<PAGE>
Exhibit 10.27
NOTE: PORTIONS OF THIS EXHIBIT ARE THE
SUBJECT OF A CONFIDENTIAL TREATMENT
REQUEST BY THE REGISTRANT TO THE SECURITIES
AND EXCHANGE COMMISSION. SUCH
PORTIONS HAVE BEEN REDACTED AND ARE MARKED
WITH A "[*]" IN PLACE OF THE
REDACTED LANGUAGE.
SUPPLY AGREEMENT
Date: 19th January, 1998
Parties:
1. 'The Supplier': Carbery Milk
Products Limited a company incorporated in
Ireland whose
registered office is at Ballineen, County Cork, Ireland
2. 'The Customer': The Roaring
Water Bay Spirits Company Limited a company
incorporated in
Ireland whose registered office is at Carrick House, 49
Fitzwilliam
Square, Dublin 2.
RECITALS:
(A) The Supplier carries on, inter
alia, the business of manufacturing and
selling the
Products.
(B) The Customer intends, with effect
from 1 March, 1998 to carry on the
business of
manufacturing and selling branded vodkas ant other alcoholic
drinks and
wishes to purchase the Products from the Supplier for that
business, and
the Supplier is willing to supply the Products to the
Customer, on the
terms set out in this Agreement.
Operative Provisions:
1 Interpretation
1.1 In this Agreement, unless the
context otherwise requires:
'CREAM LIQUEUR
PRODUCTS' means alcohol beverages which contain alcohol and
dairy, or
alternative fats, which in combination with sweetening and
sugars
are intended to
compete with or replicate existing cream or fat based
alcoholic
beverages
'FORCE MAJEURE'
means, in relation to either party, any circumstances
beyond the
reasonable control of that party (including, without
limitation,
any strike,
lock-out or other industrial action)
'PRODUCTS' means
neutral spirit with an alcohol level as set out in the
Specification
'SPECIFICATION'
means the specification of the Products described in
Schedule I or
any other specification of the Products agreed in writing
between the
Supplier and the Customer from time to time
'PROCESS
PROCEDURE' refers to the matters set out in Schedule II
1.2 Any reference in this Agreement to
'writing', or cognate expressions,
includes a
reference to any communication effected by telex, cable,
facsimile
transmission or any comparable means.
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1.3 The headings in this Agreement are
for convenience only and shall not
affect its
interpretation.
2 Sale of the
Products
2.1 During the continuance of this
Agreement the Supplier shall sell and the
Customer shall
exclusively purchase all quantities of the Products and
other neutral
spirit requirements of the Company required by the Customer
subject to the
terms and conditions of this Agreement.
2.2 Each order shall specify the
quantities of each of the Products by volume
and type. The
Products or any of them shall be delivered in bulk tanker
container
form.
2.3
2.3.1 The
Customer shall, where the expected requirement for any one year
of the Products is greater than twice that set out for that year
in
clause 5.1 below, inform the Supplier of such projected
increased
requirements at least six months in advance of that year;
2.3.2 The
Customer shall give the supplier not less than three months
notice of its estimated requirements of the Products for each
month
and shall promptly notify the Supplier of any changes in
circumstances
which may affect its requirements.
2.4 If the Customer's orders for the
Products exceed (or it appears from any of
the estimates or
revised estimates given pursuant to clause 2.3 or 5.1 that
they will
exceed) the output capacity or stocks of the Supplier, whether
produced by the
Supplier or obtained by the Supplier from a third party the
Supplier shall
as soon as practicable notify the Customer and, the customer
shall, be
entitled to obtain from any other person such quantity of the
Products as the
Supplier is unable to supply in accordance with the
Customer's
orders.
2.5 For the avoidance of doubt, in the
event that the Supplier is unable to
supply
sufficient quantities of the Products to the Customer and the
Customer, as a
result of such inability obtains Products from a third party
at a cost
greater than that which the Customer would have paid to the
Supplier, the
Supplier shall forthwith repay the difference in price
between the
price charged by the third party and the price which would have
been charged by
the Supplier. Any price negotiated with a third party shall
be a price
negotiated on a commercial basis and at arms length.
3 Conditions of sale
All sales of the
Products sold pursuant to this Agreement shall be subject
to the terms and
conditions of this Agreement and shall prevail over any
other terms and
conditions unless this Agreement is varied by the parties
hereto. This
Agreement shall not be and shall not be deemed to be varied by
the parties
hereto unless the parties state in writing that this Agreement
is so
varied.
4 Specification of the
products
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4.1 All Products sold by the Supplier
to the Customer pursuant to this
Agreement shall
conform in all respects to the Specification.
4.2 The parties shall consult with
each other from time to time during the
continuance of
this Agreement in order to ensure that the Specification is
acceptable to
both parties, and the Specification may subsequently be
changed by
agreement in writing by the parties.
4.3 Testing of the Products shall take
place in accordance with the provisions
of Schedule
II.
4.4 If as a result of inspection or
testing the Customer is lot satisfied that
the Products
will comply in all respects with the Specification and the
Customer so
informs the Supplier within 7 days of inspection of testing,
the Supplier
shall take such steps as are necessary to ensure compliance.
4.5 The Products shall be marked in
accordance with the Customer's instructions
and any
applicable regulations or requirements of the carrier, and
properly
packed and
secured so as to reach their destination in an undamaged
condition in the
ordinary course.
5 Orders &
Supply
5.1 The Customer projects (but without
commitment to purchase) that it will
purchase from
the Supplier the following quantities of Product in the years
set out below
(where reference to Year 1 refers to the 12 month period
commencing on 1
June, 1998 and reference to each subsequent year refers to
each 12 month
period thereafter).
<TABLE>
<CAPTION>
No. of Cases Litres of Alcohol
------------
-------------------
<S> <C>
<C>
Year 1 *
* litres
p.a.
2 *
* litres
p.a.
3 *
* litres
p.a.
4 *
* litres
p.a.
5 *
* litres
p.a.
</TABLE>
6 Trade Secrets
6.1 The parties agree that
notwithstanding any termination in accordance with
clause 12
hereof, they shall not use any name, trademark, trade name or
logo of the
other party. The Supplier shall not be entitled either by
implication or
otherwise to any title, or right of interest in any
trademarks,
trade names, logos or symbols employed, designed, or developed
by the Customer
in connection with the Products. The Supplier further
acknowledges
that it is granted no rights in relation to copyright or other
rights of
whatever nature subsisting in any Product produced or developed
by the
Customer.
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In particular
the Supplier acknowledges that all and any sights subsisting
in any bottle or
graphic representation (including any label on any bottle)
belongs to the
Customer.
6.2 The Supplier acknowledges that it
has no right to sell any brands of vodka
or other branded
alcoholic product produced or developed by the Customer
throughout the
world. The Customer acknowledges that the provisions of
clause 15.2 do
not apply insofar as they relate to Cream Liqueur Products.
7 Manufacture and
delivery of the Products
7.1 The Supplier shall use its best
endeavours to manufacture and maintain
sufficient
stocks of the Products to fulfill its obligations under this
Agreement.
7.2 The Supplier shall ensure delivery
of each of the Customer's orders of the
Products on the
date specified in the order, and time of delivery stall be
of the
essence.
7.3 Delivery of the Products shall be
on a CIF basis and shall take place at
the premises of
Terra Limited at Institute Road, Bailieboro, Co Cavan or
such other
location as the Customer may agree with the Supplier. The
obligation to
store the Products in bonded warehouse storage shall pass
from the
Supplier to the Customer or its nominee upon delivery of the
Products
pursuant to clause 7.3 to the Customer or its agents.
7.4 The Supplier shall comply with all
applicable regulations or other legal
requirements
concerning the manufacture and delivery of the Products.
7.5 The Customer, or its nominee,
shall be entitled to reject any Products
delivered which
are not in accordance with the Specification within 14 days
of delivery of
the Products to the Customer or its nominee as the case may
be and failing
such rejection, be deemed to have accepted the Products one
day after expiry
of such 14 day period.
7.6 The Supplier shall supply the
Customer or its nominee in good time with any
instructions or
other information required to enable the Customer or its
nominee to
accept delivery of the Products.
7.7 If the Customer or its nominee
rejects any delivery of the Products which
are not in
accordance with clause 7.5 the Supplier at its own cost shall
forthwith take
possession of such Products and remove them from the
premises of
Terra Limited or from such other location to which such
Products were
delivered and the Supplier shall within 10 days of being
requested to do
so by the Customer or its nominee supply replacement
Products which
are in accordance with the Specification (in which event the
Supplier shall
not be deemed to be in breach of this Agreement or have any
liability to the
Customer) or shall notify the Customer or its nominee that
it is unable to
do so, whereupon the Customer or its nominee shall be
entitled to
obtain from any other person such quantity of the Products as
the Supplier has
been unable so to supply, and the provisions of clause 2.5
shall apply
accordingly.
7.8 The Supplier on request, shall, at
the Suppliers cost, send to the Customer
or its nominee
samples of the Products or any other Products manufactured
by the
Supplier.
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8 Risk and Property
8.1 Risk of damage to or loss of the
Products shall pass to the Customer upon
delivery to the
Customer or its nominee in accordance with clause 7.3.
8.2 The property in each consignment
of the Products delivered shall pass to
the Customer
upon payment in full for all of the Products contained in such
consignment
unless payment for such Products is made prior to delivery,
when it shall
pass to the Customer once payment has been made and the
Products have
been appropriated to the Customer.
8.3 If the Customer shall sell or
otherwise dispose of the Products, or any of
them before
payment in full by the Customer has been made to the Supplier,
the Customer
shall in such case hold all monies received by it from such
sale or disposal
in trust for the Supplier and shall on request furnish the
Supplier with
the names and addresses of the persons to whom such disposals
have been made
together with all necessary particulars to enable the
Supplier to
recover any outstanding sums due from such persons. So long as
the property in
the Products shall remain in the Supplier, the Customer
shall hold the
Products as bailee for the Supplier and store the Products
so as to clearly
show them to be the property of the Supplier, and the
Supplier shall
have the right in default of payment by the Customer for
such Products as
and when due, without prejudice to the obligations of the
Customer to
purchase the Products, to retake possession of the Products
(and for that
purpose to go upon any premises occupied by the Customer).
Nothing in this
clause shall confer any right upon the Customer to return
the Products.
The Supplier may maintain an action for the price
notwithstanding
that property in the Products shall have vested in the
Customer.
Default by
Customer
(a) If the Customer:
-
(i) fails to
comply
