Exhibit 2.14
SALES REPRESENTATIVE SERVICES AGREEMENT
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THIS SALES REPRESENTATIVE SERVICES AGREEMENT, dated April 25, 2002 (the
"Agreement"), is entered into by and between Spectrum Organic Products, Inc., a
California corporation ("Spectrum"), and Organic Ingredients, Inc., a California
corporation ("Buyer"), a wholly-owned subsidiary of Acirca, Inc., a Delaware
corporation ("Acirca").
WHEREAS, Spectrum, Buyer and Acirca have entered into an Asset Purchase
Agreement, dated as of the date hereof (the "Asset Purchase Agreement"), whereby
Spectrum has agreed to sell and Buyer has agreed to purchase certain assets of
Spectrum;
WHEREAS, the Asset Purchase Agreement contemplates the transfer of certain
activities from Spectrum to Buyer (the "Transfer") and such transfer requires
the provision of certain sales representative services by Buyer; and
WHEREAS, as a condition to Spectrum entering into the Asset Purchase
Agreement, Buyer has agreed to provide Spectrum with certain sales
representative services necessary to efficiently complete the Transfer with
minimal disruption to Spectrum's customers and suppliers.
NOW, THEREFORE, in consideration of the mutual promises contained herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:
1. Definitions. Capitalized terms used herein and not otherwise defined
herein shall have the meanings ascribed to such terms in the Asset Purchase
Agreement.
2. Services.
(a) Sales Representative; Authorization. Subject to the terms and
conditions hereof, Spectrum hereby designates and appoints Buyer its exclusive
sales representative for the sale, marketing and collection of proceeds relating
to the sale of Spectrum's inventory of roasted and regular garlic puree, muscat
grape juice concentrate, single strength pear puree, pink grapefruit
concentrate, single strength pink grapefruit juice, single strength celery
juice, and orange juice concentrate (each, an "Inventory Item"), and Buyer
hereby accepts such appointment. A schedule of the amount of each Inventory Item
held by Spectrum as of the date hereof is attached hereto as Exhibit A. In
connection with such appointment, Buyer, or any agent of Buyer, is hereby
authorized to take all action reasonably necessary or desirable to effect the
sale of the Inventory Items and collection of the proceeds arising out any such
sales; provided, however, that Buyer and his agents, contractors or affiliates
shall not make any representation regarding the Inventory Items other than those
authorized by Spectrum. Buyer shall use its commercially reasonable efforts to
sell the Inventory Items to potential buyers, abide by all the terms and
conditions herein and diligently perform its obligations hereunder. Buyer
further agrees to keep all sums obtained from the sale of the Inventory Items
(other than the Fee (as defined herein)) in trust for Spectrum until paid out as
Net Proceeds pursuant to Section 4(b) hereof. Spectrum shall be responsible for
storing, shipping and delivering the Inventory Items as provided herein,
including without limitation payment of all freight costs, distribution costs
and storage/warehousing costs. Spectrum shall use its commercially reasonable
efforts to take all action and to do all things necessary, proper, or advisable
to consummate and make effective the transactions contemplated by this
Agreement.
(b) Sales Procedure; Collection. All sales shall be affected by a
purchase order executed by the purchaser in a form reasonably acceptable to
Spectrum (each, a "Purchase Order"). Upon receipt of a Purchase Order, Buyer
shall deliver to Spectrum a true and correct copy of such Purchase Order. Upon
receipt of any Purchaser Order, Spectrum shall confirm to Buyer in writing
Spectrum's agreement to deliver the Inventory Items set forth in such Purchase
Order in accordance with the terms set forth therein. Buyer shall collect all
proceeds arising out of the sale of the Inventory Items, and shall remit such
proceeds to Spectrum in accordance with Section 4(b) hereof; provided, however,
in no event shall Buyer be liable for any purchaser's failure to pay.
(c) Pricing. Each sale shall be at a price approved by Spectrum, which
approval shall not be unreasonably withheld or delayed.
3. Communication. The parties agree that specified points of contact for
both Buyer and Spectrum are critical to this transition. The contacts for each
party are set forth below:
(a) Primary Contacts.
Buyer: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Spectrum: ▇▇▇▇▇▇ ▇▇▇▇▇▇
(b) Service Contacts.
Buyer: ▇▇▇▇▇▇ ▇▇▇▇▇
Spectrum: ▇▇▇▇▇ ▇▇▇▇▇▇
4. Service Charges. (a) Buyer shall invoice Spectrum once monthly for all
reasonable out-of-pocket costs actually incurred by Buyer in connection with the
provision of the Services including without limitation travel, meals and lodging
of Buyer employees ("Out-of-Pocket Costs"); provided, however, in no event shall
such costs include overhead costs incurred by Buyer, including without
limitation compensation of Buyer employees, all of which costs shall be the sole
responsibility of Buyer. Spectrum shall reimburse Buyer for Out-of-Pocket Costs
within thirty (30) days of Spectrum's receipt of the related invoice.
(b) Buyer shall act as Spectrum's sales representative hereunder in
exchange for a fee (the "Fee") equal to 3% of the gross sales of the Inventory
Items during the Term (as defined herein). The Fee shall be deducted from any
collected proceeds arising out of the sale of the Inventory Items prior to any
distribution of any monies to Spectrum. The remaining collected proceeds after
the Fee is deducted shall be called the "Net Proceeds." Within thirty (30) days
after the last day of each calendar month, Buyer shall remit to Spectrum the Net
Proceeds for such month.
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5. Quality of Inventory Items. Spectrum represents, warrants and agrees
that:
(a) Spectrum has not violated, nor is in violation of, the applicable
provisions of the federal Food, Drug and Cosmetics Act, as amended, the
regulations and requirements adopted by the United States Food and Drug
Administration (the "FDA") pursuant to such Act, the regulations and
requirements adopted by the United States Department of Agriculture (the
"USDA"), applicable state law and the requirements established by state and
local authorities responsible for regulating food products and establishments,
including, without limitation, the California Organic Foods Act of 1990
(collectively "state food authorities"), as well as with the terms and
conditions imposed in any licenses granted to Spectrum by the FDA, USDA or state
food authorities.
(b) All Inventory Items sold pursuant hereto shall, when delivered, meet
all standards for organic products as prescribed under the applicable laws, as
amended from time to time, of the United States (including without limitation,
the Act), the regulations and requirements adopted by the FDA pursuant to the
Act, the regulations and requirements adopted by the USDA, and the respective
states in which such Inventory Items are delivered hereunder, and the laws or
ordinances of any state food authorities applicable to the Inventory Items, as
well as comply with the terms and conditions imposed in any licenses granted to
Spectrum by the FDA, the USDA or any state food authorities; and
(c) All Inventory Items sold pursuant hereto shall, when delivered, meet
or exceed the specifications, which are attached to each Purchase Order.
6. Title; Risk of Loss. Spectrum represents to Buyer that, except as set
forth in Schedule 2.16 of the Asset Purchase Agreement, Spectrum has good title
to all of the Inventory Items, free and clear of all Liens. Spectrum represents
to Buyer, and Buyer acknowledges, that, except as otherwise set forth herein,
Spectrum shall maintain title to, and possession of, all of the Inventory Items.
Spectrum warrants that all Inventory Items sold pursuant hereto shall be sold
free and clear all Liens. Risk of loss for the Inventory Items shall be and
remain with Spectrum until such Inventory Items are delivered in accordance with
a Purchase Order therefor.
7. Indemnification. Each party shall give notice to the other party after
it has notice of any claim or proceeding as to which indemnity may be sought
hereunder, so as to give the indemnifying party the opportunity to assume the
defense of any such claim or proceeding. The other party shall not, in the
defense of any such claim or proceeding, except with the consent of the other
party (which consent shall not be unreasonably withheld) consent to the entry of
any judgment or enter into any settlement.
(a) Spectrum agrees to defend, indemnify and hold harmless Buyer, its
subsidiaries and affiliates and its and their agents, officers, directors,
employees, representatives, successors and permitted assigns from and against
all obligations, liabilities, damages, penalties, fines, violations, claims,
causes of action, suits, judgments, costs and expenses (including, without
limitation, reasonable attorneys' fees) (together, "Losses") that Buyer may
suffer, arising out of, resulting from or connected with (a) Spectrum's breach
of the representations, warranties and agreements set forth in herein; (b) any
action or inaction of Spectrum or its agents in connection with the manufacture,
processing or delivery of Inventory Items, including, without limitation, any
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claims for bodily injury, illness or property damage relating to the condition
of the Inventory Items prior to delivery to the purchaser; (c) any violation of
any law, regulation or ordinance by Spectrum as described in Section 5 hereof;
and (d) any recall of Inventory Items.
(b) Buyer agrees to defend, indemnify and hold harmless Spectrum, its
subsidiaries and affiliates and its and their agents, officers, directors,
employees, representatives, successors and permitted assigns from and against
all Losses that Spectrum may suffer, which Losses have been directly caused by
Buyer's gross negligence, willful misconduct or bad faith.
(c) The obligations of Buyer and Spectrum in this Section 7 shall
survive the termination or cancellation of this Agreement for any reason
whatsoever.
(d) The foregoing shall be in addition to, and not in limitation of, any
rights either party may have against the other party arising out of or in
connection with this Agreement and the Asset Purchase Agreement.
8. Mail. The parties acknowledge that it may occur that, after the Closing
Date, each of Spectrum and Buyer may inadvertently receive mail, telegrams,
packages or other communications properly belonging to the other. Accordingly,
each of Spectrum and Buyer recognizes and agrees that after the Closing Date the
other may receive and open all mail, telegrams, packages and other
communications so received in order to determine the appropriate recipient, and
may retain the same to the extent that they relate to the business of the
receiving party and, to the extent that they do not relate to the business of
the receiving party, shall promptly send the same to the other party by personal
delivery, mail, facsimile or nationally recognized overnight courier service, as
appropriate, or contact the other party by telephone for delivery instructions
for such mail, telegrams, packages or other communications (or, in case the same
relate to both businesses, shall promptly forward copies thereof to the other
party in accordance with the other party's delivery instructions). The
provisions of this Section 5 are not intended to and shall not be deemed to
constitute an authorization by either party to permit the other to accept
service of process on its behalf, and neither party is or shall be deemed the
agent of the other for service of process or for any other purpose.
9. Termination. The term of this Agreement shall commence on the date
hereof and thereafter continue in full force and effect until the sale of all of
Inventory Items set forth in Exhibit A, unless terminated sooner or extended by
mutual agreement (such period from the date hereof until termination hereof
referred to herein as the "Term"). Notwithstanding the foregoing, if any
proceeds of the sale of Inventory Items are collected by Buyer after the
termination of this Agreement, the obligation of Buyer to pay the Net Proceeds
as provided in Section 4(b) hereof shall survive the termination of this
Agreement.
10. Relationship of Parties. For the purposes of this Agreement, Buyer is
deemed to be an independent contractor and nothing contained herein or any
document executed in connection herewith shall be deemed or construed by the
parties hereto, nor by any third party, as creating the relationship of employer
and employee, partnership, or joint venture between the parties. All sums paid
to Buyer are gross sums being paid to Buyer as an agent and not as an employee
of Spectrum.
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11. Notices. All notices, demands and other communications which may or are
required to be given to or made by either party to the other in connection with
this Agreement shall be in writing, and shall be deemed to have been duly given
or made: (a) if sent by registered or certified mail, five days after the
posting thereof with first class postage attached, and (b) if sent by hand or
overnight delivery, upon the delivery thereof, in each case addressed to the
respective parties as follows:
If to Spectrum:
Spectrum Organic Products, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ Godward LLP
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Buyer:
Organic Ingredients, Inc.
One ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address and to the attention of such other persons as either
party hereto may specify from time to time by notice to the other party.
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12. Entire Agreement. This Agreement and the Asset Purchase Agreement, and
the documents and certificates referred to therein embody the entire agreement
and understanding of the parties hereto with respect to the subject matter
hereof, and supersede all prior and contemporaneous agreements and
understandings, oral or written, relative to said subject matter.
13. Captions. The section headings of this Agreement are inserted for
convenience only and shall not constitute a part of this Agreement in construing
or interpreting any provision hereof.
14. Waiver; Consent. This Agreement may not be changed, amended,
terminated, augmented, rescinded or discharged (other than by performance), in
whole or in part, except by a writing executed by the parties hereto, and no
waiver of any of the provisions or conditions of this Agreement or any of the
rights of a party hereto shall be effective or binding unless such waiver shall
be in writing and signed by the party claimed to have given or consented
thereto. Except to the extent that a party hereto may have otherwise agreed in
writing, no waiver by that party of any condition of this Agreement or breach by
the other party of any of its obligations or representations hereunder shall be
deemed to be a waiver of any other condition or subsequent or prior breach of
the same or any other obligation or representation by the other party, nor shall
any forbearance by the first party to seek a remedy for any noncompliance or
breach by the other party be deemed to be a waiver by the first party of its
rights and remedies with respect to such noncompliance or breach.
15. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING
EFFECT TO THE CONFLICTS RULES THEREOF TO THE EXTENT SUCH CONFLICTS RULES WOULD
REQUIRE THE APPLICATION OF THE LAW OF ANOTHER JURISDICTION.
16. Forum Selection and Consent to Jurisdiction. ANY LEGAL ACTION OR
PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN THE COURTS OF NEW
YORK, NEW YORK OR ANY UNITED STATES FEDERAL COURT SITTING IN NEW YORK, NEW YORK,
AND, BY THE EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH PARTY HERETO HEREBY
IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ANY OF ITS PROPERTY, GENERALLY
AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. EACH PARTY HERETO
FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS FROM ANY OF THE
AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY HAND DELIVERY OR BY
REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO SUCH PARTY, AS THE CASE MAY
BE, AT THE ADDRESSES DESCRIBED IN SECTION 8 OF THIS AGREEMENT, SUCH SERVICE TO
BECOME EFFECTIVE UPON HAND DELIVERY OR TEN (10) DAYS AFTER SUCH MAILING. EACH
PARTY HERETO HEREBY IRREVOCABLY WAIVES TO THE FULLEST EXTENT IT MAY EFFECTIVELY
DO SO, ANY OBJECTION IT MAY HAVE TO VENUE AND THE DEFENSE OF AN INCONVENIENT
FORUM TO THE MAINTENANCE OF SUCH ACTIONS OR PROCEEDINGS.
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17. No Third Party Beneficiaries. Nothing herein, expressed or implied, is
intended or shall be construed to confer upon or give to any Person including,
without limitation, any employee of Spectrum, any legal or equitable right,
remedy, claim or other benefit under or by reason of this Agreement.
18. Counterparts. This Agreement may be executed simultaneously in multiple
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same instrument.
19. Gender. Whenever the context requires, words used in the singular shall
be construed to mean or include the plural and vice versa, and pronouns of any
gender shall be deemed to include and designate the masculine, feminine or
neuter gender.
20. Severability. All provisions of this Agreement, and all portions of
such provisions, are intended to be, and shall be, independent and severable,
and in the event that any provision or portion thereof is determined to be
unlawful, invalid or unenforceable, such determination shall not affect the
validity or enforceability of any other provision, or portion thereof, of this
Agreement, and all other provisions and portions thereof shall continue to be
valid and enforceable.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
SPECTRUM ORGANIC PRODUCTS, INC. ORGANIC INGREDIENTS, INC.
By: By:
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chief Financial Officer Title: Chief Financial Officer
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EXHIBIT A
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