Dear Mahesh,
As sought for please find enclosed the requisite draft.
MEMORANDUM OF UNDERSTANDING / AGREEMENT
This Memorandum of Undertaking is made on this th day, of the month November 2009 between having its Office at …………………………………………………………………………New Delhi amongst
M/s __________________a duly incorporated Company under the provisions of the Companies Act, 1956 having its Registered Office at _______________New Delhi (Hereinafter referred to as “the Company”) through ____________ . which expression shall unless repugnant to context or meaning hereof, be deemed to mean and include its successors and assigns) of the First Part
__________________________ having its Office at ____________ and is dealing in manufacture, sale and supply of Toys, Books and other ancillary items and Fast Moving Consumer Goods (Hereinafter referred to as FLIP) through its Sole Proprietor Mr.____________ which expression shall unless repugnant to context or meaning hereof, be deemed to mean and include its employees, agents, successors and assigns) of the Second Part.
WHEREAS :
1. The Company is a leading well known brand name and is having its Stores in Nagpur & Pune.
2. M/s ____________dealing in manufacture, sale and supply of Toys, Books and other ancillary items and Fast Moving Consumer Goods is in use and occupation of the Company’s premises at its ______________Stores comprising an area of _____ Sq.Feet and _________ Sq Feet respectively by the virtue of one Business Conduct Agreement dated ___________ .
3. Now M/s FLIP has approached and represented to the Company that for the purposes of enlarging the scope of commercial and financial arrangement amongst the parties and keeping in view the joint and common long term prospective business interests it is willing to change the business module from the Proprietary concern to Private Limited Company by getting incorporated the same by fulfilling the requisite modalities in this regard.
4. Further FLIP is also willing to use the networking, professional expertise, resources, logistics and financial support of the Company for the purposes of enlarging scope of its operations to be able to have a Pan India presence and with a view to attain a leadership module in the segment of sale of manufactured toys, books, equipments and other fast moving consumer goods and is desirous of entering into the joint venture on mutually agreed terms as hereunder :
· Incorporation of Company : Flip will initiate the process of getting transferred itself from being a Proprietary Business Concern to that of Private Limited Company on a future date.
· Percentage of equity participation : The parties to this MOU shall proportionately subscribe to the share capital of the yet to be incorporated Company.
· The Company shall at all time have the controlling stakes in the yet to be formed Private Limited Company and its authorized person shall be promoting stake holders in the same.
· The amount due and payable by the FLIP to the Company by virtue of the Business Conducting Agreement same shall form its initial equity participation in the yet to be incorporated Company by the FLIP.
· The Company and FLIP shall each have one joint Managing Director on the Board of the yet to be incorporated Company.
· The brand FLIP which is a registered proprietary trade mark of the FLIP shall in future become property of the yet to be incorporated Company on payment of Re.1 to the Proprietary concern.
5. Responsibilities of M/s ______________________ FLIP
M/s FLIP shall;
a) Not make any financial commitment on behalf of Company, nor shall take loans or create any other financial liability binding Company under this MOU/ Agreement;
b) Have all employees relating to this project on its payroll, or shall engage competent professionals on contractual basis on its own, and Company shall have no legal, financial or any other responsibility towards them;
c) Follow the decoram and business conduct guidelines at the Retail Stores of the Company at Nagpur and Pune without failure or demur from time to time;
d) Shall at all time keep adequate stock of books, toys, video and other such Articles at base 25 points (at least having value of minimum value of Rs.25,00,000/- (Rupees Twenty Five Lacs only).
e) Conduct no such parallel activity which may be prejudicial to the interests of the scheme of this MOU and or of the Company;
f) Maintain records of the inward entry of its various products inter alia books, toys, video and other such Articles and sale details and share the same with Company;
g) Provide the following minimum infrastructural facilities:
i. Computers with necessary software
ii. Printers and photocopiers, as required
iii. TV/VCR/ACR
iv. Sinage or other publicity articles in print or electronic media.
v. Necessary infrastructure including but not limited to fit outs, furniture, electricity, manpower requirement, upkeep and maintenance etc.
b) Responsibilities of the Company:
The COMPANY shall:
a. Extend all possible help for maximum potential sale or the products by the Brand name of FLIP from its premises.
b. Provide infrastructural support of maintenance, manpower, advertisement space, signage spage, logistic support, help in inwarding of stocks of FLIP, storage and sale of its products at Company’s stores.
c. Provide help and guidelines wherever possible and necessary so as to enable FLIP to fulfill statutory regulations;
d. Provide time to time inputs, coordination and consultation for giving effect to the terms and covenants of this MOU/Agreement and to extend all possible help and expertise for taking over of the businesses/business activity/ies ventures at Company’s stores at Pune and Nagpur.
e. Shall ensure that all possible monetary and infrastructural requirement so required are provided on actual basis.
c) Force Majeure
In the event of non-fulfillment of the contract terms and conditions due to any reason of force majeure namely fires, wars, riots, strikes, natural calamities, etc., neither the Company nor FLIP shall be held responsible for any loss or consequential loss.
d) Indemnity
The FLIP hereby agrees jointly and severally to indemnify Company, their representatives, administrators, employees and authorized persons and properties from and against all action, demands, proceedings, prosecutions, attachments, and the like arising out of its liabilities and all charges, taxes, etc.
Similarly, COMPANY shall be liable to indemnify/compensate the FLIP on account of any losses arising due to the fault of COMPANY.
e) Liabilities
The Company shall not, however, be liable for:
a. any payments of claims by employees, third party in relation to the business deal involving getting manufactured, stored or sale of its products.
b. discharging any financial commitments made by FLIP prior to the signing and execution of this Agreement to any third party.
c. Any suit on account of demands for infringement of copyright and other laws by the FLIP which have no nexus with the object of the MoU/Agreement being entered into.
f) The FLIP shall ensure that all its manufacture process qua the products is legal and under no circumstances the Company shall be responsible in any way for any liabilities arising out of use of pirated software/faulty/environmentally hazardous, banned or otherwise dangerous raw material of the FLIP products.
g) Breach of Agreement
COMPANY shall have the right to terminate the agreement with the FLIP, in case the either fails to strictly adhere to the understanding amongst the parties more particularly reduced in writing by way of this MOU/Agreement to provide the services, support, infrastructure, logistic, information sharing etc. continuously without failure or demur as mentioned in the agreement, or violates any of the clause mentioned in the MOU, or exploits the trust or misuses the business understanding with FLIP in any way.
h) Amendment to the Agreement
The obligation of the Company and FLIP have been outlined in this agreement. However, during the operation of this MOU/Agreement, circumstances may arise which call for alteration or modifications of this Agreement. These modifications/alterations will be mutually discussed and agreed upon in writing by way of Addendum to this MOU/Agreement.
i) Period of Validity
This agreement shall be initially valid for Three years from the date of signing the agreement and to be renewed subsequently by mutual consent of both the parties upto the period as and when the Private Limited Company is got incorporated.
j) This MOU/Agreement constitutes the entire Agreement amongst the parties with respect of the subject matter hereof and supersedes all previous proposals, written and or verbal understandings, commitment and or other communications with respect to the subject matter hereof and if not released, discharged, changed or modified except by an instrument in writing signed by a duly authorized representative of each of the parties.
k) Arbitration
Any dispute arising with regard to any aspect of this Agreement shall be settled through mutual consultations and agreements by the parties to the Agreement as per the terms and covenants of the Arbitration and Conciliation Act, 1996, the place of Arbitration shall only be Delhi and only courts at Delhi shall have exclusive jurisdiction to entertain and adjudicate upon any dispute arising out of this MOU/Agreement.
IN WITNESS WHEREOF the parties hereto have executed this MOU/AGREEMENT as of the date set forth above
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For the (COMPANY
______________________
( )
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For FLIP
_________________
( )
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Witness :
1.
2.
I hope this will suffice your requirement otherwise it is advised that you may see chamberpractice.com site.
Thanks and best regards
Daksh
