Certain portions of this
agreement, for which confidential treatment has been requested,
have been omitted and filed separately with the Securities and
Exchange Commission.
Sections of the agreement where portions have been omitted have
been identified in the text.
RESTATED
DEL MONTE FOODS RETAIL BROKERAGE AGREEMENT
THIS
AGREEMENT, effective as of the last date following the signatures
set forth below (the “Effective Date”) between DEL
MONTE CORPORATION , a corporation with its main business office
at One Market @ The Landmark, San Francisco, California 94105,
hereinafter called “Client,” and ADVANTAGE SALES AND
MARKETING LLC , a limited liability company with its main
business office at 19100 Von Karman Avenue, Suite 600, Irvine,
California 92612, hereinafter called
“Broker.”
WHEREAS,
Client distributes food and beverage products for human and animal
consumption under various brands including but not limited to DEL
MONTE, S&W, CONTADINA, STARKIST, EATWELL, 9 LIVES, KIBBLES
‘N BITS, COLLEGE INN, MEOW MIX, ALLEY CAT and
MILK-BONE;
WHEREAS,
Client desires that Broker act as a broker in connection with the
servicing, promotion, and sale of those food and beverage products
listed on Attachment A (“Products”), which
attachment Client may modify , with written notice to Broker, from
time to time, and Broker desires to so act;
NOW,
THEREFORE, Client, in consideration of certain agreements
hereinafter set forth and to be performed by Broker, hereby
appoints Broker to act as broker in connection with the servicing,
promotion, and sale of the Products at the applicable brokerage
rates and to the classes of trade listed on Attachment B-1
and Attachment B-2 (“Accounts”) for direct
buying accounts located within Broker’s assigned territory
listed on Attachment C (“Territory”) , and
Broker, in consideration of the commissions specified herein,
agrees to so act.
The
parties mutually agree as follows:
1. All Sales
Subject to Client’s Terms and Conditions . All Products
represented by Broker shall be sold subject to Client’s
prices, terms, conditions, and confirmation by Client at its main
office, and in amounts and assortments authorized by, and to
customers approved by Client. Broker shall so advise the trade in
receiving orders. Broker shall not solicit nor accept orders from
buyers located outside Broker’s assigned territory or
assigned area of responsibility and no commissions will be paid on
any such orders whether confirmed or not. Broker agrees to assist
Client in the collection of all due invoices. All remittances due
to Client shall be made by customers directly to Client, unless
otherwise instructed by Client. Broker understands that a
customer’s order shall be subject to credit approval by
Client and that Client shall be the sole judge of a
customer’s credit-worthiness. If for any reason a customer
does not accept delivery or if Client does not effect delivery to a
customer because in Client’s judgment customer’s credit
standing is impaired, Client shall be entitled to sell or otherwise
dispose of Products and in such event Broker shall be entitled to
no commission thereon. All orders shall be booked and transmitted
in the name of the actual customer.
2. Commission;
Full Compensation . For Products sold by Broker to direct
accounts located within Broker’s territory and confirmed by
the main office of Client, and subject to the terms and conditions
set forth in this Agreement, Broker shall be entitled to
commissions computed as indicated on Attachment B .
Such commissions shall be based on [**]
*
. Client shall not be liable for any
costs or expenses of Broker in connection with any services
performed hereunder or the operation or maintenance of
Broker’s places of business. The commissions specified herein
shall constitute full compensation to Broker for all services
hereunder.
3. Promotional
Programs and Trade Spending . Broker shall accurately and
completely convey to customers Client’s terms and conditions
of sale and all terms and conditions of promotional programs in
which the customer is eligible to participate. Broker shall
accurately and completely convey terms and conditions of any
promotional program. Broker shall use best efforts to ensure that
trade spending by Broker’s customers does not exceed amounts
established by the Client. In the event that trade spending by
Broker’s customers exceeds such amounts per SBU on a per
market basis (“Overspends”) and such Overspends are the
direct result of the gross negligence or willful misconduct of
Broker’s or Broker’s employees, Client shall have the
right to set-off the amount of such Overspends against commissions
earned and to be earned by the Broker. Broker shall be responsible
for managing customer deductions and program performance (including
Overspends and
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*
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CONFIDENTIAL
INFORMATION HAS BEEN OMITTED AND HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION
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unauthorized
performance) but shall have no financial obligation to Client for
such Overspends and/or unauthorized performance other than if such
event is a direct result of the gross negligence or willful
misconduct of Broker or Broker’s employees. Broker’s
commissions shall be adjusted only as provided for herein and in
accordance with Client’s Deduction Management Policy set
forth on Attachment D , as such policy may be modified, with
written notice to Broker, from time to time .
4. Compliance
with Law . Broker agrees to act in accordance with applicable
federal, state and local laws. Broker agrees not to pay or transfer
any part of commissions received from Client to anyone other than
employees of Broker other than as required by law. Broker warrants
and represents that no customer or account or representative
thereof, or governmental employee, has any ownership or financial
interest, direct or indirect, in Broker. Broker agrees to indemnify
Client for expenses and losses incurred by Client and caused by
Broker’s gross negligence or actions in violation of the
terms of this Agreement, or in violation of any laws, regulations,
or policies of Client, or without written authorization of Client.
Client agrees to indemnify and hold harmless Broker from and
against any and all claims, demands, actions, proceedings and costs
(including reasonable attorneys’ fees), in any way resulting
from the gross negligence of Client, its employees, or agents in
the performance of this Agreement, and any loss or injury resulting
from and/or arising out of products, point of sale materials and/or
other product related materials and/or goods, supplied in
connection with this Agreement, including but not limited to, any
defect in merchandise, or the purpose or use of any product
manufactured, produced or distributed by Client, except to the
extent of Broker’s responsibility set forth in the preceding
sentence.
5. Fair and
Equitable . Client’s policy is to treat all competitive
customers on a fair, equal, and proportionate basis. Broker agrees
to follow such policy in representing the Products under this
Agreement.
6. Ownership of
Records . Files and records maintained by Broker and directly
relating to transactions between Client and Client’s
customers are the property of Client and shall be delivered to
Client promptly following the written request by Client for such
records. Broker acknowledges that failure to promptly release
records to Client may cause irreparable harm to Client, and that
Client shall be entitled to immediate injunctive relief to obtain
such records in addition to other remedies available at law. During
the term of this Agreement Broker shall maintain custody of such
Client records in accordance with Broker’s internal policies,
however such records shall not be kept for a period shorter than as
required by applicable laws, rules and regulations; and shall
permit Client or its agent(s), upon reasonable notice, to inspect
and copy such records at Client’s sole expense at a mutually
agreed upon time. Broker may make copies of such records for its
internal use.
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7.
(a)
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Services . Client shall establish quarterly
and annual performance objectives in consultation with Broker and
Broker shall accomplish the objectives so established and agreed
upon by Client and Broker. Broker agrees to provide services as
customary in the marketplace in connection with the servicing,
promotion and sale of products comparable to the Products. Services
shall include but not be limited to (a) retail store coverage at
the frequency and depth of coverage as agreed to with Client and as
provided on Attachment B-1 ; (b) retail services to
assure the availability for sale of Products to the consumer on the
selling floor of all retail stores; (c) category management
services including but not limited to development of new item
presentations, development of business reviews for customers and
Del Monte sales personnel, item assortment work utilizing Client
Category Management Systems and other assortment tools, customizing
Client corporate presentations for local customers, complete post
promotional analysis, utilizing ASMkting Spectra tools for
Consumer/Shopper insights, and creating production plan-o-grams for
all appropriate Client categories, (d) promptly providing at
Client’s request consumer marketing information which shall
include but not be limited to the areas of competitive activity,
customer coverage, product distribution, national marketing
information, and other reasonable information as requested by
Client; (e) activities designed to achieve all retail
objectives of Client regarding distribution, shelf placement,
pricing, and promotional merchandising support; (f) removing
from sale Products not meeting Client’s standards or
policies, (g) reporting retail conditions as requested by
Client, (h) invoice management and recovery of unauthorized
deductions and customer Overspends and timely validation and
clearing of open deduction balances in accordance with Client
objectives as defined for each fiscal year, (i) Atlas
maintenance, and (j) conveying to Client information
concerning customers’ credit-worthiness or changes in
financial condition. In addition, Broker shall provide the
Dedicated Client Team resources as described on Attachment E
hereto. Services provided hereunder shall not include services
provided by divisions of Broker which are not customarily included
as part of the principal/broker relationship, including services
provided by Broker’s Integrated Marketing Solutions and CPG3
divisions and/or any retail specific coverage service options, not
specifically set forth in this Agreement. Services not covered by
this Agreement shall be provided by Broker pursuant to a separate
written contract.
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(b)
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Personnel . In performing services hereunder,
Broker agrees to dedicate a sufficient number of personnel to
effectively accomplish Client’s business objectives within
the time frames set by Client. Client and Broker agree to meet
annually (and more often as deemed necessary by Client) to
establish necessary staffing levels, expertise, objectives and
goals. Broker shall retain responsibility for supervising Broker
personnel. With respect to manager level employees and above,
Client acting in good faith shall have the right to disqualify
persons from working on Client’s account and shall have the
right to approve persons before they are assigned to Client’s
account.
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(c)
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Training . Broker acknowledges that training
is essential to the successful and consistent achievement of
Client’s sales development objectives. Broker agrees to
provide transitional and ongoing training as directed by Client to
its personnel servicing Client’s account to the extent
necessary or appropriate to accomplish Broker’s obligations
under this Agreement. Broker shall designate and shall identify to
Client regional training supervisors to provide ongoing training to
Broker personnel. Broker acknowledges that ongoing training among
Broker’s personnel shall be Broker’s responsibility and
that Client’s responsibility shall be limited to providing
training guidance and direction to Broker’s regional training
supervisors.
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(d)
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Retailer Services
. Client acknowledges
that subject to the terms of this Agreement, Broker shall act as an
exclusive broker to Client in connection with the servicing,
promotion and sale of the Products for the customers and classes of
trade listed on Attachment B for the assigned territory
listed on Attachment C . If a retailer performs similar
services as those contemplated by Broker under this Agreement
(“Retailer Services”) and the Retailer charges Client
(or deducts amounts due to Client) for the Retailer Services,
Client shall not deduct any amounts from Broker’s commissions
related to such charges.
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8. Confidential
Information . Broker and Client each acknowledges that from
time to time each party to this Agreement will have access to
certain confidential and proprietary information and systems of the
other party (the “Disclosing Party”) which is generally
not available to or known by the public, in which the Disclosing
Party has a legitimate protectable interest and which has
particular value to the Disclosing Party, the disclosure of which
could be harmful to the Disclosing Party’s interests (the
“Confidential Information”). During the term of this
Agreement and for a period of five (5) years thereafter,
Broker and Client each agree that it shall not directly or
indirectly disclose such Confidential Information to a
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