EXHIBIT 10.1
CPNM AGREEMENTS
JOINT VENTURE AGREEMENT
THIS JOINT VENTURE AGREEMENT (the "Agreement"), entered into this
21st day of April, 1998 is by and between the following
corporations, collectively referred to herein as "the
partners"sometimes referred to hereinafter individually as Venturer
or collectively as Venturers, as the context may require;
Red Oak Hereford Farms, Inc. (referred to as "HERF"), a Nevada
corporation with offices at ▇.▇. ▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇▇;
and
Cable/Print Network Marketing, Inc. (referred to as "CPNM"), a
Pennsylvania corporation with offices in ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
WHEREAS, CPNM has developed proprietary multimedia marketing
programs and is skilled and experienced in the use of a variety of
promotional, direct and targeted marketing methods ("CPNM's
Marketing");
WHEREAS, HERF is skilled and experienced in beef/cattle business
listed in Exhibit "B", which is attached hereto and herewith made
part of this Agreement ("HERF'S Business").
WHEREAS, the parties desire to enter into an agreement to form a
Joint Venture in the form of a Nevada corporation with the purpose
of utilizing CPNM's Marketing multimedia marketing methods in the
promotion of HERF's Business as to be mutually agreed and listed in
"Exhibit A";
NOW, THEREFORE, in consideration of the foregoing and the mutual
promises contained herein the parties, intending to be legally
bound, agree as follows:
ARTICLE I
FORMATION
1.1 Formation and Ownership. The Venturers partners hereby agree
to form a Joint Venture to implement the business as set forth
hereinfor the purposes of utilizing CPNM's Marketing in the
promotion of HERF's Business as set forth herein. The Joint
Venture shall be created in the form of a Nevada corporation under
the name Here's the Beef Corp. (the "Corporation"). Red Oak
Hereford Farms, Inc. shall owning 80% of the common stock of the
Corporation and CPNM, Inc. shall owning 16.25% of the common stock
of the Corporation and others 3.75%.
1.2 Name of Joint Venture. The name of the Joint Venture shall be
Here's the Beef, Corp.
1.32 Term. The this Joint Venture agreement shall commence as of
the date hereof and remain in full force and effect until the stock
of the Corporation is issued to each Venturer as provided herein or
this Agreement is terminated by the parties in accordance with the
terms hereof this Agreement.
1.43 Initial Capitalization. Red Oak Hereford Farms, Inc. HERF
agrees to contribute $50,000 to the Corporation provide, or to
secure investors for the initial marketing, in the amount of who
will contribute, in the aggregate, $50,000 within ninety (90) days
following the execution of this Agreement. These funds will be
placed into a checking account to be set up by the Corporation
Joint Venture. This initial capitalization and CPNM's marketing
management services are to be used for Multi Media Marketing tests
as mutually agreed to by the Venturers partners or as determined by
the Board of Directors of the Corporation, as listed on Exhibit
"A". A Full roll out of CPNM's Multi Media Marketing will be
conducted only after it can be fully funded by revenues from test
sales, and/or from mutually agreed to subsequent additional
capitalization or loans from the Venturers to the Corporation. The
Board of Directors of the Corporation may hire a facilitator will
be mutually agreed upon to be stationed/ liaison with the Joint
Venture with a $2,000 draw per month for six (6) months against a
percentage of profits/equity of the Corporation. In the event the
facilitator is entitled to payment as a percentage of profits of
the corporation in addition to the Two Thousand Dollars ($2,000.00)
draw per month, the additional payment to the facilitator shall be
paid from CPNM's percentage of profits arising under the Marketing
Services Agreement referred to in Article 6.1. Joint Venture.
1.4 Additional Capitalization/Loans from Venturers.
a. Additional Capitalization. It is the intention of the
Venturers that the Corporation's business and activities shall be
conducted in such a manner that additional capital contributions
shall not be required; to that end, the Venturers shall attempt to
conduct activities of the Corporation in such a way that the
Corporation's business can be conducted with the initial capital
contributions as augmented by debt financing and proceeds from
operations. However, to the extent that additional capital
contributions are required, the Venturers shall make such
additional capital contributions as agreed upon by the Board of
Directors of the Corporation in accordance with its Bylaws.
b. Loans from Venturers. All expenses of the Corporation that
are paid by HERF shall be treated as a loan to the Corporation.
Loans by Venturers to the Corporation shall not be capital
contributions to the Corporation. Loans shall be a debt due from
the Corporation to such lending Venturer and shall be, together
with accrued interest thereon, reimbursed to the Venturer making
such loan prior to any payment or distribution to the Venturers in
connection with the division of profits or the liquidation of the
Corporation.
1.5 Inspection. The books and records of the Joint Venture
Corporation, to shall be maintained by CPNM on behalf of the
Corporation Joint Venture and shall be available for inspection by
all shareholders the partners upon reasonable notice of to CPNM.
Inspection shall take place at the offices of CPNM during normal
business hours.
1.6 CPNM Corporation Checking Account. CPNM shall maintain the
checking account for the Corporation. following the initial
capitalization and subsequent capitalization. All revenues
generated by the Joint Venture Corporation shall be deposited into
a Joint Venture the Corporation checking account. Monthly balance
reports shall be submitted to the Joint Venture shareholders
partner no later than ten (10) days following month end.
1.7 Accounting. CPNM shall maintain the accounts of the
Corporation. Joint Venture shall be maintained by CPNM and The
Corporation's accounts shall be audited by BDO ▇▇▇▇▇▇▇, CPA's, who
shall prepare all necessary tax returns and financial statements
for the Corporation.
1.8 Management. So long as HERF owns 85% of the common stock of
the Corporation and CPNM continues to own 15% of the common stock
of the Corporation, the Joint Venture Corporation shall be managed
by a Board of Directors consisting of the signatories of this
Agreement and three additional nominees, two appointed by HERF and
one appointed by CPNM. As soon as HERF or CPNM transfer part or
all of their common stock holdings to any other person, the Board
of Directors of the Corporation shall be elected by the
shareholders pursuant to the terms of the Bylaws of the
Corporation. The directors shall mutually agree on the budget for
Exhibit "A", selection of officers and all other discretionary
matters.
1.9 Offices. The Joint Venture Corporation shall maintain offices
at the following places, unless otherwise agreed by the parties
from time to time:
a. ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Phone
▇▇▇-▇▇▇-▇▇▇▇, Fax ▇▇▇-▇▇▇-▇▇▇▇.
b. ▇.▇. ▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇, ▇▇ ▇▇▇▇▇, Phone ▇▇▇-▇▇▇-▇▇▇▇, Fax
▇▇▇-▇▇▇-▇▇▇▇.
1.10 Public Offering. The Venturers desire to have the
Corporation's securities registered with the Securities and
Exchange Commission ("SEC") in the future. The Board of Directors
may, in its sole discretion, decide to register the securities of
the Corporation with the SEC if the circumstances warrant such
registration. To the extent that the Corporation's profits are
insufficient to offset the cost of the registration, HERF shall pay
the costs of the registration, such payment from HERF to be treated
as a loan to the Corporation. Failure to register the
Corporation's securities shall not be treated as a breach of this
Agreement by either Venturer.
1.11 Restriction On Sale. Each of the Venturers partners covenant
and agrees that it shall execute a shareholders agreement providing
that it shall not mortgage, pledge, sell, assign, hypothecate or
otherwise encumber, transfer or permit to be transferred in any
manner or by any means whatsoever, whether voluntarily or by
operation of law all or any part of its Joint Venture interest in
the Corporation or withdraw from the Joint Venture Corporation
except as set forth in the shareholders agreement this Agreement.
Except that the Board of Directors of Red Oak Hereford Farms, Inc.
(HERF), at its sole discretion, may vote and approve a motion to
distribute the Joint Venture Corp., Here's The Beef, Corp., in the
form of a Spin Off Dividend to its shareholders. Said Spin Off
distribution who have to be registered with the Securities and
Exchange Commission. The shareholders agreement shall allow HERF,
at its sole discretion, to distribute its shares in the Corporation
to its shareholders in the form of a spin-off dividend following
registration of the Corporation's shares with the SEC.
1.12 Allocation of Profits and Loss. All the Venturers intend
that, prior to the registration of the Corporation's common stock
with the SEC, net profit and loss of the Joint Venture Corporation,
after payment of all of the Corporation's current and prior
financial obligations, including repayment
of loans from Venturers, shall be allocated equally to the among
the Venturers partners after the cost of products to be marketed
and multimedia expenditures as mutually agreed, on a quarterly
basis. The Venturers shall mutually determine an acceptable means
for allocating such profits and losses and shall retain sufficient
funds in the Corporation to continue operations. No allocation or
distribution shall be made until the Venturers are assured that
such allocation or distribution will not cause adverse legal or
income tax consequences to the Corporation. Once the Corporation's
stock is registered with the SEC, all profits and losses shall
inure to the benefit of the shareholders in accordance with their
stock ownership.
1.13 Limitation on Authority of Venturers. Except as otherwise
expressly and specifically provided in this Agreement or by the
organizational documents of the Corporation, neither Venturer shall
have any authority to bind or act for, or assume any obligations or
responsibility on behalf of, the other Venturer. Neither the
Corporation nor either Venturer shall be responsible or liable for
any indebtedness or obligation of the other Venturer or otherwise
relating to HERF's Business or CPNM's Marketing arising either
before or after the execution of this Agreement, except as to those
joint responsibilities, liabilities, indebtedness, or obligations
incurred pursuant to and as limited by the terms of this Agreement.
1.14 Non-Encumbrance. Each of the partners covenants and agrees
that it shall not obligate the other to any third party without
written notice to the other.
ARTICLE II
VENTURER PARTNER'S OBLIGATIONS AND RESPONSIBILITIES
2.1 HERF: Red Oak Hereford Farms, Inc. responsibilities and
obligations shall include, but not be limited to: HERF shall sell
sufficient quantity of beef products to the Corporation at prices
which will not exceed branded prices to the Joint Venture
sufficient qualities of beef products and which the Joint Venture
Corporation may agree to make to be paid out of sales receipts of
the Joint Venture.
2.2 CPNM's: CPNM shall use its best efforts to: responsibilities
and obligations shall include, but not be limited to: Management
of the marketing strategies and plans (listed on Exhibit "A"), for
the promotion and marketing of HERF's Business, the implementation
of which and budgeting for which are subject to the approval of the
Joint Venture Board of Directors of the Corporation partners.
ARTICLE III
INTELLECTUAL PROPERTY
3.1 Copyrights, Patents and Trademarks
a. Any and all patents, trademarks or copyrights, relating
to HERF's Business, which the Joint Venture Corporation may be
entitled to register under state or federal law shall be registered
in the name of the HERF. All other patents, trademarks or
copyrights which the Corporation may be entitled to register under
state or federal law shall be registered in the name of the
Corporation. Joint Venture company, Here's The Beef, Corp.
b. All preexisting patents, trademarks or copyrights of the
Venturers partners shall remain their respective property.
3.2 Customers Lists. All preexisting customer lists disclosed by
HERF to the Corporation shall remain the property of HERF and shall
be returned to HERF upon HERF's request. All customers lists
developed by the Joint Venture Corporation will be the property of
the Joint Venture company Corporation, but shall be distributed to
HERF upon dissolution and liquidation of the Corporation. CPNM
will use its expertise and be responsible for promotion and the
marketing to customers of on the lists on behalf of the Joint
Venture company Corporation.
3.3 Warranty/Indemnification. The parties of the Agreement do
hereby warrant and covenant for themselves for itself that its
their undertaking hereunder does not infringe or interfere with any
intellectual property or other contract rights of third parties,
and each shall indemnify, save and hold the other party harmless,
including attorney's fees and cost of defense, from any suit,
demand, claim, liability or proceeding founded on such third
party's claim, liability, or proceeding founded on such third
party's claim or settlement. The Board of Directors of the
Corporation shall determine, in its sole judgment, whether
marketing beef under the Corporation's name shall cause any
tradename violations and, if so, what course of action, including
revision of the Corporation's name, is advisable under the
circumstances.
ARTICLE IV
CONFIDENTIALITY
4.1 Confidential Information. CPNM acknowledges and agrees that
during the term of this Agreement, it may have access to certain
proprietary confidential information of the HERF, maintained in
confidence by CPNM, including but not limited to information
pertaining to the HERF's customers, processes, products, pricing,
purchasing, accounting, marketing, finances and business practices
(the "Confidential Information"). CPNM further acknowledges and
agrees that all information disclosed to or accessed by CPNM,
including information originated by CPNM in the course of
performing its duties under this Agreement, which CPNM has reason
to believe is confidential or which is treated by HERF as
confidential, shall be presumed to be confidential information,
unless such information was available to the public by publication
or otherwise was part of the public domain through no fault of
CPNM. CPNM further acknowledges and agrees that HERF has developed
and established and is continuing to develop and establish a
valuable and extensive trade in its products and services, and that
HERF would suffer great loss and irreparable injury if the CPNM
discloses any confidential information or uses it to the HERF's
detriment.
4.2 Nondisclosure of Confidential Information. CPNM, during the
term of this Agreement and at all times thereafter, shall maintain
in strictest confidence and shall not directly or indirectly
divulge, release, disclose, or make available to any other firm,
person, corporation, or other entity any Confidential Information
of HERF, except as required by this Agreement or as permitted by
HERF in writing.
4.3 Termination. Upon termination of this Agreement, CPNM shall
deliver promptly to HERF all Confidential Information in any form
to the owner, and shall keep no photocopies, facsimiles, or other
duplications thereof.
4.4 Noncompete. Throughout the term of this Agreement and the
existence of the Corporation, the Corporation will not compete with
either Venturer, nor shall either Venturer compete with the other
Venturer.
ARTICLE IV
TERMINATION
4.1 In the case of any unresolved breach of this Agreement by
either party, and after conformance with the cure provisions as
defined in ARTICLE VI, Subparagraph f, hereafter, either party may
declare this Agreement terminated as to any further business to
which the Joint Venture is not already obligated and the
Corporation shall be liquidated. Upon liquidating, the assets of
the Joint Venture Corporation after retirement of all Joint Venture
of the Corporation's obligations, including loans from Venturers,
shall be divided equally between the distributed to the
shareholders in accordance with the Bylaws of the Corporation
partners. The Venturers partners agree that any obligations,
financial or otherwise to third parties will be satisfied prior to
the dissolution and liquidation of the Joint Venture Corporation.
and that each partner will fulfill its such obligations prior to
such dissolution except as noted in 1.3 of this Agreement.
4.2 At any time during or subsequent to the termination of the
Corporation Joint Venture as provided herein, or otherwise, HERF
Red Oak Hereford Farms, Inc. will not utilize any of CPNM's Multi
Media Marketing techniques that are unique to CPNM, and materials
or any parts thereof, without the express written permission of
CPNM. Any marketing techniques that are employed by any competitor
of CPNM or any other person at any time during the term of this
Agreement shall not be deemed to be unique to CPNM.
ARTICLE VI
MISCELLANEOUS PROVISIONS
5.1 Execution of other Documents. The parties will execute and
deliver all documents and instruments which are reasonably
necessary to carry out the terms of this Agreement, including but
not limited to an Exclusive Supply Contract between the Corporation
and HERF and a Marketing Services Agreement between the Corporation
and CPNM.
5.2 Miscellaneous.
a. This Agreement represents the entire agreement between
the parties and shall not be changed orally. There are no other
contemporaneous oral agreements.
b. This Agreement shall inure to the benefit of the parties
together with their permitted successors and assigns. CPNM may not
assign its rights hereunder without the prior written consent of
HERF.
c. If any portion of the Agreement is struck down or
declared unenforceable by a court of competent jurisdiction, it
shall not affect the other provisions of this Agreement.
d. The waiver by either party of any right hereunder shall
not constitute a waiver of any other rights, nor shall the waiver
of any right in an instance constitute the waiver of such right
ongoing.
e. Any and all disputes arising under or related to this
Agreement shall be submitted to binding arbitration before the
American Arbitration Association, in accordance with the rules and
regulations then in effect. Any award may be entered by either
party as a judgment or decree in any court of competent
jurisdiction and enforced accordingly. The parties shall share
equally an AAA fees incurred by either party in connection with any
dispute. Any such arbitration shall take place in ▇▇▇▇▇▇▇▇▇▇
County Pennsylvania. Any dispute under this Agreement shall be
governed by Pennsylvania law.
f. Neither party shall enforce an alleged breach of any
provision of this Agreement clearly without first giving the other
party written notice clearly specifying the nature of such alleged
breach, and an opportunity to cure said alleged breach within
THIRTY (30) DAYS of receipt by certified mail of such notice.
g. All signatories of this Agreement hereby represent and
warrant that they have the requisite authority to execute this
Agreement enter into this transaction, and that the entity which
they represent has complied with all necessary formalities under
all applicable by-laws or agreements, as well as all applicable
state laws and regulations.
h. Except as specifically restricted herein, Each VENTURER
PARTNER agrees that the other shall at all times be free to engage
inn any other business activities.
i. The form and substance of all organizational documents
for the Corporation shall be subject to the approval of the board
of directors of each Venturer.
j. Each signatory to this Agreement shall pay its own
expenses associated with the creation, negotiation and execution
hereof.
k. The Venturers acknowledge that the operation of the
Corporation can be conducted only after the Corporation is licensed
with the American Hereford Association.
Dated this 21st day of April, 1998
Signature /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
RED OAK HEREFORD FARMS, INC.
By:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, President
CABLE/PRINT NETWORK MARKETING, INC.
By:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇, President
Signature
▇▇▇▇▇ ▇. ▇▇▇▇, President, CPNM, Inc.
EXHIBIT "A"
MARKETING SERVICES
CPNM will provide Multi Media marketing for the Joint Venture as
mutually agrees to by the Board of Directors of the Joint Venture:
* TV -- Production and airing to 20,000,000 households, minimum of
3 times. Infomercial and/or commercials.
* Licensing of products, services and of independent sales
representatives
* CartCade-- test on cart in one of Sales Dynamics licensed sites in
150 regional shopping malls
* Fairs, Festivals and Flea Markets -- via American Vendors
Association
* Magazine advertising and tune ads -- 33 potential magazines/20
million + exposure
* Loyalty marketing via club/association with selected CPNM
membership benefits
* Multi-level marketing opportunities
* College Marketing via National Association of College Marketers
* Advertisements in catalogs
* Sales as a premium
* Sweepstakes, as applicable
* Fax Broadcasting tests (up to 1,000 faxes weekly for five weeks,
via Fax Owners & Users Association)
* Radio -- 180 Radio Stations
* TV Home Shopping Network introductions
* Data Base Marketing
* Internet Test Site
* Family Guide Seal of Approval
* Package Inserts -- based on availability
* "Family Guide" Free Fall Newspaper Inserts, via co-op or sponsor
dollars, when available
* Out bound telemarketing -- 7,000 operators
* Access to our Databases
* E-mail -- 80 million addresses
* ArabNet -- 27 Middle East Countries/40 million Households
* Franchising via Franchise America
AGREEMENT
THIS AGREEMENT ("Agreement") executed as of the _____ day of May, 1998,
by and between Red Oak Hereford Farms, Inc., a corporation formed under the
laws of the state of Nevada with its principal place of business in Red Oak,
Iowa ("ROHF") and Cable/Print Network Marketing, Inc., a corporation formed
under the laws of the state of Pennsylvania with its principal place of
business in Jenkintown, Pennsylvania ("CPNM").
WHEREAS, the parties hereto have executed that certain Joint Venture
Agreement dated April 21, 1998 ("Joint Venture Agreement") pursuant to which
they have agreed to form a joint venture in the form of a Nevada corporation;
and
WHEREAS, Here's The Beef Corp., a Nevada corporation (the
"Corporation"), has been formed in accordance with the provisions of the Joint
Venture Agreement; and
WHEREAS, the parties to this Agreement wish to specify certain terms and
conditions that will govern the operation of the Corporation during the term
of this Agreement.
NOW THEREFORE, in consideration of the mutual agreements contained in the
Joint Venture Agreement and contained herein as well as other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Term and Termination. This Agreement shall be effective until it
is terminated as provided herein or until the Corporation files a Registration
Statement with the Securities Exchange Commission ("SEC"). The parties may
agree to terminate this Agreement anytime prior to filing a Registration
Statement with the SEC by mutual written agreement.
2. Capital Requirements. CPNM shall not be required to contribute any
cash to the Corporation. All cash requirements for the Corporation shall be
provided by ROHF in the form of loans.
3. Board of Directors. The parties agree to vote their stock in such
a manner as to elect five (5) members of the board of directors, three (3) of
which will be designated by ROHF and two (2) of which will be designated by
CPNM.
4. Allocation of Profits and Loss. Until this Agreement is terminated,
the parties shall cause the Corporation's profits and losses to be allocated
between CPNM and ROHF so as to provide 50% of all profits and losses to CPNM
and 50% of all profits and losses to ROHF, regardless of actual stock
ownership. CPNM and ROHF shall direct their designees to the board of
directors to determine an acceptable means for allocating profits and losses
between the parties as provided herein, while retaining sufficient funds in
the Corporation to continue operations. The Corporation shall consult with
its auditor and/or legal counsel to determine that any allocation or
distribution of profits or losses will not cause adverse legal or income tax
consequences to the Corporation. The allocation of profits and losses
provided herein shall be effective only until the termination of this
Agreement.
5. Binding Effect. All the covenants, stipulations, promises and
agreements contained in this Agreement shall bind the parties hereto and the
parties' successors and permitted assigns.
6. Severability. If any one or more of the provisions contained in
this Agreement shall be held invalid, illegal or unenforceable in any respect,
the validity, legality and enforceability of the remaining provisions hereof
shall not be effected or impaired thereby, and this Agreement shall be
interpreted and construed to carry out the intentions of the parties hereto
as nearly as may be possible.
IN WITNESS WHEREOF the parties hereto do hereby execute this Agreement
as of the date and year first above written.
RED OAK HEREFORD FARMS, INC.
By:
Its:
CABLE/PRINT NETWORK MARKETING, INC.
By:
Signature ____________________________________________
▇▇▇▇▇ ▇. ▇▇▇▇, President, CPNM, Inc.
Its:
MARKETING SERVICES AGREEMENT
THIS MARKETING SERVICES AGREEMENT, (the "Agreement"), made and entered
into as of the day of , 1998 by and between
CABLE/PRINT NETWORK MARKETING, INC., a Pennsylvania corporation ("CPNM") and
HERE'S THE BEEF CORP., a Nevada corporation ("HTBC").
WITNESSETH
WHEREAS, HTBC is in the business of marketing and promoting food
products manufactured or distributed by one or more subsidiaries of Red Oak
Hereford Farms, Inc., a Nevada corporation ("HTBC's Business"); and
WHEREAS, the CPNM is skilled and experienced in the use of a variety of
promotional, direct and targeted marketing methods; and
WHEREAS, HTBC desires to retain CPNM to provide marketing services to
HTBC, subject at all times to the general supervision and control of HTBC.
NOW, THEREFORE, in consideration of the mutual undertakings contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereby agree as
follows:
ARTICLE I
APPOINTMENT OF MARKETING SERVICES MANAGER
The HTBC hereby retains CPNM and CPNM hereby agrees to provide or cause
to be provided to HTBC the services specified in Article II of this
Agreement.
ARTICLE II
MARKETING SERVICES
2.1 Marketing Services. Subject to the general authority of the Board
of Directors of HTBC to control the affairs of HTBC, CPNM shall provide
marketing and promotion services (the "Marketing Services"), to HTBC in
connection with HTBC's Business. Consistent with the foregoing, CPNM shall
use its best efforts consistent with sound business practice to provide or
cause others to provide Marketing Services necessary or appropriate for the
successful marketing and promotion of HTBC's Business, including, without
limitation, those services set forth in Exhibit A, attached hereto and by
this reference incorporated herein.
2.2. HTBC Authority. All of the services identified in subparagraph 2.1
above shall be rendered by CPNM subject to the following:
(a) The approval of the Board of Directors of HTBC with the understanding
by CPNM that the ultimate control of HTBC's Business shall remain vested in
HTBC and CPNM shall do nothing inconsistent therewith.
(b) That all facilities, property and equipment used or employed in HTBC's
Business and by HTBC shall at all times remain the property of HTBC.
2.3 Prior Approval by HTBC. Notwithstanding any provision of this
Agreement to the contrary, without the prior written consent of HTBC, CPNM
shall not be authorized on behalf of HTBC to:
(a) Borrow money for any purpose; or
(b) Sell, lease, trade, exchange or otherwise dispose of any property of
HTBC other than in the ordinary course of business;
2.4 CPNM as Agent. All actions taken by CPNM under the provisions of this
Agreement shall be taken as the Agent of HTBC and all obligations or
expenses incurred hereunder shall be for the account, on behalf and at the
expense of HTBC, whether such obligations or expenses are incurred with
respect to independent third parties other than CPNM.
ARTICLE III
REIMBURSEMENT OF COSTS; MARKETING SERVICES FEE
3.1 Reimbursement of Costs. HTBC shall be responsible for and shall
reimburse CPNM for all reasonable costs incurred by CPNM directly in
connection with the performance by CPNM of its duties hereunder.
3.2 Marketing Services Fee. HTBC shall also pay to CPNM a Marketing
Services Fee in the amount of fifteen percent (15%) of the Net Profits of
HTBC per year beginning in 1998 and thereafter during the existence of this
Agreement (the "Marketing Service Fee"). The term Net Profits shall mean
earnings of the Corporation after all taxes or reserves for taxes,
determined in accordance with generally accepted accounting principles
taking account of cumulative losses for all prior periods. The Marketing
Services Fee shall be paid in January of each year for the services rendered
in the previous year.
ARTICLE IV
TERM OF THE AGREEMENT
This Agreement shall commence as of the day of , 1998 (the
"Commencement Date"), and shall continue for a period of one (1) year from
the date hereof. This Agreement shall automatically continue for additional
one year periods on the same terms and conditions as provided for herein,
subject at all times to termination as provided herein. This Agreement may
be terminated by HTBC at any time, without cause, upon fourteen (14) days
written notice sent by certified mail, addressed to CPNM's last-known
address. This Agreement may be terminated by CPNM at any time for cause,
upon fourteen (14) days written notice sent by certified mail, addressed to
HTBC's last known address.
ARTICLE V
EXCULPATION AND LIABILITY
5. l Limitation of Liability. CPNM shall not be liable, responsible or
accountable in damages or otherwise, to HTBC or any shareholder thereof for
any act or omission performed or omitted by it in good faith pursuant to the
express or implied authority granted to it by this Agreement and reasonably
believed by it to be within the scope of authority granted to it by this
Agreement and in the best interest of HTBC; provided that, in connection
with such act or omission, CPNM is not guilty of a breach of this Agreement,
a breach of fiduciary duty, fraud, bad faith, gross negligence or willful
misconduct.
5.2 Indemnification by HTBC. HTBC shall indemnify, defend and hold
harmless CPNM when acting as an agent for HTBC, from and against any claim,
damage or liability incurred by CPNM and against the costs and expenses
incurred by it in defending against such claim, damage or liability
(including, without limitation, the reasonable fees and expenses of legal
counsel), by reason of any acts or omissions performed or omitted by it on
behalf of HTBC pursuant to CPNM's express or implied authority under this
Agreement and in the best interest of HTBC. Provided, however, HTBC shall
not be required to indemnify and defend CPNM from and against any claim,
damage or liability which CPNM may incur by reason of the breach of this
Agreement, breach of fiduciary duty, fraud, bad faith, gross negligence or
willful misconduct by CPNM. The obligations of HTBC, under this Section
5.2, shall survive the termination of the Agreement.
5.3 Indemnification by CPNM. CPNM shall indemnify, defend and hold
harmless HTBC (its officers, directors or employees and agents) from and
against any claim, damage or liability incurred by them, and against the
costs and expenses incurred by them in defending against any such claim,
damage or liability (including, without limitation, the reasonable fees and
expenses of legal counsel), by reason of any breach of this Agreement,
breach of fiduciary duty, fraud, bad faith, gross negligence or willful
misconduct by CPNM. The obligations of CPNM, under this Section 5.3, shall
survive the termination of this Agreement.
ARTICLE VI
COPYRIGHTS, PATENTS AND TRADEMARKS
Any and all patents, trademarks or copyrights, relating to HTBC's
Business, or Red Oak Hereford Farms, Inc. shall remain the property of HTBC
and Red Oak Hereford Farms, Inc., respectively.
ARTICLE VII
CUSTOMERS LISTS
All preexisting customer lists disclosed by HTBC or Red Oak Hereford Farms,
Inc. to CPNM shall remain the property of HTBC and Red Oak Hereford Farms,
Inc., respectively and shall be returned to HTBC or Red Oak Hereford Farms,
Inc. upon their request. All customer lists developed by the CPNM during
the term of this Agreement will be the property of the HTBC. CPNM will use
its expertise and be responsible for promotion and marketing to customers on
the lists on behalf of the HTBC.
ARTICLE VIII
NONCOMPETITION
8.1 CPNM's Covenant Not to Compete. CPNM shall not, for a period of five
(5) years following the termination of this Agreement (the "Restricted
Period"), directly or indirectly, by or for itself or through others as its
agent, own, manage, operate, join, control or participate in the ownership,
management, operation, or control of, or be connected in any manner (such as
in a capacity as an owner, director, officer, shareholder, employee,
manager, advisor, independent contractor or similar capacity), with any
business whether now existing or hereafter created which is competitive with
HTBC's business of distributing food products ("HTBC's Business"), or Red
Oak Hereford Farms, Inc.'s business of manufacturing and distributing food
products ("HERF's Business") within a ten (10) mile radius of any location
in which HERF's Products are sold or HTBC's Business is conducted (the
"Restricted Territory").
8.2 CPNM's Covenant Not To Disclose and Not To Interfere. CPNM shall not,
at any time after the date hereof, directly or indirectly, by or for itself
or through others as his agent, or in a capacity as an owner, director,
officer, shareholder, employee, manager, advisor, independent contractor, or
similar capacity of any business now existing or hereafter created:
a. Divulge, communicate, use or disclose, or permit others to use or
disclose, any non-public information concerning HTBC's Business or HERF's
Business, whether past or present, including, but not limited to, corporate
structure or strategy, customers, customer lists, pricing schedules,
material contracts and/or financing arrangements (all of which non-public
information being deemed by Employee and by HTBC to be "Confidential
Information" and hereinafter referred to as such); and/or
b. In any way interfere with, or counsel or permit others to interfere
with, HTBC or HTBC's Business including HTBC's business relationships, or
disparage in any way the good name or reputation of HTBC.
c. In any way interfere with, or counsel or permit others to interfere
with, HERF or HERF's Business including HERF's business relationships, or
disparage in any way the good name or reputation of HERF.
8.3. CPNM's Covenant Not To Solicit. CPNM shall not at any time during the
Restricted Period, except as contemplated by this Agreement, directly or
indirectly, by or for itself or through others as its agent, or in a
capacity as an owner, director, officer, shareholder, employee, manager,
advisor, independent contractor or similar capacity of any business now
existing or hereafter created, engage in any of the following within the
Restricted Territory:
a. Call upon, solicit, divert, take away or accept business from any of
the customers or suppliers or former customers or suppliers of HTBC's
Business or HERF's Business(as such terms are defined above); or
b.. Solicit for employment, retain or employ, or become employed by, any
past or present employee or sales representative of HTBC's Business or
HERF's Business(as such terms are defined above); or
c. Request, induce or advise any employee of HTBC or HERF to leave the
employ of or cease affiliation with HTBC or HERF.
8.4 Equitable Enforcement. The CPNM acknowledges and agrees that the terms
and conditions set forth in this Article X are reasonable and necessary for
the protection of HTBC's Business and HERF's Business and are necessary to
prevent damage or loss to HTBC and HERF, and that any breach by CPNM of the
foregoing provisions may cause HTBC and HERF irreparable injury for which
there may be no adequate remedy at law. CPNM further agrees that the
services to be rendered by it is of a special and unique character, which
gives it a special value in the successful operation of HTBC's Business and
HERF's Business. By reason thereof, CPNM agrees that HTBC and HERF shall be
entitled to injunctive and equitable relief to prevent or curtail any breach
of the provisions of this Article X by him, in addition to any other
remedies HTBC and HERF may have under this Agreement. It is further agreed
that the provisions of this Article X, shall survive the termination of this
Agreement.
ARTICLE IX
GENERAL PROVISIONS
9.1 Entire Agreement. This Agreement embodies the entire understanding
between the parties with respect to the subject matters covered hereby and
supersedes any prior agreement or understanding between the parties with
respect to such matters.
9.2 Modification and Waiver. This Agreement may not be amended nor may any
rights hereunder be waived except by an instrument in writing signed by the
party sought to be charged with such amendment or waiver. The failure of a
party to insist upon adherence to any term of this Agreement on any occasion
shall not be considered a waiver or deprive that party of the right
thereafter to insist upon adherence to that term or any other term of this
Agreement.
9.3 Governing Law. This Agreement shall be construed in accordance with
and governed by the laws of the State of Iowa, without giving effect to the
provisions, policies or principles thereof relating to choice or conflict of
laws.
9.4 Assignability and Successors. This Agreement may not be assigned by
either party hereto without the prior written consent of the other party,
which consent shall not be unreasonably withheld. Except as provided
otherwise herein, this Agreement shall be binding upon and shall inure to
the benefit of the parties hereto and their respective successors and
permitted assigns.
9.5 Headings. The section and other headings contained in this Agreement
are for reference purposes only and shall not affect the meaning or
interpretation of this Agreement.
IN WITNESS WHEREOF, HTBC and CPNM have each caused this instrument to be
executed as of the day of , 1998.
CABLE/PRINT NETWORK HERE'S THE BEEF CORP.
MARKETING, INC.
By: ▇▇▇▇▇ ▇. ▇▇▇▇, President By:
EXHIBIT "A"
MARKETING SERVICES
CPNM will provide Multi Media marketing for the Joint Venture as mutually
agrees to by the Board of Directors of the Joint Venture:
* TV -- Production and airing to 20,000,000 households, minimum of 3 times.
Infomercial and/or commercials.
* Licensing of products, services and of independent sales representatives
* CartCade-- test on cart in one of Sales Dynamics licensed sites in 150
regional shopping malls
* Fairs, Festivals and Flea Markets -- via American Vendors Association
* Magazine advertising and tune ads -- 33 potential magazines/20 million +
exposure
* Loyalty marketing via club/association with selected CPNM membership
benefits
* Multi-level marketing opportunities
* College Marketing via National Association of College Marketers
* Advertisements in catalogs
* Sales as a premium
* Sweepstakes, as applicable
* Fax Broadcasting tests (up to 1,000 faxes weekly for five weeks, via Fax
Owners & Users Association)
* Radio -- 180 Radio Stations
* TV Home Shopping Network introductions
* Data Base Marketing
* Internet Test Site
* Family Guide Seal of Approval
* Package Inserts -- based on availability
* "Family Guide" Free Fall Newspaper Inserts, via co-op or sponsor dollars,
when available
* Out bound telemarketing -- 7,000 operators
* Access to our Databases
* E-mail -- 80 million addresses
* ArabNet -- 27 Middle East Countries/40 million Households
* Franchising via Franchise America