Exhibit 10.4
[Pursuant to Rule 24b-2, certain information has been deleted and filed separately with the Commission.]
CONTRACT MANUFACTURING SUPPLY AGREEMENT
This agreement effective this 22nd day of September, 1999
BETWEEN:
MARK ANTHONY INTERNATIONAL SRL , a Barbados Society with an address and head office on Bond Street, Holetown, St. James, Barbados, West Indies
(the "Buyer")
AND:
Minnesota Brewing Company , a company duly incorporated under the laws of Minnesota and having a business office at 882 West 7th Street, St. Paul, Minnesota, USA, 55102
(the "Supplier")
WHEREAS, the Buyer wishes to retain the services of the Supplier to manufacture, blend, produce, process, bottle, label, package, store and load (all of these operations collectively termed "manufacture")
beverage(s) known as "Mike92s Hard Lemonadeae" (the "Beverage") and the Supplier has agreed to Manufacture the Beverage upon the terms and conditions set out in this Agreement.
NOW, THEREFORE, in consideration of the terms and conditions set out in this Agreement, the parties agree as follows:
1.
SUPPLIER92S REPRESENTATIONS AND WARRANTIES
Product, Product Quality and Vendor Delivery Performance
1.1
The Supplier will Manufacture finished cases (case = 24 bottles, 4 96 6 packs) of the Beverage as determined by the Buyer from time to time, which will include but not be limited to satisfying
the flavor profile and taste requirements and technical specifications set out in Appendix "A" and the packaging specifications set out in Appendix "B". It is further understood and agreed that the Buyer may vary these requirements and specifications
in Appendix "A" or Appendix "B" at its discretion on giving 60 days written notice to the Supplier subject to the terms of the following paragraph.
In advance of any changes in specifications as outlined in Appendix "A" and Appendix "B", the Buyer and Supplier will mutually agree in writing on which party will absorb any costs
which may result.
1.2 Further to Article 1.1, the Supplier shall meet outlined quality expectations and Manufacture the Beverage in a good and
competent
fashion in accordance with normal industry standards, using specified quality control procedures and analytical
methods (as specified in Appendix "E"), Good Manufacturing Practices (as understood in the industry), which
include but
are not limited to:
(a)
supply materials being fit for their intended purpose and of good quality;
(b)
complying with all requirements and specifications and standards of quality in relationship to the blending and bulk specification tolerances supplied by the Buyer; together with receiving, production,
processing, bottling, labelling, packaging, storing, handling and loading of the Beverage along with all necessary documentation as required under the terms of this Agreement. The Supplier shall not Manufacture Beverage outside the bulk specification
tolerances without prior written authorization from the Buyer;
(c)
complying with all applicable local, state, and U.S. federal laws and regulations governing the Manufacture of the Beverage (including all laws and regulations in U.S. jurisdictions where the
Beverage may be shipped), and maintaining and acquiring any permits relating to the Manufacture of the Beverage and the operation of its business;
(d)
providing, keeping, maintaining and operating all of its equipment, materials, supplies, facilities and personnel as will be sufficient to perform its obligations under the terms of this Agreement;
(e)
make all reasonable efforts to ensure that all labels are applied consistently avoiding flaps, cartons are properly erected, and cases glue and are palletized and shrink wrapped to meet all U.S.
government and Buyer92s U.S. Customers (where the Buyer92s Customer includes but is not limited Liquor Distributors and other customers determined by the Buyer) reasonable requirements and all other reasonable requests made by the Buyer. The buyer
will to the best of its knowledge, keep the supplier informed of any changes in regulations that it becomes aware of;
(f)
ensuring that all raw material, packaging materials and finished cases of the Beverage under the Supplier92s control shall be stored, warehoused and shipped under proper and sanitary conditions
in accordance with good industry practice;
(g)
taking out during the continuance of this Agreement and maintaining at its own expense product liability insurance at least in a sum of $[Confidential Treatment Requested] in respect of any one
occurrence and in the aggregate, such insurance to cover the Buyer and the Supplier against any liability arising out of any alleged defects in Products manufactured by the Supplier pursuant to the terms of this Agreement. In addition, the Supplier
will also maintain at its own expense property and general liability insurance sufficient to cover materials and finished goods stored in the Supplier92s facilities on behalf of the Buyer. The Supplier shall upon request provide from time to time
to the Buyer the certificate of insurance in respect of the insurance required to be taken out and maintained by the Supplier under this clause.
1.3 Analysis of samples of the Beverage will be performed by the Supplier prior to bottling and on bottled samples of the
Beverage
of each production run prior to shipment, as outlined in Appendix "E" (Analysis Article). The Supplier agrees
to forward analysis results of each production run to the Buyer within 24 hours of results completion by
fax.
The Supplier will also supply to the Buyer or its authorized representatives bottled samples of the Beverage for the purposes of inspecting and tasting the Beverage and inspecting packaging materials
related to the Beverage. See Appendix "E" for retention and sampling requirements.
1.4
The Supplier agrees to permit the Buyer or its authorized representatives to enter and remain at the Supplier92s production site to inspect the Buyer92s raw materials, inventories, retained
samples and/or technical records, production, labeling, bottling and packaging processes and conditions of storage at any time during regular business hours.
1.5
Prior to October 15, 1999 the Supplier is required to submit a copy of their Year 2000 plan to the Buyer. At its discretion, the Buyer may require an audit of the processes of such plan at
its expense.
1.6
The buyer will provide the supplier with a letter of credit in a form acceptable to the Supplier. The letter of credit will be based on monthly requirements and will not be less than [Confidential
Treatment Requested] and not exceed [Confidential Treatment Requested] .
2.
TRADEMARKS
2.1
The Buyer and Supplier will be bound by the terms of the trademark agreement attached as Appendix "H". Any breach by the Buyer/Supplier or its personnel of the trademark agreement will
be considered a material breach under Article 5.2.
3.
ALTERNATING BREWERS LICENCE
3.1
In the event that the buyer seeks to establish itself as a brewer at the Premises under federal and/or state law, the supplier agrees to assist at the Buyer92s expense in obtaining all governmental
authorizations required on its behalf to establish an alternating proprietorship between the buyer and the supplier for the production of the beverage at the premises. That is, to operate federally (and on a state level, if required) as an alternate
proprietor, from time to time those portions of the premises in which the product will be produced and stored.
3.2
Such actions may require, without limitation, that the supplier make certain federal and state filings at the buyer92s expense, segregate the beverage produced by the buyer from beverage produced
by the supplier or other alternating proprietors and file and prepare related records on behalf of the buyer. The supplier agrees not to take any independent action regarding the alternation of the Premises except as otherwise directed or approved by
the buyer or as required by federal and state authorities.
3.3
During the alternation of premises, the buyer shall remain responsible for payment of federal excise taxes on the beverage manufactured hereunder and filing all required tax returns and other
government requests for information.
4. TERM
4.1
This Agreement will continue in full force and effect from October 1, 1999 to [Confidential Treatment Requested] and will automatically be renewed for additional terms of [Confidential Treatment
Requested], unless either party gives written notice of cancellation to the other party at least [Confidential Treatment Requested] days prior to [Confidential Treatment Requested] and thereafter for at least [Confidential Treatment Requested] days prior
to the termination date of any renewal term.
In the event the Buyer ceases to have full sales and distribution rights to the Beverage, the Buyer or Supplier may terminate this Agreement on 90 days written notice to the other party and notice
can only be given at any time after the Buyer cease ...
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