MASTER DISTRIBUTOR AGREEMENT

Omnibus Agreement

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REDHOOK ALE BREWERY INC

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Title: MASTER DISTRIBUTOR AGREEMENT
Governing Law: Oregon Date: 7/2/2004
Industry: Beverages (Alcoholic) Sector: Consumer/Non-Cyclical

EXHIBIT 10.5

MASTER DISTRIBUTOR AGREEMENT

BETWEEN

CRAFT BRANDS ALLIANCE LLC

AND

ANHEUSER-BUSCH, INCORPORATED

<PAGE>

MASTER DISTRIBUTOR AGREEMENT

THIS MASTER DISTRIBUTOR AGREEMENT (the "Agreement") is made as of July

1, 2004 by and between CRAFT BRANDS ALLIANCE LLC having its principal place of

business at 929 North Russell, Portland, Oregon 97227 ("CBA") and

ANHEUSER-BUSCH, INCORPORATED having its principal place of business at One Busch

Place, St. Louis, MO 63118 (referred to herein interchangeably as "Master

Distributor" or "ABI").

WHEREAS, CBA acquires products from Redhook Ale Brewery, Incorporated

and Widmer Brothers Brewing Company and markets the Products in certain states

west of the Mississippi River.

WHEREAS, ABI and CBA desire to have ABI serve as Master Distributor of

the Products and to coordinate the delivery of the Products to designated

wholesalers in the ABI wholesaler network; and

WHEREAS, ABI and CBA desire CBA to have responsibility for developing

and implementing programs that create demand for, market, promote and advertise

the Products in the Territory (as defined herein);

NOW THEREFORE, in consideration of the mutual covenants and agreements

hereinafter set forth, CBA and ABI agree as follows:

ARTICLE I

DEFINITIONS

For purposes of this Agreement, capitalized terms not otherwise defined

herein shall have the following meanings ascribed thereto:

"ABI COMPETITOR" shall mean any Person that, together with the

Affiliates of such Person, has annual alcohol beverage sales of $100,000,000 or

more in North America (such number to be adjusted annually in proportion to

changes in the Consumer Price Index from the date hereof).

"ABI DISTRIBUTION FACILITY" shall mean the ABI source brewery,

warehouse, WSC, third-party warehouse or other suitable location reasonably

designated by ABI from which ABI will ship Product to Alliance Wholesalers.

<PAGE>

"ADDITIONAL PRICE COMPONENT" shall mean 90% of the difference between

the price actually charged to an Alliance Wholesaler by ABI for a Product, and

the Fully Loaded Cost for such Product.

"AFFILIATE" shall mean, with respect to any Person, (i) each Person

that, directly or indirectly, owns or controls, whether beneficially, or as a

trustee, guardian or other fiduciary, 50% or more of the equity securities

having ordinary voting power in the election of directors of such Person, or

(ii) each Person that controls, is controlled by or is under common control with

such Person or any Affiliate of such Person. For the purpose of this definition,

"control" of a Person shall mean the possession, directly or indirectly, of the

power to direct or cause the direction of its management or policies, whether

through the ownership of voting securities, by contract or otherwise. Kona,

Redhook, Widmer shall be considered to be Affiliates of CBA.

"AFFILIATED WHOLESALER" shall mean any wholesaler of the alcohol

beverage products of ABI that distributes the Products in any portion of the

Territory pursuant to a distribution agreement between CBA, Redhook or Widmer

and such wholesaler.

"ALLIANCE WHOLESALERS" shall mean those malt beverage wholesalers of

ABI, including without limitation, ABI branches, which have agreed to purchase

the Products from ABI and to distribute the Products in the Territory.

"BARREL" shall be equal to 31 United States gallons.

"COMMENCEMENT DATE" shall mean July 1, 2004.

"CONFIDENTIAL INFORMATION" shall have the meaning assigned to it in

Section 18.01(a).

<PAGE>

"COOPERAGE HANDLING CHARGE" shall mean * per Pallet Lift for draft

Product during 2004; ATTACHMENT A attached hereto describes the methodology used

to modify Cooperage Handling Charge for 2005 and future years.

"FORCE MAJEURE" shall have the meaning assigned to it in Section 16.01.

"FULLY LOADED COST" shall mean for a Product, the sum of:

(a) the Scheduled Price for such Product; plus (b) the Margin.

"INCOMPATIBLE CONDUCT" shall mean any act or omission of CBA or its

Affiliates that, in the sole determination of ABI, damages either the reputation

or image of ABI or of the brewing industry. ATTACHMENT B attached hereto sets

forth examples of the nature and gravity of acts and omissions constituting

Incompatible Conduct and not constituting Incompatible Conduct; such examples

shall not limit the nature of acts that could be construed as Incompatible

Conduct.

"INCREMENTAL MARGIN" shall mean during 2004, * per case-equivalent (of

288 fluid ounces per case) for packaged or draft Product. For 2005 and future

years, the applicable amount described above in this definition shall increase

or decrease for each calendar year pursuant to the methodology set forth in

ATTACHMENT C attached hereto.

"INITIAL TERM" shall have the meaning assigned to it in Section 7.01

hereof.

"INTELLECTUAL PROPERTY" shall have the meaning assigned to it in

Section 6.01.

"INVENTORY MANAGER" shall have the meaning assigned to it in Section

11.10.

"INVENTORY MANAGER FEE" shall mean the Inventory Manager's annual cash

compensation.

"INVOICING COSTS" shall mean * per Pallet Lift for Product during 2004.

For 2005 and future years, the applicable amount described above in this

definition shall increase or decrease for each calendar year pursuant to the

methodology set forth in ATTACHMENT C attached hereto.

* CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

"KONA" shall mean Kona Brewery LLC.

"MARGIN" shall mean during 2004 * per case-equivalent (of 288 fluid

ounces per case) for packaged or draft Product.

For 2005 and future years, the applicable amount described above in

this definition shall increase or decrease for each calendar year pursuant to

the methodology set forth in ATTACHMENT C attached hereto.

"MASTER DISTRIBUTOR" shall mean ABI in its capacity as a distributor

under this Distribution Agreement.

"MODIFIED PRODUCT" shall have the meaning set forth in Section 11.08 of

this Agreement.

"NEW PRODUCT" shall mean new malt beverage(s) that CBA wishes to add,

through development or acquisition, to its beverage product line existing as of

the Commencement Date.

"NON-ALLIANCE WHOLESALERS" shall mean those beer wholesalers to which

CBA, Redhook or Widmer has granted distribution rights for any of the Product in

the Territory as of the date of this Agreement and which are listed as

"WHOLESALER" on ATTACHMENT D attached hereto, as the same may be modified from

time to time pursuant to the terms and conditions of this Agreement, but shall

not include Affiliated Wholesalers.

"OFFER EXPIRATION DATE" shall have the meaning assigned to it in

Section 11.04(a).

"OFFER NOTICE" shall have the meaning assigned to it in Section

11.04(a).

"PALLET LIFT" shall mean a pallet of draft or packaged Product or

cooperage that, in each case, is prepared in such a manner that ABI may deliver

or move such Pallet in accordance with its customary practices in one operation.

"PERSON" shall mean any individual, sole proprietorship, partnership,

joint venture, trust, unincorporated organization, association, corporation,

institution, public

* CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

benefit corporation, entity or government (whether federal, state, county,

city, municipal or otherwise, including, without limitation, any

instrumentality, division, agency, body or department thereof).

"PRODUCTS" shall mean all malt beverage products marketed by CBA as of

the Commencement Date and any malt beverage products for which ABI agrees to act

as master distributor pursuant to Section 11.03 hereof but shall not include any

malt beverage products the marketing of which CBA discontinues or the

distribution of which is terminated pursuant to this Agreement.

"PURCHASE PRICE" shall have the meaning assigned to it in Section 4.01

hereof.

"RECORDS" shall have the meaning assigned in Article XVII (a).

"REDHOOK" shall mean Redhook Ale Brewery, Incorporated.

"SCHEDULED PRICE" shall mean the purchase price for Product.

"STAGING COSTS" shall mean * per Pallet Lift for packaged Product, and

* per Pallet Lift for draught Product, during 2004. ATTACHMENT A describes the

methodology used to modify Staging Costs for 2005 and future years and the

assumptions and activities involved in Staging Costs.

"STOCKHOLDERS AGREEMENT" shall mean the letter agreement dated July 1,

2004 between Kurt and Robert Widmer, Widmer and ABI.

"TAXES" shall mean all applicable national, federal, state and local

excise and other brewing related taxes and any applicable duties and import

tariffs and fees (including without limitation liquor and consumption taxes)

paid or incurred by ABI in connection with this Agreement.

"TERM" shall have the meaning assigned to it in Section 7.01 hereof.

"TERRITORY" shall mean Alaska, Arizona, California, Colorado, Hawaii,

Idaho, Montana, New Mexico, Nevada, Oregon and Wyoming, and shall also include

any other jurisdiction included within the scope of this Agreement pursuant to

Section 11.11 hereof.

* CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

"WHOLESALER SUPPORT CENTER COSTS" or "WSC COSTS" with respect to any

Product shipped by CBA to a WSC shall mean the fee paid by ABI to the operator

of the WSC for its services with respect to such Product.

"WIDMER" shall mean Widmer Brothers Brewing Company.

"WSC" shall mean the regional wholesaler support centers or

distribution centers established by ABI for the receipt of products designated

by ABI and the palletizing and preparation for pick up of such products by the

adjoining wholesalers.

ARTICLE II

GRANT OF DISTRIBUTION RIGHTS

CBA hereby grants to ABI and ABI hereby accepts from CBA the exclusive

right to serve as the master distributor to distribute the Products in the

Territory commencing on the Commencement Date, except as otherwise described in

this Section. ABI shall not, without the prior written consent of CBA, sell the

Product outside the Territory or to any party other than an Alliance Wholesaler.

CBA agrees to not sell any Product to any other Person in the Territory other

than ABI, Affiliated Wholesalers and Non-Alliance Wholesalers. At the option of

ABI and the respective Affiliated Wholesaler, any Affiliated Wholesaler may

become an Alliance Wholesaler, and CBA shall, and shall cause Redhook and Widmer

to, execute any documents or instruments reasonably requested by ABI to

effectuate this.

ARTICLE III

PURCHASE AND SALE OF PRODUCTS

CBA agrees to sell to ABI, and ABI agrees to purchase from CBA and

re-sell to the Alliance Wholesalers, the quantities of Products ordered by ABI

from time to time hereunder. CBA acknowledges that ABI is not guaranteeing any

level of Product sales; and that ABI's obligations under this Agreement are

limited to making the Products available to the Alliance Wholesalers, it being

understood that CBA assumes full responsibility for creating demand for the

Products. Except for Product shipped directly by CBA as set forth in Section

11.07, (i) all purchases of Product by ABI from CBA shall be on an F.O.B. ABI

Distribution Facility, freight prepaid basis, and (ii) CBA shall ship Products

to be delivered to an Alliance Wholesaler to the ABI Distribution Facility

designated from time to time by ABI for such Alliance Wholesaler.

<PAGE>

ARTICLE IV

PRICING OF PRODUCTS

4.01 The price for all Product sold by CBA to ABI for Products shipped

to ABI breweries or distribution centers shall equal: (a) the Scheduled Price

minus as applicable, (b) (i) the Staging Costs, (ii) the Cooperage Handling

Charge, and/or (iii) Taxes. The price for all Product sold by CBA to ABI for

Products shipped to a WSC shall equal (a)(i) the Scheduled Price minus as

applicable, (b)(i) the Invoicing Costs, (ii) the Cooperage Handling Charge

and/or (iii) Taxes. The price for all Product sold by CBA to ABI for Product

shipped directly by CBA to Alliance Wholesalers shall equal (a) the Scheduled

Price minus as applicable, (b)(i) the Invoicing Costs, (ii) the Cooperage

Handling Charge and/or (iii) Taxes. With respect to any Product, howsoever

shipped, the difference between the respective (a) and (b) shall be referred to

as the "Purchase Price").

CBA shall establish the initial Scheduled Price for each Product sold

by CBA to ABI. CBA shall have the right at any time in its sole discretion to

modify such Scheduled Price, such new pricing to become effective for all

deliveries to ABI not less than 30 days after date of written notice to ABI of

such price modifications.

4.02 Within 30 days after the end of each calendar quarter during the

Term, ABI shall pay to CBA any Additional Price Component which is due CBA with

respect to sales of Product by ABI to Alliance Wholesalers during such calendar

quarter.

4.03 CBA may, from time to time, suggest Product resale prices to ABI,

and ABI will consider such suggestions. However, ABI shall have the right to

re-sell the Product to Alliance Wholesalers at such prices and on such terms and

conditions as ABI may, in its sole discretion, determine from time to time. Any

and all price promotions to be offered to Alliance Wholesalers by CBA shall be

implemented in strict accordance with the procedures set forth in ATTACHMENT E

attached hereto.

<PAGE>

4.04 ABI shall remit payment of the Purchase Price to CBA for all

Product purchased hereunder, contemporaneously with its receipt of funds from

the Alliance Wholesalers with respect to such purchases. ABI shall be entitled

to set off against such payments any amounts owed to ABI for defective Products

(including without limitation, any costs of disposing of such defective

Product), or which are due ABI pursuant to the terms of this Agreement or

otherwise or which are due ABI from Redhook or Widmer and which amounts arose

out of the brewing or sale of Products in the Territory. In the event that any

Alliance Wholesaler does not pay to ABI the purchase price with respect to any

Products purchased by such Alliance Wholesaler within 60 days after delivery

thereof, at the option of CBA, ABI shall assign all of its rights to CBA against

such Alliance Wholesaler relating to the purchase price for such Products.

4.05 Notwithstanding the foregoing provisions of this Article IV, CBA

and ABI recognize that the laws of certain States and/or U.S. federal laws may

preclude the parties from implementing the pricing mechanisms described above.

Under such circumstances, it is the intention of the parties to comply with the

requirements of such laws, without such compliance being a breach of this

Agreement. Under such circumstances, CBA and ABI shall in good faith negotiate a

periodic adjustment to the Purchase Price, other affected provisions hereof and

the procedures set forth herein where it is permissible to do so, in an amount

necessary to restore the same economic benefits CBA and ABI would have received

had the above pricing mechanisms been in effect.

4.06 (a) Within 45 days after the end of each calendar quarter, CBA

shall deliver a report setting forth the aggregate volume, in case -

equivalents, of Product: (i) sold by CBA in the Territory and by Redhook and

Widmer in the State of Washington in such calendar quarter and (ii) sold by

Kona, Redhook and Widmer in the Territory and in the State of Washington during

the respective calendar quarter in 2003.

(b) Contemporaneously with the delivery of such report, CBA

shall pay to ABI the Margin for all Product sold by CBA to Non-Alliance

Wholesalers or Affiliated Wholesalers and the Margin for all Product sold by

Redhook or Widmer in the State of Washington during such calendar quarter.

<PAGE>

quantity of Products sold in the Territory by CBA and by Redhook and Widmer in

the State of Washington exceeds the quantity of Products (in each case

determined on a case equivalent basis) sold by Kona, Redhook or Widmer in the

respective calendar quarter in 2003 in the Territory and the State of

Washington, CBA shall pay to ABI the Incremental Margin for all such Product

sold during such calendar quarter. Such payment shall be made contemporaneously

with the payment set forth in Section 4.06(b).

(d) If during any calendar year, the product of the (i) the

Incremental Margin and (ii) the amount, if any, by which the aggregate volume,

in case-equivalents, of Product sold by CBA in the Territory and Redhook and

Widmer in the State of Washington in such calendar year exceeds the aggregate

volume, in case-equivalents of Product sold by Kona, Redhook and Widmer during

2003 in the Territory and in the State of Washington does not equal the amounts

paid by CBA for such calendar year pursuant to Section 4.06(c), then, within 45

days after the end of such calendar year ABI shall pay to CBA any amount by

which the payments previously made by CBA pursuant to Section 4.06(c) exceed

such product or CBA shall pay to ABI any amount by which the payments previously

made by CBA are less than such product.

(e) The sales used in computing the Incremental Margin for any

calendar quarter shall be the sales derived from the sales areas included in the

Territory and in the State of Washington for the calendar quarter for which the

Margin is calculated and those sales derived from those same sales areas and the

State of Washington for the respective calendar quarter in 2003. For purposes of

determining the Margin, the parties agree that Schedule 4.06 sets forth the

Product sold by Kona, Redhook and Widmer in the Territory and the State of

Washington in each calendar quarter of 2003. The parties agree that for purposes

of determining Incremental Margin to be paid by CBA in 2004, the calculations

set forth in Section 4.06(c) and (d) shall be applied only to that period in

2004 (and the respective period in 2003) occurring after the Commencement Date.

<PAGE>

4.07 (a) Within 30 days after the end of each calendar month, ABI shall

notify CBA of the WSC Fees payable with respect to the Product delivered by CBA

for such month, together with the product delivered by CBA to each WSC and the

fees incurred with respect to each WSC. CBA shall pay such WSC Fees within 15

days after its receipt of notification.

(b) Within 30 days after the end of each calendar year, ABI

shall notify CBA of the fees charged by each WSC to which CBA may ship Product

during such calendar year.

be paid to a WSC, in either case to which CBA may be reasonably expected to ship

Product, ABI shall notify CBA of such change or renegotiated fees.

ARTICLE V

DELIVERY OF PRODUCTS AND RISK OF LOSS

5.01 Except as set forth in Section 11.07, title to the Product and its

risk of loss or destruction shall pass from CBA to ABI upon delivery of the

Product to the ABI Distribution Facility designated by ABI to be used for the

respective Alliance Wholesaler.

5.02 CBA shall insure that Product shall be packaged, palletized and

prepared for shipment in accordance with ABI's instructions in effect from time

to time for ABI's malt beverage products. CBA shall reimburse ABI for any costs

incurred by ABI in handling Products which are not properly palletized and/or

prepared for shipment, or which are palletized and/or prepared for shipment in a

manner which causes ABI to incur handling expenses not otherwise included in the

calculation of Staging Costs as set forth in ATTACHMENT A, and ABI's

determination of such costs, absent material error, shall be binding on each of

ABI and CBA, provided, however, that such determination shall be subject to the

audit provisions of Article XVII below.

<PAGE>

ARTICLE VI

CBA'S TRADEMARKS

6.01 ABI shall not acquire any right in any of the CBA, Kona, Redhook,

or Widmer trademarks, trade dress, copyrights, promotional slogans, trade names,

designs, labels, get-ups, color combinations, product shapes, and other

distinctive features in the Products, or the promotional goods, advertisements

and promotional activities used during the term of this Agreement in conjunction

with the advertising, promotion, distribution, and sale of the Products

(collectively, "Intellectual Property'). ABI is hereby granted the right during

the Term to use the Intellectual Property in advertising, promotion,

distribution, and sale of the Products in the Territory, which right ABI may

sub-license to the Alliance Wholesalers; provided, however, that CBA shall have

the right to require ABI and the Alliance Wholesalers to submit representative

samples of any use of such Intellectual Property to CBA for approval, which

approval shall be deemed given if CBA does not provide ABI with written notice

of reasonable objection within 10 days of receipt of such samples. Any and all

rights that may be acquired in the Intellectual Property by the use of the

Intellectual Property by ABI or any Alliance Wholesaler will inure to the sole

benefit of the owner of the Intellectual Property, which will be either CBA,

Kona, Redhook, or Widmer. The foregoing sentence does not affect ABI's rights in

other marks it may use or adopt. At the request of CBA, ABI will execute an

instrument, in a form agreeable to CBA and ABI, to effect further registration,

maintenance, and renewal of the Intellectual Property, and, where applicable, to

record CBA, Kona, Redhook, or Widmer (as the case may be) as a registered user

of the Intellectual Property. CBA represents and warrants that it has the right

and authority to provide ABI and the Alliance Wholesalers with the rights

provided in this Section.

6.02 ABI shall promptly notify CBA of any and all infringements of the

Intellectual Property pertaining to the Products that may come to ABI's

attention and shall assist CBA in taking such action against said infringements

as CBA, in its sole discretion, may decide. All expenses and costs of such legal

action, including those of ABI, shall be paid by CBA.

<PAGE>

ARTICLE VII

TERM AND TERMINATION

7.01 The term of this Agreement (the "Term") shall become effective at

the Commencement Date and, unless sooner terminated pursuant to the provisions

of this Agreement, shall continue in effect until December 31, 2014 (the

"Initial Term"). Following the Initial Term, this Agreement shall renew

automatically for an additional 10 year period, unless ABI provides written

notice to CBA on or prior to June 30, 2014 that the Agreement shall not be

renewed.

7.02 Either party shall have the right at any time to terminate this

Agreement immediately, without prejudice to any other legal rights to which such

terminating party may be entitled, upon the occurrence and during the

continuance of any one or more of the following:

(a) material default by the other party in the performance of

any of the provisions of this Agreement or any other agreement between the

parties, which default is either:

(i) curable within 30 days, but is not cured

within 30 days following written notice of

default; or

(ii) not curable within 30 days and either:

(A) the defaulting party fails to take

reasonable steps to cure as soon as

reasonably possible following

written notice of such default; or

(B) such default is not cured within 90

days following written notice of

such default;

(b) default by the other party in the performance of any of

the provisions of this Agreement or any other agreement between the parties,

which default is not described in Section 7.02(a) and which is not cured within

180 days following written notice of such default;

<PAGE>

benefit of creditors; or the commencement by the other party of a voluntary case

or proceeding or the other party's consent to or acquiescence in the entry of an

order for relief against such other party in an involuntary case or proceeding

under any bankruptcy, reorganization, insolvency or similar law;

(d) the appointment of a trustee or receiver or similar

officer of any court for the other party or for a substantial part of the

property of the other party, whether with or without the consent of the other

party, which is not terminated within 60 days from the date of appointment

thereof;

(e) the institution of bankruptcy, reorganization, insolvency

or liquidation proceedings by or against the other party without such

proceedings being dismissed within 90 days from the date of the institution

thereof; or

(f) Any representation or warranty made by the other party

hereunder or in the course of performance of this Agreement shall be false in

material respects.

7.03 (a) ABI shall have the right and option to terminate this

Agreement at any time upon six months' prior written notice to CBA, in the

event:

(i) CBA, Kona, Redhook or Widmer engage in any

Incompatible Conduct which is not curable or is not cured to ABI's satisfaction

(in ABI's sole opinion) within 30 days following written notice from ABI to CBA;

(ii) (x) any Person (including any "group" as defined

by Section 13(d)(3) of the Securities and Exchange Act of 1934), other than

Redhook or Widmer, acquires or enters into an agreement to acquire any equity

securities issued by CBA or CBA provides such Person the ability to acquire any

equity securities issued by CBA.

(y) any ABI Competitor or Affiliate thereof

acquires 10% or more of the outstanding equity securities in Kona, Redhook or

Widmer, and one or more officers, designees or agents of such Person becomes a

member of the Board of Directors of Kona, Redhook or Widmer, respectively;

(iii) Material default by Redhook or Widmer in the

performance of any of the provisions of any agreement between such parties and

ABI or any material default by CBA, Redhook or Widmer in any agreement between

or among such parties related to the establishment or operation of CBA, in

either case, which default is either:

<PAGE>

(x) curable within 30 days, but is not cured

within 30 days following written notice

of default; or

(y) not curable within 30 days and either:

(A) the defaulting party fails to take

reasonable steps to cure as soon as

reasonably possible following written

notice of such default; or

(B) such default is not cured within 90 days

following written notice of such

default.

(iv) Default by Redhook or Widmer in the performance

of any of the provisions of any agreement between such parties and ABI or any

default by CBA, Redhook or Widmer in any agreement between or among such parties

related to the establishment or operation of CBA, in either case, which default

is not described in Section 7.03(a)(iii) and is not cured within 180 days

following written notice of such default;

(v) The current chief executive officer of any of

CBA, Redhook or Widmer ceases to function as chief executive officer and within

six months of such cessation a successor satisfactory in the sole, good faith

discretion of ABI is not appointed; or

(vi) Redhook, Widmer or CBA shall merge or

consolidate into or with any other Person or any other Person shall merge or

consolidate into or with Redhook, Widmer or CBA;

(vii) ABI or its corporate affiliates incur any

liability or expense as a result of any claim asserted against them by or in the

name of Redhook or Widmer or any shareholder of Redhook or Widmer as a result of

the equity ownership of ABI or its affiliates in Redhook or Widmer or any equity

transaction or exchange between ABI or its affiliates and Redhook and Widmer,

and Redhook or Widmer, respectively, do not reimburse and indemnify ABI and its

corporate affiliates on demand for the entire amount of such liability and

expense; or

<PAGE>

(viii) Kurt or Robert Widmer are in default or breach

of their obligations under the Stockholders Agreement which default or breach is

not cured within 30 days after written notice thereof by ABI.

(b) Notwithstanding the foregoing, this Agreement shall not be

subject to termination as a consequence of Incompatible Conduct if: (i) the act

of Incompatible Conduct does not arise out of or relate to the operations or

condition of CBA; (ii) within 90 days after notice of termination by ABI, CBA

has terminated its sale and marketing of the products of each brewer out of

whose operations or condition the act of Incompatible Conduct arose or to which

operations or condition the act of Incompatible Conduct related and such

products are no longer subject to distribution pursuant to the terms hereof; and

(iii) such termination has, in the good faith judgment of ABI, rectified the

damage to the reputation or image of ABI or the brewing industry caused by such

act.

7.03(a)(ii)-(viii), this Agreement shall not be subject to termination as a

consequence of the circumstances described in such provisions if: (i) the

circumstances do not arise out of the operations, acts, omissions or condition

of CBA; and (ii) within 90 days after notice of termination by ABI, CBA has

terminated its sale and marketing of the products of each brewer out of whose

operations, acts, omissions, condition or stockholders the circumstances arose

and such products are no longer subject to distribution pursuant to the terms

hereof. Notwithstanding the provisions set forth in Section 7.03(a)(viii), this

Agreement shall not be subject to termination as a consequence of the

circumstances described in such provisions if within 90 days after notice of

termination by ABI, CBA has terminated its sale and marketing of the Widmer

products.

7.04 ABI shall have the right and option to terminate this Agreement at

any time upon written notice to CBA in the event:

(i) Either Redhook or Widmer makes an assignment for

the benefit of creditors; or commences a voluntary case or proceeding or

consents to or acquiesces in the entry of an order for relief against it in an

involuntary case or proceeding under any bankruptcy, reorganization, insolvency

or similar law;

<PAGE>

(ii) A trustee or receiver or similar officer of any

court is appointed for Redhook or Widmer or for a substantial part of the

property of Redhook or Widmer, whether with or without the consent of Redhook or

Widmer, which is not terminated within 60 days from the date of appointment

thereof;

(iii) The institution of bankruptcy, reorganization,

insolvency or liquidation proceedings by or against Redhook or Widmer without

such proceedings being dismissed within 90 days from the date of the institution

thereof;

(iv) Any of Kona, Redhook or Widmer terminate or

purport to terminate the right of CBA to market and sell the Products as

contemplated hereby or either of Redhook or Widmer terminate or disavow, or

purport to terminate or disavow, the guaranty of the obligations of CBA

hereunder; or

(v) CBA dissolves or undertakes proceedings to

dissolve; or

(vi) the master distributor agreement between ABI and

Redhook or the master distributor agreement between ABI and Widmer is

terminated.

(vii) Notwithstanding the provisions set forth in

Section 7.04(i)-(vi), this Agreement shall not be subject to termination as a

consequence of the circumstances described in such provisions (or, if the

Agreement has been terminated as a result of such provisions, shall be subject

to automatic reinstatement) if: (i) the circumstances do not arise out of or

relate to the operations, acts, omissions or condition of CBA; and (ii) within

90 days after notice of termination by ABI, CBA has terminated its sale and

marketing of the products of each brewer out of whose operations, acts,

omissions or status the circumstances arose or to which operations, acts,

omissions, condition or stockholders the circumstances related and such products

are no longer subject to distribution pursuant to the terms hereof.

<PAGE>

ARTICLE VIII

REMEDIES

If either party commits a breach or a default of this Agreement, no

remedy herein conferred upon or reserved to either party is exclusive of any

other available remedy or remedies, but each and every such remedy shall be

cumulative and shall be in addition to every other remedy given under this

Agreement or now or hereafter existing at law or in equity or by statute. No

delay or omission to exercise any right or power accruing upon any breach or

default shall impair any such right or power or shall be construed to be a

waiver thereof, but any such right and power may be exercised from time to time

and as often as may be deemed expedient.

ARTICLE IX

DUTIES OF ABI

9.01 Except as set forth in Section 11.07, ABI shall have

responsibility and authority for coordinating delivery of the Product to the

Alliance Wholesalers. ABI shall specify the brand, package and quantity of

Product ordered and shall designate the ABI Distribution Facility to which the

Product shall be shipped (and ABI may change such designation from time to

time). The costs charged to CBA shall vary depending on which ABI Distribution

Facility is designated.

9.02 ABI shall store all Product as it stores its own products, and

shall handle all Product with the same degree of care as it handles its own

products.

9.03 Except for deliveries made by CBA directly to Alliance Wholesalers

as set forth herein, ABI shall promptly and correctly fill each Alliance

Wholesaler's order, or shall instruct the WSC to promptly and correctly fill

each Alliance Wholesaler's order and to load all Products on the trucks or other

means of conveyance to the Alliance Wholesalers.

9.04 ABI may, in its sole discretion, add the Products to Exhibit 1 of

the existing Wholesaler Equity Agreement that ABI has with any Alliance

Wholesaler. At the option of ABI, in the event ABI acquires the distribution

rights to the Products in any sales area, ABI may direct CBA and an ABI

wholesaler servicing such sales area to enter into a transitional distribution

agreement in a form satisfactory to ABI in lieu of adding the Products to

Exhibit 1 of the Wholesaler Equity Agreement between ABI and such wholesaler.

<PAGE>

9.05 ABI shall use its best efforts (to the extent commercially

reasonable) to maintain all licenses, permits and other authorizations that are

necessary for ABI to dist

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