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10
EXCLUSIVE
MARKETING AGREEMENT
This Agreement
(the "Agreement") is being entered into as of this 17th
day of
April, 2007, by
and among the
party of the first part COMPETITIVE
TECHNOLOGIES, INC. ("CTT"), the
party of the
second part, AGROFUT
E.U.
("AGROFRUT"), and the party of the third part, its sole
shareholder BETTY RIOS
VALENCIA ("AGROFRUT Shareholder"), and sets forth the terms and conditions of
their agreement regarding
CTT's acquisition of certain rights to AGROFRUT's
nutraceutical Product output on an exclusive basis and certain other rights,
all
as more
particularly set forth below. As used herein, the term
"Parties" shall
refer collectively to
CTT, AGROFRUT and
AGROFRUT Shareholder, and the term
"Party" shall refer to CTT,
AGROFRUT or AGROFRUT Shareholder individually.
The
Parties hereby agree
as follows:
1. SCOPE OF THE
AGREEMENT: For good and valuable
consideration as stated
herein, receipt of which is hereby
acknowledged, the Parties state the scope of
their Agreement as
follows:
a. Exclusive
First Refusal Obligation.
During the Output Term (as
-------------------------------------
defined herein), AGROFRUT shall submit
to CTT, on an exclusive, "first-refusal"
basis, all AGROFRUT Products (as defined herein) with respect to which CTT
shall
have the
right to exploit
Marketing Rights worldwide in accordance with the
terms and conditions
hereof. Each submission
shall be made by AGROFRUT in
accordance with the
requirements and procedures
set forth below. The term
"AGROFRUT Product" shall
mean an original nutraceutical Product: (i) to be
produced or acquired
for Product release
by AGROFRUT; and/or
(ii) to be
otherwise released under
the AGROFRUT name and/or logo
and/or any other name
and/or logo owned,
operated or controlled by, or otherwise affiliated with,
AGROFRUT, by itself
or through a joint venture with another entity, in each
instance for which
AGROFRUT controls the
Product Rights. A nutraceutical
product shall be deemed to be an AGROFRUT Product on the
first date upon which
AGROFRUT produces or
enters into an agreement to
acquire the rights to cause
such nutraceutical or
other Product to
be produced, acquired or
otherwise
released in accordance with the definition of an AGROFRUT Product hereunder
(the
"Production Date"). For
purposes hereof, "first refusal" means that an AGROFRUT
Product shall be
submitted solely and
exclusively to CTT for purposes of
exploiting the Marketing Rights in and
to such AGROFRUT Product before the same
is submitted to any other person or entity.
It is the essence of this Agreement
that AGROFRUT will
not submit any AGROFRUT Product to a third party for sale,
marketing, acquisition, licensing,
exploitation or any other use unless and
until the AGROFRUT
Product has been submitted to CTT hereunder, and CTT has
declined to exploit
the Marketing Rights to the AGROFRUT Product (a "Rejected
Product"). An AGROFRUT
Product for which CTT elects to
exploit the Marketing
Rights shall be
referred to as
an "Included Product."
b. Grant
of Rights. AGROFRUT
hereby irrevocably grants,
transfers,
-----------------
assigns and licenses
to CTT the
Product Rights worldwide
(as defined in
Paragraph 2 hereof) in and to each AGROFRUT Product
during the Output Term (as
defined herein) subject
to, and in
accordance with, the
terms hereof.
c. Output
Term. The term
"Output Term" shall
mean the period
------------
commencing on the
date hereof and expiring 180 (one hundred eighty) days from
the date
hereof; provided, however, that
the Product Rights granted hereunder
<PAGE>
thereafter shall remain
in effect in
perpetuity so long
as AGROFRUT's
Shareholder and CTT
engage in the Closing of the Exchange contemplated by the
Term Sheet accompanying
this Agreement.
2. PRODUCT RIGHTS:
The term "Product
Rights" shall mean the exclusive
Marketing Rights (as defined herein) to each of the AGROFRUT
Products, and all
rights necessary to
distribute, to exploit, to advertise, to promote and to
publicize such Marketing
Rights of each
AGROFRUT Product for
worldwide
exploitation. "Marketing Rights" shall mean the following: rights to sell, to
distribute, to advertise, to supply and
to control delivery of the Products and
the Products' name,
label, packaging or trade dress;
i.e., the overall
appearance and commercial impression of the Products, in
print media, point of
sale, radio broadcast
and television advertising,
and in brochures, sales
literature and nutraceutical
promotional activities, including
on-line
nutraceutical promotional activities,
for the Products.
3. EQUITY INTEREST:
a.
AGROGRUT Common Stock. CTT shall be entitled to receive from
AGROFRUT
----------------------
five percent (5%)
of the shares
of AGROFRUT's Common
Stock (the "Equity
Interest"). The shares
issued shall be
referred to as the
"Shares." Such
Shares shall be issued pursuant to the
Stock Purchase Agreement executed at the
time of
this Agreement.
4. SUBMISSION PROCEDURES:
a. Submission.
Not later than
10 (ten) business days following
the
----------
Production Date of
an AGROFRUT Product, AGROFRUT shall submit such AGROFRUT
Product to CTT, along with a written notice ("Submission Notice"),
from AGROFRUT
to CTT.
b. CTT's
Response to Submission.
Within 10 (ten)
days following
-------------------------------
receipt by CTT of a Submission Notice,
together with samples of the Product and
any marketing materials prepared by AGROFRUT (the
"Response Period"), CTT will
provide written notice
to AGROFRUT as to
whether CTT elects to exploit the
Marketing Rights to such AGROFRUT
Product. CTT's failure to respond within
the
Response Period shall be deemed to constitute CTT's rejection
of such AGROFRUT
Product, and such AGROFRUT Product shall thereafter be
deemed to be a Rejected
Product.
c. Rejected
Products. With respect to each
Rejected Product, AGROFRUT
------------------
will have the
option to arrange
for the Marketing Rights to such
Rejected
Product to be
acquired by third parties; provided, however, that prior to the
time that AGROFRUT
concludes any agreement
to grant such rights to a third
party, if there is a change in any of the elements of the Product, then
AGROFRUT
shall resubmit the
Rejected Product to CTT
in accordance with the terms of
Paragraph 3.a. above
(provided CTT shall have 10 (ten)
days from the date of
such resubmission to make its determination), and the Rejected Product shall
not
be submitted to
any third party
unless and until CTT has again declined to
exploit said rights.
All of CTT's right, title, and interest in and to
each
Rejected Product that is not required to be resubmitted to CTT
pursuant to the
terms of
this Paragraph 3.c.
shall revert to
AGROFRUT automatically.
<PAGE>
d. Submission by CTT. In addition to AGROFRUT's submissions
hereunder,
-----------------
CTT shall have the right, but not the obligation, to order from AGROFRUT, at
any
time, nutraceutical Products for which CTT is willing to exploit
the Marketing
Rights. None of
such Products shall be deemed an AGROFRUT Product hereunder
unless and until
AGROFRUT enters into a binding written agreement with CTT to
produce or to acquire the rights to cause such Products to be produced,
acquired
or otherwise released in accordance with the definition of
an AGROFRUT Product
hereunder.
5. PAYMENTS AND
DIVISION OF REVENUES:
a. Revenue
Division. In lieu of royalties or
other payments, AGROFRUT
-----------------
and CTT
shall engage in a division of
revenues so that AGROFRUT shall receive
sixty percent (60%)
of marketing and sales proceeds of AGROFRUT products, and
CTT shall receive
forty percent (40%)
of marketing and sales proceeds of
AGROFRUT products. Any revenues payable to AGROFRUT pursuant to
this Agreement
shall be paid on a monthly basis
provided that, in each such case, each payment
hereunder shall be accompanied by a
revenue statement. The division of
revenue
pursuant to this
Agreement shall be
based on "Net Revenue" determined by
application of Subparagraph (e) of this
Paragraph. Revenue shall be determined
on a "cash basis" at the time of receipt by CTT. No revenues will be payable by
CTT to
AGROFRUT on returns
that are accepted and credited by CTT or by an
affiliate of CTT,
or on units
of the Products distributed
exclusively for
demonstration or nutraceutical
purposes, or for replacements.
CTT shall have
the right to
retain a reasonable reserve from
revenues for returned Products
(provided that such reserve will be
reviewed and, if appropriate, liquidated in
good faith on a quarterly basis). To the extent that the actual returns to CTT
or affiliates of CTT in any given
quarter are greater than the expected returns
based upon which CTT has adjusted any
revenue payments, such difference will be
withheld by or payable to CTT, as the
case may be. No revenues will be payable
on sales or other transactions between
CTT and any affiliate of CTT until final
sale of the Products by the affiliate of CTT.
If CTT makes a revenue payment to
AGROFRUT where CTT is
subsequently required to refund or to reduce all or any
part of
the Net Sales collected by it, CTT shall have the right to a refund of
overpayments of revenues
made to AGROFRUT.
b.
Books and Records Relating to
Sales. CTT will maintain sufficient and
------------------------------------
accurate books and records relating to all transactions relevant to sales of
the
Products or in
respect of which CTT is required to provide information
in a
revenue statement.
c.
Inspection. CTT will
permit a chartered
accountant reasonably
----------
acceptable to CTT
and appointed by
AGROFRUT (the "AGROFRUT Accountant") to
inspect the books and records maintained by CTT after 15
(fifteen) days notice
at any reasonable time during normal business hours at AGROFRUT's expense and
in
such manner as
not to interfere with the business of CTT for the
purpose of
verifying the correctness of the revenue statements and the payments made by
CTT
to AGROFRUT by way of revenue pursuant to this Paragraph. AGROFRUT shall not be
entitled to make such inspections more frequently than on
one occasion in each
<PAGE>
period of 12 (twelve) calendar months unless it can
demonstrate that there are
exceptional circumstances requiring such additional inspections. In the event
that the
AGROFRUT Accountant discovers
an error of
greater than 5% (five
percent) in favor
of AGROFRUT, AGROFRUT shall be entitled to reimbursement by
CTT for the costs of such a review plus interest at 10% (ten percent) per
annum.
d.
Nondisclosure. Neither AGROFRUT
nor the AGROFRUT
Accountant shall
-------------
disclose any information
acquired as a
result of any such examination or
inspection to any
person, firm or
corporation other than to its employees,
authorized representatives and as
otherwise strictly necessary to enforce its
rights hereunder.
e.
Net Sales. "Net Sales" means the gross revenue
(including advances)
----------
earned and actually received by or credited to CTT, or any affiliated or
related
entity thereof, from
the sale, lease,
license, distribution or
other
exploitation of the Product less the
following (all of which shall collectively
be known
as the "Cost
of Goods"): (i) actual, direct, third-party, out-of
pocket charges or expenses incurred by CTT, or any affiliate
or related entity
thereof, in connection
with transportation, handling,
carriage, delivery,
insurance, taxes (including
withholding taxes and Value Added Tax), duties,
tariffs, assessments, levies and other governmental and
"pass-through" charges
on or
after sale of units of the Product; and (ii) any rebates
or allowances
(including allowances credited
to resellers or
distributors in respect to
marketing and nutraceutical
costs) paid by CTT in connection with the sale or
distribution of the
Product. If CTT
earns revenue from distribution of a
Product in combination
or bundle with
one or more other CTT products, such
revenue will be allocated between that Product and such other products on a
fair
and reasonable basis
taking into consideration
the current or most recent
wholesale prices of
components of such
compilation or bundle.
6. CONSULTATION AND
APPROVAL RIGHTS:
a. AGROFRUT.
AGROFRUT s






