SCHEDULE A FORM OF DIRECTION TO AGCO BY PARTICIPATING WINERY APPOINTING THE BUSINESS OF AS MANUFACTURER S REPRESENTATIVE Via Fax No. (416) 326-5555 DATE: Alcohol and Gaming Commission of Ontario ( AGCO ) 20 Dundas Street West Toronto, ON M5G 2N6 Attention: Manufacturer & Special Licensing, Advertising and Promotions Dear AGCO, Re: Appointment of WineOnline Marketing Company Ltd as our Manufacturer s Representative under s.11 of the Liquor License Act We, holding AGCO Manufacturing License No. confirm that we have entered into an agreement appointing WineOnline Marketing Company Ltd agency #41736 as our Licensed Representative under s. 11 of the Liquor License Act. Yours very truly, Winery Name: Signatory Name: Signatory Title: Page 1 of 8
WineOnline Marketing Company Ltd Participating Winery Terms and Conditions 1. PRINCIPAL DEFINITIONS. (i) (ii) (iii) (iv) (v) (vi) (vii) AGCO means Alcohol and Gaming Commission of Ontario Business means the business of WineOnline Marketing Company Ltd including selecting and promoting Designated Wines and administering orders and fulfillment Delivery Agent means the 3 rd party carrier of the Participating Winery as further described herein Designated Wine means a wine submitted by a participating winery and chosen by the business for sale through the WineOnline Marketing Company Ltd website and direct to consumer wine tastings. Participating Wineries means Ontario wineries for which the business holds a manufacturer s representative license from the AGCO; and Participating Winery means the winery signatory hereto. Offering means a case of designated wine Sold Product means Designated Wine for which a purchase advisory has been processed by the business 2. Policies and Procedures. The participating winery agrees to abide by the terms of the policies and procedures forming part of this agreement in connection with WineOnline Marketing Company Ltd 3. Manufacturer s Representative. The participating winery hereby appoints the Business as its manufacturer s representative. The Business hereby accepts that appointment. The participating Winery will immediately upon execution of this Agreement confirm such appointment in writing with the AGCO as set out in schedule A. and comply with any other requirements of the AGCO necessary for the procurement by the Business of the manufacturer s representative licence. The parties agree that the Business will apply to the AGCO to be qualified as a section 11 Liquor Licence Act R.S.O. 1990 c.l.19 manufacturer s representative for the Participating Winery. 4. Call for Wine. The Business will put out a Call for Wine to Participating Wineries. In order to have a wine considered for an Offering, the Participating Winery must send wine samples as directed by the Business Page 2 of 8
5. Selection of Designated Wines. The Business will select wines based on a variety of factors including taste relevancy to the Business wine portfolio and price. No wine submitted by the Participating Winery is guaranteed to be chosen as a Designated Wine, and any such designation is at the discretion of the Business. Participating wineries will indicate the quantity of each wine allocated to the Business as well as well as a time period in which the Business can offer the wine for sale. 6. Commission Fee. Participating winery agrees to pay the Business a set 28% brokerage commission based on the retail selling price of the wine. 7. Promotion. The Business will promote Offerings through one or more marketing programs including but not limited to its website, e-mail promotions, editorials and paid advertising or sponsorship engagements. The Participating Winery hereby grants to the Business a royalty free, nonexclusive license to use its trademarks, trade names, copyright and business names for the purposes of promoting any Designated Wines through any WineOnline Marketing Company Ltd program. 8. No Sale by Business. The Participating Winery is deemed to be the vendor of any Designated Wine and the Business will process customer orders on behalf of the Participating Winery. The Business will not physically keep any liquor for sale whatsoever. The Participating Winery must keep all Sold Product in its warehouse pending delivery to the Delivery Agent as set out in the Agreement. 9. Purchase Advisory. The Business will receive and process all customer orders and payment for Offerings on behalf of the Participating Winery. Within a reasonable timeframe after receipt of a customer order and payment, the Business will transmit a purchase advisory to the Participating Winery. The Purchase Advisory will set out at minimum: (i) name and address of the person to whom the delivery of sold product is to be made (ii) type and quantity of Designated Wine ordered (iii) date and time of the order (iv) name and address of the delivery agent The Participating Winery will review each purchase advisory once received and will prominently mark it Received by either electronic or telephone communication. 10. Personal Information. The Participating Winery may not use any Personal Information contained in any purchase advisory, customer order, receipt or other document for any reason other than in accordance with this agreement. Page 3 of 8
11. Sold Product. The Participating Winery will maintain a record of all Sold Product and purchase advisories. 12. Delivery Agent. The Business will designate a Delivery Agent generally licensed for delivery of liquor and send a letter to the AGCO confirming such designation in form set out in schedule B. The Delivery Agent will not be permitted to receive any Designated Wines until the purchase advisory has been processed by each of the Business and Participating Winery, and has been affixed to the Sold Product by the Participating Winery. The Participating Winery hereby authorizes the Business to deal directly with the Delivery Agent in respect of any activity the Delivery Agent shall perform on behalf of the Participating Winery. 13. Delivery. The Participating Winery will deliver all Sold Product to the Delivery Agent within 2 business days following receipt of the purchase advisory. Risk of loss and damage shall pass from Participating Winery to Delivery Agent upon acceptance of the Designated Wines by Delivery Agent. 14. Payment and Commission Deduction. The Participating Winery will render an invoice in respect of the Designated Wine in each purchase advisory and maintain a record of such invoice together with the accepted purchase order. The Business will collect payment on behalf of the Participating Winery, and will remit and account for customer receipts payment monthly for all transactions on the same day of each month. 15. The Business will hold customer payments and receipts separately from its general accounts. Such payments and receipts will be deemed to belong to the Participating Winery in accordance with the invoice, and any sales taxes, which shall be remitted as prescribed by law. The Business will deduct the commission fee for the Designated Wines from the gross receipts to be remitted and accounted to each Participating Winery. For greater certainty, commissions are payable in respect of all Sold Product, regardless of whether such Sold Product was delivered. 16. Delivery and Handling Fee. The Participating Winery hereby directs the Business to pay directly to the Delivery Agent on behalf of the Participating Winery the delivery fee and any handling fee payable in connection with WineOnline Marketing Company Ltd 17. Customer Returns. The Business will not accept returns, but will direct the customer to send any returns to the Participating Winery. The Participating Winery must accept all reasonable returns. The Business may, at its sole discretion, offer to credit a customer s account in lieu of directing such customer to send a return to Participating Winery. In such case, the Participating Winery agrees that it shall be solely responsible to the Business for any such credit amount. Page 4 of 8
18. Undelivered Wine. If any offering is deemed by the Delivery Agent or the Business to be undeliverable (for any reason including, but not limited to, inability of Delivery Agent to obtain a signed receipt), the Business shall immediately upon notice to it of any such undeliverable Offering, arrange for the return of the Designated Wine. 19. Recalls. The Participating Winery is solely responsible for complying with any recall order for any Designated Wine. The Participating Winery shall notify the Business and each customer in writing of any recall. The Business may, in its sole discretion, offer reasonable assistance to the Participating Winery in connection with any such recall. 20. Representations, Warranties and Covenants. The Participating Winery represents, warrants and covenants that: (a) each Designated Wine has been manufactured by it in accordance with the Wine Content and Labeling Act, S,O, 200 c.26 and has been tested and certified as suitable for sale and consumption; (b) it will purchase and carry adequate third party liability insurance with a reputable Insurer in which product liability Insurance for its involvement in the Business is provided. The Business will be given a copy of a Certificate of Insurance immediately upon the execution of this Agreement. The policy will contain a waiver of subrogation clause in favour of the Business; and so (c) it has the full power to enter into and honour this agreement, and by doing: and firm or (i) (ii) there is no conflict with or breach of any of the terms of a Participating Winery's other legal obligations or contracts; there will be no need to obtain the consent of any person, corporation who is not a party to this agreement. 21. Indemnification. Each Participating Winery will indemnify and hold the Business harmless from and against: (b) any claim, demand, suit, proceeding or threat received by it or by the Business as it pertains (without limitation) to any Product of the Participating Winery (including any Designated Wine) or the Participating Winery's business; Page 5 of 8
(c) any breach by the Participating Winery of the provisions of this agreement in letter or in spirit, including the representations, warranties and covenants; and (d) any breach by the Participating Winery of any applicable law or regulation. 22. Confidential Information. At all times during and after the term of this Agreement, the Participating Winery will maintain the confidentiality of any information supplied to it which is designated as confidential or which by its nature should be considered to be confidential, including without limitation the terms of this Agreement, the procedures, policies, structures and methods for the sale of wine in Ontario by the Business, and all materials provided by the Business to a Participating Winery will not disclose or otherwise make available any confidential information supplied by the business to any third party without the consent of the Business in writing. The Participating Winery shall use at least the same procedures, which it uses to protect it's own proprietary information of a similar nature to maintain and protect any and all such confidential information as confidential and to prevent disclosure to third parties. 23. No Liability. In no event will either party be liable to the other or to any other person for any indirect, incidental, special, consequential, punitive or exemplary damages including without limitation loss or revenues, profit or data, however caused and regardless of form of action, even if they have been advised or the possibility or likelihood of such loss. 24. Term and Termination. This Agreement shall commence upon execution and have an initial term of one year. The parties agree that this Agreement will be renewed for successive one year terms unless either party gives notice to the other at least 30 days prior to the suspension or termination date. The Business may suspend or terminate this Agreement immediately if in the Business's discretion the Participating Winery has materially breached any provision of this agreement. Upon termination or expiry, the business will withdraw its ACGO manufacturer's representative license, and the Business will have no further obligation to the former Participating Winery. Termination or expiry will not release the Participating Winery from any existing obligation and the Participating Winery will fulfill any remaining obligations it may have to the Business. Either party may terminate this Agreement immediately if either party suffers an insolvency event. 25. No Partnership. The relationship if the Participating Winery and the Business is an independent and contractual one. Nothing herein shall be construed to constitute the parties as partners, joint venturers or employees of one another. This Agreement shall not be construed as authority for either party to make commitments of any kind for the account of or on behalf of the other except as permitted herein. Page 6 of 8
26. Dispute Resolution. If any disputes, disagreements, controversies, questions or claims arise out of or relate to this Agreement, including, without limitation, with respect to its formation, execution, validity, interpretation, performance, breach, termination, or enforcement ("Disputes") then, without prejudicing any rights of the parties at law or in equity, including termination of this Agreement, the parties agree that they will attempt in good faith to resolve the dispute between them. If the parties cannot resolve the Dispute within 5 days of the date on which the parties began to resolve the Dispute, then the Dispute will be submitted to mediation in accordance with this section and the parties will jointly appoint a mediator. The parties agree to negotiate in good faith in mediation and any related negotiation for a period of 10 days in accordance with the procedures directed by the mediator. The parties acknowledge that the mediation is a procedure to facilitate the settlement of the Dispute. All conduct, opinions and statements made in the course of mediation are to be kept confidential. No party will call the mediator as a witness for any purpose in any arbitral or judicial proceeding, nor will any seek to access any documents prepared for or delivered to the mediator or any notes or records of the mediator in any proceeding. Evidence that is otherwise admissible or discoverable will not be rendered inadmissible or undiscoverable as a result of its presentation or use in mediation. Each party will equally bear the cost of the mediation. All remedies in this Agreement are cumulative. 26. Force Majeure. Neither party shall be liable for damages over the term of this Agreement or for any delay or default in its respective obligations under this Agreement, if such delay or default is caused by conditions beyond their control, (including but not limited to, acts of God, catastrophes, wars, Insurrections, fires or floods.) 28. Further Assurances. Each of the parties will promptly make, do, execute or deliver, or cause to be made, done, executed or delivered, all such further acts and things as the other party may reasonably require from time to time for the purpose of giving effect to this Agreement and will use reasonable efforts and take such steps as may be reasonably within its power to implement to their full extent the provisions of this Agreement. 29. Applicable Laws and Regulations. In the case of any conflict between the terms of this Agreement and any applicable law or regulation governing the conduct of the Business, such applicable law or regulation shall take precedence. Nothing shall limit the right of the Business to terminate this Agreement in accordance with section 24. 30. Miscellaneous. This Agreement and any attached order summary constitutes the entire agreement between the parties with respect to the subject matter hereof, and no amendment, modification, waiver of termination of this Agreement or any of it's provisions will be binding upon the parties unless Page 7 of 8
confirmed in writing. No waiver if any provision of this Agreement will affect the rights of the parties hereto to enforce any other provision of this Agreement. The headings herein are used for ease of reference only and will not be used in the interpretation of this Agreement. If any of the provisions hereof are found to be unenforceable, they will be severed from this agreement without affecting the validity of that which remains. The parties hereto agree to replace any such unenforceable or invalid provision with a new provision that has the most nearly similar permissible economic or other effect. This Agreement will ensure to the benefit of the parties hereto and their respective subsidiaries, affiliates, heirs, successors, legal representatives or permitted assigns. This Agreement will be interpreted in accordance with the laws of the Province of Ontario and the laws of Canada applicable therein, and the parties hereto hereby irrevocably attorn to the jurisdiction of the courts of the Province of Ontario. IN WITNESS WHEREOF the parties have executed this Agreement on this day of [YEAR]. WineOnline Marketing Company Ltd By: Name: Title: Participating Winery STATE FULL CORPORATE NAME: By: Name: Title: Page 8 of 8