This wine bond represents only the right to acquire the wine described herein and is subject to satisfaction of the terms and conditions herein. This wine bond does not constitute a purchase of the wine by the Payee or a sale of such wine by the Maker and is not to be construed as such a purchase or sale by any person or entity.
Bond No. 1001 June 1st, 2012
Red Vineyard, a California LLC, with its principal place of business located at 6500 Silverado Trail, Napa, California, 94558 (“Maker”), hereby promises to deliver to Mr. John Smith, an individual, or its permitted assigns (“Payee”), in full satisfaction of Maker’s obligations under this Winery Bond (this “Bond”), one case (the “Case Amount”), with each case consisting of twelve (12) 750 ml bottles, of 2011 Cabernet Sauvignon (the “Wine”), on the date when such Wine is first released for sale to the public (the “Release Date”).
1. Payment. Upon the terms and subject to the conditions of this Bond, on the Release Date, Maker shall make available to Payee the Case Amount of the Wine. Delivery by Maker of the Case Amount of the Wine on the Release Date shall constitute payment and satisfaction in full of all obligations of Maker under this Bond.
2. Taxes. Payee shall be responsible for the payment of all federal, state and local taxes of any kind or nature that may be due in respect of the Case Amount of the Wine made available by Maker in accordance with this Bond.
3. Shipping. Maker will make the Case Amount of the Wine available for pickup at Maker’s primary place of business during regular business hours and, if requested by Payee, will use commercially reasonable efforts to assist Payee with the packaging, shipping or warehousing of the Wine. Payee shall be responsible for the payment of any and all shipping, handling or warehousing charges related to delivery or storage of such Wine. Payee bears all risks associated with applicable laws governing the interstate shipment of Wine, including, but not limited to, any changes thereto that may affect Maker’s ability to ship the Wine to Payee on or after the Release Date. For the avoidance of doubt, under no circumstances will Maker be required to ship Wine to any country, state, territory, county or other jurisdiction where Maker reasonably believes that the shipment of the Wine could violate applicable law. If Maker has taken commercially reasonable efforts to notify Payee of the maturity of this Bond on the Release Date and any Wine made available by Maker remains undelivered to Payee on the second (2nd) anniversary of the Release Date, such Wine will be considered abandoned and Maker, in its sole discretion, may take any action it considers appropriate under the then existing conditions.
4. Conditions of Performance. Maker's obligations to make the Case Amount of the Wine available to Payee are subject to satisfaction of each of the following conditions:
4.1 Payee is, on the date of this Bond, at least 21 years of age, and has the legal capacity to accept this Bond from Maker;
4.2 Payee’s representation, warranty and acknowledgement on the date of this Bond of each of the following:
(a) Payee understands that the value of the Wine may decline or become worthless for many reasons including, without limitation, its vintage, the reputation of Maker, the quantity of Wine produced, the conditions under which it its stored following the Release Date, or any failure of Maker to successfully produce the Wine that is intended to be made available to satisfy Maker’s obligations under this Bond;
(b) Payee understands that Maker may be unable to make available or deliver the Wine for reasons including, but not limited to, fire, earthquake, natural disaster, bankruptcy or change in laws (including laws regarding distribution of wine) that may make it impossible to enter into shipping arrangements or otherwise make the Wine available to Payee;
(c) Payee understands that if, for any reason, Maker is unable to make available or deliver the Wine in accordance with the terms of this Bond, Payee’s sole recourse is against Maker and, in the event of such breach, Payee agrees that it will not seek any remedy against any broker, dealer, advisor or financial services provider (including, but not limited to, any credit card processor), involved in the initial sale of this Bond;
(d) Payee is able to bear the economic risk of loss of all or a portion of the amount invested by it at the time this Bond was made by Maker;
(e) Payee understands that, if this Bond is executed by Maker with an electronic signature, Maker’s obligations hereunder are conditioned by, and limited to, the Bond in the form electronically delivered contemporaneously to Maker and Payee;
(f) Payee is acquiring this Bond for its own account and not as nominee or agent for any other person and not with a view to, or for offer or sale in connection with, any distribution thereof; and
(g) Payee acknowledges that any assignment of this Bond must fully comply with the provisions of Section 5.1 (Assignment; Binding Effect) or any such attempted assignment will be of no force or effect and Maker will have no obligation to any person or entity other than Payee.
5.1 Assignment; Binding Effect. This Bond shall not be assignable by Maker. This Bond may not be assigned by Payee; provided that Payee may assign this Bond: (a) by gift to an individual if this Bond has been held by Payee for at least six (6) months prior to such gift; (b) by transfer to an estate planning trust (or similar vehicle) for the benefit of Payee; or (c) by descent, devise or the laws of intestate succession; provided, further, that Payee or its legal representative promptly notifies Maker in writing of the assignment of this Bond by Payee; provided, further, that any such assignee is at least 21 years of age at the time of such assignment and such assignment otherwise complies with applicable law. Subject to the foregoing, this Bond shall be binding upon, inure to the benefit of, and be enforceable by, the respective successors, heirs, legal representatives, and assigns of Maker and Payee.
5.2 Amendments. This Bond may only be modified by a written instrument signed by Maker and Payee.
5.3 Headings. The headings used herein are for purposes of convenience only and should not be used in construing the provisions hereof.
5.4 Notices. All notices and any other communications permitted or required under this Bond must be in writing and will be effective (a) immediately upon delivery in person, provided delivery is made during regular business hours or receipt is acknowledged by a person reasonably believed by the delivering party to be employed by the recipient; (b) upon the earlier of actual delivery confirmed by executed receipt of the recipient or at the end of the next business day after deposit (in time for next day delivery) with a commercial courier or delivery service for overnight delivery, provided delivery is made during regular business hours or receipt is acknowledged by a person reasonably believed by the delivering party to be employed by the recipient; or (c) three days after deposit (before the last pick up time) with the United States Postal Service, certified mail, return receipt requested, postage prepaid and with the return receipt returned to the sender marked as delivered, undeliverable or rejected. All notices to: (i) Maker must be properly addressed and delivered to the address set forth herein; and (ii) Payee must be properly addressed and delivered to the address provided by Payee via written notice to Maker; or, in each case, at such other addresses as Maker or Payee may subsequently designate by written notice given in the manner provided in this Section.
5.5 Governing Law. This Bond shall be governed by and construed in accordance with the laws of the State of California (without giving effect to its choice of law principles).
5.6 Attorneys’ Fees. In the event of any dispute between Maker and Payee in any way related to this Bond, the non-prevailing party shall pay to the prevailing party all reasonable attorneys’ fees and costs and expenses of any type, without restriction by statute, court rule or otherwise, incurred by the prevailing party in connection with any action or proceeding (including arbitration proceedings, any appeal and the enforcement of any judgment or award), whether or not the dispute is litigated or prosecuted to final judgment. The “prevailing parties” shall be determined based upon an assessment of which party’s major arguments or positions taken in the action or proceeding could fairly be said to have prevailed (whether by compromise, settlement, abandonment by the other party of its claim or defense, final decision, after any appeals, or otherwise) over the other party’s major arguments or positions on major disputed issues.
5.7 Arbitration of Disputes. If a controversy arises with respect to this Bond, such controversy shall be settled by final, binding arbitration in accordance with the commercial arbitration rules of JAMS/Endispute (”JAMS”) applying the laws of California, and judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. The arbitration will take place in San Francisco, California. The arbitration award shall be in writing and upon the request of a party, the arbitrator’s award shall include findings of fact and conclusions of law. The authority of the arbitrator will include, without limitation, the power to grant equitable remedies, including specific performance.
In Witness Whereof, Maker has caused this Bond to be duly executed by a duly authorized officer as of the date and year first above written.
Name: William Red
Title: Owner, Red Vineyard