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Distribution Agreement

This Agreement, made as of , 20___, between


having its principal office at
(hereinafter called
Company) and having its
principal place of business at
(hereinafter called Distributor.).

Whereas, Company is a duly licensed to manufacture and sell Beer and,

Whereas, Distributor is duly licensed, under Federal and State law to sell Beer to
retailers within the State of Michigan and represents to Company that it possesses, or has
access to, all the facilities necessary for the distribution of Beer to retailers in the State of
Michigan, including, but not limited to, sufficient warehouse space, office space, properly
trained sales, office, warehouse and other personnel; office equipment, warehouse
equipment and transportation equipment to service the retail trade within the State of
Michigan;

Now therefore, in consideration of the mutual promises contained herein, the parties
agree as follows:

A. Appointment

1. Upon the terms and conditions set forth herein, Company appoints
on an exclusive basis as a
Distributor in the following areas of the State of Michigan:

(hereinafter called the Territory), for resale to licensed retailers the following Beer(s):
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(hereinafter called the Products).

2 Companys purpose for entering into this relationship with Distributor is to


maximize the sale of the Products in the Territory.

3. This Agreement shall become effective on , 20__ and


shall remain in effect until terminated in a manner consistent with the provisions of MCL
436.1403 and Article E herein.

4. If Company looses its right or ability to manufacture or sell the Products in the State
of Michigan, this agreement may be modified, eliminating that item or items from the
Products, provided Distributor is given thirty (30) days written notice of this modification.
Such action shall not constitute a wrongful breach by Company.

B. Company Obligations

1. Company agrees, during the term of this Agreement, to supply the Products to
Distributor at such times, and in such reasonable quantities as Distributor may order;
provided, however, if at any time Companys supplies of the Products available for sale are
insufficient to fill the order to all its Distributors, Company may, in a reasonable manner,
restrict the amount to be supplied to Distributor under this Agreement.

2. Prices of the Products sold to Distributor shall be Companys current prices at time
of each shipment. Company shall provide Distributor with written notice of any price
changes in the Products fifteen (15) days prior to the effective date of the price change.

C. Distributor Obligations

1. Distributor agrees, during the term of this Agreement, to use all reasonable efforts to
maintain complete coverage of its retail customers so as to promote and develop the sale of
the Products in the Territory and to render prompt delivery service. Distributor further
agrees to maintain an adequate sales force and to engage in sufficient promotional
activities to insure the maximum reasonable distribution and proper representation of the
Products. All expenses incurred in connection with the sale and distribution of the
Products shall be paid by Distributor and Company will be under no obligation to
reimburse Distributor for such expenditures.
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2. In order to accomplish the objectives of paragraph C1 above Distributor and


Company have mutually agreed to an Annual Business Plan which is included as
Attachment A and hereby incorporated by reference. Further, Company and Distributor
agree to meet no later than the _____ week of the ___ month on a yearly basis to adopt an
Annual Business Plan for the following year. If after due diligence and good faith
negotiations Company and Distributor are not able to adopt an Annual Business Plan the
previous years business plan will be modified by (what are your measurable and increase
them by a reasonable amount) and operate as the business plan for the following year .

3. Distributor agrees to maintain complete and accurate records of all sales, sales calls,
marketing programs and expenses for the Products and its inventory of Products which
shall be made available to Companys representatives, upon reasonable notice by
Company, during Distributors normal business hours and Distributor shall make such
reports as to sales and inventory of Companys Products as Company shall from time to
time request.

4. Distributor shall allow Company access to Distributors facilities to ensure


compliance with the terms of this agreement upon reasonable notice by Company on no
more than a quarterly basis and only during Distributors normal business hours.

5. Distributor agrees to maintain a ____ day inventory level of the Products to ensure it
has adequate inventory to meet the needs of the market.

6. Distributor shall place orders for products in the following


manner:_______________

7. Distributor shall accept delivery of all ordered product unless the order was properly
cancelled in the following manner:_______________________

8. Distributor shall pay cash for the Products upon delivery by Company.

9. Distributor agrees not to sell ineligible brands to retail accounts. Ineligible brands
include brands that are out-of-code date at the time of sale to a retail account and brands
that are scheduled to be made available for sale and delivery to retailers on a specific date
and that Distributor sells and/or delivers to retailers prior to the specific date.
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10. Distributor shall warehouse product in a temperature controlled environment that


shall be kept at _____.

11. Distributor shall only deliver the product in refrigerated delivery vehicles.

12. Distributor shall sell product to retail accounts on a first in first out basis and shall
monitor retail accounts to ensure that no out of date product is offered for sale at retail.
Distributor shall, at its expense, remove out-of-date product from retail locations and
exchange the product on a one for one basis, or as allowed by the Michigan Liquor
Control Code.

13. Distributor shall ensure that licensed salespersons are properly trained in the sale of
craft beer and are familiar with the Products.

14. Distributor shall appoint a brand manager that will be the primary point of contact
for Company regarding the Products and shall be responsible for ensuring Distributors
compliance with its obligations as described herein. Company shall have the right to
approve the brand manager and will evaluate a proposed candidate based on the following
standards:
Company reserves the right to require removal of a brand manager that does not meet the
above described standards.

15. Distributor shall not delegate or assign its obligations contained herein to another
Distributor (Act as a master Distributor in the territory) without the express written
permission of Company, which Company is under no obligation to give.

16. Distributor shall not sell products outside of the Territory or sell Products to a
person that it has reason to believe will, or is likely to sell the Product outside of the
Territory. Distributor agrees that the Territory cannot be modified unless done so in writing
as an amendment to this agreement signed by both parties. Distributor shall immediately
notify _________ at Company if any of Companys employees directs or encourages
Distributor to sell outside of the Territory.

D. Transfer of Ownership
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1. Transfer of Ownership means the voluntary sale, assignment, or other transfer of the
business or control of the business of Distributor, including the sale or other transfer of
stock or assets (including the distribution rights to the Products) by merger, consolidation,
dissolution or sale.

2. Distributor shall not engage in any Transfer of Ownership without the approval of
Company. Distributor shall notify Company in writing of any proposed Transfer of
Ownership before any Transfer is initiated. Distributor shall allow Company 90 days to
review the qualifications of a proposed transferee. Company will evaluate the potential
transferee based on the following standards:

3. A Transfer of Ownership by Distributor that is not approved by Company is null and


Void.

E. Termination

1. Company has the right to terminate this agreement in accordance with the provisions
of MCL 436.1403(6)-(8) and (10) if Distributor fails to comply with any of the Distributor
Obligations described in Article C herein, including the Annual Business Plan except for
C9 and C16. Distributor acknowledges and agrees that its obligations described in Article
C, including the Annual Business Plan are material and significant to the business
relationship between Distributor and Company.

2. Company shall have the right to terminate this agreement upon fifteen days notice
and in compliance with MCL 436.1403(12) for the following Distributor actions:

a. Fraudulent conduct on the part of Distributor in its dealings with Company.


b. Distributor fails to confine its sales to the Territory.
c. Distributor sells an ineligible brand.

3. Company shall have the right to terminate this agreement immediately upon written
notice for the following Distributor Actions:

a. The insolvency of Distributor, the filing of any petition by or against the


Distributor under any bankruptcy or receivership law or the dissolution or
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liquidation of the Distributor which materially affects Distributors ability to


remain in business.
b. Revocation of the Distributors License by the Michigan Liquor Control
Commission for a period of more than 60 days.
c. Distributor or any owner who has more than a 10% ownership interest in
Distributor is convicted of a felony.

4. Upon termination of this Agreement Distributor shall, if so requested by Company,


return to Company at point of delivery specified by Company all inventory of the Products
in Distributors possession and/or ownership, in transit, or on order. For the Products so
returned to Company, Company shall reimburse Distributor at its laid-in cost, not including
warehousing, plus cost of transportation to point of delivery specified by Company. The
Company, however, reserves the right to reject any product not in salable condition. All
Product not repurchased by Company shall be returned to Distributor by Company.

F. Miscellaneous

1. Neither Company nor Distributor is the agent of the other party. Any and all
contracts and/or agreements made by either party, beyond this Agreement, shall be for the
sole account of the party entering into such contract and/or agreement, without risk or
liability to the party not entering into the contract and/or agreement.

2. This Agreement sets forth the entire understanding of the parties with respect of its
subject matter and cannot be amended, changed, modified or supplemented other than by
means of another written instrument duly executed by both the Company and Distributor.

3. The Parties shall not be liable for nonperformance of their respective duties under
this Agreement if such nonperformance is due to fires, strikes, Acts of God, Governmental
interference, transportation difficulties, inability to obtain adequate quantities of the
Products or for other cause beyond the Parties reasonable control.

4. This Agreement shall be subject to all laws, Federal and State of Michigan, and all
regulations promulgated under such laws.

5. Any notice provided for herein shall be in writing addressed to the party to whom
given, i.e. to Company at and
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to Distributor at or to such
other place as the parties may direct in writing.

6. This Agreement shall in all respects be governed by and interpreted in accordance


with the laws of the State of Michigan.

IN WITNESS WHEREOF, the parties hereto have on the days and date written
above caused this Agreement to be executed by their duly authorized representatives.

Company

Date: , 20__ by:

Title

Distributor

Date: , 20__ by:

Title

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