 
    

 

 

BOTTLER’S AGREEMENT FOR OTHER BEVERAGES

 

THIS AGREEMENT, made and entered into with effect October 4, 2017, by and between THE COCA-COLA COMPANY, a corporation organized and existing under the laws of the state of Delaware, United States of America, with principal offices at One Coca-Cola Plaza, N.W., Atlanta, Georgia 30313, United States of America (hereinafter the “Company”); and RIO DE JANEIRO REFRESCOS LTDA. established and existing according to the laws of Brazil, with principal offices at Rua André Rocha 2299, Jacarepaguá, Rio de Janeiro, Brazil (hereinafter  the “Bottler”).

 

WHEREAS:

 

A.                                The Company is engaged in the manufacture and sale of beverage bases, essences and other ingredients (hereinafter referred to as the “Beverage Bases”), the formulae for which are industrial secrets of the Company and from which are manufactured non-alcoholic beverage syrups and powders (hereinafter referred to as the “Syrups”). These Beverage Bases and Syrups are used in the preparation of non-alcoholic beverage products. The Company is also engaged in the manufacture and sale of the Syrups and has the right to engage in producing and selling other nonalcoholic beverage products, all of which are identified under the trademarks set forth in Exhibit 1 (the beverage products described above are hereinafter collectively referred to as the “Beverages”). These Beverages are produced for sale in bottles and other containers and in other forms and manners;

 

B.                              The Company is the owner of the trademarks which are listed in Exhibit 1 attached hereto and which distinguish the Beverage Bases, the Syrups and the Beverages, and such other related intellectual property embodied in the distinctive trade dress and other design devices and packaging elements associated with the Beverage Bases, the Syrups and the Beverages and any additional trademarks that the Company may adopt from time to time to distinguish the Beverage Bases, the Syrups and the Beverages (hereinafter referred to as the “Trade Marks”);

 

C.                              The Company has the exclusive right to prepare, package, distribute and sell the Beverages and the right to manufacture and sell the Beverage Bases and the Syrups in Brazil, among other countries;

 

D.                              The parties hereto are also parties to a n agreement dated October 4, 2017, and which expires on October 4, 2022, (hereinafter referred to as the “Bottler’s Agreement for Coca-Cola”), pursuant to which the Bottler is authorized to prepare and package the Beverage Coca-Cola for sale and distribution in and throughout the Territory therein defined and described; and

 

E.                               The Bottler seeks an authorization from the Company to prepare and package the Beverages and to distribute and sell the same under the Trade Marks in and throughout the Territory (as defined and described in the Bottler’s Agreement for Coca-Cola).

 

 

THEREFORE, the Company hereby authorizes the Bottler, and the Bottler undertakes, upon the terms and conditions set forth in the Bottler’s Agreement for Coca-Cola, to prepare and package the Beverages and to distribute and sell the same under the Trade Marks, in and throughout the Territory, and the terms and conditions, duties and obligations set forth in the Bottler’s Agreement for Coca-Cola are incorporated herein by reference as though set forth in haec verba; provided that (a) wherever the terms “Coca-Cola” and “Coke” appear in said Bottler’s Agreement for Coca-Cola the Trade Marks shall be substituted therefor, (b) wherever the term “Concentrate” appears in said Bottler’s Agreement for Coca-Cola the term “Beverage Bases” shall be substituted therefor, and (c) this Agreement shall automatically terminate  upon the expiration or earlier termination of the Bottler’s Agreement for Coca-Cola.

 

IN WITNESS WHEREOF, the Company in Atlanta, Georgia, United States of America, and the Bottler in Brazil, have caused these presents to be executed in tri plicate by the duly authorized person or persons in their behalf on the dates indicated below.

 

 

	
THE COCA-COLA COMPANY
    	
RIO DE JANEIRO REFRESCOS LTDA.
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    	
By:
    	
 
    
	
 
    	
Authorized Representative
    	
 
    	
Authorized Representative
    
	
 
    	
 
    	
 
    	
 
    
	
Date:
    	
 
    	
 
    	
Date:
    	
 
    

 

 

EXHIBIT 1

To the Bottler’s Agreement for Other Beverages

Effective October 4, 2017

 

Trade Marks:

 

COCA-COLA LIGHT

COCA-COLA STEVIA

COCA-COLA ZERO

FANTA

FANTAZERO

KUAT

KUATZERO

SPRITEZERO

SPRITE

 

The Company hereby authorizes the Bottler to assign the production rights for the products identified by the trademarks listed below, to Leão Alimentos e Bebidas Ltda. This assignment shall be recognized and accepted by the Company in writing and shall establish that, once the transfer is made, the Bottler may only withdraw it by prior written approval by the Company.

 

The transfer, by the Bottler, of the production rights of the trademarks listed below, shall be made in its entirety and the Bottler will not be entitled to the production of the Beverages, and the Company, hereby releases the Bottler of any and all obligations under the Bottler Agreement for Coca-Cola in relation to the subject matter of the assignment. Additionally, the assignment should include an authorization for Leão Alimentos e Bebidas Ltda. by written consent of the Company, to hire third parties for the production and/or packaging of Beverages.

 

In addition to the provisions of Clauses 25 and 26 of the Bottler Agreement for Coca-Cola, this agreement may be terminated by the Company, without liability for loss and damage, if the Company, at its sole discretion, determines that the Bottler has not reached the performance objectives for the Beverages, set in the annual plan provided for in Clause 6(e) of the Bottler Agreement for Coca-Cola.

 

If this agreement is terminated as a result of the above paragraph, the Bottler Agreement for Coca-Cola its additions and related agreements and authorizations shall automatically be terminated.

 

DEL VALLE

I9

KAPO

POWERADE

POWERADEZERO

 

 

LEÃO BOTTLER’S AGREEMENT

 

This Agreement, made and entered into with effect October 4, 2017, by and between THE COCA-COLA COMPANY, a corporation organized and existing under the laws of the state of Delaware, United States of America, with principal offices at One Coca-Cola Plaza, N.W., Atlanta, Georgia 30313, United States of America (hereinafter “TCCC”); COCA-COLA INDUSTRIAS LTDA., a company  organized and existing under the laws of the Federal Republic of Brazil, with offices at Playa de Botafogo, n° 374, piso 12, parte, in the city of Río de Janeiro, state of Río de Janeiro, registered in the CNPJ/MF under No. 45.997.418/0001-53, represented herein according to its bylaws (hereinafter “CCIL”); TRANSPORTADORA MC LTDA, a company  organized and existing under the laws of the Federal Republic of Brazil, with offices at Rodovia BR 262, Km 02, Anel Rodoviário, n° 2233, prédio “A”, in the city of Belo Horizonte, state of Minas Gerais, registered in the CNPJ under No. 23.161.045/0001-43  represented herein according to its bylaws (hereinafter “TMC”). Hereinafter TCCC, CCIL and TMC, jointly referred to as the “Owners of the Trade Marks”; and RIO DE JANEIRO REFRESCOS LTDA. A company established and existing according to the laws of Brazil, with principal offices at Rua André Rocha 2299, Jacarepaguá, Rio de Janeiro, Brazil (hereinafter the “Bottler”).

 

WHEREAS,

 

A.                                   TCCC and CCIL are engaged in the manufacture and the sale of Beverage bases, essences, and other ingredients (hereinafter referred to as the “Beverage Bases”), the formulas for which are an industrial secret of TCCC and CCIL, from which a non-alcoholic beverage syrup or powder (hereinafter referred to as the “Syrup”) is prepared, and are also engaged in the manufacture and sale of the Syrup, which Beverage Bases or Syrup are used in the preparation of a non-alcoholic beverage product identified under the trade marks FUZE, LEÃO and MATTE LEÃO (hereinafter referred to as the “Beverages”) for sale in bottles and other containers and in other forms or manners;

 

B.                                   TMC, as member of the Coca-Cola group and controlled by CCIL, is the current Owner of the mixed and figurative trademarks, FUZE, LEÃO and MATTE LEÃO that distinguish the Beverage Bases, Syrup and Beverages, and the Owners of the Trade Marks jointly retain the intellectual property embodied in the distinctive trade dress, other design devices and packaging elements associated with the Beverage Bases, the Syrup and the Beverage and any additional trademark that the Holders of the Trade Marks may adopt from time to time to distinguish the Beverage Bases, the Syrup and the Beverages (hereinafter referred to as the “Trade Marks”);

 

C.                                 The Owners of the Trade Marks have the exclusive right to prepare, package, distribute and sell the Beverage and the right to manufacture and sell the Beverage Bases and Syrup in Brazil, among other countries;

 

D.                                 TCCC and the Bottler have also entered into a Bottler Agreement dated October 4, 2017,

 

 

that will expire on October 4, 2022 (hereinafter referred to as the “Bottler Agreement for Coca-Cola”), by which the Bottler has been authorized to prepare and package Coca-Cola Beverages for the sale and distribution throughout the territory defined and described in the Bottler Agreement for Coca-Cola.

 

D.                                 The Company has designated and authorized certain third parties to supply the Concentrate to the Bottler (said third parties being hereinafter referred to as the “Authorized Suppliers”);

 

E.                                  The Bottler has requested an authorization from the Owners of the Trade Marks for the preparation, packaging, distribution and sale of the Beverages in and throughout the Territory as defined and described in the Bottler Agreement for Coca-Cola;

 

NOW, THEREFORE, the parties agree as follows:

 

I.                                       OBJECT OF THE AGREEMENT

 

1.                            The Owners of the Trade Marks hereby authorize the Bottler, and the Bottler undertakes, upon the terms and conditions established in the Bottler Agreement for Coca-Cola, to prepare and package the Beverages and to distribute and sell the same under the Trade Marks, in and throughout the Territory; and the terms and conditions, duties and obligations established in the  Bottler Agreement for Coca-Cola are herein incorporated by reference as if haec verba provided that (a) wherever the terms “Coca-Cola” and “Coke” appear in said Bottler’s Agreement for Coca-Cola the Trade Marks shall be substituted therefor, (b) wherever the term “Concentrate” appears in said Bottler’s Agreement for Coca-Cola the term “Beverage Bases” shall be substituted therefor, (c) wherever the word “Company” appears in said Bottler’s Agreement for Coca-Cola the expression “Owners of the Trade Marks” shall be substituted therefor, and (d) this Agreement shall automatically terminate  upon the expiration or earlier termination of the Bottler’s Agreement for Coca-Cola.

 

2.                            The Owners of the Trade Marks hereby authorize the Bottler to transfer the production rights of the Beverages to Leão Alimentos e Bebidas Ltda.  This transfer must be recognized and accepted in writing by TCCC and shall establish that once the transfer is performed, the Bottler may only withdraw it through the prior written approval of TCCC.

 

3.                            The transfer by the Bottler of the production rights for the Beverages mentioned herein shall be complete and the Bottler shall have no right to produce the Beverages and TCCC hereby frees the Bottler from any obligation under the Bottler Agreement for Coca-Cola regarding the transfer.  Additionally, the transfer shall include a permission by written consent of TCCC to Leão Alimentos e Bebidas Ltda. for the hiring of third parties for the production and/or packaging of the Beverages

 

4.                           In addition to the provision of Clause 25 and 26 of the Bottler Agreement for Coca-Cola, this

 

 

agreement can be terminated by the Owners of the Trade Marks forthwith and without liability for damages, if the Owners of the Trade Marks, at their sole discretion determine that the Bottler has not reached the performance goals established in the annual plan set forth in Clause 6(e) of the Bottler Agreement for Coca-Cola related to the Beverages.

 

5.                            If this Agreement shall terminate as a result of paragraph 4 above, the Bottler Agreement for Coca-Cola, its exhibits and related agreements and authorizations shall automatically terminate.

 

IN WITNESS WHEREOF, the Company in Atlanta, Georgia, United States of America, and CCIL, TMC and the Bottler in Brazil have caused these documents to be executed in triplicate by the duly authorized person or persons in their behalf on the dates indicated below.

 

	
COCA-COLA   INDÚSTRIAS LTDA.
    	
 
    	
TRANSPORTADORA   MC LTDA.
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
By:
    	
 
    
	
 
    	
Authorized   Representative
    	
 
    	
Authorized   Representative
    
	
 
    	
 
    	
 
    	
 
    
	
Date:
    	
 
    	
 
    	
Date:
    	
 
    
	
 
    	
 
    	
 
    
	
THE   COCA-COLA COMPANY
    	
 
    	
RIO DE   JANEIRO REFRESCOS LTDA.
    
	
 
    	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
By:
    	
 
    
	
 
    	
Authorized   Representative
    	
 
    	
Authorized   Representative
    
	
 
    	
 
    	
 
    	
 
    
	
Date:
    	
 
    	
 
    	
Date:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
WITNESSES:
    	
 
    
	
1
    	
 
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    
	
CPF/MF:
    	
 
    	
 
    
	
 
    	
 
    
	
2
    	
 
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    
	
CPF/MF:
    	
 
    	
 
    
						

 

 

ADES BOTTLER’S AGREEMENT

 

THIS AGREEMENT, made and entered into with effect October 4, 2017, by and between THE COCA-COLA COMPANY, a corporation organized and existing under the laws of the state of Delaware, United States of America, with principal offices at One Coca-Cola Plaza, N.W., Atlanta, Georgia 30313, United States of America (hereinafter the “Company”); and RIO DE JANEIRO REFRESCOS LTDA. established and existing according to the laws of Brazil, with principal offices at Rua André Rocha 2299, Jacarepaguá, Rio de Janeiro, Brazil (hereinafter  the “Bottler”).

 

WHEREAS,

 

A.                          The Company is engaged in the manufacture and the sale of beverage bases, essences, and other ingredients and a beverage base concentrate (hereinafter referred to as the “Beverage Bases”), the formula for which is an industrial secret of the Company, from which a non-alcoholic beverage syrup or powder (hereinafter referred to as the “Syrup”) is prepared, and is also engaged in the manufacture and sale of the Syrup, which Beverage Bases or Syrup is used in the preparation of a non-alcoholic beverage product (hereinafter referred to as the “Beverage”) for sale in bottles and other containers and in other forms or manners;

 

B.                          The Company is the owner of the trademark ADES that distinguishes the Beverage Base, the Syrup, and the Beverage, and other intellectual property embodied in the distinctive trade dress, other design devices and packaging elements associated with the Beverage Base, the Syrup and the Beverage, and any additional trademarks that the Company may adopt from time to time to distinguish the Beverage Base, the Syrup and the Beverage being hereinafter referred to as the “Trade Marks”);

 

C.                          The Company has the exclusive right to prepare, package, distribute and sell the Beverage and the right to manufacture and sell the Beverage Base and the Syrup in Brazil, among other countries;

 

D.                          The parties to this instrument are also parties to an agreement effective October 4, 2017 and which expires October 4, 2022 (hereinafter, the “Bottler’s Agreement for Coca-Cola”) by which the Bottler has been authorized to prepare and package Coca-Cola Beverages for the sale and distribution throughout the territory defined and described in the Bottler Agreement for Coca-Cola;

 

NOW, THEREFORE,

 

1.                           The Company hereby authorizes the Bottler, and the Bottler undertakes, upon the terms and conditions set forth in the Bottler’s Agreement for Coca-Cola, to prepare and package the Beverages and to distribute and sell the same under the Trade Marks, in and throughout the Territory, and the terms and conditions, duties and obligations set forth in the Bottler’s Agreement for Coca-Cola are incorporated herein by reference as though set forth in haec verba; provided that (a) wherever the

 

 

terms “Coca-Cola” and “Coke” appear in said Bottler’s Agreement for Coca-Cola the Trade Marks shall be substituted therefor, (b) wherever the term “Concentrate” appears in said Bottler’s Agreement for Coca-Cola the term “Beverage Bases” shall be substituted therefor, and (c) this Agreement shall automatically terminate  upon the expiration or earlier termination of the Bottler’s Agreement for Coca-Cola.

 

2.                            The Company hereby authorizes the Bottler to transfer the rights of production, packaging, marketing and distribution of Beverages identified by the ADES trademark indicated herein, to Unilever Brasil Industrial Ltda. and Unilever Brasil Ltda. This transfer is hereby recognized and accepted by the Company (the “Transfer”). The Parties agree that the manufacture and packaging of Beverages will be carried out by Unilever Brasil Industrial Ltda. According to the Supplier Agreement entered into by and between Unilever Brasil Industrial Ltda., the Bottler and other Coca-Cola bottlers in Brazil on March 28, 2017 (“Supplier Agreement “). The marketing and distribution will be carried out by Unilever Brasil Ltda. Under the terms of the Transitional Sale and Distribution Agreement entered into by and between Unilever Brasil Ltda., the Bottler and other Coca-Cola bottlers in Brazil on March 28, 2017 (“Sale and Distribution Agreement”). The Parties understand and agree that the manufacturing, packaging, marketing and distribution Transfers may only be withdrawn with the prior written consent of the Company and also agree that the authorization to transfer the manufacture and packaging of Beverages will automatically terminate with the end of the term and subsequent termination or earlier termination of the Supplier Agreement and the authorization to the marketing and distribution of Beverages will automatically terminate with the end of the term and subsequent termination or earlier termination of the Sale and Distribution Agreement.

 

3.                            After the expiration or termination of the Supplier Agreement, the Bottler accepts and agrees that the rights of manufacture and bottling of Beverages identified by the AdeS trade mark shall be allocated to an entity, yet to be defined, for the purposes of centralized production of Beverages identified by the AdeS trade mark (the “Subsequent Delegation”). This Subsequent Delegation shall be recognized and accepted by the Company in writing and shall establish that, after the Subsequent Delegation has been made, the Bottler may only withdraw it with the prior written approval of the Company.

 

4.                            Unless otherwise agreed between the Parties, the Delegation and Subsequent Delegation of the Bottler with respect to the manufacture and bottling rights of AdeS Beverages shall be made in full and the Bottler shall have no right to manufacture or filling of Beverages while the Supplier Agreement or the agreement for the manufacture and filling of AdeS Beverages remains in force, as appropriate. In such cases, the Company, hereby releases the Bottler from any obligation under the Bottler Agreement for Coca-Cola with respect to the subject matter of the Delegation and Subsequent Delegation.

 

5.                            In addition to the provisions of clauses 25 and 26 of the Bottler Agreement for Coca-Cola, this Agreement may be terminated by the Company, without liability for loss and damage, if the

 

 

Company, in its sole discretion, determines that the Bottler has not achieved the performance objectives established in the annual plan provided for in clause 6 (e) of the Bottler Agreement for Coca-Cola.

 

6.                            If this Agreement terminates as a result of paragraph 5 above, the Bottler Agreement for Coca-Cola, its exhibits and related agreements and authorizations will automatically terminate.

 

IN WITNESS WHEREOF, the Company in Atlanta, Georgia, United States of America, and the Bottler in Brazil have caused this Agreement to be executed in triplicate by the duly authorized person or persons in their behalf on the dates indicated below.

 

 

	
THE COCA-COLA COMPAN Y
    	
RIO DE JANEIRO REFRESCOS LTDA.
    
	
 
    	
 
    
	
By:
    	
By:
    
	
Authorized representative
    	
Authorized representative
    
	
Date:
    	
Date:
    

 

	
WITNESSES:
    	
 
    
	
1
    	
 
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    
	
CPF/MF:
    	
 
    	
 
    
	
 
    	
 
    
	
2
    	
 
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    
	
CPF/MF:
    	
 
    	
 
    

 

 

 

COCA-COLA PLAZA

ATLANTA, GEORGIA

 

October 4, 2017

 

Rio de Janeiro Refrescos Ltda.

Rua André Rocha N° 2299, Jacarepaguá

Rio de Janeiro, Rio de Janeiro

Brasil

 

AUTHORIZATION TO MANUFACTURE PRODUCTS FOR SALE TO OTHER BOTTLERS

 

Dear Sirs,

 

Reference is made to the Bottler’s Agreement effective October 4, 2017, by and between THE COCA-COLA COMPANY (hereinafter the “Company’’) and RIO DE JANIERO REFRESCOS LTDA. (hereinafter the “Bottler”), authorizing the Bottler to prepare and package the Beverage COCA-COLA and any ancillary authorizations for other Company Beverages for sale and distribution granted by the Company to the Bottler (hereinafter collectively referred to as the “Bottler’s Agreements”). The terms used herein shall have the same meaning assigned to them in the Bottler’s Agreements unless otherwise specifically stated.

 

The Bottler shall be granted an Authorization to sell the syrups or Beverages in the Approved Containers only to the Authorized Purchasing Bottler who is based outside the Territory (hereinafter referred to as “Purchasing Bottlers”) listed in exhibit A attached, provided that the following conditions are met:

 

1.                            The Bottler will prepare and sell to the Purchasing Bottlers the Syrups or Beverages packaged in the Approved Containers, in the quantities designated by the mentioned Purchasing Bottlers, and will provide the Company with a monthly sales report of Syrups or Beverages the same that will be delivered to the Purchasing Bottlers.

 

2.                            The authorized Purchasing Bottlers will pay the Bottler an amount for each returnable Approved Container and its returnable case delivered at the Bottlers distribution centers and reimburse that amount for each Returnable Container and Returnable Case returned by the authorized Purchaser Bottler to the Bottler in perfect condition and in good use conditions.

 

3.                            Except for a supplement or amendment to this document, all stipulations, agreements, terms, conditions and provisions of the Bottling Agreements shall apply and will remain in force in relation to this additional authorization.

 

 

This authorization may be cancelled by the Company or by the Bottler by prior written notice of 180 (one hundred and eighty) days and will automatically extinguish at the end of the period of validity of the Bottler Agreement for Coca-Cola or its termination. The Company reserves the right to cancel this authorization at any time with respect to any of the Authorized Purchasing Bottlers, the Syrups or Beverages. Renewal of the Bottler Agreement implies the automatic renewal of this authorization.

 

In the case of the sale of Syrups by the authorized Manufacturing Bottlers, the Authorized Purchasing Bottler shall be responsible for ensuring that the sale of the Syrups to the Distributors of the Authorized Purchasing Bottlers is always carried out through a commitment signed by the Distributors designated by the Authorized Purchasing Bottlers to ensure full compliance with the provisions stated in the authorization in relation to the Syrups and post-mix Beverages.

 

This authorization shall prevail over any and all previously signed authorizations between the Company and the Bottler with respect to the purpose of this instrument.

 

 

	
THE COCA-COLA COMPAN Y
    	
 
    	
RIO DE JANEIRO REFRESCOS LTDA.
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
By:
    
	
Authorized representative
    	
 
    	
Authorized representative
    
	
Date:
    	
 
    	
Date:
    

 

 

	
WITNESSES:
    
	
1   
    	
 
    	
 
    
	
Name:
    
	
Title:
    
	
CPF/MF:
    
	
 
    
	
2   
    	
 
    	
 
    
	
Name:
    
	
Title:
    
	
CPF/MF:
    

 

 

EXHIBIT A

 

Date: October 4, 2017

 

AUTHORIZED PURCHASING BOTTLERS

 

1. REFRESCOS BANDEIRANTES IND. E COM. LTDA.

2. UBERLÁNDIA REFRESCOS LTDA.

3. SOROCABA REFRESCOS LTDA.

4. BRASAL REFRIGERANTES S.A.

5. CVI- REFRIGERANTES LTDA

6. SPAL INDÚSTRIA BRASILEIRA DE BEBIDAS

7. NORSA REFRIGERANTES S.A.

8. REFRESCOS GUARARAPES LTDA.

9. BRASIL NORTE BEBIDAS S.A.

10. COMPAR- COMPANHIA PARAENSE DE REFRIGERANTE

 

APPROVED BEVERAGES

COCA-COLA

COCA-COLA LIGHT

COCA-COLA STEVIA

COCA-COLA ZERO

FANTA

FANTA ZERO

LEÃO

KUAT

KUAT ZERO

SPRITE ZERO

SPRITE

DEL VALLE

I9

KAPO

POWERADE

POWERADE ZERO

 

 

 

COCA-COLA PLAZA

ATLANTA, GEORGIA

October 4, 2017

 

Rio de Janeiro Refrescos Ltda.

Rua André Rocha N° 2299, Jacarepaguá

Rio de Janeiro, Rio de Janeiro

Brasil

 

Reference is made to the Bottler’s Agreement effective October 4, 2017, by and between THE COCA-COLA COMPANY (hereinafter the “Company’’) and RIO DE JANIERO REFRESCOS LTDA. (hereinafter the “Bottler”), authorizing the Bottler to prepare and package the Beverage COCA-COLA and any ancillary authorizations for other Company Beverages regarding the sale and distribution of beverages bearing the Trademarks (hereinafter referred to as the “Bottler’s Agreements”). The terms used herein shall have the same meaning assigned to them in the Bottler’s Agreements unless otherwise specifically stated.

 

The Bottler is granted a non-exclusive authorization for the purchase from the Authorized Suppliers listed in Exhibit A of the Beverages packaged in Approved Containers, as provided in the terms of the Bottler Agreements or any other form as communicated to you by the Company or its representatives and, also, to sell and distribute them throughout the Territory, provided that the following conditions are fulfilled:

 

1.                            This authorization may be cancelled by the Company or by the Bottler by prior written notice of 180 (one hundred and eighty) days and will automatically extinguish at the end of the period of validity of the Bottler Agreement for Coca-Cola or its termination. Renewal of the Bottler Agreement implies the automatic renewal of this authorization.

 

2.                            Upon termination or cancellation of this authorization, the Bottler shall immediately refrain from the purchase of Beverages in Approved Container in the Territory.

 

3.                            Except as expressly provided in this letter, all stipulations, agreements, terms, conditions and provisions of the Bottler Agreements shall apply and remain in force with respect to this additional authorization.

 

This authorization shall prevail over any and all previously signed authorizations between the Company and the Bottler with respect to the purpose of this instrument.

 

	
THE COCA-COLA COMPANY
    	
RIO DE JANEIRO REFRESCOS LTDA.
    
	
 
    	
 
    
	
By:
    	
By:
    
	
Authorized representative
    	
Authorized representative
    
	
Date:
    	
Date:
    

 

 

EXHIBIT A

AUTHORIZATION TO PURCHASE AND DISTRIBUTE BEVERAGES

October 4, 2017

 

AUTHORIZED BEVERAGES:

 

COCA-COLA

COCA-COLA LIGHT

COCA-COLA STEVIA

COCA-COLA ZERO

FANTA

FANTA ZERO

LEÃO

KUAT

KUAT ZERO

SPRITE ZERO

SPRITE CHARRUA DEL VALLE

I9

KAPO

POWERADE

POWERADE ZERO

TAI

 

AUTHORIZED SUPPLIERS:

 

l. REFRESCOS BANDEIRANTES IND. E COM. LTDA.

2. UBERLÁNDIA REFRESCOS LTDA.

3. SOROCABA REFRESCOS LTDA.

4. BRASAL REFRIGERANTES S.A.

5. CVI- REFRIGERANTES LTDA

6. SPAL INDÚSTRIA BRASILEIRA DE BEBIDAS

7. NORSA REFRIGERANTES S.A.

8. REFRESCOS GUARARAPES LTDA.

9. BRASIL NORTE BEBIDAS S.A.

1O. COMPAR- COMPANHIA PARAENSE DE REFRIGERANTE

 

 

 

COCA-COLA PLAZA

ATLANTA, GEORGIA

 

October 4, 2017

 

Rio de Janeiro Refrescos Ltda.

Rua André Rocha N° 2299, Jacarepaguá

Rio de Janeiro, Rio de Janeiro

Brasil

 

AUTHORIZATI ON IN RESPECT OF SYRUPS FOR POST-MIX BEVERAGES

 

Gentlemen:

 

Reference is made to the Bottler’s Agreement effective October 4, 2017, by and between THE COCA-COLA COMPANY (hereinafter the “Company’’) and RIO DE JANIERO REFRESCOS LTDA. (hereinafter the “Bottler”), authorizing the Bottler to prepare and package the Beverage COCA-COLA and any ancillary authorizations for other Company Beverages for sale and distribution under the Trade Marks granted by the Company to the Bottler (hereinafter collectively referred to as the “Bottler’s Agreements”). The terms used herein shall have the same meaning assigned to them in the Bottler’s Agreements unless otherwise specifically stated.

 

The Bottler is hereby granted a non-exclusive authorization to prepare, package, distribute and sell syrups for the Beverages authorized under the Bottler’s Agreements (hereinafter the “Post-Mix Syrups”) to retail dealers in the Territory for use in dispensing the Beverages through Post-Mix Dispensers in or adjoining the establishments of retail outlets and also to operate Post-Mix Dispensers and sell the Beverages dispensed therefrom directly to consumers subject to the following conditions:

 

1.                            The Bottler shall not sell Post-Mix Syrups to a retail outlet for use in any Post-Mix Dispenser, or operate any Post-Mix Dispenser unless:

 

(a)                       there is available an adequate source of safe, potable water;

 

(b)                       all Post-Mix Dispensers are of a type approved by the Company and conform in all respects to the hygienic and other standards which the Company issues in writing to the Bottler in connection with the preparation, packaging and sale of the Post-M ix Syrups; and

 

(c)                        the Beverages dispensed through the Post-Mix Dispensers are in strict adherence to and

 

 

compliance with the instructions for the preparation of the Beverages from Post-Mix Syrups as issued in writing to the Bottler from time to time by the Company.

 

2.                            The Bottler shall take samples of the Beverages dispensed through the Post-Mix Dispensers operated by retail outlets to whom the Bottler has supplied the Post-Mix Syrups or which are operated by the Bottler in accordance with such instructions and at such intervals as may be notified by the Company in writing and shall submit said samples at the Bottler’s expense to the Company for inspection.

 

3.                            The Bottler shall maintain an adequate staff of trained personnel who will make periodic inspections at reasonable intervals of Post-Mix Dispensers operated by retail dealers to whom the Bottler has supplied Post-Mix Syrups. In making the inspections, the Bottler shall ensure:

 

(a)                       that the instructions issued by the Company are being complied with; and

 

(b)                       that the Beverages dispensed through the Post-Mix Dispensers comply strictly with the standards prescribed by the Company for the Beverages.

 

4.                            The Bottler shall, on its own initiative and responsibility, discontinue immediately the sale of Post-Mix Syrups to any retail outlet which fails to comply with the standards prescribed by the Company.

 

5.                            The Bottler shall discontinue the sale of Post-Mix Syrups to any retail outlet when notified by the Company that any of the Beverages dispensed through a Post-Mix Dispenser located in or adjoining the establishment of the retail outlet do not comply with the standards prescribed by the Company for the Beverages or that the Post-Mix Dispenser is not of a type approved by the Company.

 

6.                            The Bottler agrees;

 

(a)                       to sell and distribute the Post-Mix Syrups only in containers of a type approved by the Company and to use on said containers only labels which have been approved by the Company; and

 

(b)                       to exert every influence to persuade retail outlets to use a standard glass, paper cup or other container approved by the Company and with markings approved by the Company to the end that the Beverages served to the customer will be appropriately identified and will be served in an attractive and sanitary container.

 

Except as modified herein, all the terms, covenants and conditions contained in the Bottler’s Agreements shall apply to this supplemental authorization and it is expressly agreed between the parties that the terms, conditions, duties and obligations of the Bottler, as set forth in the Bottler’s

 

 

Agreements, are incorporated herein by reference and, unless the context otherwise indicates or requires, any reference in the said Bottler’s Agreements to the term “Beverages” is deemed to refer to the term “Post-Mix Syrups” for the purpose of this authorization.

 

This authorization may be terminated by the Company or the Bottler upon one hundred and eighty (180) days’ prior written notice and terminates automatically upon the expiration or earlier termination of the Bottler’s Agreement for COCA-COLA. The renewal of the Bottler Agreement implies the automatic renewal of this authorization.

 

This authorization supersedes any prior authorizations entered into between the Company and the Bottler in connection with the subject matter of this authorization.

 

Sincerely,

 

	
THE COCA-COLA   COMPANY
    	
 
    	
RIO DE JANIERO   REFRESCOS LTDA.
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
By:
    	
 
    
	
 
    	
Authorized Representative
    	
 
    	
 
    	
Authorized Representative
    
	
 
    	
 
    	
 
    
	
Date:
    	
 
    	
 
    	
Date:
    	
 
    

 

 

 

COCA-COLA PLAZA

ATLANTA, GEORGIA

 

October 4, 2017

 

Rio de Janeiro Refrescos Ltda.

Rua André Rocha N° 2299, Jacarepaguá

Rio de Janeiro, Rio de Janeiro

Brasil

 

Re: Bottler Agreement

 

Gentlemen:

 

Reference is made to the Bottler’s Agreement effective October 4, 2017, by and between THE COCA-COLA COMPANY (hereinafter the “Company’’) and RIO DE JANIERO REFRESCOS LTDA. (hereinafter the “Bottler”), authorizing the Bottler to prepare and package the Beverage COCA-COLA and any ancillary authorizations for other Company Beverages granted by the Company to the Bottler (hereinafter collectively referred to as the “Bottler’s Agreements”). The terms used herein shall have the same meaning assigned to them in the Bottler’s Agreements unless otherwise specifically stated.

 

The parties agreed to make certain clarifications regarding the Manufacturing Agreement, particularly regarding the following terms and conditions:

 

1.                                     The purpose of Clause 8 (b) of the Bottler Agreement is to allow the Company to respond and deal with the needs of international clients acting in various jurisdictions, as described in the aforementioned clause. As you may conclude, this is an important contractual device that aims to ensure that the System continues to positively meet its customers’ demands, and maintain its flexibility, competitiveness and supply capacity. Considering your concerns regarding the exercise of the rights referred to in this clause, we confirm that the Company will act in a reasonable manner in the exercise of these rights and will maintain prior understandings with you before starting any action in that regard.

 

2.                                     The Company is convinced that the use of a direct distribution and sale system to clients is advantageous and constitutes an essential requirement to fully satisfy the demand for the Beverage in the Territory. However, and in accordance with the terms of Clause 10 of the Bottler Agreement, the Bottler will be dispensed of any additional Company consent to distribute and sell the Beverage to the acting wholesalers and distributors in the Territory, for further distribution within the Territory.

 

 

3.                                     The “Transshipment” policy, provided for in clause 11 of the Bottler Agreement, is intended to protect and contain any abuse by Bottlers participating in the Coca-Cola System. In accordance with clause 11(b)(2) of the Bottler Agreement, the Company may require compensation from the defaulting Bottler on the basis of the quantity of products found in the Territory of the Injured Bottler. The amount of the indemnity, less the cost incurred by the Company will be passed on to the Injured Bottler. Despite these considerations, the Company recognizes that the current transfer protocol has served to reduce the volume of products transferred among Brazilian bottlers. Therefore, the current policy for the transfer of products between the Brazilian bottlers, which is indicated in the Commitment Term for Regulating Responsibilities, Impose Collection of Compensation (or fines) and Other Agreements, dated March 21, 2003, shall continue to be in force. However, Clause 11 of the Bottler Agreement should apply to claims relating to transfers occurring between the territories of the Authorized Bottlers and any of the territories outside Brazil.

 

4.                                     The commercial reputation referred to in Clause 13 of the Bottler Agreement refers only to the goodwill obtained by means of the Trademarks, thus belonging to the Company, as Holder of the Trademark. Such goodwill does not belong to the Bottler, since the Bottler is required to use the aforementioned trademarks without payment of any remuneration or fees, detached from any right or interest relating to the use of the Trademarks in preparing the Beverages. Meanwhile, it is a fact, that any goodwill not related to the Trademarks and that is established exclusively by the Bottler through its operations and its normal relationship with customers will belong to the Bottler and not to the Company.

 

5.                                     Clause 18 (e) of the Bottler Agreement describes the procedure to be adopted in the event of the occurrence of technical or quality problems relating the Beverage. In accordance with Clause 33(b) of the Bottler Agreement, the Bottler shall indemnify the Company for all costs, expenses, claims, obligations and liabilities resulting from facts or circumstances not attributable to the Company. If any such problem results from the Concentrate, only the Company will be responsible for the costs that arise. However, if the technical or quality problem is caused by any other element, including any problem with Approved Container, the Company shall not be liable for the related costs or any other obligations of a financial nature.

 

6.                                     The Company and the Bottler shall annually ratify the standardized environmental management procedures provided for in Clause 22(b)(ii) of the Bottler Agreement, in accordance with the Annual Plan.

 

7.                                     The mechanism to be adopted for the extension of the Bottler Agreement is expressly provided for in Clause 24(b) and is based on the fulfilment of applicable objective criteria, for determining the fulfillment by the Bottler of its contractual obligations. The Bottler shall have the right to request the extension of the Agreement if it has fulfilled the conditions established therein. CCIL will remain the relevant contact and resource for the Bottler in the Territory, advising the Company on the performance of the Bottler and the possibility of granting the extension of the Bottler Agreement and for what reasonable time, if applicable.

 

8.                                     The Company agrees to include in the Bottler Agreement the obligation to purchase the

 

 

equipment of the Bottler, as provided in Clause 24(d) of the previous Bottler Agreement. This provision shall consist of an exception to the Company’s standard for the International Bottler Agreement and will be granted only in relation to the Brazilian contracts, considering the commitments arising from negotiations with local government authorities and the tradition of this provision in the Brazilian Bottler Agreements.

 

9.                                     In accordance with what has been strictly stipulated in Clause 28(b) of the Bottler Agreement, the Company may terminate the Bottler Agreement in the event that the Bottler performs any transfer established in that clause. However, the Company may only use this faculty in the circumstances in which such transfer represents a significant change in the ownership or corporate control of the Bottler. The Company shall only exercise its right to terminate the Bottler Agreement pursuant to Clause 25(b) “iii” and “v” when all creditors of the Bottler are involved.

 

10.                              Clause 33(a) of the Bottler Agreement stipulates that the Bottler must consult with the Company in all claims involving actions, procedures or liability actions, procedures or actions against the Bottler with respect to the Beverages or Approved Containers. Consequently, the Bottler shall forward to the Company or to whom it designates, at least one (1) semiannual report, containing a complete and accurate list of all actions, procedures and claims related to liability for the products, whether proposed or in progress against the Bottler in relation to the Beverages or Approved Containers.

 

11.                              Through the Brazilian Coca-Cola Bottlers Association — “AFBCC”, The Bottler will obtain and maintain a collective insurance policy with the insurers accepted by the Company, as stipulated in Clause 33(e) of the Bottler Agreement. The Bottler and the Company agree that the value of this collective policy that will be obtained through the AFBCC will be USD30 million, a value that will be subject to adjustment in the case of relevant alterations in the scope of the business of the Bottler or ancillary authorizations to the Bottler Agreement. Regarding the insurance policy, the Company establishes a period of 180 (one hundred and eighty) days for submission, counted from the execution of this document.

 

12.                              The Company and the Bottler agree that the provisions of Clause 38 of the Bottler Agreement also apply with respect to the Bottler, i.e. the fact that the Bottler ceases to exercise any rights granted in this instrument, or requires the strict fulfillment of any obligation assumed by the Company in the Bottler Agreement will not be considered as an exemption of this right or the right to demand the subsequent fulfillment of any and all the obligations undertaken by the Company in that instrument.

 

13.                              In accordance with Clause 6(e) of the Bottler Agreement, the Company and the Bottler must develop five-year investment plans, with annual reviews, in order to ensure the efficiency of the System. The above plans will be discussed and agreed upon within 90 (ninety) days of the execution of this document.

 

14.                              The provisions of this document shall remain in force throughout the term of the Bottler Agreement, any renewals and other agreements and authorizations celebrated with the

 

 

Company in function or in reference to the Bottler Agreement. However, this document may be periodically updated and amended, if necessary, by the Company.

 

 

	
Sincerely,
    
	
 
    
	
THE COCA-COLA COMPANY
    
	
 
    
	
By:
    	
 
    	
 
    

 

 

 

COCA-COLA PLAZA ATLANTA, GEORGIA

 

October 4, 2017

 

Rio de Janeiro Refrescos Ltda.

Rua André Rocha N° 2299, Jacarepaguá

Rio de Janeiro, Rio de Janeiro

Brasil

 

Re: Consent to Deal in Energy Drinks

 

Gentlemen:

 

Reference is made to the Bottler’s Agreement effective October 4, 2017, between THE COCA-COLA COMPANY (hereinafter the “Company”) and RIO DE JANEIRO REFRESCOS LTDA. (hereinafter the “Bottler”), authorizing the Bottler to prepare and package the Beverage COCA-COLA and any ancillary authorizations for other Company Beverages for sale and distribution under the Trade Marks (hereinafter collectively referred to as the “Bottler’s Agreements”). The terms used herein have the same meaning assigned to them as in the Bottler’s Agreements unless otherwise specifically stated.

 

Pursuant to Clauses 15(c) and (d) of the Bottler’s Agreement, you have agreed not to manufacture, prepare, package, distribute, sell, deal in or otherwise be concerned with any non-alcoholic beverage products other than those prepared, packaged, distributed or sold by the Bottler under authority of the Company or to use delivery vehicles, cases, cartons, coolers, vending machines and other equipment bearing the Trade Marks for the distribution and sale of any products which are not identified by the Trade Marks without the prior written consent of the Company.

 

The Company hereby consents to the manufacture, preparation, packaging, distribution and sale by you of the following beverage products:

 

Energy Drinks under the MONSTER and BURN trademarks (hereinafter the “Product”).

 

Further, the Company hereby consents to the use by you of delivery vehicles, cases, cartons, coolers, vending machines and other equipment bearing the Trade Marks for the distribution and sale of the Product. However, and only with respect to the use of coolers and vending machines bearing the Trade Marks, the Bottler shall limit the Product placement in coolers and vending machines to only one (1) of the Product SKU per cooler and/or vending machine. Any additional Product placement shall take into account local market and financial consideration and other relevant factors as may be agreed upon by the Company and Monster Beverage Corporation and communicated to the Bottler by the Company in writing. In no event shall the Bottler modify any equipment bearing the Trade Marks to permit use by the

 

 

Product.

 

This consent is limited to the products listed above and shall in no way be construed as a consent or a waiver of any rights of the Company to future actions of the Bottler under Clause 15(c), 15(d) or any other provision of the Bottler’s Agreements.

 

Except as supplemented or modified herein, the stipulations, covenants, terms, conditions and provisions of the Bottler’s Agreements shall apply to and be effective for this supplemental authorization.

 

	
THE   COCA-COLA COMPANY
    
	
 
    
	
 
    
	
By:
    	
 
    	
 
    	
By:
    	
President
    
	
Authorized   Representative
    	
 
    	
Authorized   Representative
    

 

 

 

COCA-COLA PLAZA

ATLANTA, GEORGIA

October 4, 2017

 

Rio de Janeiro Refrescos Ltda.

Rua André Rocha N° 2299, Jacarepaguá

Rio de Janeiro, Rio de Janeiro

Brasil

 

AUTHORIZATION IN RESPECT OF SHIPS AND AIRLINES

 

Gentlemen:

 

Reference is made to the Bottler’s Agreement effective October 4, 2017, by and between THE COCA-COLA COMPANY (hereinafter the “Company”) and RIO DE JANIERO REFRESCOS LTDA. (hereinafter the “Bottler”), authorizing the Bottler to prepare and package the Beverage COCA-COLA and any ancillary authorizations for other Company Beverages for sale and distribution under the Trade Marks granted by the Company to the Bottler (hereinafter the “Bottler’s Agreements”). The terms used herein shall have the same meaning assigned to them in the Bottler’s Agreements unless otherwise specifically stated.

 

The Bottler is hereby granted a non-exclusive authorization to supply the Syrups or Beverages in Approved Containers authorized under the Bottler’s Agreements for sale on board ships and airlines within the Territory, subject to the following conditions:

 

1. This authorization may be withdrawn by the Company at any time and terminates automatically upon the expiration or earlier termination of the Bottler’s Agreement for COCA-COLA.

 

2. Upon the termination or cancellation of this authorization, the Bottler shall immediately discontinue the sale and distribution to ships and airlines.

 

3. Except as supplemented or modified herein, the stipulations, covenants, terms, conditions and provisions of the Bottler’s Agreements shall apply to and be effective for this supplemental authorization.

 

 

This authorization supersedes any prior authorizations entered into between the Company and the Bottler in connection with the subject matter of this authorization.

 

Sincerely,

 

	
THE COCA-COLA   COMPANY
    	
RIO DE JANIERO   REFRESCOS LTDA.
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    	
By:
    	
 
    
	
 
    	
Authorized Representative
    	
 
    	
Authorized Representative
    
	
 
    	
 
    
	
 
    	
 
    
	
Date: 
    	
 
    	
 
    	
Date:
    	
 
    

 

 

 

COCA-COLA PLAZA

ATLANTA, GEORGIA

 

October 4, 2017

 

Rio de Janeiro Refrescos Ltda.

Rua André Rocha N° 2299, Jacarepaguá

Rio de Janeiro, Rio de Janeiro

Brasil

 

RE:                   APPROVED CONTAINERS

 

Gentlemen:

 

Reference is made to the Bottler’s Agreement effective October 4, 2017, and entered into between THE COCA-COLA COMPANY (hereinafter the “Company”) and RIO DE JANIERO REFRESCOS LTDA. (hereinafter the “Bottler”), authorizing the Bottler to prepare and package the Beverage COCA-COLA, and any ancillary authorizations for other Company Beverages, for sale and distribution under the Trade Marks granted by the Company to the Bottler (hereinafter collectively referred to as the “Bottler’s Agreements”).

 

The Company authorizes the Bottler to prepare, package, distribute and sell the Beverages in the following containers, which for the purpose of said Bottler’s Agreements, shall be deemed Approved Containers:

 

	
COCA-COLA LIGHT
    	
 
    	
1.5 L GRF PET NRET
    
	
 
    	
 
    	
350 ML LAT ALU NRET CAN
    
	
 
    	
 
    	
600 ML GRF PET NRET
    
	
COCA-COLA ZERO
    	
 
    	
1 L GRF PET NRET
    
	
 
    	
 
    	
1.5 L GRF PET NRET
    
	
 
    	
 
    	
1.5 L GRF RPET RET SFS
    
	
 
    	
 
    	
1.51 L GRF PET NRET
    
	
 
    	
 
    	
1.75 L GRF PETNRET
    
	
 
    	
 
    	
2 L GRF PET NRET
    

 

 

	
 
    	
 
    	
2 L GRF RPET RET 2LREFPET
    
	
 
    	
 
    	
2.25 L GRF PET NRET MAXI
    
	
 
    	
 
    	
2.5 L GRF PET NRET
    
	
 
    	
 
    	
200 ML GRF PET NRET
    
	
 
    	
 
    	
220ML CAN SLEEK
    
	
 
    	
 
    	
250 ML GRF ALU NRET
    
	
 
    	
 
    	
250 ML GRF PET NRET
    
	
 
    	
 
    	
250 ML GRF VDR NRET
    
	
 
    	
 
    	
250 ML MINI CAN ALU NRET
    
	
 
    	
 
    	
290 ML GRF VDR RET KS Ultra
    
	
 
    	
 
    	
290 ML GRF VDR RET KS10
    
	
 
    	
 
    	
310ML CAN SLEEK
    
	
 
    	
 
    	
350 ML LAT ALU NRET CAN
    
	
 
    	
 
    	
500 ML GRF PET NRET
    
	
 
    	
 
    	
600 ML GRF PET NRET
    
	
 
    	
 
    	
FOUNTAIN
    
	
COCA-COLA STEVIA
    	
 
    	
1 L GRF PET NRET
    
	
 
    	
 
    	
1.5 L GRF PET NRET
    
	
 
    	
 
    	
1.75 L GRF PET NRET
    
	
 
    	
 
    	
250 ML GRF ALU NRET
    
	
 
    	
 
    	
250 ML MINI CAN ALU NRET
    
	
 
    	
 
    	
350MLLAT ALUNRETCAN
    
	
COCA-COLA
    	
 
    	
1 L GRF PET NRET
    
	
 
    	
 
    	
1 L GRF VDR NRET
    
	
 
    	
 
    	
1 L GRF VDR RET LS
    
	
 
    	
 
    	
1.25 L GRF VDR RET SLS
    
	
 
    	
 
    	
1.5 L GRF PET NRET
    
	
 
    	
 
    	
1.5 L GRF RPET RET SFS
    
	
 
    	
 
    	
1.51 L GRF PET NRET
    
	
 
    	
 
    	
1.75 L GRF PETNRET
    
	
 
    	
 
    	
2 L GRF PET NRET
    
	
 
    	
 
    	
2 L GRF RPET RET 2LREFPET
    
	
 
    	
 
    	
2.25 L GRF PET NRET MAXI
    
	
 
    	
 
    	
2.5 L GRF PET NRET
    
	
 
    	
 
    	
200 ML GRF PET NRET
    
	
 
    	
 
    	
200 ML GRF VDR RET
    
	
 
    	
 
    	
220ML CAN SLEEK
    
	
 
    	
 
    	
237 ML GRF VDR NRET
    
	
 
    	
 
    	
250 ML GRF ALU NRET
    
	
 
    	
 
    	
250 ML GRF PET NRET
    
	
 
    	
 
    	
250 ML GRF VDR NRET
    
	
 
    	
 
    	
250 ML MINI CAN ALU NRET
    
	
 
    	
 
    	
270ML CAN SLEEK
    
	
 
    	
 
    	
290 ML GRF VDR RET KS Ultra
    

 

 

	
 
    	
 
    	
290 ML GRF VDR RET KS10
    
	
 
    	
 
    	
3 L GRF PET NRET
    
	
 
    	
 
    	
300 ML GRF PET NRET
    
	
 
    	
 
    	
310ML CAN SLEEK
    
	
 
    	
 
    	
350MLLAT ALUNRETCAN
    
	
 
    	
 
    	
355 ML GRF PET NRET
    
	
 
    	
 
    	
400 ML GRF PET NRET
    
	
 
    	
 
    	
500 ML GRF PET NRET
    
	
 
    	
 
    	
600 ML GRF PET NRET
    
	
 
    	
 
    	
FOUNTAIN
    
	
COCA-COLA CHERRY
    	
 
    	
310ML CAN SLEEK
    
	
COCA-COLA LARANJA
    	
 
    	
310ML CAN SLEEK
    
	
COCA-COLA LIMAO
    	
 
    	
310ML CAN SLEEK
    
	
COCA-COLA VANILLA
    	
 
    	
310ML CAN SLEEK
    
	
DEL VALLE (All flavors)
    	
 
    	
1 L GRF PET NRET
    
	
 
    	
 
    	
1 L TPK PAP NRET
    
	
 
    	
 
    	
1.5 L GRF PET NRET
    
	
 
    	
 
    	
1.5 L TPK PAP NRET
    
	
 
    	
 
    	
200 ML TPK PAP NRET
    
	
 
    	
 
    	
250 ML GRF PET NRET
    
	
 
    	
 
    	
250 ML TPK PAP NRET
    
	
 
    	
 
    	
290ML CAN SLEEK
    
	
 
    	
 
    	
300 ML GRF PET NRET
    
	
 
    	
 
    	
335 ML CAN ALU NRET
    
	
 
    	
 
    	
450 ML GRF PLAST NRET
    
	
 
    	
 
    	
600 ML GRF PET NRET
    
	
 
    	
 
    	
FOUNTAIN
    
	
 
    	
 
    	
200 ML GRF PET NRET
    
	
DEL VALLE KAPO MORANGO
    	
 
    	
200 ML TPK PAP NRET
    
	
DEL VALLE KAPO ABACAXI
    	
 
    	
200 ML TPK PAP NRET
    
	
DEL VALLE KAPO UVA
    	
 
    	
200 ML TPK PAP NRET
    
	
DEL VALLE KAPO LARANJA
    	
 
    	
200 ML TPK PAP NRET
    
	
DEL VALLE KAPO MARACUJÁ
    	
 
    	
200 ML TPK PAP NRET
    
	
FANTA GUARANA
    	
 
    	
1.5 L GRF PET NRET
    
	
 
    	
 
    	
1.51 L GRF PET NRET
    
	
 
    	
 
    	
2 L GRF PET NRET
    
	
 
    	
 
    	
2.5 L GRF PET NRET
    
	
 
    	
 
    	
220ML CAN SLEEK
    
	
 
    	
 
    	
250 ML GRF PET NRET
    
	
 
    	
 
    	
250 ML MINI CAN ALU NRET
    
	
 
    	
 
    	
3 L GRF PET NRET
    
	
 
    	
 
    	
310ML CAN SLEEK
    
	
 
    	
 
    	
350MLLAT ALUNRETCAN
    
	
 
    	
 
    	
500 ML GRF PET NRET
    
	
 
    	
 
    	
600 ML GRF PET NRET
    
	
 
    	
 
    	
FOUNTAIN
    

 

 

	
FANTALARANJA
    	
 
    	
1 L GRF PET NRET

1 L GRF VDR RET LS
    
	
 
    	
 
    	
1.5 L GRF PET NRET
    
	
 
    	
 
    	
1.5 L GRF RPET RET SFS
    
	
 
    	
 
    	
1.51 L GRF PET NRET
    
	
 
    	
 
    	
1.75 L GRF PET NRET
    
	
 
    	
 
    	
2 L GRF PET NRET
    
	
 
    	
 
    	
2 L GRF RPET RET 2LREFPET
    
	
 
    	
 
    	
2.25 L GRF PET NRET MAXI
    
	
 
    	
 
    	
2.5 L GRF PET NRET
    
	
 
    	
 
    	
200 ML GRF PET NRET
    
	
 
    	
 
    	
200 ML GRF VDR RET
    
	
 
    	
 
    	
220ML CAN SLEEK
    
	
 
    	
 
    	
250 ML GRF PET NRET
    
	
 
    	
 
    	
250 ML MINI CAN ALU NRET
    
	
 
    	
 
    	
290 ML GRF VDR RET KS Ultra
    
	
 
    	
 
    	
290 ML GRF VDR RET KS lO
    
	
 
    	
 
    	
3 L GRF PET NRET
    
	
 
    	
 
    	
300 ML GRF PET NRET
    
	
 
    	
 
    	
310 ML GRF VDR RET
    
	
 
    	
 
    	
310ML CAN SLEEK
    
	
 
    	
 
    	
350MLLAT ALUNRETCAN
    
	
 
    	
 
    	
500 ML GRF PET NRET
    
	
 
    	
 
    	
500 ML GRF PET SPLASH NRET
    
	
 
    	
 
    	
600 ML GRF PET NRET
    
	
 
    	
 
    	
FOUNTAIN
    
	
FANTA UVA
    	
 
    	
1 L GRF VDR RET LS
    
	
 
    	
 
    	
1.5 L GRF PET NRET
    
	
 
    	
 
    	
1.51 L GRF PET NRET
    
	
 
    	
 
    	
1.75 L GRF PETNRET
    
	
 
    	
 
    	
2 L GRF PET NRET
    
	
 
    	
 
    	
220ML CAN SLEEK
    
	
 
    	
 
    	
250 ML GRF PET NRET
    
	
 
    	
 
    	
250 ML MINI CAN ALU NRET
    
	
 
    	
 
    	
290 ML GRF VDR RET KS Ultra
    
	
 
    	
 
    	
290 ML GRF VDR RET KS10
    
	
 
    	
 
    	
310 ML GRF VDR RET
    
	
 
    	
 
    	
310ML CAN SLEEK
    
	
 
    	
 
    	
350MLLAT ALUNRETCAN
    
	
 
    	
 
    	
500 ML GRF PET NRET
    
	
 
    	
 
    	
500 ML GRF PET SPLASH NRET
    
	
 
    	
 
    	
600 ML GRF PET NRET
    
	
 
    	
 
    	
FOUNTAIN
    
	
FANTA ZERO (LARANJA, UVA E
    	
 
    	
2 L GRF PET NRET
    
	
GUARANÁ)
    	
 
    	
350MLLAT ALUNRETCAN
    
	
 
    	
 
    	
FOUNTAIN
    

 

 

	
KUAT/KUAT ZERO
    	
 
    	
1 L GRF PET NRET

1 L GRF VDR RET LS
    
	
 
    	
 
    	
1.5 L GRF PET NRET
    
	
 
    	
 
    	
1.51 L GRF PET NRET
    
	
 
    	
 
    	
1.75 L GRF PET NRET
    
	
 
    	
 
    	
2 L GRF PET NRET
    
	
 
    	
 
    	
2.25 L GRF PET NRET MAXI
    
	
 
    	
 
    	
2.5 L GRF PET NRET
    
	
 
    	
 
    	
200 ML GRF VDR RET
    
	
 
    	
 
    	
220ML CAN SLEEK
    
	
 
    	
 
    	
250 ML GRF PET NRET
    
	
 
    	
 
    	
250 ML MINI CAN ALU NRET
    
	
 
    	
 
    	
290 ML GRF VDR RET KS10
    
	
 
    	
 
    	
3 L GRF PET NRET
    
	
 
    	
 
    	
300 ML GRF VDR RET KS11
    
	
 
    	
 
    	
310ML CAN SLEEK
    
	
 
    	
 
    	
350MLLAT ALUNRETCAN
    
	
 
    	
 
    	
500 ML GRF PET NRET
    
	
 
    	
 
    	
600 ML GRF PET NRET
    
	
 
    	
 
    	
FOUNTAIN
    
	
LEÃO FUZE Guara Nat.
    	
 
    	
300 ML COPO PLASTICO NRET
    
	
LEÃO FUZE Tea
    	
 
    	
1 L GRF PET NRET
    
	
 
    	
 
    	
1 L TPK PAPNRET
    
	
 
    	
 
    	
1.5 L GRF PET NRET
    
	
 
    	
 
    	
1.5 L GRF PLAST NRET
    
	
 
    	
 
    	
300 ML COPO PLASTICO NRET
    
	
 
    	
 
    	
300 ML GRF PET NRET
    
	
 
    	
 
    	
300 ML GRF PLAST NRET
    
	
 
    	
 
    	
335 ML CAN ALU NRET
    
	
POWERADEI9
    	
 
    	
500 ML GRF PLAST NRET
    
	
POWERADEPRO OWERADEZERO
    	
 
    	
500 ML GRF PET NRET
    
	
 
    	
 
    	
500 ML GRF PLAST NRET
    
	
SPRITE/SPRITE ZERO
    	
 
    	
1 L GRF PET NRET
    
	
 
    	
 
    	
1.5 L GRF PET NRET
    
	
 
    	
 
    	
1.51 L GRF PET NRET
    
	
 
    	
 
    	
1.75 L GRF PET NRET
    
	
 
    	
 
    	
2 L GRF PET NRET
    
	
 
    	
 
    	
2.25 L GRF PET NRET MAXI
    
	
 
    	
 
    	
220ML CAN SLEEK
    
	
 
    	
 
    	
250 ML GRF PET NRET
    
	
 
    	
 
    	
250 ML MINI CAN ALU NRET
    
	
 
    	
 
    	
290 ML GRF VDR RET KS10
    
	
 
    	
 
    	
300 ML GRF VDR RET KS11
    
	
 
    	
 
    	
310ML CAN SLEEK
    
	
 
    	
 
    	
350MLLAT ALUNRETCAN
    
	
 
    	
 
    	
500 ML GRF PET NRET
    
	
 
    	
 
    	
600 ML GRF PET NRET
    
	
 
    	
 
    	
7.SL POST MIX
    

 

 

	
 
    	
 
    	
FOUNTAIN
    
	
ADES MORANGO
    	
 
    	
1000 Ml Tetrapak
    
	
ADESUVA
    	
 
    	
1000 Ml Tetrapak
    
	
ADES LARANJA
    	
 
    	
1000 Ml Tetrapak
    
	
ADESMACA
    	
 
    	
1000 Ml Tetrapak
    
	
ADES PESSEGO
    	
 
    	
1000 MI Tetrapak
    
	
ADES ABACAXI
    	
 
    	
1000 MI Tetrapak
    
	
ADESMACA
    	
 
    	
1000 Ml Tetrapak
    
	
ADES MORANGO
    	
 
    	
200 MI Tetrapak
    
	
ADESUVA
    	
 
    	
200 Ml Tetrapak
    
	
ADES LARANJA
    	
 
    	
200 MI Tetrapak
    
	
ADESMACA
    	
 
    	
200 Ml Tetrapak
    
	
ADES PESSEGO
    	
 
    	
200 Ml Tetrapak
    
	
ADES ABACAXI
    	
 
    	
200 Ml Tetrapak
    
	
ADESCHOCOLATE
    	
 
    	
200 Ml Tetrapak
    
	
ADES SABOR ORIGINAL
    	
 
    	
1000 Ml Tetrapak
    
	
ADES ORIGINAL
    	
 
    	
1000 Ml Tetrapak
    
	
ADES ZERO ORIGINAL
    	
 
    	
1000 Ml Tetrapak
    
	
ADES SABOR SHAKE MORANGO
    	
 
    	
1000 Ml Tetrapak
    
	
ADES SABOR FRAPE DE COCO
    	
 
    	
1000 Ml Tetrapak
    
	
ADES SABOR VITAMINA BANANA
    	
 
    	
1000 Ml Tetrapak
    

 

In accordance with the Crystal Distribution Authorization, the containers that the Bottler is authorized to purchase for distribution within its Territory are as follows:

 

	
CRYSTAL
    	
 
    	
1 L GRF PLAST NRET
    
	
 
    	
 
    	
1.5 L GRF PLAST NRET
    
	
 
    	
 
    	
1OL GRF PLAST
    
	
 
    	
 
    	
2 L GRF PET NRET
    
	
 
    	
 
    	
200 ML COPO PLAST NRET
    
	
 
    	
 
    	
300 ML COPO PLASTICO NRET
    
	
 
    	
 
    	
300 ML GRF PET NRET
    
	
 
    	
 
    	
310 ML COPO PLAST
    
	
 
    	
 
    	
330 ML GRF PLAST AGUA
    
	
 
    	
 
    	
350 ML GRF PLAST NRET
    
	
 
    	
 
    	
5 L GRF PLAST NRET
    
	
 
    	
 
    	
500 ML GRF PLAST NRET
    

 

Please note that the permission referenced herein is subject to the following provisions as set forth by the Company:

 

 

1.                           The terms used herein shall have the same meaning assigned to them in the Bottler’s Agreements unless otherwise specifically stated.

 

2.                            The permission referenced herein specifically refers to the Approved Containers/Capacity, and that the authorization to prepare, package, distribute and sell the particular Beverages listed above is granted through the Bottler’s Agreements;

 

3.                            All of the stipulations, covenants, terms, conditions and provisions of the Bottler’s Agreements shall remain in full force and effect; and

 

4.                            The list of Authorized Containers/Capacity may be modified by the Company at any time and terminates automatically upon the expiration or earlier termination of the Bottler’s Agreements.

 

This authorization supersedes any prior authorizations entered into between the Company and the Bottler in connection with the subject matter of this authorization.

 

	
THE COCA-COLA COMPANY
    
	
 
    
	
By:
    	
 
    	
 
    
	
Authorized   representative
    

 

 

 

COCA-COLA PLAZA

ATLANTA, GEORGIA

 

October 4, 2017

 

Rio de Janeiro Refrescos Ltda.

Rua André Rocha N° 2299, Jacarepaguá

Rio de Janeiro, Rio de Janeiro

Brasil

 

AUTHORIZATION FOR DISTRIBUTION OF THIRD PARTY PRODUCTS

 

Gentlemen:

 

Reference is made to the Bottler’s Agreement effective October 4, 2017, by and between THE COCA-COLA COMPANY (hereinafter the “Company”) and RIO DE JANIERO REFRESCOS LTDA. (hereinafter the “Bottler”), authorizing the Bottler to prepare and package the Beverage COCA-COLA and any ancillary authorizations for other Company Beverages for sale and distribution under the Trade Marks granted by the Company to the Bottler (hereinafter the “Bottler’s Agreements”). The terms used herein shall have the same meaning assigned to them in the Bottler’s Agreements unless otherwise specifically stated.

 

Pursuant to clause 15(d) of the Bottler Agreement mentioned above, you agreed not to use delivery vehicles, cases, cardboard boxes, refrigerators, vending machines and other equipment that present the trademarks for the distribution and sale of Products not identified by the trademarks, without the prior written consent of the Company.

 

This document authorizes you to use delivery vehicles, cases, cardboard boxes, refrigerators, vending machines and other equipment identified by the trademarks for the distribution and sale of the following products:

 

	
PRODUCT
    	
 
    	
CONTAINER
    
	
CERVEJASOL
    	
 
    	
GLASS RET - 600 ML
    
	
CERVEJASOL
    	
 
    	
CAN-355ML
    
	
CERVEJASOL
    	
 
    	
LONG NECK - 355ML
    
	
CERVEJASOL
    	
 
    	
GLASS DESC- 250ML
    
	
CERVEJASOL
    	
 
    	
BARRIL- SOL
    
	
CERVEJASOL
    	
 
    	
BARRIL -20L
    
	
CERVEJA BAVARIA PILSEN
    	
 
    	
GLASS RET - 600 ML
    

 

 

	
CERVEJA BAVARIA PILSEN
    	
 
    	
Can-355ML
    
	
CERVEJA BAVARIA PILSEN
    	
 
    	
LONG NECK -3SSML
    
	
CERVEJA BAVARIA PILSEN
    	
 
    	
BARRIL- SOL
    
	
CERVEJA BAVARIA PREMIUM
    	
 
    	
GLASS - 600 ML
    
	
CERVEJA BAVARIA PREMIUM
    	
 
    	
CAN -3SSML
    
	
CERVEJA BAVARIA PREMIUM
    	
 
    	
LONG NECK- 3SSML
    
	
CERVEJA KAISER PILSEN
    	
 
    	
GLASS RET - 600 ML
    
	
CERVEJA KAISER PILSEN
    	
 
    	
CAN— 3SSML
    
	
CERVEJA KAISER PILSEN
    	
 
    	
LONG NECK- 3SSML
    
	
CERVEJA KAISER PILSEN
    	
 
    	
BARRIL- SOL
    
	
CERVEJA KAISER SUMMER DRAFT
    	
 
    	
GLASS RET - 600 ML
    
	
CERVEJA KAISER SUMMER DRAFT
    	
 
    	
CAN- 3SSML
    
	
CERVEJA KAISER SUMMER DRAFT
    	
 
    	
LONG NECK - 3SSML
    
	
CERVEJA KAISER BOCK
    	
 
    	
GLASS RET - 600 ML
    
	
CERVEJA KAISER BOCK
    	
 
    	
CAN-3SSML
    
	
CERVEJA KAISER BOCK
    	
 
    	
LONG NECK - 3SSML
    
	
CERVEJA KAISER GOLD
    	
 
    	
GLASS RET - 600 ML
    
	
CERVEJA KAISER GOLD
    	
 
    	
CAN-3SSML
    
	
CERVEJA KAISER GOLD
    	
 
    	
LONG NECK - 3SSML
    
	
HEINEKEN
    	
 
    	
GLASS RET - 600 ML
    
	
HEINEKEN
    	
 
    	
CAN- 3SSML
    
	
CERVEJA HEINEKEN
    	
 
    	
LONG NECK - 3SSML
    
	
Chopp HEINEKEN
    	
 
    	
BARRIL- SOL
    
	
Chopp HEINEKEN
    	
 
    	
BARRIL- 30L
    
	
Chopp HEINEKEN
    	
 
    	
BARRIL- 20L
    
	
CERVEJA SOL PREMIUM
    	
 
    	
LONG NECK - 3SSML
    
	
CERVEJA DOS EQUIS
    	
 
    	
LONG NECK - 3SSML
    
	
Chopp HEINEKEN
    	
 
    	
BARRIL-SL
    
	
CERVEJA HEINEKEN
    	
 
    	
GLASS DESC- l,SL
    
	
CERVEJA HEINEKEN
    	
 
    	
GLASS DESC - 3L
    
	
CERVEJA HEINEKEN
    	
 
    	
CAN2SOML
    
	
CERVEJA HEINEKEN
    	
 
    	
SHOT VNR 2SO ML
    
	
CERVEJA HEINEKEN
    	
 
    	
VNR2SOML
    
	
CERVEJA HEINEKEN
    	
 
    	
VNR600ML
    
	
CERVEJA AMSTEL
    	
 
    	
CAN269ML
    
	
CERVEJA AMSTEL
    	
 
    	
CAN3SOML
    
	
CERVEJA AMSTEL
    	
 
    	
LATÁ0473ML
    
	
Chopp AMSTEL
    	
 
    	
BARRIL-SOL
    
	
CERVEJA DESPERADOS
    	
 
    	
LONG NECK-330ML
    
	
CERVEJA DESPERADOS
    	
 
    	
CAN2SOML
    
	
CERVEJA EDELWEISS
    	
 
    	
VNRSOOML
    
	
CERVEJA BIRRA MORETI
    	
 
    	
LONGNECK
    

 

This authorization is limited to the products mentioned above and should not be construed as a consent or waiver of any of the rights of The Coca-Cola Company to take further action under Clause 15(d) or any other provision of the Bottler Agreements. The Company may cancel this consent in whole or in part, upon notice, in writing, with 180 (one hundred and eighty) days in advance. Renewal of the Bottler Agreement implies the automatic renewal of this authorization.

 

With the exception of any modification or amendment contemplated, the stipulations, terms, conditions

 

 

and provisions of the Bottler Agreements shall apply and remain in force for this additional authorization.

 

This document replaces each and every one of the authorizations previously signed between the Company and the Bottler with respect to the object of this instrument.

 

We request you to indicate your consent to these provisions by signing and returning a copy of this document.

 

	
THE COCA-COLA COMPANY
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
Authorized Representative
    	
 
    
			

 

 

PRODUCTION AGREEMENT

 

THIS PRODUCTION AGREEMENT, made and entered into with effect October 4, 2017, by and between THE COCA-COLA COMPANY, a corporation organized and existing under the laws of the state of Delaware, United States of America, with principal offices at One Coca-Cola Plaza, N.W., Atlanta, Georgia 30313, United States of America (hereinafter the “Company”), LEÃO ALIMENTOS E BEBIDAS LTDA. A limited liability company, with offices in São Paulo, State of São Paulo, at Rua Paes Leme, 524, 10° andar, Pinheiros, CEP 05424-010, registered in the CNPJ under No 76.490.184/0001-87, represented herein according to its bylaws (hereinafter the “Producer”, and on the other RIO DE JANEIRO REFRESCOS LTDA. A company established and existing according to the laws of Brazil, with principal offices at Rua André Rocha 2299, Jacarepaguá, Rio de Janeiro, Brazil (hereinafter the “Bottler”). Jointly the Producer and the Bottler referred to as Parties or individually and indistinctively as Party and still as interveners of THE COCA-COLA COMPANY, a company incorporated and existing in accordance with the laws of the state of Delaware, United States of America, with main offices at One Coca-Cola Plaza. N.W., in the city of Atlanta, State of Georgia 30313, United States of America (hereinafter the “Company”), COCA-COLA INDÚSTRIAS LTDA., a limited liability company, with headquarters in the city of Rio de Janeiro, state of Rio de Janeiro, at Praia de Botafogo, n ° 374 , 12 ° Andar, part, registered in the CNPJ/MF under No. 45.997.418/0001-53 herein represented according to the terms of its by-laws, (hereinafter “CCIL”), and RECOFARMA INDÚSTRIA DO AMAZONAS LTDA., a limited liability company with a subsidiary in the city and state of Rio de Janeiro, at Praia de Botafogo, 374, Botafogo, registered in the CNPJ/MF under No. 61.454.393/0006-02, represented herein according to the terms of by-laws, (hereinafter “RECOFARMA”).

 

WHEREAS,

 

A.                                   The Company is engaged in the manufacture and the sale of beverage bases, essences, and other ingredients (hereinafter referred to as the “Beverage Bases”), the formulas for which are an industrial secret of the Company, used in the preparation of non-alcoholic beverages identified by several trademarks, including those listed on Exhibit A (hereinafter referred to as the “Beverages”) for sale in bottles and other containers and in other forms or manners;

 

B.                                   The Company and CCIL themselves or through subsidiary or controlled entities, are the owners or have been duly authorized to license said trademarks listed on Exhibit A that distinguish the Beverage Bases, and the intellectual property embodied in the distinctive trade dress, other design devices and packaging elements associated with the Beverage Bases and the Beverages and any additional trademarks that the Company or CCIL may adopt from time to time to distinguish the Beverage Bases and the Beverages (hereinafter referred to as the “Trade Marks”);

 

C.                                 The Company, as the owner or with the authorization of the owners has the exclusive right to prepare, package, distribute and sell the Beverage and the right to manufacture and sell the Beverage Bases in Brazil, among other countries;

 

 

D.                                 The Company and the Bottler on this date have entered into the Bottler Agreement whereby the Bottler has been authorized to prepare and package the Beverages and sell and distribute them throughout a specific Territory defined in the Bottler Agreement (hereinafter the “Territory”) (hereinafter referred to as the “Riders Agreements”).

 

E.                                  Through the RIDERS AGREEMENTS, the Bottler has been expressly authorized by the Company to grant the PRODUCER (i) the rights of production and packaging of the Beverages, and (ii) the rights of use of the Trademarks for the production and packaging of the Beverages and other rights granted under the Riders Agreements, relating to the Beverages, all in accordance with the objectives of the Subscription of Shares Agreement, Association and Other Agreements (“Leão Jr. Subscription Agreement”) intended to regulate the management system of integrated activities related to non-carbonated Beverages of The Coca-Cola System in Brazil.

 

NOW, THEREFORE, the parties agree to mutually regulate the production and other agreements regarding the Beverages, in accordance with the following clauses:

 

I.                                            OBJECT OF THE AGREEMENT

 

1.                           The Bottler with the consent of the Company, hereby completely transfers to the Producer (i) the rights and obligations relating to the production and packaging of the Beverages, and (ii) the rights of use of trademarks for the production and packaging of the Beverages and other rights related to such activities, granted in the terms of the Riders Agreements, for the Beverages, and therefore the Producer is authorized and is committed to the following terms and conditions, to prepare and package the Beverages in containers approved by the Interveners informed in writing periodically, as stipulated in the Bottler Agreements, in relation to the Beverages (hereinafter referred to as the “Approved Containers”), mainly for the purpose of selling such Beverages to the Bottler.

 

2.                           RECOFARMA will sell and deliver to the Producer the quantities of Beverage Bases periodically requested by the Producer, understanding that the Producer shall request and RECOFARMA shall sell and deliver to the Producer only the quantities of Beverage Bases necessary and sufficient to implement this agreement. In this sense, the Producer covenants and agrees to purchase the Beverage Bases only from RECOFARMA.

 

3.                           The Producer shall use the Beverage Bases only for the preparation and packaging of the Beverages as provided periodically by the Interveners. The Producer shall be responsible for not selling or reselling the Beverage Bases or allowing them to fall into the hands of third parties without the prior written consent of the Interveners.

 

4.                           The Interveners shall retain the exclusive and private right to amend the formula, composition or ingredients of the Beverage and Beverage Bases at any time.

 

 

II.                                   OBLIGATIONS OF THE PRODUCER RELATIVE TO THE MARKETING, PLANNING AND REPORTING

 

5.                           The Producer agrees with the Bottler and the Interveners according to the provisions of this instrument, to comply with all the obligations established in the Leão Jr. Subscription Agreement and its additions, in relation to the annual marketing and investment plans, as agreed in this instrument also committing:

 

(a)                     to make every effort and employ all practicable and approved means to promote, develop and exploit the full potential of the business of preparing, packaging, distributing, marketing and selling the Beverage throughout the Territory by creating, stimulating and expanding continuously the future demand for the Beverage and by satisfying fully and in all respects the current demand therefor;

 

(b)                     to prepare, package and sell to the Bottler such quantities of the Beverage as shall in all respects satisfy fully every demand for the Beverage within the Territory;

 

(c)                      to invest all the capital and to obtain and expend all the funds required for the organization, installation, operation, maintenance and replacement of such manufacturing, warehousing, delivery, transportation and others as shall be necessary to implement this Agreement;

 

(d)                     to provide competent and well-trained management and recruit, train, maintain and direct all personnel required, sufficient in every respect to perform all of the obligations of the Producer under this Agreement;

 

6.                           The Parties agree that the Producer shall be responsible for the management of the disbursements necessary for the implementation of the Annual Marketing and Investment plans provided for in the Leão Jr. Subscription Agreement, related to the Beverages. To stimulate and sustain the demand for Beverages, the Producer, on his own account, shall expend the funds for advertising, marketing and promotion of the Beverages as defined in the aforementioned Annual Plans, understanding that the Producer shall only use, publish, maintain or distribute advertising, marketing or promotional material related to the Trademarks of the Beverages and beverages approved and authorized in such plans. The Bottler and the Interveners, directly or indirectly, may, from time to time, agree to contribute financially to the Producer’s marketing programs, observing the terms and conditions stipulated in the Annual Plans. The Bottler and the Interveners, directly or indirectly, may also undertake, at their own expense and independently of the Producer, any additional advertising or sales promotion activity.

 

 

III.                           OBLIGATIONS OF THE PRODUCER RELATIVE TO THE TRADE MARKS

 

7.                           The Producer will at all times recognize the validity and ownership of the Trade Marks by the Company and will not at any time put in issue the validity and ownership of the Trade Marks.

 

8.                           Nothing herein shall give the Producer any interest in the Trade Marks or the goodwill attaching thereto or in any label, design, container or other visual representations thereof, or used in connection therewith; and the Producer acknowledges and agrees that all rights and interests created by that use of Trademarks, labels, designs, packaging or other visual representations will be in the interest of and shall be owned by the Company.

 

The Company and the Producer agree and understand that under this Agreement, the Producer is granted a simple temporary authorization, not related to any right or participation, and without the payment of any remuneration or royalty fee, to use such Trademarks, labels, designs, packaging and other visual representations thereof, with regard to the preparation and packaging of Beverage in Approved Containers without the payment of any fee; said use to be in such manner and with the result that all goodwill relating to the same shall accrue to the Company as the source and origin of such Beverage, and the Company shall be absolutely entitled to determine in every instance the manner of presentation and such other steps necessary or desirable to secure compliance with this Clause.

 

IV.                           OBLIGATIONS OF BOTTLER RELATIVE TO THE PREPARATION AND PACKAGING OF THE BEVERAGE

 

9.                           The Producer shall have priority in the production and packaging of the Beverages, activities which, during the period of validity of this Agreement, may only be developed by the Bottler, by other Bottlers of The “Coca-Cola system” and/or by third parties, provided that the specific rules contained in the Leão Jr. Subscription Agreement are fulfilled.

 

10.                    The Producer covenants and agrees to use only the Beverage Bases to prepare and package the Beverages, strictly observing and complying with the written instructions given to the Producer, periodically by the Interveners. The Producer further covenants and agrees that, in preparing, packaging, storage and handling the Beverage, the Producer shall at all times conform to the standards, including quality, hygienic, environmental and otherwise, established in writing from time to time by the Company and comply with all applicable legal requirements.

 

 

10.1.          The Producer, recognizing the importance of identifying the source of manufacture of the Beverage in the market, agrees to use identification codes on all packaging materials for the Beverage, including Approved Containers. The Producer further agrees to install, maintain and use the necessary machinery and equipment required for the application of such identification codes. The Interveners shall provide the Producer, from time to time, with necessary instructions in writing regarding the forms of the identification codes to be used by the Producer in that connection, and the production and sales records to be maintained by the Producer regarding the Beverage and Approved Containers.

 

10.2             The producer shall allow the Bottler and the Interveners, their directors, agents or representatives, to enter and inspect, at any time, the facilities, equipment and methods used by the Producer, either directly or possibly in the preparation, packaging, storage and handling of the Beverages to ensure that the Producer complies with the terms of this Agreement. The Producer also agrees to provide the Bottler and the Interveners with all the information regarding the Producer’s compliance with the terms of this Agreement.

 

10.3             The Producer shall submit to the Interveners, at the expense of the Producer, the samples of the Beverages and materials used in the preparation of the Beverages, in accordance with the instructions that the Interveners may provide in writing from time to time.

 

11.                    In the packaging and sale of the Beverage, the Producer shall use only such Approved Containers and closures, cases, cartons, labels and other packaging materials approved from time to time by the Interveners, and the Producer shall purchase such items only from manufacturers who have been authorized in writing by the Interveners to manufacture the items to be used in connection with the Trade Marks and the Beverage. The Interveners shall use their best efforts to approve two or more manufacturers of such items.

 

12.                    The Producer shall inspect Approved Containers and closures, cases, labels and other packaging materials to be used in connection with the Beverage and shall use only those items which the Producer has determined comply with both the standards established by applicable laws in Brazil and the standards and specifications prescribed by the. The Producer shall assume independent responsibility in connection with the use of such Approved Containers, closures, cases, cartons, labels and other packaging materials which the Producer has determined conform to such standards.

 

13.                    The Producer shall maintain at all times a sufficient stock of Approved Containers, closures, cases, cartons, labels and other packaging materials to satisfy fully the demand for the Beverage in the Territory of the Bottler.

 

 

14.                    The Producer recognizes that increases in the demand for the Beverage, as well as changes in the Approved Containers, may from time to time require modifications or other changes in respect of its existing manufacturing equipment and/or containers, or require the purchase of additional manufacturing, packaging, delivery or vending equipment, always in accordance to the annual marketing and investment plans established in the Leão Jr. Subscription Agreement. The Producer agrees to make such modifications to existing equipment and to purchase and install such additional equipment as necessary with sufficient lead time to enable the introduction of new Approved Containers and the preparation and packaging of the Beverage in accordance with the continuing obligations of the Producer to develop, stimulate and satisfy fully every demand for the Beverage in the Territory.

 

15.                    The Producer shall not use or permit the use of the Approved Containers, closures, cases, labels and other packaging materials referred to in this Agreement for any purpose, except in connection with the Beverage and shall not refill or otherwise reuse any non-refillable Approved Containers that have been previously used.

 

16.                    The Producer shall be solely responsible in carrying out its obligations herein for compliance with all applicable laws, statutes, regulations, by-laws and other legal requirements issued by government or local authorities and shall inform the Bottler forthwith of any provision thereof which would prevent or limit in any way strict compliance by the Producer with its obligations herein.

 

17.                    Without limiting the generality of the foregoing, the Producer covenants and agrees to comply at all times with (i) all anti-bribery, environmental, and health and safety laws, regulations and other legal requirements issued by government authorities and applicable in Brazil (ii) the Interveners’ environmental management standards and programs as issued from time to time in writing.

 

V.                                   DURATION AND TERMINATION OF AGREEMENT

 

18.                    This Agreement begins on this date and will remain in force as long as the following instruments are in force:

 

(a) Bottler Agreement celebrated with the Bottler, and

 

(b) One or more Rider Agreement(s) regarding one or more Beverages listed on Exhibit A.

 

18.1             (a) Upon termination of any specific Rider Agreement(s) in relation to all Bottlers, this Agreement may be terminated only with respect to the Beverage(s) object of the Rider Agreement(s), remaining in this case valid with respect to the other Beverages, provided that this is expressly foreseen at the time of termination.

 

 

18.2             The expiration of all Rider Agreement(s) related to the Beverages held with the Bottler will imply the automatic expiration of this Agreement. Also, the renewal of all Rider Agreement(s) with the Bottler will imply the automatic renewal of this Agreement for the same period of renewal of the Rider Agreement(s).

 

18.3             This Agreement shall terminate automatically if the association provided for in the Leão Jr. Subscription Agreement and in the other agreements governing the relationship between the Parties and/or those involved in such an association is terminated or withdrawn in connection with all of its Parties and Interveners, with the consequent termination or withdrawal of such instruments.

 

18.4             The termination or withdrawal of this Agreement, including the repeal of the transfer of the production rights provided for in this Agreement under Clause 2 of the Rider Agreements, shall imply the reintegration, to the Bottler, of the rights and obligations given to the Producers pursuant to this Agreement, except in the case of termination or withdrawal, specifically, of the Bottler Agreement for Coca-Cola signed between TCCC and the Bottler and the Rider Agreement(s).

 

18.5             The validity of this Agreement remains conditional on the other conditions established in the Leão Jr. Subscription Agreement, accordingly.

 

VI. GENERAL PROVISIONS

 

19.                    The Parties and the Interveners acknowledge and agree that, during the validity of this Agreement, the Producer shall have priority in the production and packaging of Beverages, necessary to service the Territory of the Bottler, unless otherwise defined, pursuant to Clause 9 above, and in accordance with the Leão Jr. Subscription Agreement, accordingly. In this case, and under the conditions established in such instruments, the Producer may establish the Toll packing or Co-packing Agreement with the Bottler or with third parties

 

20.                    Neither of the Parties nor the Interveners shall be liable for failure to perform any of their respective obligations hereunder when such failure is caused by or results from:

 

(a)                    strike, blacklisting, boycott or sanctions imposed by a sovereign nation or supranational organization of sovereign nations, however incurred; or

 

(b)                    act of God, force majeure, public enemies, authority of law and/or legislative or administrative measures (including the withdrawal of any government authorization required by any of the parties to carry out the terms of this Agreement), embargo, quarantine, riot, insurrection, a declared or undeclared war, state of war or belligerency or hazard or danger incident thereto; or

 

(c)                     any other cause whatsoever beyond their respective control.

 

 

21.                    The Company reserves the sole and exclusive right to institute any civil, administrative or criminal proceedings or actions, and generally to take or seek any available legal remedy it deems desirable, for the protection of its reputation, Trade Marks, and other intellectual property rights, as well as for the protection of the Beverage Bases and Beverages, and to defend any action affecting these matters. At the request of the Company, the Producer will render assistance in any such action. The Producer shall not have any claim against the Company as a result of such proceedings or action or for any failure to institute or defend such proceedings or action. The Producer shall promptly notify the Company of any litigation or proceedings instituted or threatened affecting these matters. The Producer shall not institute any legal or administrative proceedings against any third party which may affect the interests of the Company without the prior written consent of the Company.

 

22.                    The Company has the sole and exclusive right and responsibility to initiate and defend all proceedings and actions relating to the Trade Marks. The Company may initiate or defend any such proceedings or actions in its own name or require the Producer to institute or defend such proceedings or actions either in its own name or in the joint names of the Producer and the Company.

 

23.                    The Producer agrees to consult with the Company on all product liability claims, proceedings or actions brought against the Producer in connection with the Beverage or Approved Containers and to take such action with respect to the defense of any such claim or lawsuit as the Company may reasonably request in order to protect the interests of the Company in the Beverage, the Approved Containers or the goodwill associated with the Trade Marks.

 

24.                    The Producer shall indemnify and hold harmless the Company, its affiliates and their respective officers, directors and employees from and against all costs, expenses, damages, claims, obligations and liabilities whatsoever arising from facts or circumstances not attributable to the Company including, but not limited to, all costs and expenses incurred in settling or compromising any of the same arising out of the preparation and packaging of the Beverage by the Producer, including, but not limited to, all costs arising out of the acts or defaults, whether negligent or not, of the Producer.

 

25.                    The Producer covenants and agrees:

 

(a)                     that it will make no representations or disclosures to public or government authorities or to any other third party, relating to the Beverage Bases or the Beverages without the prior written consent of the Bottler and Interveners;

 

(b)                     that it will at all times, both during the continuance and after termination of this Agreement, keep strictly confidential all secret and confidential information including, without limiting the generality of the foregoing, mixing instructions and techniques, sales, marketing and distribution information, projects and plans, relating to the subject matter of this Agreement,

 

 

which the Producer may receive from the Bottler or the Interveners, or in any other manner, and to ensure that such information shall be made known only to those officers, directors and employees bound by reasonable provisions incorporating the secrecy obligations set out in this Clause; and

 

(c)                      that upon the expiration or earlier termination of this Agreement, the Bottler will forthwith hand over to the Interveners all written or graphic, electromagnetic, computerized, digital or other materials comprising or containing any information subject to the obligation of confidentiality hereunder.

 

26.                  The Parties and the Interveners recognize that incidents may arise which can threaten the reputation and business of the Producer and/or negatively affect the good name, reputation and image of the Company and the Trade Marks. In order to address such incidents, including but not limited to any questions of quality of the Beverage that may occur, the Producer will designate and organize an incident management team and inform the Interveners of the members of such team. The Producer further agrees to cooperate fully with the Interveners and such third parties as the Interveners may designate and coordinate all efforts to address and resolve any such incident consistent with procedures for crisis management that may be issued to the Producer by the Interveners from time to time.

 

27.                  In the event of any provisions of this Agreement being or becoming legally ineffective or invalid, the validity or effect of the remaining provisions of this Agreement shall not be affected; provided that the invalidity or ineffectiveness of the said provisions shall not prevent or unduly hamper performance hereunder or prejudice the ownership or validity of the Trade Marks. The right to terminate in accordance with Clause 25(a)(2) is not affected hereby.

 

28.                  As to all matters and things herein mentioned, this Agreement, as may be amended or supplemented in writing from time to time, shall constitute the only agreement between the Producer, the Bottler and the Interveners. All prior agreements of any kind whatsoever between the parties relating to the subject matter are cancelled hereby, except to the extent that the same may comprise agreements and other documents within the provisions of this Agreement.

 

29.                  Any waiver or modification of, or alteration or addition to, this Agreement or any of its provisions, shall not be binding upon the Parties or the Interveners unless they are executed by duly authorized representatives of the Parties and the Interveners.

 

30.                  All written notices given pursuant to this Agreement shall be by fast delivery or courier, hand or registered (air) mail and shall be deemed to be given on the date such notice is dispatched, such hand delivery is affected, or such registered letter is mailed. Such written notices shall be addressed to the last known address of the Party concerned. Each Party shall promptly

 

 

advise the other Party of any change in its address.

 

Company:

THE COCA-COLA COMPANY

One Coca-Cola Plaza, N.W.

Atlanta, Georgia 30313

United States of America

 

Producer:

LEÃO ALIMENTOS E BEBIDAS LTDA.

Rua Paes Leme, 524, 10° andar,

Pinheiros São Paulo - SP

CEP 05424-010

At.: Diretor-Presidente

 

Bottler:

RIO DE JANEIRO REFRESCOS LTDA.

Rua André Rocha N° 2299, Jacarepaguá

Rio de Janeiro, Brasil

 

31.                  Failure of the Parties or the Interveners to exercise promptly any right herein granted, or to require strict performance of any obligation undertaken herein by the Party or the Interveners, shall not be deemed to be a waiver of such right or of the right to demand subsequent performance of any and all obligations herein undertaken by the Party or the Interveners.

 

32.                  The headings herein are solely for the convenience of the parties and shall not affect the interpretation of this Agreement.

 

33.                  This Agreement will be interpreted, construed and governed in accordance with the laws of Brazil, electing the Parties the central forum of the County of Rio de Janeiro/RJ to settle any disputes arising from this Agreement, expressly resigning to any other, however privileged it may be.

 

34.                  This Agreement consolidates, repeals and replaces all production agreement individually signed by the Producer, or in conjunction with its predecessors, with the Bottler, and this instrument is the only current document regulating the rights of production resulting from the Rider(s) Agreements signed with the Company in relation to the Beverages.

 

 

IN WITNESS WHEREOF, the Company at Atlanta, Georgia, United States of America, and the Producer, the Bottler CCIL and Recofarma in Brazil have caused these documents to be executed in triplicate by the duly authorized person or persons in their behalf on the dates indicated below.

 

	
LEÃO ALIMENTOS E BEBIDAS LTDA.
    	
 
    	
RIO DE JANEIRO REFRESCOS LTDA
    
	
 
    	
 
    	
 
    
	
Legal Representative
    	
 
    	
Legal Representative
    
	
 
    	
 
    	
 
    
	
INTERVENERS
    	
 
    	
Witnesses
    
	
 
    	
 
    	
 
    
	
The Coca-Cola Company
    	
 
    	
Name
    
	
 
    	
 
    	
Id. No.
    
	
Coca-Cola Industrias Ltda.
    	
 
    	
 
    
	
 
    	
 
    	
Name
    
	
Recofarma Indústria do Amazonas Ltda.
    	
 
    	
Id. No.
    

 

 

EXHIBIT A

 

DEL VALLE

KAPO

POWERADE

POWERADE ZERO

I9

LEÃOExhibit 4.33

OFFER LETTER NO. 1/2017

 

November 30, 2017

 

Monster Energy Company

c/o Katten Muchin Rosenma LLP.

575 Madison Avenue

New York, NY 10022 Att.: Rodney C. Sacks

 

Re: Offer Letter No. 1/2017 (this “Offer”) from Embotelladora del Atlántico S.A. d/b/a Coca-Cola Andina Argentina, a company organized and existing under the laws of Argentina (“Distributor”). Unless otherwise defined in this Offer, capitalized terms shall have the meaning ascribed to such terms in the Agreement (as defined below).

 

Dear Mr. Sacks:

 

Distributor hereby irrevocably makes this Offer to Monster Energy Company, a Delaware corporation (“MEC”), to enter into a Distribution Agreement in accordance with the terms and conditions attached hereto as Annex A “International Distribution Agreement” (the “Agreement”) signed by Distributor on each of its pages for the purpose of its identification.

 

The Agreement is the result of good faith negotiations held by the parties and supersedes all prior oral and written discussions and communications between MEC and Distributor with respect to the subject matter hereof and constitutes the parties’ sole and exclusive understanding with respect to the subject matter hereof and it replaces any prior agreements between them.

 

This Offer will be irrevocable, valid, and binding until December 15, 2017, and shall be deemed accepted by MEC in New York only upon MEC accepting all of the terms of this Offer in a writing dated prior to such date and thereafter promptly delivering its written acceptance of this Offer to Distributor. The Agreement shall be deemed to be entered into in New York on the acceptance date specified in MEC’s written acceptance of this Offer. MEC’s acceptance of this Offer by any other method is strictly prohibited.

 

Distributor acknowledges that MEC’s acceptance of this Offer shall be in MEC’s sole and absolute discretion Distributor further acknowledges that: (a) this Offer, its prospective acceptance by MEC, the Agreement, and the resulting contractual relationship between Distributor and MEC shall be subject to New York law in accordance with terms of Section 25 of the Agreement, and (b) any dispute, controversy or claim arising out of or relating to the Offer, its acceptance, the Agreement or breach or termination thereof shall be subject to the arbitration clause set forth in Section 26 of the Agreement.

 

In the event MEC accepts this Offer in accordance with its terms, such acceptance is deemed to have occurred at MEC’s office located at 575 Madison Avenue, New York, NY 10022.

 

	
Sincerely yours,
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
EMBOTELLADORA DEL   ATLÁNTICO S.A.
    	
 
    
	
d/b/a COCA-COLA ANDINA   ARGENTINA
    	
 
    
	
Fabián Castelli 
    	
 
    
	
General Manager
    	
 
    

 

1

 

ANNEX A

 

INTERNATIONAL DISTRIBUTION AGREEMENT

 

This INTERNATIONAL DISTRIBUTION AGREEMENT (“Agreement”) shall be deemed entered into on the acceptance date specified in MEC’s Acceptance (as defined below) (the “Effective Date”) between MONSTER ENERGY COMPANY, a Delaware corporation, with offices at 1 Monster Way, Corona, California 92879 (“MEC”) and EMBOTELLADORA DEL ATLÁNTICO S.A. d/b/a COCA-COLA ANDINA ARGENTINA (“Distributor”). MEC and  Distributor are referred to herein collectively as the “parties” and individually as a “party” hereto.

 

1.                                      Recitals and Definitions.

 

a.                                              Distributor offered to MEC to enter into this Agreement pursuant to that Offer Letter No. 1/2017 from Distributor dated November 30, 2017 (the “Offer”). In the event MEC accepts the Offer by delivering its written notice of acceptance to Distributor as contemplated in the Offer (“MEC’s Acceptance”), this Agreement shall be in full force and effect as of the Effective Date.

 

b.                                              Distributor is a leading distributor of beverages throughout the Territory (as defined below) and has substantial experience in the distribution of beverages. Distributor has developed and implemented successful marketing plans and/or systems for such distribution and which are substantially associated with the trademarks and trade name of The Coca-Cola Company (“KO”). KO has designated Distributor, and MEC wishes to appoint Distributor, as a distributor of Products (as defined below) as part of Distributor’s business operations and systems, with performance to commence as of such date as may be mutually agreed by the parties in writing, but which in no event shall be later than March 1, 2018 (the “Commencement Date”).

 

c.                                               When used herein: (i) the word “Products” means (x) all Energy Drinks (as defined below) in any form, that are offered, packaged and/or marketed by MEC or any of its Affiliates at any time after the Effective Date in the Territory under the primary brand name “Monster” or any other primary brand name having “Monster” as a derivative or part of such name, and/or containing the ” as a primary brand component, and which may, but are not required, to contain the ” mark, and/or the ” icon, and (y) such additional beverage products, whether marketed under the Trademarks (as defined below) or otherwise, as MEC and Distributor shall agree from time to time by executing a mutually agreed upon amended Exhibit A. MEC and Distributor shall use commercially reasonable efforts to periodically review and update Exhibit A on a reasonable basis throughout the Term. The Products shall include all sizes of SKUs as may be determined by MEC and offered, packaged and/or marketed by MEC or any of its Affiliates in good faith from time to time; (ii) the word “Territory” means the territory identified in Exhibit B hereto; (iii) the words “Distributor’s Accounts” mean all accounts or classes of accounts in the Territory (including those set forth as exclusive or non-exclusive Distributor’s Accounts on Exhibit C hereto), other than those reserved for MEC as identified on Exhibit C; (iv) the word “Trademarks” means those names and marks identified on Exhibit D hereto; (v) the words “Energy Drink/s” mean any shelf-stable, in ready-to-drink, powdered, drops or concentrate form, non-alcoholic beverage that satisfies all of the following conditions: (A) it is marketed or positioned to consumers as an energy beverage, (B) it

 

2

 

contains one or more of the following ingredients: guarana, taurine, panax ginseng, L-carnitine, B-2 vitamins, B-6 vitamins, B-12 vitamins, L-arginine, astralagus, glucuronolactone or inositol (or, to the extent approved by KO, which approval shall not be unreasonably withheld, conditioned or delayed, any ingredients substituting for or supplementing any of the foregoing ingredients) and (C) it has at least five (5) milligrams of caffeine per ounce (the “Caffeine Requirement”), except that (1) Products under the brand Monster Energy Unleaded (substantially as such Products are formulated, manufactured, marketed and/or sold as of the date hereof, and any line extensions or expansions of such Products marketed under such brand) shall not be required to meet the Caffeine Requirement; and (2) the Caffeine Requirement shall be reduced in respect of any particular territory to the extent that any final law applicable to MEC in such territory imposing restrictions on the on-going business activities of MEC is enacted by a Governmental Entity having jurisdiction over such territory that either (I) specifically establishes a maximum caffeine concentration that is lower than the Caffeine Requirement (in which case the Caffeine Requirement applicable to such territory shall be the maximum caffeine concentration permitted by such law) or (II) is reasonably expected, based on the good faith judgment of MEC, to have an adverse impact on MEC’s business, sales or profitability in such territory due to the caffeine concentration of the Products exceeding a specified level (including, for example, a material tax imposed on beverages with caffeine concentrations above a stated amount but excluding, for the avoidance of doubt, any age or similar restriction on the manner of sale of such beverages) (in which case the Caffeine Requirement applicable to such territory shall be the maximum caffeine concentration that would not have such adverse impact); it being agreed that affected Products in any affected territory may be reformulated by MEC to the extent necessary to comply with any such law or to avoid such adverse impact; (vi) the word “Affiliates” means as to any Person, any other Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with such Person, as such terms are used in and construed under Rule 405 under the Securities Act of 1933 of the United States of America; (vii) the word “Person” means an individual or firm, corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind; and (viii) the words “Governmental Entity” mean any (A) nation, state, county, city, town, village, district, or other jurisdiction of any nature, (B) federal, state, local, municipal, foreign, or other government, (C) governmental or quasi-governmental authority of any nature (including any governmental agency, branch, department, official, or entity and any court or other tribunal), or (D) body exercising, or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory, or taxing authority or power of any nature. All Exhibits referred to in this Agreement shall be deemed to be incorporated into this Agreement.

 

2.                                      Appointment.

 

a.                                              With effect from the Commencement Date, MEC appoints Distributor, and Distributor accepts appointment, as a distributor and seller of Products to Distributor’s Accounts within the Territory. Such appointment shall be exclusive with respect to each of Distributor’s Accounts, except if and to the extent specifically designated as non-exclusive on Exhibit C hereto. Such appointment shall exclude any SKU/s deleted from distribution pursuant to Sections 13(b) or 13(f) below. Those categories of customers which are excluded from the definition of Distributor’s Accounts are expressly reserved for MEC, or such other distributors as MEC may from time to time appoint. Distributor shall be entitled to appoint sub-distributors within the Territory provided that the terms of such appointment shall provide that the sub-distributors shall not actively seek or solicit

 

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customers for the Products outside the Territory or any customers located within the Territory other than Distributor’s Accounts, and the terms of such appointments shall not be inconsistent with the terms and conditions of this Agreement and shall be subject to MEC’s rights hereunder. Distributor’s appointment of sub-distributors shall be to supplement and augment, but not to replace or substitute, wholly or partially, Distributor’s resources, performance capabilities and/or ability to fully perform all of Distributor’s obligations in the Territory under this Agreement, including without limitation, as provided in Section 3 below. Distributor will remain liable for the actions, omissions and performance of all of Distributor’s sub-distributors.

 

b.                                              Distributor shall not directly or indirectly, alone or in conjunction with any other Person (i) actively seek or solicit customers or accounts for the Products outside the Territory or any customers or accounts located within the Territory other than Distributor’s Accounts (in particular, but without limiting the above, Distributor shall not actively approach customers outside the Territory or accounts other than Distributor’s Accounts in the Territory, whether by direct mail, visits, promotions or media advertising targeted at such customers, or otherwise), and/or (ii) actively sell, market, distribute or actively otherwise dispose of any Products to any Persons located outside the Territory or to any Persons located within the Territory who Distributor knows or reasonably believes will distribute or resell the Products outside the Territory, except that, subject to all of the terms and conditions of this Agreement, Distributor may sell, market, distribute, assign or otherwise transfer Products to other bottlers or distributors designated by KO that are authorized in writing by MEC for sale, marketing, distributing, assigning or otherwise transferring into such distributor’s or bottler’s territory. During the Term, Distributor shall purchase exclusively and directly from MEC or its nominees (and from no other Person) all of its requirements for Products. In the event Products distributed or sold by Distributor are found outside the Territory, upon MEC’s reasonable request therefor, Distributor shall use Best Efforts (as defined below) to make available to representatives of MEC such sales agreements and other records relating to applicable Products as may be reasonably required for, and otherwise reasonably cooperate with MEC in, all MEC investigations relating to the sale and distribution of the Products outside the Territory, in each case, subject to confidentiality and other obligations to third parties and solely to the extent permissible under applicable law. Distributor shall use Best Efforts to promptly inform MEC if at any time any solicitation or offer to purchase Products is made to Distributor in writing by a third party which Distributor knows would result in a breach of this Section 2(b), in each case, subject to confidentiality and other obligations to third parties and solely to the extent permissible under applicable law. “Best Efforts” means the efforts a prudent Person desiring in good faith to achieve a result would use in the circumstances to ensure such result is achieved as expeditiously as possible but does not require the Person subject to such obligation to take actions that would result in any materially adverse change, or any financial change which in the aggregate, or over a period of time, would result in any materially adverse change, in the benefits to such Person under this Agreement or require such Person to expend funds or extend other economic incentives, unless otherwise expressly required under this Agreement.

 

c.                                               Distributor acknowledges and agrees that it has no right to distribute any products of MEC other than the Products. Any sales by MEC to Distributor of any products of MEC that are not the Products, and/or any products sold by MEC to Distributor and/or its sub-distributor(s) beyond the scope, Term (as defined below) or after the termination of this Agreement, with or without cause, for any reason or no reason at all (i) shall not constitute, be construed as, or give rise to, any express or implied distribution agreement, course of conduct or other relationship between MEC and

 

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Distributor, (ii) shall not confer upon Distributor or its sub-distributor(s) any rights of any nature whatsoever, including without limitation to purchase, sell, market or distribute or continue to purchase, sell, market or distribute any products, including Products, or use the Trademarks other than with respect to products sold and delivered by MEC to Distributor, and (iii) shall constitute a separate transaction for each shipment of products actually delivered by MEC to Distributor and/or sub-distributor(s), in MEC’s sole and absolute discretion, which MEC shall be entitled to exercise, vary, withdraw and/or cease, on a case by case basis, at any time in MEC’s sole and absolute discretion. Distributor irrevocably waives, releases and discharges any claims, liabilities, actions and rights, in law or in equity, against MEC including without limitation for damages (including without limitation, consequential, special or punitive damages), compensation or severance payments or any other claims of whatsoever nature by Distributor arising from or in connection with the matters referred to in this Section 2(c) and/or any acts, omissions or conduct of MEC with regard to such matters.

 

d.                                              MEC and Distributor shall reasonably cooperate with respect to obtaining any import licenses, permits, certificates, and governmental approvals which are necessary to permit the sale of Products in the Territory. To the extent MEC reasonably requests that Distributor obtain any such licenses, permits, certificates, or governmental approvals, Distributor shall, at MEC’s sole expense, use Best Efforts to obtain such import licenses, permits, certificates, and governmental approvals which are necessary to permit the sale of Products in the Territory. Distributor acknowledges and agrees that all such licenses, permits, certificates, and governmental approvals are obtained for the benefit of MEC, and are subject to Distributor’s obligation to comply with the provisions of Sections 3(x) and 12(e)(vi) below. Distributor shall also comply with any and all governmental laws, regulations, and orders which are applicable to Distributor by reason of its entering into and performance of this Agreement, including any and all laws, regulations or orders in the Territory which govern or affect the ordering, export, shipment, import, sale, delivery or redelivery of Products in the Territory. Each of the parties shall notify the other of the existence and content of any provision of law which such party has actual knowledge, conflicts with any provisions of this Agreement at the Effective Date or thereafter. In the export of Products from the United States, Distributor shall further comply with the applicable law of the Territory, as well as U.S. laws and regulations governing exports, including the Export Administration Act and regulations thereunder, and the U.S. Boycott Regulations. Distributor shall use Best Efforts to provide MEC all reasonably necessary assistance in ensuring compliance by MEC, Distributor and the Products with any applicable governmental laws, regulations, orders and registration requirements for, and translations of, the Products, Product labels and any other written information as may be necessary in the Territory, in each case without limiting MEC’s representations, warranties or obligations hereunder.

 

e.                                               MEC and its Affiliates (if applicable) will use commercially reasonable efforts to include provisions comparable to subsections 2(b)(i) and 2(b)(ii) above in its distribution agreements with distributors in territories within Argentina. If any other distributor appointed by MEC in Argentina (i) actively seeks and solicits customers in Distributor’s Accounts (other than such non- exclusive Distributor’s Accounts as identified on Exhibit C) for Products in the Territory, or (ii) actively sells, markets, distributes or otherwise disposes of any Products, either directly or indirectly to any Persons located within its territory who such distributor knows or reasonably believes will distribute or resell the Products inside the Territory, MEC will take commercially reasonable steps to (A) enforce MEC’s rights under any distribution agreement, to the extent enforceable under such distribution agreement and applicable law, to address the importation of Products into the Territory

 

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in violation of any applicable distribution agreement relating to the Products, (B) enforce MEC’s rights against any other distributors to address the importation of Products into the Territory in violation of applicable distribution agreements with such other distributors relating to the Products to which MEC or its Affiliates are a party, but only to the extent enforceable under such applicable distribution agreements and applicable law, and (C) prevent such other distributors from breaching provisions comparable to subsections 2(b)(i) and 2(b)(ii), above, but only, to the extent that MEC shall be entitled to do so pursuant to the terms of its distribution agreements with such distributors and to the extent enforceable under applicable law. Distributor shall cooperate and, if necessary and required by MEC, join with MEC in all such proceedings in accordance with the foregoing. Distributor shall have no claim, and MEC shall have no liability, arising from the sale of Products by such other distributors in the Territory, except to require MEC to enforce the above-mentioned provisions in the applicable distribution agreements.

 

f.                                                If Distributor becomes aware that corrective labeling of Products delivered by MEC to Distributor is required in order to comply with applicable law in the Territory, Distributor shall provide to MEC for MEC’s written consent, which shall not be unreasonably withheld (i) written notice including details of the applicable law/s, (ii) the corrective Product label proposed by Distributor, and (iii) the estimated costs of relabeling the applicable Products. Upon receipt of MEC’s written consent (which shall not be unreasonably withheld), Distributor shall affix the corrective labeling to the Products at MEC’s cost provided that such cost has been approved by MEC in writing, which approval shall not be unreasonably withheld. All right, title and interest of every kind and nature in and to such corrective labeling shall be the sole and exclusive property of MEC for all purposes or uses. Distributor hereby assigns to MEC all of Distributor’s right, title and interest, if any, in and to such corrective labeling, and agrees to execute any documents and take any action MEC may deem reasonably necessary or appropriate to effectuate such assignment, at MEC’s reasonable request and expense.

 

g.                                               The parties acknowledge that it is their current mutual intention that they will consider in due course Distributor offering to enter into a written agreement with MEC in such a form and containing such terms as MEC may accept in writing to provide for the manufacture of certain Products in the Territory. This subsection 2(g) shall not be enforceable against either party unless and until MEC has accepted such offer in writing and an enforceable agreement has been entered into by both parties.

 

h.                                              Subject to and without limiting MEL’s (as defined below) and its Affiliates’ obligations to KO under the International Distribution Coordination Agreement (as defined below), if Distributor declines to distribute, declines to continue to distribute, or proposes not to distribute (each a “Distribution Refusal”) (i) substantially all Products, as the case may be, designated by MEC in good faith for sale in the Territory, MEC shall have the right to sell any or all of the Products so designated by MEC for sale in the Territory directly or through other distributors in the Territory, to the exclusion of Distributor, or (ii) one or more of MEC’s SKUs designated by MEC for sale in the Territory, MEC shall have the right (without prejudice to its right in clause (i) above) to sell such declined SKU/s directly or through other distributors in the Territory, to the exclusion of Distributor, in each case (i) and (ii) upon forty-five (45) days written notice to Distributor and KO of its intention to do so; provided that such Distribution Refusal continues to exist for such forty-five (45) day period. MEC’s right to sell or have sold such Products shall be limited to the portion of the Territory for which such distribution has been declined. The “International Distribution Coordination

 

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Agreement” means the Amended and Restated International Distribution Coordination Agreement dated June 12, 2015 between KO and Monster Energy Ltd. (formerly Tauranga, Ltd.), a company organized and existing under the laws of the Republic of Ireland (“MEL”) and MEC.

 

i.                                                  If, after the Effective Date, MEC determines to sell or otherwise distribute any Product or any SKU of any Product (“Product SKUs”) in the Territory not previously sold or distributed by Distributor (each a “New Product SKU”), prior to launching or otherwise commencing the sale or other distribution of such New Product SKU, MEC shall provide Distributor the right to distribute such New Product SKUs, subject to the terms of this Agreement (and subject to and without limiting MEL’s obligations to KO under the International Distribution Coordination Agreement). If Distributor declines to sell and distribute such New Product SKUs in the Territory within fifteen (15) days of MEC’s request that such New Product SKUs be added, then MEC shall have the right and option, in MEC’s sole and absolute discretion, to sell and distribute such refused New Product SKUs directly or through other distributors selected by MEC, to the exclusion of Distributor; provided that MEC gives such Distributor an additional fifteen (15) days written notice of MEC’s intention to do so and Distributor does not commence and continue purchasing from MEC and selling such refused New Product SKUs within such additional fifteen (15) day period. MEC’s right to sell or have sold such New Product SKUs shall be limited to the portion of the Territory for which such distribution has been declined.

 

j.                                                 The parties acknowledge and agree that MEC may designate a wholly owned subsidiary of MEC to perform any of MEC’s obligations, and/or to exercise any of MEC’s rights, under this Agreement, to the extent determined by MEC in its sole and absolute discretion, and such obligations and rights shall be deemed to have been performed and or exercised (as the case may be) by MEC.

 

3.                                      Distributor’s Duties. Distributor shall:

 

a.                                              Use commercially reasonable good faith efforts (i) to actively and diligently promote, solicit and push vigorously the wide distribution and sale of the Products to Distributor’s Accounts in the Territory, and (ii) to develop and exploit the full potential of the business of distributing, Marketing (as defined below) and selling the Products throughout the Territory by creating, stimulating and expanding continuously, the future demand for the Products and satisfying fully and in all respects, the current demand therefor (except to accounts reserved for MEC pursuant to Exhibit C and those MMM Accounts (as defined below) that are serviced directly by MEC in accordance with Section 14). For the purposes of this Section 3 and Section 13(a) below, “Marketing” means trade marketing, local marketing and local Product promotions in the Territory;

 

b.                                              Use commercially reasonable good faith efforts to actively and diligently develop new business opportunities for Products in Distributor’s Accounts in the Territory;

 

c.                                               Use commercially reasonable good faith efforts to actively and diligently manage all of Distributor’s sub-distributors throughout the Territory to gain system alignment to promote the sale and distribution of Products;

 

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d.                                              Use commercially reasonable good faith efforts to secure extensive in-store merchandising and optimal shelf positioning in Distributor’s Accounts in the Territory with respect to Products, except for those MMM Accounts serviced directly by MEC in accordance with Section 14 below;

 

e.                                               Use commercially reasonable good faith efforts to perform complete and efficient distribution functions to and in Distributor’s Accounts throughout the Territory;

 

f.                                                Use commercially reasonable good faith efforts to fully implement the Annual Business Plan (as defined and to be agreed upon from time-to-time in accordance with Section 13(b) below), and use commercially reasonable good faith efforts to achieve and maintain all of the objectives set with respect thereto as contemplated in Section 13(b) below;

 

g.                                               Use commercially reasonable good faith efforts to achieve and maintain the Performance Targets (as defined and determined each calendar year in accordance with Section 13(d) below);

 

h.                                              In relation to the sales of the Products only, permit MEC representatives to accompany Distributor’s salesmen on sales routes in the Territory, upon reasonable advance notice to Distributor;

 

i.                                                  Use commercially reasonable good faith efforts to achieve optimum ambient and cold space, position, prominence, and visibility of the Products in all Distributor’s Accounts in the Territory, except for those MMM Accounts serviced directly by MEC in accordance with Section 14 below;

 

j.                                                 Use commercially reasonable good faith efforts to promote and maintain an efficient, viable and financially sound system of distribution for the Products in Distributor’s Accounts throughout the Territory, except for those MMM Accounts serviced directly by MEC in accordance with Section 14 below;

 

k.                                              Provide the resources necessary for the sale, delivery, Marketing, promotion and servicing of the Products in Distributor’s Accounts within the Territory, except for those MMM Accounts serviced directly by MEC in accordance with Section 14 below;

 

l.                                                  Use commercially reasonable good faith efforts to achieve and maintain Minimum Distribution Levels for the Products in Distributor’s Accounts (other than such non-exclusive Distributor’s Accounts as identified on Exhibit C) as agreed upon or determined in accordance with Section 13(c) below from time to time;

 

m.                                          Perform and satisfy its obligations specified in Sections 10 and 13 below;

 

n.                                              Provide such sales and Marketing information in relation to the Products as may be reasonably requested by MEC;

 

o.                                              Comply with any applicable laws and regulations of or applicable in the Territory and shall be responsible for ensuring that all Product deliveries by Distributor within the Territory

 

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comply with all health, safety, environmental and other standards, specifications and other requirements imposed by law, regulation or order in the Territory, and applicable to the Products;

 

p.                                              Assign such article numbers as may be utilized by Distributor from time to time for each Product and Product package to track sales information by its sales data collection system;

 

q.                                              Cause all of its promotional and Marketing efforts and/or activities under this Agreement to be devoted solely to the Products. Unless approved by MEC’s prior written consent, it shall be a violation of this subsection for (i) Products to be placed by Distributor in Equipment (as defined below) branded with the trademark of an Energy Drink other than a Product, it being agreed that Distributor may place Products in Equipment branded with another beverage other than an Energy Drink; (ii) Energy Drinks other than Products to be placed by Distributor in Equipment branded for Products; (iii) sales materials for Products created by Distributor to include trademarks of products or Energy Drinks other than Products; (iv) Distributor distributing sales material created by Distributor including trademarks of Products; and (v) Distributor’s promotional pricing and/or promotional and/or Marketing activities and/or promotional and/or Marketing programs to apply to all or any Products in combination with all or any Energy Drinks other than Products sold by Distributor. It is not a violation of this subsection for Products to be ordered, sold, delivered, or merchandised by the same Person or in the same vehicles as other products;

 

r.                                                 Invest all the capital and obtain and expend all the funds required for the organization, installation, operation, maintenance and replacement within the Territory of such warehousing, Marketing, distribution, delivery, transportation and other facilities and equipment as shall be necessary for Distributor to comply with its obligations under this Agreement;

 

s.                                                For its own account, budget and expend such funds for advertising, Marketing and promoting the Products in the Territory as may be reasonably required by MEC. The parties shall, pursuant to the terms of this Agreement, equally contribute financially to local Marketing programs to create, stimulate and sustain the demand for the Products in the Territory, provided that Distributor shall submit all advertising, Marketing and promotional projects relating to the Trademarks or the Products to MEC for its prior approval, and shall use, publish, maintain or distribute only such advertising, Marketing or promotional material relating to the Trademarks or the Products as MEC shall approve and authorize. MEC may also undertake, at its own expense and independently from Distributor, any additional advertising or sales promotion activities in the Territory it deems useful or appropriate;

 

t.                                                 Use commercially reasonable good faith efforts to allocate Products in Distributor Equipment consistent with the Annual Business Plan and to the extent (and in the form and manner) agreed between Distributor and MEC, including without limitation by including at least a reasonable representation of Products in Distributor Equipment, but only where appropriate. “Distributor Equipment” shall mean any refrigeration equipment, coolers, barrels, vending machines or similar equipment provided by Distributor, or placed and maintained by Distributor in premises of Distributor’s customers within the Territory for use in relation to the refrigeration, display, Marketing, promotion, and/or sale of all or any beverages distributed and sold by Distributor in the Territory. “MEC Equipment” shall mean any refrigeration equipment, coolers, barrels, vending machines or similar equipment funded by MEC and/or its Affiliate/s or provided by MEC and/or its Affiliate/s to Distributor and placed in premises of Distributor’s customers within the Territory by

 

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Distributor for use in relation to the refrigeration, display, Marketing, promotion, and/or sale of all or any Products distributed and sold by Distributor in the Territory, the price of which shall be funded and paid for equally by MEC and/or its Affiliate/s and Distributor as part of the Annual Business Plan and/or as may otherwise be agreed by the parties in writing from time to time. The appearance and branding of MEC Equipment shall be determined by MEC and/or its Affiliate/s in its discretion. Distributor Equipment and MEC Equipment shall be referred to collectively as the “Equipment;”

 

u.                                              Take such steps and execute such documents as may be necessary to ensure that any MEC Equipment for use in relation to the refrigeration, display, Marketing, promotion, and/or sale of Products, and any licenses, entitlements, consents or other rights relating to the placement or location of MEC Equipment in a customer’s premises remains the exclusive, unencumbered property of MEC. Distributor shall maintain the MEC Equipment in good condition throughout the Term of this Agreement, ordinary wear and tear excepted. Upon termination of this Agreement Distributor shall deliver the MEC Equipment to MEC and/or its Affiliate/s at the location of such Equipment in the customers’ premises. As the bona fide depository of the MEC Equipment, Distributor undertakes to take all commercially reasonable steps for the proper storage, preservation and use of the MEC Equipment for as long as such MEC Equipment remains serviceable, and shall be responsible for any failure to do so. If for any reason any of the MEC Equipment is removed and not recovered, Distributor shall be liable for all loss and damages arising from Distributor’s breach of this Section 3(u). Distributor hereby agrees to pay MEC any loss or damages incurred by MEC with respect to replacing the MEC Equipment and securing the placement of the MEC Equipment. Distributor further agrees to maintain and to replace such Equipment at such reasonable intervals as are reasonably necessary, and the cost of any such Equipment shall be funded and paid for equally by MEC and Distributor in accordance with the terms of this Agreement and attached Exhibit E;

 

v.                                              Use commercially reasonable good faith efforts to protect the reputation and goodwill of MEC, the Products, and the Trademarks, conduct business in a proper and businesslike manner and otherwise act in the best interests of MEC in relation to its Products, reputation and goodwill. Distributor shall not act or fail to act in any manner that would reasonably be expected to be detrimental to the brand image of MEC or the Products. Distributor shall not engage in any activities or practices, or fail to engage in activities or practices, that would reasonably be expected to impair the value of or otherwise damage the reputation or goodwill of MEC, the Products, or the Trademarks;

 

w.                                            Maintain in stock at all times a reasonably sufficient quantity of each Product/s in relation to the demand from Distributor’s Accounts in the Territory for at least a reasonable period based on such demand, subject to availability as provided by MEC; and

 

x.                                              Promptly upon MEC’s reasonable request and at MEC’s expense, take such action and execute such document/s as may be necessary to assign or otherwise transfer to MEC or MEC’s designee, any registrations, licenses, permits, certificates, and governmental approvals that Distributor may have acquired in connection with, and only to the extent it solely relates to, the sale of Products in the Territory, in each case subject to and to the extent permissible under applicable law.

 

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4.                                      Prices.

 

a.                                              The prices (“Selling Price”) to be paid by Distributor to MEC for the Products shall be reviewed and determined annually by MEC for the forthcoming year in its sole discretion after discussion with Distributor but shall be subject to adjustment in accordance with Section 4(c) below. The annual increases to the Selling Price will be communicated to Distributor no later than three (3) calendar months prior to implementation of price increases in a country within the Territory.

 

b.                                              It is acknowledged that from time to time Distributor may be required by its customer/s to fix, for a period of up to twelve (12) months, the prices that Distributor may charge to its customer/s for certain Products. In such event, Distributor may request that MEC fix the prices to be paid by Distributor for the applicable Product/s to be resold to such customer/s. MEC shall promptly discuss such a request with Distributor in good faith and the parties will prepare and record any agreement in writing. Provided that MEC agrees to the foregoing in writing, MEC shall not adjust, for the same period that Distributor’s prices are fixed, the prices to be paid by Distributor for the applicable Product/s to the extent that (i) the applicable Product/s are to be supplied by Distributor to the customer in question, and (ii) Distributor is not entitled to pass on any price adjustments to such customer. Nothing contained in this Section 4(b) shall be construed as imposing any agreement or restriction on the right of either MEC to unilaterally determine the Selling Price or the right of Distributor to unilaterally determine Distributor’s own resale prices and terms of business.

 

c.                                               Notwithstanding anything to the contrary contained in this Agreement, in the event of any material change in the costs associated with production of the Products (including, but not limited to, a material change in the costs of ingredients, packaging materials, energy or freight costs related to the production and shipping of Products) at any time, then MEC may adjust the Selling Price of Products to Distributor to reflect such cost increase, effective thirty (30) days after written notice from MEC to Distributor of such change. MEC shall provide reasonable supporting documentation evidencing the material change in its costs of production and delivery, if requested by Distributor.

 

d.                                              All Selling Prices are exclusive of (i) any costs of carriage and insurance of the Products, and (ii) any applicable value added or any other sales or similar tax, which shall be payable by Distributor.

 

5.                                              Orders. All purchase orders for Products shall be transmitted in writing or electronically, shall specify a reasonable date and time for delivery to locations in the Territory agreed upon in writing between the parties from time to time and shall be submitted with a lead time of at least ten (10) days and shall be subject to acceptance by MEC in MEC’s reasonable discretion. If MEC is unable to accept an order for any reason, then MEC will use commercially reasonable efforts to equitably allocate available Products to fill orders from its distributors and customers, including Distributor. In the event of any conflict or inconsistency between the terms of this Agreement and any purchase order, the terms of this Agreement shall govern. All such purchase orders shall be deemed acceptances of MEC’s offers to sell Products and shall limit acceptance by Distributor to the terms and conditions thereof.

 

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6.                                              Payment. MEC shall invoice Distributor on a monthly basis or other mutually agreed periodic basis in the primary currency of the Territory (Argentine Pesos). Such payment shall be made by electronic transfer to a bank account as designated by MEC, or such other bank account as may be designated by MEC, within (i) sixty (60) days of the date of the applicable invoice issued during the first nine (9) months following the Commencement Date, (ii) forty (40) days of the date of the applicable invoice issued after the expiration of the first nine (9) months following the Commencement Date, or (iii) such other period as may be agreed by MEC from time to time in writing. Distributor and MEC shall use a mutually agreeable method of electronic settlement of accounts that Distributor reasonably approves which may include ACH or Xign, Distributor’s current electronic invoice presentment system. If Distributor is delinquent in payment upon presentation of invoice and remains delinquent for seven (7) days after written notice calling upon Distributor to pay, Distributor shall reimburse MEC for any costs and expenses incurred by MEC in collecting such delinquent amounts, including, without limitation, legal fees and costs including fees of collection agencies, and interest computed at the lesser of one percent (1%) per month or part thereof from the due date(s) or the maximum legally permissible rate. MEC will establish the conditions of shipment and will designate the supply point and/or alternate supply points for each of the Products, in all cases, with the previous consent of Distributor, which consent shall not be unreasonably withheld, conditioned or delayed.

 

7.                                      Title and Risk of Loss. Title and risk of loss to the Products shall pass to Distributor upon delivery of the Products to Distributor.

 

8.                                      Forecast and Delivery.

 

a.                                              Distributor shall provide MEC with rolling thirteen (13) week forecasts describing the volume of each SKU of Products that Distributor projects will be ordered during each thirteen (13) week period during the Term (as defined below) of this Agreement. Distributor shall submit each updated forecast monthly in a format reasonably acceptable to MEC and Distributor no later than the first day of each month during the Term.

 

b.                                              Unless otherwise agreed in writing by the parties to this Agreement, the Products will be tendered by MEC for delivery to Distributor in full truckload quantities of particular Product lines and extensions but without combining different Product lines in the same truckloads. By way of example, Monster Green (i.e. Monster’s original product) and its extensions and Java Monster and its extensions are different particular Product lines. Subject to Distributor providing MEC forecasts in accordance with Section 8(a) above, MEC agrees to use commercially reasonable good faith efforts to deliver Products to Distributor within thirty (30) days of receipt by MEC of the applicable purchase orders for Products in compliance with Sections 5 and 8(a) above to (i) Distributor, in the case of Products delivered from the point of manufacture to Distributor by ground transportation, and (ii) the shipper, in the case of delivery of the Products to Distributor which involves shipment by sea. MEC shall deliver to Distributor Products with at least six (6) months or fifty percent (50%) of each Product’s shelf life remaining at the time of delivery or such other period as may be agreed to between MEC and Distributor with respect to any specific Products. Notwithstanding the foregoing, Distributor acknowledges that delivery dates set forth in purchase orders for Products accepted by MEC are merely approximate and that MEC shall have no liability for late deliveries, except only for fines, penalties and assessments imposed by Distributor’s customers and actually paid by Distributor

 

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which arise solely and directly as a result of MEC’s failure to comply with its obligations under this Section 8.

 

9.                                      Trademarks.

 

a.                                              Distributor acknowledges the respective exclusive right, title, and interest in and to the Trademarks and trade names of MEC and/or its Affiliates, whether or not registered, patents, patent applications, and all rights in inventions (whether or not patentable) (collectively, “Patents”), copyrights and copyrightable material (collectively, “Copyrights”) and trade secrets and know-how (collectively, “Know-How”) which MEC and/or its Affiliates may have at any time created, adopted, used, registered, or been issued in the United States of America, the Territory or in any other location in connection with MEC’s business or the Products and Distributor shall not do, or cause or permit to be done, any acts or things contesting or in any way impairing or tending to impair any portion of MEC’s right, title, and interest in and to the Trademarks, trade names, Patents, Copyrights, and Know-How. Any approval by MEC for Distributor to use any Trademarks, trade names, Patents, Copyrights, trade secrets and Know-How in connection with the distribution and sale of the Products shall be a mere temporary permission, uncoupled with any right or interest, and without payment of any fee or royalty charge for such use.

 

b.                                              Distributor shall not use any trademark, name, brand name, logo or other production designation or symbol in connection with Products other than the Trademarks, subject to the terms of this Section 9. It will not be a breach of this Section for the Products to be delivered by Distributor in vehicles, or using employees, agents, assigns or sub-distributors wearing clothing, displaying any other trademark, name, brand name, logo or other products designation or symbol. Distributor acknowledges that it has no right or interest in the Trademarks (except as expressly permitted hereunder) and that any use by Distributor of the Trademarks will inure solely to MEC’s benefit. Distributor may only use the Trademarks in strict accordance with MEC’s policies and instructions, and MEC reserves the right, from time to time and at any time, at its discretion, to modify such policies and instructions then in effect.

 

c.                                               Any proposed use by Distributor of the Trademarks (to the extent that it either has not been previously approved by MEC in writing or differs materially from a use previously approved by MEC in writing) shall be subject to the prior written consent of MEC, which MEC may withhold in its sole and absolute discretion. Distributor shall submit to MEC in writing each different proposed use of the Trademarks in any medium.

 

d.                                              Distributor shall not at any time alter the Trademarks or the packaging of Products, use the Trademarks for any purpose other than the promotion, advertising and sale of Products hereunder, or challenge the validity, or do or refrain from doing any act which might result in impairment of the value, of the Trademarks. Distributor shall not cause or permit its business name to include any of the Trademarks or its business to be operated in a manner which is substantially associated with any of the Trademarks.

 

e.                                               In advertising, promotions or in any other manner so as to identify Products, Distributor shall clearly indicate MEC’s ownership of the Trademarks. Distributor further agrees that before distributing or publishing any sales literature, promotional or descriptive materials, MEC shall have the right, upon request, to inspect, edit and approve such materials which illustrate,

 

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describe or discuss the Products. Distributor shall comply with any Trademark usage guidelines that MEC provides to it in writing.

 

f.                                                Upon the termination of this Agreement, the temporary permission granted under sub- Section 9(a) above will terminate and Distributor shall immediately cease and desist from any use of the Trademarks and any names, marks, logos or symbols similar thereto and the use of any Patents, Copyrights and Know-How.

 

g.                                               Distributor shall (i) notify MEC of any actual or suspected misuse or infringement of any Trademark, brand name, logo or other production designation or symbol in the Territory, (ii) at MEC’s expense and upon MEC’s request, assist in such legal proceedings as MEC will deem necessary for the safeguard of any Trademark, brand name, logo or other production designation or symbol in the Territory, and execute and deliver in accordance with MEC’s request such documents and instruments as may be necessary or appropriate in the conduct of such proceedings, and (iii) at MEC’s expense, assist MEC in the registration and/or renewal of registration of any Trademark, brand name, logo or other production designation or symbol in the Territory as MEC may determine to be necessary or desirable, and execute such documents and instruments as may be necessary to register or to apply for the registration (or registration renewal) of such Trademark, brand name, logo or other production designation or symbol.

 

h.                                              Distributor shall not acquire or attempt to acquire, for itself or for others, any rights in or to the Patents, Copyrights, Know-How, Trademarks, or any names, marks, logos or symbols confusingly similar thereto, either through registration or use. All rights granted to Distributor concerning the Trademarks, Patents, Copyrights, and Know-How are personal to Distributor, and are not assignable (except in accordance with Section 23) or sublicensable (except to a sub-distributor in accordance with Section 2(a)). Subject to Distributor’s rights under Sections 2 and 23, Distributor shall not grant or attempt to grant any rights in or to the Trademarks, Patents, Copyrights, and Know-How to any other Person.

 

i.                                                  If during the Term a third party institutes against MEC or Distributor any claim or proceeding that alleges that the use of any Trademark or any Know-How, Patent, trade secret or Copyright in connection with the distribution, marketing, promotion, merchandising and/or sales of the Products under this Agreement infringes the intellectual property rights held by such third party, then MEC shall, in its sole discretion, and at its sole expense, contest, settle, and/or assume direction and control of the defense or settlement of, such action, including all necessary appeals thereunder. Distributor shall use all reasonable efforts to assist and cooperate with MEC in such action, subject to MEC reimbursing Distributor for any reasonable out-of-pocket expenses incurred by Distributor in connection with such assistance and cooperation. If, as a result of any such action, a judgment is entered by a court of competent jurisdiction, or settlement is entered by MEC, such that any Know- How, Patent, trade secret, Copyright or Trademark cannot be used in connection with the distribution, marketing, promotion, merchandising and/or sales of the Products under this Agreement without infringing upon the intellectual property rights of such third party, then MEC and Distributor promptly shall cease using such affected Know-How, Patent, trade secret Copyright or Trademark in connection with the distribution, marketing, promotion, merchandising and/or sale of the Products under this Agreement. Except as otherwise specified in this Agreement, neither party shall incur any liability or obligation to the other party arising from any such cessation of the use of the affected Trademark.

 

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j.                                                 If MEC, for the purposes of this Agreement, should reasonably require that, in accordance with applicable laws governing the registration and licensing of intellectual property, Distributor be recorded as a registered user or licensee of the Trademarks then, at the request and expense of MEC, Distributor will execute any and all agreements and such other documents as may be necessary for the purpose of entering, varying or canceling the recordation.

 

10.                                       Promotion and Trade Marketing of Products. Distributor shall be responsible for promotion and Marketing of the Products to Distributor’s Accounts within the Territory. Distributor shall use commercially reasonable efforts to actively and diligently distribute and encourage the utilization of merchandising aids and promotional materials in all Distributor’s Accounts throughout the Territory. Without in any way detracting from the foregoing, Distributor shall reasonably participate in and diligently implement all Marketing and promotional programs that are mutually agreed upon by MEC and Distributor from time to time. Distributor acknowledges that (a) MEC has no obligation to market and promote the Products, and (b) MEC makes no, and hereby disclaims any, express or implied warranty, representation, or covenant relating to or in connection with MEC’s marketing and promotional activities including any Global Branding and Marketing activities (as defined in Section 13(a) below), including without limitation, as to the value, performance, extent, effectiveness, quantity, quality, success or results of any such activities or the lack thereof. Except as expressly provided in Section 19 below, Distributor shall have no claim against MEC and its Affiliates and hereby releases MEC and its Affiliates from all and any claims by, and/or liability to, Distributor of any nature for their failure to market and promote, or adequately market and promote, the Products or arising from or relating to or in connection with any Global Branding and Marketing activities procured, provided or performed by MEC and/or its Affiliates or MEC’s and/or its Affiliates’ failure to procure, provide or perform such activities.

 

11.                                       Term. Unless terminated by either party pursuant to the terms of this Agreement, the initial term of this Agreement shall commence on the Effective Date and shall end on the tenth (10th) anniversary of the Commencement Date (the “Initial Term”). After the Initial Term, this Agreement shall be renewed automatically for up to two (2) further successive five (5) year terms (“Additional Term/s”) unless either party gives written notice to the other at least one hundred twenty (120) days prior to the end of the Initial Term or applicable Additional Term, as the case may be, of its intention not to renew the Agreement for an Additional Term, and providing the provisions of Sections 2(a), 2(b) and 21 of this Agreement are valid and enforceable in accordance with their respective terms during the applicable Additional Term. If MEC reasonably determines that it is necessary or desirable that the parties enter into an additional agreement or instrument in order for the provisions of Sections 2(a), 2(b) and 21 to be valid and enforceable, then the parties agree to execute such documents as may reasonably be required to give effect to the foregoing. A “Contract Year” means any calendar year during the Term and the period from the Commencement Date until the close of business on December 31st of the calendar year in which the Commencement Date falls. The Initial Term and any Additional Terms are collectively referred to as the “Term”.

 

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12.                               Termination.

 

a.                                              Termination for Cause.

 

i.                                 Termination By Either Party. Without prejudice to its other rights and remedies under this Agreement and those rights and remedies otherwise available in equity or at law, either party may terminate this Agreement on the occurrence of one or more of the following:

 

A.                                            Breach. A party’s material breach of a provision of this Agreement and failure to cure such breach within thirty (30) days after receiving written notice describing such breach in reasonable detail from the non-breaching party; provided, however, if such breach is of a nature that it cannot reasonably be cured within thirty (30) days, then the breaching party shall have an additional forty-five (45) day period to cure such breach, providing it immediately commences, and thereafter diligently prosecutes, in good faith, its Best Efforts to cure such breach. In the event that either MEC or Distributor exercises its right to terminate this Agreement in accordance with this Section 12(a)(i)(A), the breaching party shall be obligated to pay the other party a severance payment measured as a genuine pre-estimate of the other party’s losses and not as a penalty (the “Breach Severance Payment”) in the amount calculated as follows: Distributor’s “average gross profit per case” (as defined below) multiplied by the number of cases of Products sold by Distributor during the most recently completed twelve (12) month period ended on the last day of the month preceding the month in which this Agreement is terminated. Distributor’s “average gross profit per case” shall mean Distributor’s actual selling price less (1) promotion allowances, discounts, free cases and allowance programs, and (2) Distributor’s laid in cost of the Products.

 

B.                                            Insolvency. The other party (1) makes any general arrangement or assignment for the benefit of creditors, (2) becomes bankrupt, insolvent or a “debtor” as defined in 11 U.S.C. § 101, or any successor statute (unless such petition is dismissed within sixty (60) days after its original filing), (3) has appointed a trustee or receiver to take possession of substantially all of such party’s assets or interest in this Agreement (unless possession is restored to such party within sixty (60) days after such taking), or (4) has substantially all of such party’s assets or interest in this Agreement (unless such attachment, execution or judicial seizure is discharged within sixty (60) days after such attachment, execution or judicial seizure) attached, executed, or judicially seized.

 

C.                                            Agreement. Mutual written agreement of the parties.

 

D.                                            Deadlock.

 

(1)                                 If (a) the parties are unable to agree upon Performance Targets, the Annual Business Plan or Minimum Distribution Levels, or (b) if Distributor has failed to achieve the applicable Performance Targets, Annual Business Plan or Minimum Distribution Levels or fails to comply with any specific requirements of Distributor under this Agreement, including Section 3 (Distributor’s Duties), Section 10 (Promotion and Trade Marketing of Products), Section 13(f) (sales velocity), and Section 13(g) (promotional activities), in any material respect, commencing with the 2017 Contract Year in accordance with Sections 13(b), 13(c) and 13(d) respectively, (clauses (a) and (b) above, collectively referred to as a “Deadlock”) then either party may, at any time after providing the other party with written notice identifying the specific issues resulting in the Deadlock and making a good faith attempt to resolve the Deadlock with the other party, but not more than three (3) times per twelve (12) month period, upon written notice to the other party (the “Meet and Confer Notice”), require that representatives of the other party’s senior management meet and confer with representatives of the notifying party’s senior management at the dates, times and place reasonably agreed by the parties. Such meet and confer shall begin no later than seven (7) days after the other

 

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party’s receipt of such Meet and Confer Notice and shall end no later than fifteen (15) days after the other party’s receipt of such Meet and Confer Notice (the “Initial Meeting Period”). Representatives of the parties’ senior management shall meet and confer during such Initial Meeting Period until (x) resolution of the Deadlock to the parties’ mutual satisfaction or (y) conclusion of the Initial Meeting Period, whichever occurs first.

 

(2)                                         If the parties are unable to resolve the Deadlock in accordance with Section 12(a)(i)(D)(1) above, then either party may, at any time after the Initial Meeting Period, upon written notice to the other party and to KO (the “Second Meet and Confer Notice”), require representatives of the other party’s senior management and representatives of management of the applicable KO business unit (and/or at MEC’s reasonable request, such other representative of senior management of KO), to meet and confer with representatives of the notifying party’s senior management at the dates, times and place reasonably agreed by MEC, Distributor and KO (including via videoconference or teleconference). Such meet and confer shall begin no later than seven (7) days after the other party’s and KO’s receipt of such Second Meet and Confer Notice and shall end no later than twenty-one (21) days after the other party’s and KO’s receipt of such Second Meet and Confer Notice (the “Second Meeting Period”). Representatives of the parties’ and the applicable KO business unit’s senior management (and/or at MEC’s reasonable request, such other representative of senior management of KO), shall meet and confer during such Second Meeting Period until (x) resolution of the Deadlock to the parties’ and KO’s satisfaction or (y) conclusion of the Second Meeting Period, whichever occurs first. For the avoidance of doubt and without limiting Section 12(a)(i)(D)(5) below, in the event that, after KO’s receipt of the Second Meet and Confer Notice, such representative of KO’s applicable business unit does not participate in accordance with the foregoing, MEC shall have the option of waiving such requirement that such KO representative participate and proceeding with the Second Meeting Period without a KO representative.

 

(3)                                         If, after the Second Meeting Period, the parties are unable to resolve the Deadlock in accordance with Section 12(a)(i)(D)(1) and Section 12(a)(i)(D)(2) above, then the Deadlock shall be resolved by reference as follows:

 

(x)                                    Reference proceedings may be commenced by either party by giving the other party written notice thereof. Any such reference shall take place before a single referee only in New York, New York or via videoconference or teleconference. The referee shall be an experienced industry expert selected jointly by the parties, or if they cannot agree on a referee within ten (10) days from the commencement of the reference proceedings, then, upon the petition of either party, the experienced industry expert shall be appointed within ten (10) days by the American Beverage Association.

 

(y)                                    The Deadlock shall be submitted to the referee within ten (10) days after the referee is appointed. No discovery will be permitted and no hearing will be held, except such informal proceedings as the referee may require. Each party shall submit to the referee and the other party within such ten (10) day period such written information and statements as that party deems appropriate in support of its claim not exceeding five (5) pages in length (excluding exhibits), together with such information as the referee may require. Each party shall concurrently submit to the referee and exchange with each other its last and best position with respect to each separate issue subject to Deadlock (“Position”) to resolve the Deadlock. Within fourteen (14) days of the date that the parties were required to submit their respective written

 

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submissions, the referee shall select one of the two written Positions submitted with respect to each separate issue subject to Deadlock, without change or modification.

 

(z)                                     Each party shall pay one-half of the referee’s fees and otherwise bear its own costs associated with the reference proceeding; provided, that the party whose Position is not selected by the referee (the “Non-Prevailing Party”) shall not be obligated to reimburse the party whose position was selected by the referee (the “Prevailing Party”) for the referee’s fees and costs relating to the proceeding paid by such party.

 

(4)                                         The Non-Prevailing Party shall have no right to terminate this Agreement or seek any other remedy with respect to the issue for which it was the Non-Prevailing Party, and the Position selected by the referee shall be binding upon the parties.

 

(5)                                         Notwithstanding anything to the contrary contained in this Section 12(a)(i)(D), the parties acknowledge and agree that:

 

(x)                                    the failure of KO or its applicable business unit’s senior management to attend or participate in, or otherwise perform, all or any of the duties, functions or activities described above will not affect the validity or enforceability of any part or result of the procedure in this Section 12(a)(i)(D).

 

(y)                                    If either party is the Prevailing Party two consecutive times in any twelve (12) month period for any issue resulting in a Deadlock, then, after providing at least five (5) days written notice to KO, with a copy to KO’s Chief Executive Officer and Chief Financial Officer, of MEC’s intention to terminate this Agreement (if MEC is the Prevailing Party), such Prevailing Party shall have the option to terminate this Agreement upon thirty (30) days written notice to the other party; provided that if MEC is such terminating party, MEC shall pay Distributor a Breach Severance Payment (and neither party shall be liable by reason of such termination of this Agreement or Deadlock pursuant to this Section 12(a)(i)(D) for payment of any other amount, including, without limitation, for compensation, reimbursement or damages of whatsoever nature including for loss of prospective compensation or earnings, goodwill or loss thereof, or expenditures, investments, leases of any type or commitment or type of commitment made in connection with the business of either party or in reliance on the existence of the Agreement).

 

(z)                                     If the Non-Prevailing Party materially fails to comply with the Position selected by the referee within a sixty (60) day period (or, if the Non-Prevailing Party cannot reasonably comply with such Position within such sixty (60) days, an extended period of no longer than an additional four (4) months) following such selection, then, after providing at least five (5) days written notice to KO (with a copy to KO’s Chief Executive Officer and Chief Financial Officer) of the Prevailing Party’s intention to terminate this Agreement, the Prevailing Party may, without prejudice to any other rights or remedies available to it under this Agreement or applicable law, give notice of such breach in accordance with, and thereafter invoke the remedy provided under, Section 12(a)(i)(A) above; provided that neither party shall be required to pay a Breach Severance Payment in such event (and neither party shall be liable by reason of such termination of this Agreement or Deadlock pursuant to this Section 12(a)(i)(D) for payment of any other amount, including, without limitation, for compensation, reimbursement or damages of whatsoever nature including for loss of prospective compensation or earnings, goodwill or loss

 

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thereof, or expenditures, investments, leases of any type or commitment or type of commitment made in connection with the business of either party or in reliance on the existence of the Agreement).

 

(6)                                         Nothing contained in this Section 12(a)(i)(D) shall be construed as limiting, restricting or delaying either party’s ability to exercise its rights and/or remedies under Section 12(a)(i)(A) above.

 

ii.                                               Termination by MEC. MEC may terminate this Agreement at any time:

 

A.                                       Upon written notice, and such termination will be effective immediately upon Distributor’s receipt of such notice, (x) if Distributor sells, assigns, delegates or transfers any of its rights and obligations under this Agreement without having obtained MEC’s prior written consent thereto (which consent may be withheld in MEC’s sole discretion), provided that MEC shall not withhold its consent if such sale, assignment, delegation or transfer is (1) to a Primary KO Distributor (as defined below), (2) to KO or an Affiliate of KO or an Affiliate of Distributor, or (3) a result of an Approved Change of Control (as defined below), or (y) if there is any material change in the control of Distributor or Distributor sells all or substantially all of its assets without the prior written consent of MEC, other than if such material change in control or sale is (1) to a Primary KO Distributor, (2) to KO or an Affiliate of KO, or (3) to any Person to the extent Distributor remains a Primary KO Distributor. “Primary KO Distributor” means a KO Distributor holding the exclusive right to distribute (or that otherwise is the primary distributor of) Coca-Cola brand products in an applicable territory. “Approved Change of Control” means any change of control of Distributor or sale of all or substantially all of Distributor’s assets that is consented to by MEC or for which MEC’s consent is not required hereunder.

 

B.                                       Upon the occurrence of an MEC Change of Control (as defined in the International Distribution Coordination Agreement), MEC shall have the option to terminate (1) this Agreement in its entirety (a “Complete Termination”) or (2) if the Territory comprises more than one market, Distributor’s right to sell Products in a portion of the Territory (a “Partial Territory Termination”), which option may be exercised within sixty (60) days of the occurrence of such MEC Change of Control, by written notice by MEC to Distributor. Any such termination shall be effective upon Distributor’s receipt of MEC’s written notice of termination. MEC’s right to terminate this Agreement under this Section 12(a)(ii)(B) shall be MEC’s sole right to terminate this Agreement for an MEC Change of Control and independent of any other rights or remedies of MEC under this Agreement.

 

(x)                                    In the event of a Complete Termination, MEC or its successor, as the case may be, shall pay to Distributor an amount equal to a Breach Severance Payment calculated in accordance with Section 12(a)(i)(A) above (the “Product Severance Payment”).

 

(y)                                    In the event of a Partial Territory Termination, MEC or its successor, as the case may be, shall pay to Distributor a severance payment with respect to the Products which are the subject of the termination, calculated on the same basis as the Breach Severance Payment in accordance with Section 12(a)(i)(A) above, but only with respect to that

 

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portion of the Territory which is the subject of the Partial Territory Termination (the “Territory Severance Payment”).

 

(z)                                     Any Product Severance Payment or Territory Severance Payment payable by MEC to Distributor in accordance with Section 12(a)(ii)(B)(x) or 12(a)(ii)(B)(y) shall be paid by MEC to Distributor within thirty (30) days of the later of (I) the date of the applicable termination, and (II) MEC’s receipt of all information reasonably necessary to support computation of the Product Severance Payment or Territory Severance Payment, as the case may be, in a form and substance satisfactory to MEC.

 

iii.                                            [INTENTIONALLY OMITTED]

 

iv.                                           Termination Upon the Occurrence of Certain Changes. If, after the Effective Date, a change in legal or regulatory conditions in the Territory occurs including, without limitation, any change in any applicable law, regulation or order, or the interpretation of any law, regulation or order in the Territory which has had or would be reasonably expected to (A) have a material adverse effect on the business of distributing Products in that Territory, (B) prevent Distributor from legally obtaining foreign exchange to remit abroad payment for the Products; or (C) result in any part of this Agreement ceasing to be in conformity with the laws or regulations applicable in the Territory and, as a result thereof, or as a result of any other laws affecting this Agreement, any one of the material provisions of this Agreement cannot be legally performed and/or the Products cannot be stored, transported, handled, distributed or sold in accordance with this Agreement, either party may, upon written notice, suspend or terminate the parties’ respective rights and obligations under this Agreement solely with respect to (1) the affected Products in the Territory, or, (2) to the extent such change and conditions affects the business of distribution of all or substantially all of the Products in the Territory, all Products in the affected portion of the Territory without liability for damages; provided that neither MEC nor any of its Affiliates shall be permitted to sell any such Products subject to suspension or termination in the affected Territory without first providing Distributor the option to remove the cause for such suspension or re-enter into the Agreement with respect to such Products and Territory. In the event of any such suspension that materially adversely effects Distributor’s benefits or obligations hereunder, Distributor shall have the option to terminate this Agreement in its entirety upon written notice to MEC.

 

b.                                              Optional Termination. MEC shall have the right to terminate this Agreement upon written notice to Distributor (i) in the event of termination or expiration of the International Distribution Coordination Agreement pursuant to and in accordance with its terms and/or (ii) if Distributor is no longer a party to any agreement with KO regarding the distribution of Coca-Cola brand products in the Territory. Neither KO, MEC nor Distributor shall be liable to any other party or otherwise obligated to pay to any other party any severance payment or other amount by reason of such termination for compensation, reimbursement or damages of whatsoever nature including, for (A) loss of prospective compensation or earnings, (B) goodwill or loss thereof, or (C) expenditures, investments, leases of any type or commitment or type of commitment made in connection with the business of either party or in reliance on the existence of this Agreement, other than any fees required to be paid by MEL pursuant to the International Distribution Coordination Agreement.

 

c.                                               International Distribution Coordination Agreement. Notwithstanding anything to the contrary herein, MEC shall not have the right to terminate this Agreement with respect to any action

 

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or circumstance approved by MEL pursuant to Section 4.8 of the International Distribution Coordination Agreement, unless KO consents to such termination in writing in advance.

 

d.                                              Sole Remedy.

 

i.                                         The Breach Severance Payment, Product Severance Payment and/or the Territory Severance Payment payable by MEC to Distributor, pursuant to the provisions of this Section 12, if any, and MEC’s repurchase of Distributor’s inventory of Products, advertising materials and MEC Equipment pursuant to Section 12(e)(iv) below, or Distributor’s right to sell such inventory if not so repurchased by MEC, shall constitute Distributor’s sole and exclusive remedy for the termination or non-renewal of this Agreement, including, without limitation, in the case of a breach and shall be in lieu of all other claims that Distributor may have against MEC as a result thereof. Without in any way detracting from or limiting the provisions of Sections 12(e)(iii) and 12(e)(v) below and, in addition thereto, under no circumstances shall MEC be liable to Distributor by reason of the termination or non-renewal of this Agreement for compensation, reimbursement or damages of whatsoever nature including, without limitation, for (A) loss of prospective compensation or earnings, (B) goodwill or loss thereof, or (C) expenditures, investments, leases of any type or commitment or type of commitment made in connection with the business of Distributor or in reliance on the existence of this Agreement.

 

ii.                                      The Breach Severance Payment payable by Distributor to MEC pursuant to the provisions of this Section 12, if any, and MEC’s repurchase of Distributor’s inventory of Products, advertising materials and MEC Equipment pursuant to Section 12(e)(iv) below, or Distributor’s right to sell such inventory if not so repurchased by MEC, shall constitute MEC’s sole and exclusive remedy for the termination or non-renewal of this Agreement, including, without limitation, in the case of a breach and shall be in lieu of all other claims that MEC may have against Distributor as a result thereof. Without in any way detracting from or limiting the provisions of Sections 12(e)(iii) and 12(e)(v) below and, in addition thereto, under no circumstances shall Distributor be liable to MEC by reason of the termination or non-renewal of this Agreement for compensation, reimbursement or damages of whatsoever nature including, without limitation, for (A) loss of prospective compensation or earnings, (B) goodwill or loss thereof, or (C) expenditures, investments, leases of any type or commitment or type of commitment made in connection with the business of MEC or in reliance on the existence of this Agreement.

 

e.                                               Other Terms Pertaining to Termination. In the event of the termination of this Agreement for any reason whatsoever (and whether such termination is due to the breach of any of the provisions of this Agreement by any party and/or itself is in breach of the Agreement or otherwise):

 

i.                                         MEC shall have the right to cancel all of Distributor’s purchase orders for affected Products accepted but remaining unfilled as of the date of termination;

 

ii.                                      All amounts payable by Distributor to MEC or by MEC to Distributor shall be accelerated and shall immediately become due unless such termination results from the other’s breach of this Agreement;

 

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iii.                                    Except for the sole remedy provisions in Sections 12(d)(i) and (ii), neither party shall be liable to the other party in contract, tort or on any other theory of liability for any damage, loss, cost or expense (whether general, special, indirect, incidental, consequential or punitive) suffered, incurred or claimed by the other party as a result of or related to such breach and/or termination (even if the termination results from a breach and the breaching party has been advised of the possibility of such damages), including, without limitation, loss of anticipated profits or goodwill, loss of or damage to goodwill or business reputation or any loss of investments or payments made by either party in anticipation of performing under this Agreement;

 

iv.                                   MEC and Distributor shall each have the option, exercisable upon written notice to the other within thirty (30) days after the date of termination hereof, to cause MEC to (A) repurchase all affected Products in Distributor’s inventory and current advertising materials (providing such Products and advertising materials are in saleable condition) at the prices paid or payable for such Products by Distributor (less any freight and insurance charges), F.O.B., Distributor’s premises and (B) purchase all of Distributor’s right, title and interest in, and all applicable rights in, related to, or associated with, all MEC Equipment and the placement or location of such MEC Equipment at all Distributor’s customers’ locations or premises by Distributor at the fair market value of Distributor’s interest, if any, in each such item of MEC Equipment with no amount or compensation allocated to, or payable for, the maintenance, placement or location of the MEC Equipment;

 

v.                                      Any Breach Severance Payment, Product Severance Payment, or Territory Severance Payment (each, a “Severance Payment”) payable in accordance with this Agreement by either MEC or Distributor in the event of termination of this Agreement shall constitute reasonable liquidated damages and is not intended as a forfeiture or penalty. MEC and Distributor agree that it would be impractical and extremely difficult to estimate the total detriment suffered by either party as a result of termination of this Agreement pursuant to this Section 12 or otherwise, and that under the circumstances existing as of the Effective Date, the applicable Severance Payment represents a reasonable estimate of the damages which either MEC or Distributor will incur as a result of such applicable termination. Therefore, MEC and Distributor agree that a reasonable estimate of the total detriment that either party would suffer in the event of termination of this Agreement pursuant to this Section 12 or otherwise is an amount equal to the applicable Severance Payment. The foregoing provision shall not waive or affect either party’s indemnity obligations or the parties’ respective rights to enforce those indemnity obligations under this Agreement, or waive or affect either party’s obligations with respect to any other provision of this Agreement which by its terms survives the termination of this Agreement;

 

vi.                                   Distributor acknowledges and agrees that the payment of any Severance Payment by MEC to Distributor shall be conditional upon (A) Distributor cooperating in good faith with MEC in effecting a smooth transition of or otherwise transferring any distribution or similar rights under this Agreement to MEC (as determined is appropriate by MEC), or in MEC’s sole discretion, to a third party distributor appointed by MEC, provided that MEC may only withhold payment of such Severance Payment if Distributor materially fails to comply with specific requests of MEC to take actions that are reasonably required to effect such transition and would not impose material costs on Distributor (except to the extent MEC reimburses the same), (B) Distributor, at MEC’s request and expense, taking such reasonable action as is necessary to terminate Distributor’s registration as MEC’s distributor, and/or an authorized importer of Products and/or holder of any

 

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health certificate and/or import permit with respect to the Products, with any Governmental Entity, in each case subject to applicable law and (C) Distributor performing its obligations under Section 12(g)(i) below in all material respects. Distributor shall cooperate in good faith with MEC in assigning or otherwise transferring to MEC (as determined is appropriate by MEC), or in MEC’s sole discretion, to a third party distributor, any such registration or approval including, without limitation, any licenses, permits, certificates, and governmental approvals (or the functional equivalent in the Territory) that Distributor may have acquired in connection with carrying out its obligations under this Agreement. MEC shall not invoke the right to withhold payment of any Severance Payment unless MEC shall have given Distributor at least twenty (20) days written notice of its failure to perform any of its obligations set forth in this Section 12(e)(vi) and Distributor has failed to cure such failure during such twenty (20) days; and

 

vii.                                Upon any notice of termination of this Agreement provided in accordance with the terms hereof and during the applicable notice period, nothing in this Agreement shall be deemed to prohibit MEC, in its sole discretion from negotiating and/or granting distribution rights to any third party or engage directly in transactions concerning the sale and distribution of the Products in the Territory.

 

f.                                        Continued Supply of Products After Termination. In the event MEC continues to supply Products to Distributor for any reason following the termination of this Agreement, Distributor acknowledges and agrees that any such action shall not constitute a waiver of MEC’s rights under this Agreement or a reinstatement, renewal or continuation of the Term of this Agreement. MEC and Distributor agree that if MEC continues to supply Products to Distributor following the termination of this Agreement, (i) Distributor shall not actively seek or solicit customers for the Products outside the Territory or any customers located within the Territory other than Distributor’s Accounts, (ii) Distributor shall promptly pay the prices of the Products in full (without deduction or set-off for any reason) in accordance with the payment terms set forth in MEC’s invoice, and (iii) MEC shall have the right, in its sole discretion, to discontinue supplying Products to Distributor at any time, without notice to Distributor.

 

g.                                       Distributor’s Obligations After Notice of Termination.

 

i.                                          During any period after either party gives the other notice of termination of this Agreement and until actual termination of this Agreement, Distributor shall (A) continue to perform all of Distributor’s obligations under this Agreement, including without limitation, all of Distributor’s obligations under Section 3 above, (B) not cause or permit the Products or the Trademarks to be prejudiced in any manner, (C) not eliminate, reduce or replace the listings, shelf space, positioning and/or other benefits enjoyed by the Products, (D) continue to conduct its business relating to the distribution and sale of Products in the ordinary course and consistent with its prior practices including, without limitation, by not purchasing more inventory than customarily purchased by Distributor of Products or offering its customers prices, terms or benefits not customarily offered by Distributor such as discounts, rebates or sales promotion allowances (except to the extent permitted hereunder), and (E) generally cooperate with MEC in relation to the transition to any new distributor appointed by MEC for the Territory.

 

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ii.                                       For a period of thirty (30) days after termination of this Agreement for any reason, Distributor shall not tortiously interfere with any listings, shelf space, or positioning for the Products.

 

13.                               Annual Business Plan; Minimum Distribution Levels; Promotion.

 

a.                                      During the Term, MEC shall have primary responsibility for the overall global branding and positioning of the Products, as well as brand and image Marketing for the Products, in such form and manner and of such nature and to such extent as may be determined by MEC in its sole and absolute discretion from time to time (“Global Branding and Marketing”). Distributor acknowledges and agrees that MEC makes no express or implied warranty, representation or covenant relating to or in connection with any Global Branding and Marketing activities, including without limitation, as to the value, performance, extent, effectiveness, quantity, quality, success or results of any such activities or the lack thereof. Except as set forth in Section 19 below, Distributor shall not have any claim against MEC and its Affiliates and hereby releases MEC and its Affiliates from all and any claims by, and liability to, Distributor of any nature for their failure to market and promote, or adequately market and promote, the Products or arising from or relating to or in connection with any Global Branding and Marketing activities procured, provided or performed by MEC and/or its Affiliates or MEC’s and/or its Affiliates’ failure to procure, provide or perform such activities.

 

b.                                      Not less than sixty (60) days before the end of each Contract Year, MEC and Distributor shall mutually review the conditions of the marketplace, Distributor’s efforts to achieve sales and its results, including year over year performance, as well as a proposed annual sales, promotion, and trade marketing plan (“Annual Business Plan”) for the next Contract Year prepared by Distributor. Such review shall include discussion on marketing efforts and proposed programs to be implemented to improve the distribution and/or sales velocity of the very lowest selling (measured by sales velocity) SKU/s of Products, if appropriate, and/or the possible deletion from distribution, if appropriate, of the very lowest selling (measured by sales velocity) SKU/s of Products but in accordance with and subject to the provisions of Section 13(f) below. Such Annual Business Plan shall cover such matters as may be appropriate including specific account placement performance objectives, merchandising goals, specific account and channel objectives for specified distribution channels, distribution goals, a sales and marketing spending plan and a strategy for maximizing sales and growth of market share as well as cooler and vending machine programs and plans. Additionally, if the Territory has an ethnic market or concentration, the Annual Business Plan shall address such specific ethnic segments, including retail promotions, point-of-sale allocations and special events for ethnic segments. The Annual Business Plan shall not detract from the provisions of Section 10 above. Distributor shall use Best Efforts to implement such Annual Business Plan in the following Contract Year in accordance with Section 3(f) above.

 

c.                                       Not less than sixty (60) days before the end of the then-current Contract Year, MEC and Distributor shall mutually agree, in writing, on minimum distribution levels to be achieved and maintained by Distributor for each of the Products throughout the next Contract Year (the “Minimum Distribution Levels”). Should the parties have failed, for whatsoever reason, to mutually agree upon the Minimum Distribution Levels to be achieved and maintained by Distributor for each of the Products throughout the next Contract Year, the same shall be determined by reference to the process described in Section 12(a)(i)(D) above. The parties shall perform all of their respective

 

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obligations under this Section except that Distributor shall not be obligated to achieve and maintain the Minimum Distribution Levels until the expiration of the six (6) month period immediately following the Commencement Date of this Agreement. A commercially reasonable representation of SKUs of Products shall be required to be in distribution throughout the year in reasonable positioning on shelves, which shall take into account retailer willingness to sell all of the SKUs of Products, shelf space limitations and other commercially reasonable factors that may be applicable in the market.

 

d.                                      MEC and Distributor shall also agree in writing to performance targets to be achieved and maintained by Distributor for the forthcoming calendar year of this Agreement (collectively, the “Performance Targets”). For the avoidance of doubt, Performance Targets will not include sales volume or value requirements and the failure to achieve sales volume and/or sales value requirements shall not constitute a breach of this Agreement nor an issue subject to adjudication under Section 12(a)(i)(D).

 

e.                                       The Minimum Distribution Levels for the Products that shall be required to be achieved and maintained by Distributor for the Products shall be reduced to the extent only that actual distribution levels are eroded as a direct result of (i) MEC’s failure to deliver Products in accordance with this Agreement, (ii) MEC’s failure to reimburse all costs pursuant to Section 13(g)(iv) below or (iii) MEC’s failure to contribute its agreed share of the parties funding obligation as set forth in Section 13(g)(iii).

 

f.                                        In every calendar year commencing 2017, the parties agree to periodically meet in order to discuss performance of the lowest selling SKU/s of Products and to delete from distribution in the Territory any SKU/s the parties mutually agree in writing, provided that MEC will not unreasonably withhold its approval to the deletion of any applicable SKU/s. MEC may withhold its approval to deletion of any SKU/s if any applicable SKU/s has/have sufficient sales velocity or is or are capable of delivering sufficient sales velocity in any one or more of Distributor’s Accounts or any one or more regions or countries, as the case may be, to make such SKU/s economically viable to continue in distribution in such one or more of Distributor’s Accounts or in any one or more regions or countries, as the case may be. Notwithstanding the foregoing, unless mutually agreed in writing, in no event shall more than ten percent (10%) of the total number of SKUs, rounded down to the nearest whole number (unless ten percent (10%) of the total number of SKUs is less than one (1) but more than 0.5, in which case the number will be rounded up to one (1)), be deleted from distribution in any rolling twelve (12) month period.

 

g.                                       Promotional activities shall be regulated as follows:

 

i.                                          The estimated costs of promotional activities shall be allocated as set forth in Exhibit E between MEC and Distributor thirty (30) days prior to the commencement of a calendar year on a cost per-case basis of Products.

 

ii.                                       The promotional activities costs are to be shared between Distributor and MEC as set forth in Exhibit E. The parties agree that the costs for the promotional activities shall be reconciled each quarter and that the estimate for the costs of promotional activities in the subsequent quarter may be adjusted provided there is mutual agreement.

 

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iii.                                    MEC and Distributor shall periodically meet and may mutually agree to promotional activities including further programs and campaigns not included in the promotional activities contemplated in Exhibit E. The promotional activities costs that are so agreed to between the parties shall be shared between, and paid by, Distributor and MEC as may be agreed in writing from time to time.

 

iv.                                   If and to the extent previously approved by MEC in writing, MEC shall reimburse or credit Distributor for all of Distributor’s actual out-of-pocket expenses paid or incurred by Distributor in relation to the promotional and trade marketing of Products not otherwise provided for and/or dealt with pursuant to Section 13(g)(i), (ii) and (iii) above.

 

v.                                      Distributor shall continue its business in the ordinary course including the provision, utilization, and maintenance of coolers, other refrigeration equipment, and vending machines (including without limitation as provided in Section 3(t) above). Distributor shall be responsible for creating marketing materials for submission to MEC for its final written approval. Distributor shall not use marketing materials unless approved by MEC in writing; provided that if MEC does not notify Distributor that it objects to any suggested marketing materials within fifteen (15) days after receipt of such materials from Distributor, MEC shall be deemed to have approved such suggested marketing materials.

 

14.                               Distribution Accounts and MMM Accounts.

 

a.                                      Distributor and its sub-distributors shall have the primary (except as specified in Exhibit C) relationship with retail and other customers throughout the Territory and shall be responsible for negotiating the terms of sale of the Products within the Territory; provided that without detracting from the foregoing, MEC may, in its sole and absolute discretion, elect to exercise the right to assume some or all of the elements in the primary relationship with any Large Accounts. For the purposes of this Agreement, “Large Account” mean any large accounts having multiple outlets within the Territory, which may include MMM Accounts. Such rights shall include, without limitation, the right to provide input to Distributor and its sub-distributors regarding sales strategy and other matters as well as to provide sales, marketing, promotional and merchandising support and programs to retail and other customers as well as the right to meet directly with and make presentations to retail and other customers within the Territory as may be appropriate from time to time; and provided further that MEC will advise Distributor of such meetings beforehand to the extent practicable and Distributor shall be entitled to accompany MEC to the meetings. Additionally, MEC may (i) accompany, assist and support Distributor and/or its sub-distributors from time to time on sales calls to Distributor Accounts in the Territory and to make independent calls on Large Accounts, (ii) to the extent KO extends an invite to MEC with respect to specific system-wide KO bottler meetings that relate in any part to Energy Drinks, attend such part of such meetings relating to Energy Drinks, and (iii) arrange, coordinate and administer a sales trip incentive program at least once per year. For the sake of clarity, MEC shall not offer or agree terms of supply and/or terms of sale of the Products within the Territory to any of Distributor’s Accounts without the prior agreement of Distributor (subject to Section 14(c) below), which agreement will not be unreasonably withheld.

 

b.                                      MEC shall have the right to attend and participate in regular performance review meetings with Distributor to facilitate efficient marketing and distribution of Products. Without

 

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detracting from the foregoing, Distributor will not oppose any additional actions the adoption of which are considered by MEC as necessary and justified in order to protect and improve the sales and distribution system for the Products, including, but not limited to those actions which might be adopted concerning the supply of large or special customers whose field of activity transcends the boundaries of the Territory.

 

c.                                       “MMM Accounts” shall mean multi-market major accounts having multiple outlets in one or more market/s and/or country/ies in any territories for which Distributor has distribution rights for the applicable Products and/or having multiple outlets in one or more market/s and/or country/ies outside of the territories in which Distributor has distribution rights for the applicable Products. The parties recognize that it is in their respective interests to work together to formulate the approach to be followed by them jointly or separately with various customers and/or channels of trade, including MMM Accounts, from time to time, both to take advantage of a coordinated approach and to avoid the negative impact of a lack of coordination. MEC and Distributor therefore agree that an aligned customer/channel approach is a key part of each Annual Business Plan and that they will engage in regular communication to adopt such plans as well as to deal with further opportunities that may arise from time to time during each calendar year, so as to avoid either party acting in an uncoordinated way towards customers. Subject to Section 14(a) above, if MEC deems it desirable for Products to be sold to any MMM Account, MEC shall be entitled, in its discretion, to make arrangements directly with such MMM Account including the terms of sale of Products to the MMM Account and the MMM Pricing (as defined below), which shall take into account the prices and funding then offered by Distributor and its sub-distributors to MMM Accounts and similar categories of customers, in the Territory. Notwithstanding anything to the contrary herein, MEC shall be entitled to determine the business relationship with MMM Accounts, including, without limitation, the pricing offered to such MMM Accounts, which may be single pricing, multiple pricing or different pricing for (a) different customers in different territories or markets, or parts of different territories or markets, (b) the same customer in the same territory or market, or parts of such territory or market and/or (c) the same customer in different territories or markets, or parts of such territories or markets (the “MMM Pricing”). To the extent feasible, MEC will consult with Distributor with respect to the MMM Pricing. MEC shall use commercially reasonable efforts to arrange for all outlets of any such MMM Account within the Territory to be serviced by Distributor and/or its sub-distributors and for delivery of the Products and other arrangements with regard thereto, to be made directly by Distributor and its sub-distributors or their warehouse system. Notwithstanding the foregoing, should the MMM Account concerned not agree to its outlets within the Territory being serviced by Distributor or should Distributor elect not to service such outlets, MEC shall be entitled to service the outlets directly. In the event MEC services the outlets directly, MEC shall bear sole liability and responsibility related to such MMM Account and MEC shall pay to Distributor, during the period that MEC services such outlets directly, an amount equal to twenty- five percent (25%) of Distributor’s “average gross profit per case” per Product case SKU sold to and calculated with respect to MMM Accounts in the channel in question but otherwise in accordance with the provisions of Section 12(a)(i)(A) above (or based on MEC’s actual selling price of such Product case SKU if such Product case SKU is not sold by Distributor), for each case of such Product case SKU sold by MEC to the outlets concerned (but only on the excess of the amount by which the aggregate cases of such Product case SKU/s sold to such outlets in the Territory during each Contract Year exceeds the number of cases set forth on Exhibit F or the number of cases reduced pro rata for any period of less than one year), within a reasonable time after receipt by MEC of all information necessary for the computation of the amount due under this Section 14, but in no

 

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event more frequently than twice per calendar year. For the purposes of this Agreement, the number of cases of Product case SKU/s sold by MEC to the outlets during any period shall be the actual number of cases reasonably determined by MEC, or if not determined by MEC then as determined by multiplying the total number of cases of Product case SKU/s sold by MEC directly to such MMM Account or regional division of such MMM Account, as the case may be, during the period concerned, by a fraction, the numerator of which shall be the number of outlets within the Territory and the denominator of which shall be the total number of outlets that the MMM Account has anywhere in the world participating in the applicable program.

 

15.                               Exclusion of Damages.

 

a.                                      EXCEPT FOR DAMAGES DIRECTLY RESULTING FROM INDEMNITY OBLIGATIONS PROVIDED IN SECTION 19, WITHOUT IN ANY WAY DETRACTING FROM OR LIMITING THE PROVISIONS OF SECTIONS 12(d), 12(e)(iii) AND/OR 12(e)(v) ABOVE AND, IN ADDITION THERETO, NEITHER PARTY SHALL BE LIABLE FOR ANY CONSEQUENTIAL, INCIDENTAL, SPECIAL, OR EXEMPLARY DAMAGES (INCLUDING, WITHOUT LIMITATION, DAMAGES FOR LOSS OF PROFITS, LOSS OF GOODWILL, BUSINESS INTERRUPTION, LOSS OF BUSINESS OPPORTUNITY, OR ANY OTHER PECUNIARY LOSS) SUFFERED BY THE OTHER RELATED TO OR ARISING OUT OF THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, AND/OR THE USE OF OR INABILITY TO USE OR SELL THE PRODUCTS, AND/OR FROM ANY OTHER CAUSE WHATSOEVER, EVEN IF IT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

 

b.                                      EACH AND EVERY PROVISION OF THIS AGREEMENT WHICH PROVIDES FOR A LIMITATION OF LIABILITY OR WARRANTIES, DISCLAIMER, OR EXCLUSION OF DAMAGES, IS EXPRESSLY INTENDED TO BE SEVERABLE AND INDEPENDENT FROM ANY OTHER PROVISION, SINCE THOSE PROVISIONS REPRESENT SEPARATE ELEMENTS OF RISK ALLOCATION BETWEEN THE PARTIES, AND SHALL BE SEPARATELY ENFORCED.

 

16.                               Distributor’s Representations and Warranties. Distributor represents and warrants to MEC that (a) it has the right and lawful authority to enter into this Agreement, and (b) the execution and delivery of the Offer and performance of this Agreement will not cause or require Distributor to breach any obligation to, or agreement or confidence with, any other Person.

 

17.                               MEC’s Representations and Warranties.

 

a.                                      MEC represents and warrants to Distributor that (i) it has the right and lawful authority to enter into this Agreement, and (ii) the execution and delivery of the Acceptance and performance of this Agreement will not cause or require MEC to breach any obligation to, or agreement or confidence with, any other Person.

 

b.                                      MEC warrants that all Products, all food additives in the Products, and all substances for use in, with, or for the Products, comprising each shipment or other delivery hereby made by MEC to, or on the order of, Distributor are hereby guaranteed as of the date of delivery to be, on such date, (i) for Products imported by Distributor from the United States, not adulterated or

 

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misbranded within the meaning of the Federal Food, Drug and Cosmetic Act, as amended, including the Food Additives Amendment of 1958 (the “Act”) and are not articles which may not under the provisions of Sections 404, 505, or 512 of the Act, be introduced into interstate commerce, and (ii) for all Products supplied by MEC to Distributor (whether or not imported from the United States) to be in compliance with all health, safety, and labeling standards and specifications imposed by law, regulation or order in the Territory in which the Products will be sold by Distributor and which are applicable to the Products.

 

c.                                       MEC warrants that all Products shall be merchantable.

 

d.                                      Distributor’s sole and exclusive remedy for MEC’s breach of MEC’s representations in Sections 17(b) and 17(c) above shall be as provided for in Section 19(b) below.

 

18.                               Limitation of Warranty. MEC MAKES NO REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED (INCLUDING THE IMPLIED WARRANTIES OF NON- INFRINGEMENT, MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE) EXCEPT THOSE SET FORTH IN SECTION 17 ABOVE.

 

19.                               Indemnification.

 

a.                                      Distributor shall indemnify, defend, and hold harmless MEC and its officers, directors, agents, employees, shareholders, legal representatives, successors and assigns, and each of them, from loss, liability, costs, damages, or expenses from any and all claims, actions and suits, instituted by any third party, whether groundless or otherwise, and from and against any and all third party claims, liabilities, judgments, losses, damages, costs, charges, attorney’s fees, and other expenses of every nature and character arising from the breach of Distributor’s express representations and warranties under this Agreement by Distributor or its agents, employees, subcontractors, sub-distributors or others acting on its behalf, provided that (i) MEC gives Distributor written notice of any indemnifiable claim and MEC does not settle any claim without Distributor’s prior written consent, and (ii) MEC does all things reasonably required by applicable law to mitigate the claim, loss, damage, liability, cost, suit, action, judgment or expense (including without limitation attorney’s fees) to the fullest possible extent.

 

b.                                      MEC shall indemnify, defend, and hold harmless Distributor and its officers, directors, agents, employees, shareholders, legal representatives, successors, assigns, and customers, and each of them, from loss, liability, costs, damages, or expenses from any and all claims, actions and suits instituted by any third party, whether groundless or otherwise, and from and against any and all such third party claims, liabilities, judgments, losses, damages, costs, charges, attorney’s fees, and other expenses of every nature and character and all Distributor’s direct documented costs to store, transport, test and destroy all unsellable Products and advertising materials arising from (i) the breach of MEC’s express representations and warranties under this Agreement or those of its agents, employees, subcontractors or others acting on its behalf, (ii) any impurity, adulteration, deterioration in or misbranding of any Products sold to Distributor by MEC, (iii) any prior distributor of Products in the Territory, (iv) any MEC marketing, advertising, promotion, labeling, Global Branding and Marketing, and the Trademarks, Copyrights, Patents, Know-How or other intellectual property relating to the Products, or (v) the fact that the Products (A) are not safe for the purposes for which goods of that kind are normally used or (B) do not comply with any applicable health, safety, or

 

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environmental laws, regulations, orders or standards imposed in the Territory; provided that (1) Distributor gives MEC written notice of any indemnifiable claim and Distributor does not settle any claim without MEC’s prior written consent, and (2) Distributor does all things reasonably required by applicable law to mitigate the claim, loss, damage, liability, cost, suit, action, judgment or expense (including without limitation attorney’s fees) to the fullest possible extent.

 

c.                                       If any action or proceeding is brought against Distributor, MEC or any other indemnified party under Section 19(a) or 19(b) (the “Indemnified Party”), the Indemnified Party shall promptly notify the party required to provide indemnification (the “Indemnifying Party”) in writing to that effect. If the Indemnified Party fails to promptly notify the Indemnifying Party, the Indemnified Party shall be deemed to have waived any right of indemnification with respect to such claim to the extent (but only to the extent) any delay in such notice prejudices the Indemnifying Party’s ability to defend such action, suit or proceeding. The Indemnifying Party shall have the right to defend such action or proceeding at the Indemnifying Party’s sole cost by counsel satisfactory to Indemnifying Party. If the Indemnifying Party fails to promptly defend or otherwise settle or finally resolve such action, suit or proceeding, Indemnified Party may defend such action, suit or proceeding using counsel selected by Indemnified Party, and the Indemnifying Party shall reimburse Indemnified Party for any resulting loss, damages, costs, charges, attorney’s fees, and other expenses and the related costs of defending such action, suit or proceeding.

 

d.                                      The parties agree that the provisions contained in this Section shall survive for two (2) years upon the termination or expiration of this Agreement.

 

20.                               Insurance. During the Term of this Agreement and for a period of one (1) year thereafter, MEC and Distributor agree to maintain policies of insurance of the nature and amounts specified below, which shall provide the other party as an additional insured (providing for a waiver of subrogation rights and endeavoring to provide for not less than thirty (30) days written notice of any modification or termination of coverage), and each party shall provide the other party with a certificate of insurance evidencing such insurance, in a form satisfactory to such party:

 

·                  Commercial General Liability, including contractual liability coverage, with limits of at least $1,000,000 per occurrence; Bodily Injury and Property Damage / $1,000,000; Personal and Advertising Injury / $1,000,000; Products/Completed Operations / $2,000,000 General Aggregate.

 

·                  Excess or Umbrella Liability with a limit of not less than $5,000,000 per occurrence over the insurance coverage described above.

 

·                  Other statutory insurance required by the applicable laws of the Territory.

 

For any claims under this Agreement, the applicable party’s insurance shall be deemed to be primary and not contributing to or in excess of any similar coverage purchased by the other party. All deductibles payable under an applicable policy shall be paid by the party responsible for purchasing such policy. All such insurance shall be written by companies authorized to do business

 

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in the state or states where the work is to be performed and having at least the ratings of the respective parties current insurers, unless not obtainable at commercially reasonable rates in light of previous premiums. The parties will ensure that the insurance policies obtained pursuant to this Section are effective and enforceable for any liability, claims or other insurable event arising in the Territory.

 

21.                               Competing Products. During the Term of this Agreement, Distributor shall not market, sell, manufacture, prepare, package, or distribute, directly or indirectly, or assist any third party in engaging in the business of manufacturing, marketing, selling, or distributing any Energy Drink/s or products reasonably likely to be confused with any of the Products in the Territory or reasonably likely to be perceived by consumers as confusingly similar to or be passed off as Products (“Competing Products”), except that Distributor may manufacture, prepare, package, market, sell and distribute and otherwise engage or assist any third party in engaging in the business of manufacturing, marketing, selling or distributing in the Territory Competing Products that: (a) are owned, marketed, sold or distributed by KO or an Affiliate of KO, or (b) were internally developed by KO or any of its Affiliates, in each case (a) and (b), to the extent KO is not otherwise prohibited from marketing, selling or distributing such Competing Products pursuant to a written agreement between MEL or MEC and KO. If under the terms of any written agreement between MEL or MEC and KO, KO authorizes Distributor to sell Competing Products, then Distributor agrees that it shall be obligated at all times to allocate and devote at least such resources and efforts (in all material respects) to the promotion, marketing, sale, and distribution of the Products as are substantially proportional to the ratio that the volume of Distributor’s sales of Products bears to the volume of Distributor’s sales of Competing Products.

 

22.                               Amendment. Except to the extent otherwise expressly permitted by this Agreement, no amendment of, or addition to, this Agreement shall be effective unless reduced to a writing executed by the duly authorized representatives of both parties or by some other form of amendment mutually agreed to in writing by the parties. KO’s approval of any amendment shall be necessary with respect to an amendment, modification, addition or deletion (a) that would reasonably be expected to materially impact KO’s rights or benefits under this Agreement or the International Distribution Coordination Agreement, or (b) to any of the following terms (or otherwise materially affecting such terms): definition of Products (to the extent KO has consent rights with respect thereto under the International Distribution Coordination Agreement), term, termination, deadlock procedures, placement in branded refrigerated equipment, distributor’s exclusivity, facilitation fee, distribution refusal, competing products or other non-competition, and amendment, in which case KO’s affirmative written approval shall be required.

 

23.                               Assignment. Neither party may assign its rights or delegate its obligations hereunder without the prior written consent of the other and KO; provided, that (a) MEC shall have the right, in its sole and absolute discretion, to assign its rights and/or obligations under this Agreement to any Affiliate or subsidiary of MEC without the written consent of Distributor and/or KO, and any such transferee shall be deemed to be included within the defined term “MEC” for purposes of this Agreement and (b) Distributor shall have the right, in its sole and absolute discretion, to assign its rights and/or obligations under this Agreement to any Affiliate or subsidiary of Distributor without the written consent of MEC and/or KO, and any such transferee shall be deemed to be included within the defined term “Distributor” for purposes of this Agreement. Any purported assignment or delegation, in the absence of such written consent, shall be void.

 

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24.                               No Agency. The relationship between MEC and Distributor is that of a vendor to its vendee and nothing herein contained shall be construed as constituting either party the employee, agent, independent contractor, partner or co-venturer of the other party. Neither party shall have any authority to create or assume any obligation binding on the other party.

 

25.                               Governing Law. This Agreement shall be governed by and interpreted in accordance with the laws of the State of New York (without reference to its law of conflict of laws), and the provisions of the United Nations Convention On Contracts For The International Sale Of Goods will expressly be excluded and not apply. The place of the making and execution of this Agreement is New York, United States of America. Distributor hereby waives any rights that it may otherwise have to assert any rights or defenses under the laws of the Territory or to require that litigation brought by or against it in connection with this Agreement be conducted in the courts or other forums of the Territory. For the sake of clarity, the parties record that their choice of law shall not include the New York Franchise Sales Act, or any amendment or functionally equivalent statute, unless such law would otherwise apply, and nothing herein shall be deemed to extend or otherwise affect the scope or application of such statute.

 

26.                               Arbitration. Any dispute, controversy or claim arising out of or relating to this Agreement or the breach or termination hereof shall be settled by binding arbitration conducted in the English language by JAMS (“JAMS”) in accordance with JAMS Comprehensive Arbitration Rules and Procedures (the “Rules”). The arbitration shall be heard by three arbitrators to be selected in accordance with the Rules, in New York, New York. Judgment upon any award rendered may be entered in any court having jurisdiction thereof. Within seven (7) calendar days after appointment the arbitral panel shall set the hearing date, which shall be within ninety (90) days after the filing date of the demand for arbitration unless a later date is required for good cause shown and shall order a mutual exchange of what such panel determines to be relevant documents and the dates thereafter for the taking of up to a maximum of five (5) depositions by each party to last no more than five (5) days in aggregate for each party. Both parties waive the right, if any, to obtain any award for exemplary or punitive damages or any other amount for the purpose or imposing a penalty from the other in any arbitration or judicial proceeding or other adjudication arising out of or with respect to this Agreement, or any breach hereof, including any claim that said Agreement, or any part hereof, is invalid, illegal or otherwise voidable or void. In addition to all other relief, the arbitral panel shall have the power to award reasonable attorneys’ fees and costs to the prevailing party. The arbitral panel shall render an award no later than seven (7) calendar days after the close of evidence or the submission of final briefs, whichever occurs later. The decision of the arbitral panel shall be final and conclusive upon all parties. Notwithstanding anything to the contrary, if either party desires to seek injunctive or other provisional relief that does not involve the payment of money, then those claims shall be brought in a state or federal court located in New York, New York, and the parties hereby irrevocably and unconditionally consent to personal jurisdiction of such courts and venue in New York, New York in any such action for injunctive relief or provisional relief.

 

27.                               Force Majeure.

 

a.                                      Neither party shall be liable for any delays in delivery or failure to perform or other loss due directly or indirectly to circumstances unforeseen as of the Effective Date or causes beyond such party’s reasonable control (each, individually, a “Force Majeure Event”), including, without limitation: (i) acts of God, act (including failure to act) of any Governmental Entity (de jure or de

 

32

 

facto), wars (declared or undeclared), governmental priorities, port congestion, riots, revolutions, strikes or other labor disputes, fires, floods, sabotage, nuclear incidents, earthquakes, storms, epidemics; or (ii) inability to timely obtain either necessary and proper labor, materials, ingredients, components, facilities, production facilities, energy, fuel, transportation, governmental authorizations or instructions, material or information. The foregoing shall apply even though any Force Majeure Event occurs after such party’s performance of its obligations is delayed for other causes but only during the period of the applicable Force Majeure Event.

 

b.                                      The party affected by a Force Majeure Event shall give written notice to the other party of the Force Majeure Event within a reasonable time after the occurrence thereof, stating therein the nature of the suspension of performance and reasons therefore. Such party shall use its commercially reasonable efforts to resume performance as soon as reasonably possible. Upon restoration of the affected party’s ability to perform its obligations hereunder, the affected party shall give written notice to the other party within a reasonable time.

 

28.                               Merger. The Offer, the Acceptance, this Agreement and the attached Exhibits contain the entire agreement between the parties to this Agreement with respect to the subject matter of this Agreement, are intended as a final expression of such parties’ agreement with respect to such terms as are included in this Agreement, are intended as a complete and exclusive statement of the terms of such agreement, and supersede all negotiations, stipulations, understandings, agreements, promises, representations and warranties, whether written or oral, if any, with respect to such subject matter, which precede the Effective Date. No other negotiations, stipulations, understandings, agreements, promises, representations, or warranties, whether written or oral, either as an inducement to enter into this Agreement or as to its meaning or effect, have been made that are not contemplated herein.

 

29.                               Waivers. No waiver of any provision hereof or of any terms or conditions will be effective unless in writing and signed by the party against which enforcement of the waiver is sought. No relaxation or indulgence which either party may grant to the other shall in any way prejudice or be deemed to be a waiver or novation of any of such party’s rights under this Agreement.

 

30.                               Product Recall. If any Governmental Entity issues a recall or takes similar action in connection with the Products, or if MEC determines that an event, incident or circumstance has occurred which may require a recall or market withdrawal, MEC shall advise Distributor of the circumstances by telephone or facsimile. MEC shall be responsible for leading and coordinating the arrangement of any Product recall, and Distributor shall cooperate in the event of a Product recall with respect to the reshipment, storage or disposal of recalled Products, the preparation and maintenance of relevant records and reports, and notification to any recipients or end users. MEC shall pay all reasonable expenses incurred by Distributor of such a recall, including the costs of destroying Products. Distributor, shall promptly refer to MEC for exclusive response to all customer or consumer complaints involving the health, safety, quality, composition or packaging of the Products, or which in any way could be detrimental to the image or reputation of MEC or the Products, and shall notify MEC of any governmental, customer or consumer inquiries regarding the Products about which Distributor becomes aware.

 

31.                               Interpretation. In the event any ambiguity or question of intent or interpretation arises, this Agreement shall be construed as drafted jointly by the parties and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of

 

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this Agreement. No provision of this Agreement shall be construed against any party on the grounds that such party or its counsel drafted that provision.

 

32.                               Partial Invalidity. Each provision of this Agreement will be valid and enforceable to the fullest extent permitted by law. If any provision of this Agreement or the application of the provision to any Person or circumstance will, to any extent, be invalid or unenforceable, the remainder of this Agreement, or the application of the provision to Persons or circumstances other than those as to which it is held invalid or unenforceable, will not be affected by such invalidity or unenforceability, unless the provision or its application is essential to this Agreement. The parties shall replace any invalid and/or unenforceable provision with a valid and enforceable provision that most closely meets the aims and objectives of the invalid and/or unenforceable provision.

 

33.                               Distributor Suppliers Guiding Principles. MEC has been informed by Distributor that the following are Distributor Suppliers Guiding Principles (the “Guiding Principles”). Notwithstanding anything set forth below, compliance with the Guiding Principles shall not constitute an obligation of MEC or Distributor under this Agreement. The Guiding Principles shall constitute unenforceable goals only of the parties and neither party shall be entitled to make any claim for breach against the other or enforce any remedy under this Agreement or terminate this Agreement as the result of non- compliance with, or a violation of, any Guiding Principle(s). The preceding sentence shall not detract from the parties’ respective rights and obligations under Section 19 above or any other representation, warranty or obligation expressly made in this Agreement.

 

·                  Laws and Regulations - Each party will use commercially reasonable good faith efforts to comply with all applicable local and national laws, rules, regulations and requirements in the manufacturing and distribution of Products.

 

·                  Child Labor - Each party will use commercially reasonable good faith efforts to comply with all applicable local and national child labor laws.

 

·                  Forced Labor - Each party will use commercially reasonable good faith efforts to not use forced, bonded, prison, military or compulsory labor.

 

·                  Abuse of Labor - Each party will use commercially reasonable good faith efforts to comply with all applicable local and national laws on abuse of employees and will not physically abuse employees.

 

·                  Freedom of Association and Collective Bargaining - Each party will use commercially reasonable good faith efforts to comply with all applicable local and national laws on freedom of association and collective bargaining.

 

·                  Discrimination - Each party will use commercially reasonable good faith efforts to comply with all applicable local and national discrimination laws.

 

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·                  Wages and Benefits - Each party will use commercially reasonable good faith efforts to comply with all applicable local and national wages and benefits laws.

 

·                  Work Hours and Overtime - Each party will use commercially reasonable good faith efforts to comply with all applicable local and national work hours and overtime laws.

 

·                  Health and Safety - Each party will use commercially reasonable good faith efforts to comply with all applicable local and national health and safety laws.

 

·                  Environment - Each party will use commercially reasonable good faith efforts to comply with all applicable local and national environmental laws.

 

34.                               Third-Party Beneficiaries. Nothing in this Agreement, express or implied, is intended or shall be construed to give any Person, other than the parties to this Agreement and their successors and permitted assigns, any legal or equitable right, remedy or claim under or in respect of any agreement or any provision contained in this Agreement.

 

35.                               Sales Information and Books and Records; Examination. Not later than thirty (30) days after the end of each calendar month Distributor shall deliver to MEC full, complete and accurate written details, separately in respect of each country within the Territory, of the following with respect to Distributor’s sale of Products in the Territory: (a) total sales, (b) taxes and/or duties, (c) discounts and sales allowances paid, accrued or credited, (d) Products returned during such period, (e) other permitted allowances, rebates, and allowance programs granted, paid, payable, reimbursed, credited or incurred by Distributor, and (f) other records containing data in sufficient detail reasonably necessary to determine all amounts payable to or reimbursable by MEC under this Agreement (collectively, the “Records”). Distributor shall keep and maintain complete and true books and other records containing data in sufficient detail reasonably necessary to determine all amounts payable to or reimbursable by MEC under this Agreement. MEC shall have the right, at its own expense, on sixty (60) days prior written notice to have such books and records and the Records (and all reasonably related work papers and other reasonable information and documents necessary for any determination under this Agreement or other related agreements) kept by Distributor examined once per calendar quarter by a public accounting firm appointed by MEC to verify the completeness and accuracy of the Records.

 

36.                               Publicity. MEC and Distributor each agree that the initial public, written announcements regarding the entering into this Agreement by each party and the subject matter addressed herein shall be coordinated between the parties prior to release. Thereafter, each party agrees to use commercially reasonable efforts to consult with the other party regarding any public, written announcement which a party reasonably anticipates would be materially prejudicial to the other party. Nothing provided herein, however, will prevent either party from (a) making and continuing to make any statements or other disclosures it deems required, prudent or desirable under applicable

 

35

 

Federal or State Securities Laws (including without limitation the rules, regulations and directives of the Securities and Exchange Commission) and/or such party’s customary business practices, or (b) engaging in oral discussions or oral or written presentations with actual or prospective investors or analysts regarding the subject matter of this Agreement, provided no confidential information is disclosed. If a party breaches this Section 36 it shall have a seven (7) day period in which to cure its breach after written notice from the other party. A breach of this Section 36 shall not entitle a party to damages or to terminate this Agreement.

 

37.                               Anti-Bribery Compliance.

 

a.                                      Distributor shall:

 

i.                                          comply with all applicable laws, statutes, regulations, and codes relating to anti-bribery and anti-corruption including but not limited to the United States Foreign Corrupt Practices Act (“Relevant Requirements”);

 

ii.                                       comply with MEC’s generally applicable Ethics, Anti-bribery and Anti- corruption Policies and the relevant industry codes on anti-bribery, in each case, that are provided to Distributor and as MEC or the relevant industry body may update them from time to time upon written notice to Distributor (“Relevant Policies”);

 

iii.                                    have and shall maintain in place throughout the term of this Agreement, its own policies and procedures to ensure compliance with the Relevant Requirements and the Relevant Policies, and will enforce them where appropriate;

 

iv.                                   to the extent permitted under applicable law, promptly report to MEC any request or demand for any undue financial or other advantage of any kind in violation of applicable law received by Distributor in connection with the performance of this Agreement; and

 

v.                                      to the extent permitted under applicable law, immediately notify MEC (in writing) if it becomes aware that a foreign public official becomes an officer or employee of Distributor or acquires a direct or indirect interest in Distributor (and Distributor warrants that, to its knowledge, it has no foreign public officials as officers, employees or direct or indirect owners at the date of this Agreement).

 

b.                                      Distributor shall use reasonable efforts to require that all of its agents and subcontractors who perform services or provide goods in connection with this Agreement do so only on the basis of a written contract which imposes on and secures from such persons terms consistent with those imposed on Distributor in this Section 37.

 

38.                               Ethical Standards.

 

a.                                      Distributor and each of its sub-distributors will comply with the United States Foreign Corrupt Practices Act and without derogating from the generality of the foregoing, will not have its directors, officers or employees, directly or indirectly, offer, promise or pay any bribes or other improper payments for the purposes of promoting and/or selling Products to any individual,

 

36

 

corporation, government official or agency or other entity. No gift, benefit or contribution in any way related to MEC or the promotion and/or sale of Products will be made to political or public officials or candidates for public office or to political organizations, regardless of whether such contributions are permitted by local laws.

 

b.                                      MEC will comply with the United States Foreign Corrupt Practices Act and without derogating from the generality of the foregoing, will not have its directors, officers or employees, directly or indirectly, offer, promise or pay any bribes or other improper payments for the purposes of promoting and/or selling Products to any individual, corporation, government official or agency or other entity. No gift, benefit or contribution in any way related to Distributor or the promotion and/or sale of Products will be made to political or public officials or candidates for public office or to political organizations, regardless of whether such contributions are permitted by local laws.

 

39.                               Controlling Language. This Agreement is in the English language only, which will be controlling in all respects. No translation, if any, of this Agreement into any other language will be of any force or effect in the interpretation of this Agreement or in a determination of the intent of either party hereto.

 

40.                               Notices. All notices or other communications required or permitted to be given to a party to this Agreement shall be in writing and shall be personally delivered, sent by certified mail, postage prepaid, return receipt requested, or sent by an overnight express courier service that provides written confirmation of delivery, to such party at the following respective address:

 

If to MEC:

 

Monster Energy Company

1 Monster Way

Corona, California 92879

Attention: Chief Executive Officer

Facsimile: (951) 739-6210

 

with a copy to:

 

Solomon Ward Seidenwurm & Smith LLP 

401 B Street, Suite 1200

San Diego, California 92101

Attention: Norman L. Smith, Esq.

Facsimile: (619) 231-4755

 

If to Distributor:

 

Embotelladora del Atlántico S.A. d/b/a Coca-Cola Andina Argentina

Ruta Nac. 19 Km. 3,7

Córdoba X5001CD2

Argentina

Attention: Pablo Teobaldo, Commercial Manager (pteobaldo@koandina.com)

Mario Lucio Ilario, Sales Manager (milario@koandina.com)

 

37

 

Marco Giuliano Peretti, Marketing Manager (mgperetti@koandina.com)

 

For Payment Notices:

 

Attention: Fernando Ramos, Finance Manager (Framos@koandina.com

 

Each such notice or other communication shall be deemed given, delivered and received upon its actual receipt, except that if it is sent by mail in accordance with this Section, then it shall be deemed given, delivered and received three (3) calendar days after confirmed delivery to such carrier. Any party to this Agreement may give a notice of a change of its address to the other party to this Agreement.

 

41.                               Further Assurances. Each party to this Agreement will execute all instruments and documents and take all actions as may be reasonably required to effectuate this Agreement.

 

42.                               [INTENTIONALLY DELETED]

 

43.                               Confidentiality. During the Term, each party shall maintain in strict confidence all commercial information disclosed by the other party (which obligation shall expressly survive termination of this Agreement for any reason); provided, however that such commercial information shall not include any information which (a) is in the public domain except through any intentional or negligent act or omission of the non-disclosing party (or any agent, employee, shareholder, director, officer, or independent contractor of or retained by such other party or any of its Affiliates), (b) can be shown by clear and convincing tangible evidence to have been in the possession of the non- disclosing party prior to disclosure by the disclosing party, (c) is legally and properly provided to the non-disclosing party without restriction by an independent third party that is under no obligation of confidentiality to the disclosing party and that did not obtain such information in any illegal or improper manner or otherwise in violation of any agreement with the disclosing party, (d) is disclosed without any restrictions of any kind by the disclosing party to third parties on a regular basis without any measures being taken, whether explicitly or implicitly, by the disclosing party to protect the confidentiality of such information, or (e) is independently generated by any employee or independent contractor of or retained by the non-disclosing party, and such employee or independent contractor has no knowledge of any of such commercial information. Notwithstanding the foregoing, the parties agree that any such commercial information may be disclosed as required by applicable law or an order by a Governmental Entity or any requirements of stock market or exchange or other regulatory body having competent jurisdiction; provided, that, except where prohibited by law, the recipient will give the disclosing party reasonable advance notice of such required disclosure, and will reasonably cooperate with the disclosing party, in order to allow the disclosing party an opportunity to oppose, or limit the disclosure of such commercial information or otherwise secure confidential treatment of such commercial information required to be disclosed; provided, further, that if disclosure is ultimately required, the recipient will furnish only that portion of such commercial information which, based upon advice of legal counsel, the recipient is required to disclose in compliance with any such requirement. The obligation of confidentiality set forth herein shall continue and be maintained for a period of three (3) years after termination of this Agreement, provided further that any Confidential Information constituting a trade secret under

 

38

 

applicable law shall continue to remain subject to the obligations of this Section 43 and other applicable provisions of this Agreement for as long as such information remains a trade secret.

 

44.                               Non-Binding Negotiations and Effectiveness. MEC and Distributor acknowledge and agree that, except as expressly stated in the Offer, the Acceptance, and this Agreement, there are no binding obligations or commitments existing between MEC and Distributor. No course of conduct, whether or not consistent with the terms discussed in connection with this Agreement, shall have the effect of converting any negotiations or discussions into a binding contract. No legally binding contract shall exist between MEC and Distributor unless and until this Agreement is accepted pursuant to the requirements set forth in the Offer.

 

39

 

EXHIBIT A

International Distribution Agreement

 

INITIAL PRODUCT LIST

 

Monster Energy

 

40

 

EXHIBIT B

International Distribution Agreement

 

THE TERRITORY

 

The same territory in Argentina that Distributor is authorized to exclusively service by KO for Coca- Cola branded products. The parties agree that the following territory description is Distributor’s representation to MEC of Distributor’s exclusive territory for Coca-Cola branded products in Argentina, but which description shall be subject to verification by MEC following the Commencement Date. Additionally, Distributor and MEC agree to work together in good faith as soon as possible following the Effective Date to provide territory maps for Distributor’s exclusive territory which will, when agreed, be attached hereto as Exhibit B-1.

 

In the Argentine Republic:

 

(a)                      The provinces of Mendoza, San Juan and San Luis, as politically constituted as of this date.

 

(b)                      The province of Córdoba, as politically constituted as of this date.

 

(c)                       In the province of Santa Fe, the Departments of San Lorenzo, Rosario, Constitución, Belgrano, Iriondo, Caseros, General López, Capital, Castellanos, Las Colonias, San Gerónimo, San Martín, Garay, San Cristóbal, Nueve de Julio and San Justo, bordered in the southern area, by an imaginary line, which starting from the town of Petronila, in the Department of San Cristobal, moves in a straight line and to the East, to a point situated 5 km south of the town of Ramayón, and continuing this imaginary line eastward in a straight  line to the town of Cacique Ariacaiquin, in the Department of San Javier.

 

(d)                      The province of Entre Ríos, as politically constituted as of this date.

 

(e)                       In the province of Buenos Aires, the departments of San Nicolás and Remallo.

 

(f)                        Also in the province of Buenos Aires, the municipalities of Bahía Blanca, Tornquist, Coronel M. L. Rosales, Coronel Dorrego, Villarino, Daireaux, Guaminí, Adolfo Alsina, Coronel Suárez, Coronel Pringles, Saavedra, Puán, Salliqueló, Municipio Urbano de Monte Hermoso, Benito Juárez, González Chávez, Tres Arroyos, Carmen de Patagones, Olavarría, Azul, Tapalqué, Laprida y Lamadrid, Arrecifes, Chacabuco, Colón, Pergamino, Rojas, Salto, Bartolomé Mitre, Capitán Sarmiento, 9 de Julio, 25 de Mayo, General Alvear, Chivilcoy, Alberti, Bragado, Junín, Viamonte, Arenales, L. N. Alem, Lincoln, General Pinto , Ameghino, Tres Lomas, Pehuajó, Carlos Casares, Hipólito Yrigoyen, Bolívar, Carlos Pellegrini, Trenque-Lauquen, Rivadavia, Carlos Tejedor and General Villegas.

 

(g)                       The provinces of Río Negro, Neuquén and La Pampa, as politically constituted as of this date

 

(h)                      The provinces of Chubut, Santa Cruz and Tierra del Fuego, as politically constituted as of this date

 

In the event of a dispute with respect to territorial boundaries between two adjacent parties, MEC shall have the right to decide such dispute in its sole discretion, and any such decision shall be final and binding upon the parties.

 

41

 

EXHIBIT B-1

International Distribution Agreement

 

[TERRITORY MAP TO COME AS SOON AS PRACTICAL FOLLOWING THE COMMENCEMENT DATE]

 

42

 

EXHIBIT C

International Distribution Agreement

 

EXCLUSIVE DISTRIBUTOR ACCOUNTS

 

All Accounts Other than Exclusive MEC Accounts

 

EXCLUSIVE MEC ACCOUNTS

 

U.S. Military — ONLY AAFES, NEXCOM, MCX, and USCG for Exchanges/Shopettes/Convenience Stores/Class 6 Stores/vending for Outside the Continental United States (“OCONUS”)

 

U.S. Military — Vending and Morale, Welfare & Recreation (i.e. including but not limited to bowling alleys, golf courses, officers clubs, etc.) for OCONUS

 

U.S. Military — all others including, but not limited to, DeCA, Ships-A-Float, Troop Feeding for OCONUS

 

43

 

EXHIBIT D

International Distribution Agreement

 

THE TRADEMARKS

 

	
MONSTER
    	
REHAB
    
	
 
    	
 
    
	
MONSTER ENERGY
    	
MONSTER RIPPER
    
	
 
    	
 
    
	

    	
RIPPER
    
	
 
    
	
 
    	
MUTANT
    
	

    	
 
    
	
ASSAULT
    
	
 
    
	

    
	
 
    
	
KHAOS
    
	
 
    
	
 
    	

    
	

    	
 
    
	
X-PRESSO   MONSTER
    
	
 
    
	
UNLEASH   THE BEAST!
    
	
 
    
	

    
	
 
    
	
 
    	
DESATA LA BESTIA
    
	

    	
 
    
	
 
    
	
 
    
	
 
    
	
 
    
	
 
    
	
 
    	
 
    
	

    	
 
    
	
 
    
	
 
    	
 
    
	

    	
 
    
	
 
    
	
 
    
	
 
    
	
 
    	
 
    
	
JAVA MONSTER
    	
 
    
	
 
    	
 
    
	

    	
 
    
	
 
    
	
 
    
	
 
    
	
 
    
	
 
    	
 
    
	
MONSTER REHAB
    	
 
    

 

44

 

EXHIBIT E

International Distribution Agreement

 

PROMOTIONAL ACTIVITIES COSTS

 

Discount and allowances, price promotions and other customer discount activities (“D&A”):

 

(a)                 MEC Led Customer Calls: Distributor shall contribute an amount equal to MEC’s contribution for D&A (including listing fees), on a 50-50 basis for all Products sold at a discounted price by Distributor to Distributor’s Accounts, provided such amount does not exceed the recommended discount set forth in the Annual Business Plan.

 

(b)                 Distributor Led Customer Calls: MEC shall contribute an amount equal to Distributor’s contribution for D&A (including listing fees), on a 50-50 basis, provided such amount does not exceed the recommended discount set forth in the Annual Business Plan.

 

(c)                  Payment & Reconciliation. The frequency of all customer promotional discount programs requiring D&A shall be agreed in the Annual Business Plan. D&A may be paid by either MEC or Distributor to the customer and reconciled periodically.

 

Trade Marketing Programs including shelf buys, CMA’s, free cases, coupons, corporate/retailer rebates, POS and Product Displays (all materials), in store sampling activities, third party reset fees, meeting competition price offers (“TMP”)

 

With respect to MEC Led Customer Calls and Distributor Led Customer Calls, the Distributor shall contribute an amount equal to MEC’s contribution on all TMP programs, provided such amount does not exceed the TMP investment agreed and set forth in the Annual Business Plan. The term “TMP programs” shall include such additional TMP programs as may be mutually agreed upon from time to time by the parties. Either party may voluntarily agree to contribute more than its equal share to cover any specific TMP programs. TMP may be paid by either MEC or Distributor to the customer and reconciled periodically.

 

Equipment.

 

Distributor shall use commercially reasonable efforts to place Products in all Distributor’s equipment where appropriate and desired by Distributor’s Accounts.

 

With respect to all agreed joint Equipment purchases, which agreements shall be in writing, each party shall reimburse the other for 50% of the cost of equipment that the other party shall purchase for the Territory in the future pursuant to such agreement and which shall be managed by Distributor.

 

45

 

Miscellaneous.

 

If MEC calls on or assists Distributor in calling on Distributor’s Accounts, to the extent that MEC makes a commitment for funds or support in excess of what is provided above or was agreed to by Distributor and MEC, any such excess shall be borne by MEC.

 

The parties’ respective rights and obligations under this Exhibit E shall be revised and amended from time to time to reflect then-prevailing conditions by written agreement of the parties to be arrived at after good faith discussions and negotiation. If the parties are unable to agree upon an amendment requested by either party, such disagreement shall be resolved pursuant to the Deadlock procedures under Section 12(a)(i)(D) of the Agreement.

 

All amounts and all contributions provided above shall be adjusted, upward or downward, from time to time to account for inflation, changes in selling prices or other adjustments that may occur from time to time, or to conform to prevailing beverage industry practices relating to the Energy Drink category. The amounts of such adjustments shall be mutually agreed in writing by the parties from time to time; provided that such adjustments shall be arrived at after good faith discussions and negotiations between the parties.

 

46

 

EXHIBIT F

International Distribution Agreement

 

MMM ACCOUNTS — MEC DIRECT VOLUME

 

0 cases*

 

*To be calculated by MEC as soon as practical following the Commencement Date and to be the number of cases sold directly by MEC to outlets in the Territory during the twelve (12) month period prior to the Commencement Date, but only with respect to that portion of the Territory, if any, (as defined in this Agreement) which was not part of Distributor’s “Territory” under one or more distribution agreements in existence between MEC and Distributor prior to the Effective Date (the “Prior Agreements”). In the event that this Agreement is amended to include additional “Territory” following the Commencement Date, the number of cases set forth above shall be increased accordingly, but only with respect to such additional “Territory.” For the avoidance of doubt, the number of cases set forth above shall (a) only apply to the calculation and payment of the fees payable by MEC to Distributor in accordance with Section 14(c) solely with respect to any new Territory allocated to Distributor pursuant to this Agreement with effect from or after the Effective Date which was not part of Distributor’s “Territory” under the Prior Agreements (the “New Territory”) and (b) not include the aggregate number of cases of Products sold by MEC to outlets in the Territory that was part of Distributor’s “Territory” under the Prior Agreements.

 

For outlets which are part of Distributor’s New Territory, MEC shall pay Distributor in accordance with the formula set forth in Section 14(c) for the number of cases of Products sold directly by MEC to such outlets, less the number of cases of Products set forth above.

 

For outlets which were part of Distributor’s “Territory” under the Prior Agreements, MEC shall pay Distributor in accordance with the formula set forth in Section 14(c) for all cases of Products sold directly by MEC to such outlets, without reference to, or subtracting, the number of cases of Products set forth above.

 

 

NOTICE OF ACCEPTANCE

 

December 13, 2017

 

Mr. Fabián Castelli

Embotelladora del Atlántico S.A.

d/b/a Coca-Cola Andina Argentina

Ruta Nac. 19 Km. 3,7

Córdoba X5001CD2

Argentina

 

Re: Offer Letter No. 1/2017 dated November 30, 2017 (the “Offer”) delivered by Embotelladora del  Atlántico S.A. d/b/a Coca-Cola Andina Argentina, a company organized and existing under the laws of Argentina (“Distributor”) to Monster Energy Company, a Delaware corporation (“MEC”)

 

Dear Mr. Castelli:

 

On behalf of MEC, I hereby accept the Offer to enter into the International Distribution Agreement included as Annex A to the Offer, which such Annex is signed by Distributor on each of its pages for the purpose of identification. MEC is deemed to have accepted the Offer as of December 13, 2017.

 

	
Sincerely,
    	
 
    
	
 
    	
 
    
	
MONSTER   ENERGY COMPANY
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Farzad   Damania
    	
 
    
	
Authorized   Signatory
    	
 
    
	
 
    	
 
    
	
Acceptance   Date: December 13, 2017
    	
 
    

 

 

OFFER LETTER NO. 1(a)/2017

 

November 30, 2017

 

Monster Energy Company

c/o Katten Muchin Rosenma LLP.

575 Madison Avenue

New York, NY 10022

Att.: Rodney C. Sacks

 

Re: Offer Letter No. 1(a)/2017 (this “Offer”) from Embotelladora del Atlántico S.A. d/b/a Coca-Cola Andina Argentina., a company organized and existing under the laws of Argentina (“Distributor”). Unless otherwise defined in this Offer, capitalized terms shall have the meaning ascribed to such terms in the Agreement (as defined below).

 

Dear Mr. Sacks:

 

Distributor hereby irrevocably makes this Offer to Monster Energy Company, a Delaware corporation (“MEC”), to amend the International Distribution Agreement between the Parties dated as of the Effective Date (the “Agreement”) in accordance with the terms and conditions attached hereto as Annex A “Addenda to the International Distribution Agreement” (the “Addenda”) signed by Distributor on each of its pages for the purpose of its identification.

 

The Addenda is the result of good faith negotiations held by the parties and supersedes all prior oral and written discussions and communications between MEC and Distributor with respect to the subject matter hereof and together with the Agreement constitute the parties’ sole and exclusive understanding with respect to the subject matter hereof and it replaces any prior agreements between them.

 

This Offer will be irrevocable, valid, and binding until December 15, 2017, and shall be deemed accepted by MEC in New York only upon MEC accepting all of the terms of this Offer in a writing dated prior to such date and thereafter promptly delivering its written acceptance of this Offer to Distributor. The Addenda shall be deemed to be entered into in New York on the acceptance date specified in MEC’s written acceptance of this Offer. MEC’s acceptance of this Offer by any other method is strictly prohibited.

 

Distributor acknowledges that MEC’s acceptance of this Offer shall be in MEC’s sole and absolute discretion Distributor further acknowledges that: (a) this Offer, its prospective acceptance by MEC, the Agreement, the Addenda, and the resulting contractual relationship between Distributor and MEC shall be subject to New York law in accordance with terms of Section 25 of the Agreement, and (b) any dispute, controversy or claim arising out of or relating to the Offer, its acceptance, the Agreement, the Addenda,  or breach or termination thereof shall be subject to the arbitration clause set forth in Section 26 of the Agreement.

 

In the event MEC accepts this Offer in accordance with its terms, such acceptance is deemed to have occurred at MEC’s office located at 575 Madison Avenue, New York, NY 10022.

 

	
Sincerely yours,
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
EMBOTELLADORA DEL ATLÁNTICO S.A.
    	
 
    
	
d/b/a COCA-COLA ANDINA ARGENTINA
    	
 
    
	
Fabián   Castelli, General Manager
    	
 
    

 

 

ANNEX A

 

ADDENDA TO THE INTERNATIONAL DISTRIBUTION AGREEMENT

 

November 30, 2017

 

Monster Energy Company

c/o Katten Muchin Rosenma LLP.

575 Madison Avenue

New York, NY 10022

Att.: Rodney C. Sacks

 

Re: International Distribution Agreement (the “Agreement”) between Monster Energy Company, a Delaware corporation (“MEC”) and Embotelladora del Atlántico S.A. d/b/a Coca-Cola Andina Argentina (“Distributor”) dated as of the Effective Date. Unless otherwise defined in this letter agreement (this “Letter Agreement”), capitalized terms shall have the meaning ascribed to such terms in the Agreement. Unless otherwise expressly stated to the contrary, all references to Section numbers in this Letter Agreement shall refer to such Section numbers in the Agreement.

 

Dear Mr. Sacks:

 

We confirm that MEC and Distributor have agreed to the following with respect to performance under the Agreement:

 

1.                      [INTENTIONALLY DELETED]

 

2.                      [INTENTIONALLY DELETED]

 

3.                      Manufacturing. MEC agrees that before appointing any other manufacturer of Products in the Territory, it will enter into good faith negotiations with Distributor with a view to providing Distributor the opportunity to manufacture some or all of the Products sold in the Territory; provided, however, that if no mutually acceptable written agreement is entered into between MEC and Distributor within three (3) months of the Effective Date, then MEC shall have the right to appoint one or more manufacturers of such Products, other than Distributor, in its sole and absolute discretion.

 

4.                      New Product SKUs. MEC and Distributor agree that during the first fifteen (15) day period provided in the second sentence of Section 2(i) of the Agreement, Distributor may give written notice to MEC requesting, and shall thereupon be entitled to, an additional sixty (60) day period in which to conduct market surveys or market research, studies or testing on any New Product SKU/s during such further sixty (60) day period. If at any time after such additional period Distributor declines to distribute, or agrees to distribute but does not commence and continue purchasing from MEC and selling such New Product SKUs under the terms of the Agreement, then MEC shall have the right and option, in MEC’s sole and absolute discretion, to

 

 

sell and distribute such New Product SKUs directly or through other distributors selected by MEC, to the exclusion of Distributor; provided that MEC gives such Distributor an additional fifteen (15) days written notice of MEC’s intention to do so and Distributor does not commence and continue purchasing from MEC and selling such New Product SKUs within such additional fifteen (15) day period.

 

5.                      Right of First Offer for New Energy Products. If at any time during the Term MEC desires to introduce any New Energy Product/s (as defined below) for sale into the Territory, MEC agrees to provide Distributor with a right of first offer to distribute and sell such New Energy Product/s in the Territory under the terms of the Agreement. Distributor will have sixty (60) days from the date on which MEC delivers to Distributor a written offer to distribute or sell any New Energy Product/s to meet and confer with MEC and accept or decline the offer. “New Energy Products” shall refer to any new Energy Drinks that (a) are packaged and/or marketed by MEC at any time after the Effective Date but not under (i) the Trademarks, or (ii) the primary brand name “Monster” or any other primary brand name having “Monster” as a derivative or part of such name and/or containing the  ” as a primary brand component, (b) MEC desires to introduce for sale in the Territory, and (c) are not currently sold by Distributor pursuant to the terms and conditions of any other agreement.

 

6.                      Section 3(u). The parties agree that Section 3(u) shall be deleted in its entirety and replaced with the following:

 

u.  Use commercially reasonable good faith efforts to take, use and/or employ the  same degree of care, business practices, control mechanisms and processes that it takes, uses and/or employs to preserve and protect all Distributor’s rights, title and interests with respect to its own equipment (i) to preserve and protect all of MEC’s rights, title and interests with respect to all MEC Equipment, including, without limitation, in customers’ premises, (ii) for the proper storage, preservation, maintenance and use of the MEC Equipment for as long as such MEC Equipment remains serviceable and (iii) to ensure that any MEC Equipment for use in relation to the refrigeration, display, Marketing, promotion, and/or sale of Products remains in situ in customers’ premises. Distributor shall periodically provide to MEC all records necessary to accurately identify the location of MEC Equipment in all customers’ premises.  Upon termination of this Agreement Distributor shall deliver the MEC Equipment to MEC and/or its Affiliate/s in situ at the customers’ premises. If for any reason any of the MEC Equipment is removed and not recovered, the parties shall bear the loss of such MEC Equipment in proportion to the parties’ respective contributions to the funding of such MEC Equipment; provided, that Distributor shall be liable for all loss and damages to any MEC Equipment that arises from Distributor’s breach of this Section 3(u) calculated based on the fair market value of such MEC Equipment at the time. Distributor hereby agrees to pay MEC any loss or damages incurred by MEC with respect to replacing the MEC Equipment calculated based on the fair market value of such MEC Equipment at the time. Distributor further agrees to maintain and to replace such MEC Equipment at such reasonable intervals as are reasonably necessary, and the cost of any such MEC Equipment shall be funded and paid for equally by MEC and Distributor; in accordance with the terms of this Agreement and attached Exhibit E to this Agreement.

 

7.                      Prices. Subject to Section 14 of the Agreement, determination of the resale prices of Products to Distributor’s Accounts will always be the final prerogative of Distributor. Without

 

 

in any way limiting or restricting the provisions of Section 4, the parties agree that they shall in good faith from time to time discuss their respective margins relating to the Products.

 

8.                      Term. The parties agree that notwithstanding anything to the contrary in Section 11,  MEC shall not provide written notice of its intention to not renew the Agreement unless (a) it has a good faith reason not to renew the Agreement or (b) Distributor is in material breach of the provisions of the Agreement and has not cured such breach in accordance with Section 12(a)(i)(A) of the Agreement. If MEC provides written notice of its intention not to renew the Agreement other than in accordance with subsection (b) of this Section 8 of this Letter Agreement, or prior to termination after all provided renewals, by effluxion of time of the full Term of the Agreement, MEC refuses to enter into a new distribution agreement on substantially similar terms and conditions as the Agreement, MEC shall pay to Distributor a Breach Severance Payment and all of the terms and conditions of the Agreement with respect to payment of such Breach Severance Payment shall be deemed to apply.

 

9.                      Deadlock. The parties agree that the third sentence of Section 12(a)(i)(D)(3)(x) shall be deemed deleted and replaced with the following:

 

The referee shall have business knowledge of, and be generally familiar with, the beverage industry in South America and shall be selected jointly by the parties, or if they cannot agree on a referee within ten (10) days from the commencement of the reference proceedings, then, upon the petition of either party, the experienced industry expert shall be appointed within ten (10) days by the American Beverage Association.

 

10.               Section 13(b). The parties agree that Section 13(b) shall be deemed deleted and replaced with the following:

 

Not less than sixty (60) days before the end of each Contract Year, MEC and Distributor shall mutually review the conditions of the marketplace,  including the performance of the Products in the market during the then current Contract Year, Distributor’s efforts to achieve sales and its results, including year over year performance, performance of the Monster brand in the market, as well as a proposed annual sales, promotion, and trade marketing plan (“Annual Business Plan”) for the next Contract Year prepared by Distributor. Such review shall include discussion on marketing efforts and proposed programs to be implemented to improve the distribution and/or sales velocity of the very lowest selling (measured by sales velocity) SKU/s of Products, if appropriate, and/or the possible deletion from distribution, if appropriate, of the very lowest selling (measured by sales velocity) SKU/s of Products but in accordance with and subject to the provisions of Section 13(f) below. Such Annual Business Plan shall cover  such matters as may be appropriate including specific account placement performance objectives, merchandising goals, specific account and channel objectives for specified distribution channels, distribution goals, a sales and marketing spending plan and a strategy for maximizing sales and growth of market share as well as cooler and vending machine programs and plans, and shall also identify MEC’s principal local marketing activities for the Territory. Additionally, if the Territory has an ethnic market or concentration, the Annual Business Plan shall address such specific ethnic segments, including retail promotions, point-of-sale allocations and special events for ethnic segments. The Annual Business Plan shall not detract from the

 

 

provisions of Section 10 above. Distributor shall use Best Efforts to implement such Annual Business Plan in the following Contract Year in accordance with Section 3(f) above.

 

11.               Distribution Accounts and MMM Accounts. The parties agree that Section 14(c) shall be deemed deleted in its entirety and replaced with the following.

 

c. “MMM Accounts” shall mean (i) multi-market major accounts  having  multiple  outlets in the Territory and in one or more country/ies outside of the Territory, and (ii) major accounts having multiple outlets in the Territory who have unilaterally determined not to permit their outlets in the Territory to be serviced by the Distributor. The parties recognize that it is in their respective interests to work together to formulate the approach to be followed by them jointly or separately with various customers and/or channels of trade, including MMM Accounts, from time to time, both to take advantage of a coordinated approach and to avoid the negative impact of a lack of coordination. MEC and Distributor therefore agree that an aligned customer/channel approach will be a key part of each Annual Business Plan. Notwithstanding  the foregoing, the parties further recognize that, although Distributor and its sub-distributors shall have the primary (except as specified in Exhibit C to this Agreement) relationship with retail and other customers throughout the Territory, from time to time circumstances may arise, within or outside the Territory, making it desirable for MEC to meet and have direct discussions with MMM Accounts which MEC shall be entitled to do at any time. In connection with such discussions, MEC shall take into account the prices and funding then offered by Distributor and its sub-distributors to MMM Accounts and similar categories of customers in the Territory. Notwithstanding anything to the contrary herein, MEC shall be entitled, in its commercially reasonable discretion, to determine the business relationship with MMM Accounts, including, without limitation, the terms of sale and/or pricing offered to such MMM Accounts (which, shall take into account and be commercially consistent with local and competitive pricing and funding then offered by Distributor and its sub-distributors to MMM Accounts in the Territory, and shall also take into account the terms of sale and/or pricing offered to “traditional” and “modern” channels, respectively - as these terms are understood in the beverage industry - in the Territory), which may be single pricing, multiple pricing or different pricing for (A) different customers in different territories or markets, or parts of different territories or markets, (B) the same customer in the same territory or market, or parts of such territory or market and/or (C) the same customer in different territories or markets, or parts of such territories or markets (the “MMM Pricing”). MEC shall use commercially reasonable efforts to arrange for all outlets of any MMM Accounts within the Territory to be serviced by Distributor and/or its sub-distributors and for delivery of the Products and other arrangements with regard thereto, to be made directly by Distributor and its sub-distributors or their warehouse system. Should the MMM Accounts concerned not agree to its outlets within the Territory being serviced by Distributor or should Distributor decline to service such MMM Accounts in accordance with the commercial arrangements and/or agreements entered into between MEC and such MMM Accounts, including as to the terms of the sale of Products to the MMM Accounts and the MMM Pricing (as defined above), MEC shall be entitled to service the outlets directly. To the extent deemed feasible by MEC, MEC agrees that before MEC enters into any binding agreement with such MMM Accounts with respect to MMM Pricing or for MEC to service the outlets directly, MEC shall (1) consult with Distributor and (2) take commercially reasonable steps to facilitate a meeting among MEC, Distributor and the MMM Account representatives if such MMM Accounts representative is located within the Territory. In the event MEC services the outlets directly, MEC shall bear sole liability and

 

 

responsibility related to such MMM Accounts and MEC shall pay to Distributor, during the period that MEC services such outlets directly, an amount equal to twenty-five percent (25%) of Distributor’s “average gross profit per case” per Product case SKU sold to and calculated with respect to MMM Accounts in the channel in question but otherwise in accordance with the provisions of Section 12(a)(i)(A) above (or based on MEC’s actual selling price of such Product case SKU if such Product case SKU is not sold by Distributor), for each case of such Product case SKU sold by MEC to the outlets concerned, within a reasonable time after receipt by MEC of all information necessary for the computation of the amount due under this Section 14, but in no event more frequently than twice per calendar year. For the purposes of this Agreement, the number of cases of Product case SKU/s sold by MEC to the outlets during any period shall be the actual number of cases reasonably determined by MEC, or if not determined by MEC then as determined by multiplying the total number of cases of Product case SKU/s sold by MEC directly to such MMM Accounts participating in the applicable program or applicable regional division which incorporates the Territory (if information relating to such regional division is reasonably available to MEC) of such MMM Account, as the case may be, during the period concerned, by a fraction, the numerator of which shall be the number of outlets within the Territory and the denominator of which shall be the total number of outlets that the MMM Account participating in the applicable program or applicable regional division which incorporates the Territory, as the case may be. In the event that Distributor challenges the number of cases and/or the selling price of Products sold directly by MEC to MMM Accounts used to compute the amount due by MEC to Distributor pursuant to this Section 14(c) (“Challenged Item/s”), then MEC shall provide a letter from its external auditors certifying the amount of the Challenged Items/s. If the amount of the Challenged Item/s certified by the external auditors differs from that initially provided by MEC resulting in the amount due Distributor to be increased by less than five percent (5%), then Distributor shall bear the cost of and incidental to the provision of such letter by the external auditors. If such difference in the amount of the Challenged Item/s results in the amount due to Distributor being increased by more than five percent (5%), then MEC shall promptly pay such difference to Distributor pursuant to Section 14.

 

12.               The parties further agree that the following shall be deemed added to the Agreement as Section 14 (d):

 

d. The parties acknowledge that the provisions of Sections 14(a) and 14(c) of the Agreement are important provisions designed to ensure that both MEC and Distributor continue to be responsive to customer demands and to maintain flexibility and competiveness. In exercising and/or implementing any of the provisions of Sections 14(a) and/or 14(c) of the Agreement, each of the parties undertakes to act reasonably to give effect to the foregoing.

 

13.               Optional Termination. Distributor shall have the right to terminate the Agreement if and only after all of the following having occurred: (a) the occurrence of an MEC Change of Control (as defined in the International Distribution Coordination Agreement), (b) KO having exercised its right to terminate the International Distribution Coordination Agreement pursuant to its terms due to such MEC Change of Control and solely and directly as a result thereof, KO has directed MEC to terminate all Distribution Agreements (as defined in the International Distribution Coordination Agreement) in accordance with such International Distribution Coordination Agreement, and (c) MEC has declined or failed to terminate the Agreement in accordance with

 

 

Section 15.1 of the International Distribution Coordination Agreement within one (1) month  after KO has directed MEC to terminate the Agreement. Distributor’s right to terminate in accordance with this Section 13 of this Letter Agreement may only be exercised upon three (3) months written notice by Distributor to MEC which shall be given within one (1) month of Distributor becoming aware of the applicable MEC Change of Control. In the event of any termination in accordance with this Section 13 of this Letter Agreement, MEC shall not be liable to Distributor or otherwise obligated to pay to Distributor or any other party any Severance Payment or other amount by reason of such termination for compensation, reimbursement or damages of whatsoever nature including, for (i) loss of prospective compensation of earnings,  (ii) goodwill or loss thereof or (iii) expenditures, investments, leases of any type or commitment or type of commitment made in connection with the business of either party or in reliance upon the existence of the Agreement or this Letter Agreement.

 

Except as specifically provided in this Letter Agreement, nothing contained in this Letter Agreement will be construed as amending, modifying, superseding or novating the Agreement and/or any other agreement between MEC (or any of its affiliates), on the one hand, or Distributor (or any of its affiliates), on the other hand. Section 25 (Governing Law), Section 26 (Arbitration), Section 39 (Controlling Language), Section 41 (Further Assurances), Section 42 (Counterparts), and Section 43 (Confidentiality) of the Agreement are hereby incorporated by reference as if fully set forth herein. This Letter Agreement may be modified only by a contract in writing executed by the party to this Letter Agreement against whom enforcement of such modification is sought. With the exception of the Offer, Acceptance, and the Agreement, this Letter Agreement supersedes all prior oral and written discussions and communications between MEC and Distributor with respect to the subject matter hereof and constitutes the parties’ sole and exclusive understanding with respect to the subject matter hereof.

 

 

NOTICE OF ACCEPTANCE

 

December 13, 2017

 

Mr. Fabián Castelli

Embotelladora Del Atlantico S.A. d/b/a Coca-Cola Andina Argentina

Ruta Nac. 19 Km. 3,7

Córdoba X5001CD2

Argentina

 

Re:   Offer Letter No. 1(a)/2017 dated November 30, 2017 (the “Offer”) delivered by Embotelladora del Atlantico S.A. d/b/a Coca-Cola Andina Argentina, a company organized and existing under the laws of Argentina (“Distributor”) to Monster Energy Company, a Delaware corporation (“MEC”)

 

Dear Mr. Castelli:

 

On behalf of MEC, I hereby accept the Offer to enter into the Addenda to the International Distribution Agreement included as Annex A to the Offer, which such Annex is signed by Distributor on each of its pages for the purpose of identification. MEC is deemed to have accepted the Offer as of December ,  2017.

 

	
Sincerely,
    	
 
    
	
 
    	
 
    
	
MONSTER   ENERGY COMPANY
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Farzad   Damania
    	
 
    
	
Authorized   Signatory
    	
 
    
	
 
    	
 
    
	
Acceptance   Date: December 13, 2017

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