Distributorship Agreement

Distributorship Agreement

This agreement of DISTRIBUTORship is made on this 16th day of December 2000 between X Co. Ltd. a company registered under the English Companies Act, and carrying on business at …………………, hereinafter called the MANUFACTURER (which term shall include its successors and assigns) of the one part and DC Co. Ltd. a company registered under the Companies Act 1956 and carrying on business at ……………………………, hereinafter referred to as the DISTRIBUTOR (which term shall unless excluded by or repugnant to the context shall include its successors and permitted nominees and assigns) of the other part.

Whereas the MANUFACTURER is manufacturing Tele-communications Instruments, Computers, Softwares and Hardwares and exporting and marketing them in India and abroad.

AND WHEREAS the MANUFACTURER intends to strengthen its distribution machinery in the backward areas in India and in unexplored areas in the East Asian markets.

And whereas the DISTRIBUTOR approached the MANUFACTURER for having the DISTRIBUTORship of the MANUFACTURER’s products in backward areas in India and unexplored areas in the East Asian and foreign markets.

And whereas the MANUFACTURER has agreed to the proposals of the DISTRIBUTOR on certain terms and conditions.

Now these presents witnesseth and the parties hereby agree as follows:

1. The MANUFACTURER hereby appoints and the DISTRIBUTOR accepts such appointment as the Sole DISTRIBUTOR of the products of the MANUFACTURER in respect of its products and the areas mentioned in the Schedule hereunder.

2. The DISTRIBUTOR will have to deposit by way of Security Money free from interest a sum of Rs. 5 lakhs before the MANUFACTURER delivers any goods to the DISTRIBUTOR. The DISTRIBUTOR agrees and undertakes to lift the products of the MANUFACTURER and store them in the DISTRIBUTOR’s godown for ultimate distribution to the wholesalers or retailers as the case may be.

3. The DISTRIBUTOR agrees to lift such products of the MANUFACTURER not less than worth Rs. 5 lakhs at a time and always store in its godown goods worth not less than Rs. 4 lakhs.

4. The DISTRIBUTOR hereby agrees and undertakes not to deal with similar products of any other MANUFACTURER in respect of the scheduled areas for which the DISTRIBUTOR has been offered the DISTRIBUTORship of the MANUFACTURER’s products.

5. The DISTRIBUTOR shall ensure that the products are sold to the consumers at the prices marked on the commodities or on the packing.

6. The MANUFACTURER will pay to the DISTRIBUTOR a commission of 30% on the prices marked on the commodities and the DISTRIBUTOR, in turn, may grant a commission not more than 10% on the prices marked on the commodities or its packing to the wholesalers or retailers as the case may be.

7. The DISTRIBUTOR shall advertise the products and popularise the same and the actual expenses incurred will be reimbursed by the MANUFACTURER.

8. The DISTRIBUTOR shall lift the goods from the factory or godown of the MANUFACTURER and the entire costs of transport will be borne by the DISTRIBUTOR.

9. The DISTRIBUTOR shall submit quarterly reports to the MANUFACTURER about the efforts made to popularise the products of the MANUFACTURER. The DISTRIBUTOR shall submit quarterly statements of accounts of the goods lifted from the MANUFACTURER and distributed or sold by the DISTRIBUTOR. The DISTRIBUTOR shall also submit every quarter a market survey report in relation to the products of the MANUFACTURER and also available information regarding similar products of other manufacturers.

10. The DISTRIBUTOR shall at its own cost keep the products of MANUFACTURER fully insured against all insurable risks of such products from the time of lifting of the products from the premises of the MANUFACTURER till these are sold by the DISTRIBUTOR. The insurance policy to be taken will be in the joint names of the MANUFACTURER and the DISTRIBUTOR and the insurance policy when received and the receipt for premium paid will be forwarded to the MANUFACTURER within 7 days of the receipt thereof.

11. The DISTRIBUTOR shall inform the MANUFACTURER of any infringement of the brand name, trade mark or patent rights of the MANUFACTURER in any of the products in respect of which the agreement has been entered into and executed with the MANUFACTURER and take and permit to be taken all such actions as will be necessary to protect the right, title and interest of the MANUFACTURER in the aforesaid products.

12. The DISTRIBUTOR shall pay for the products lifted by it every quarter and if there be any delay in payment for goods lifted, interest at 15% shall be charged on the outstanding amount with quarterly rests.

13. This agreement is subject to the compliances by both parties of all rules, regulations and laws applicable to the agreement and the transactions as may be entered into by the MANUFACTURER and/or the DISTRIBUTOR.

14. This agreement is terminable by giving three months’ notice by either side.

15. It is agreed and the DISTRIBUTOR covenants that in respect of products lifted by it from the MANUFACTURER if not paid for will remain the property of the MANUFACTURER and no right, title or interest will pass to the DISTRIBUTOR until full payment has been made for such products.

16. All disputes and differences that might arise in relation to or touching the agreement or the transactions between the parties or claims, liabilities and rights of the parties shall be referred to Mr. MN, Advocate of Old Post Office Street, Calcutta for adjudication by Arbitration in accordance with the provisions of the Arbitration and Conciliation Act 1996 including any modifications thereof for the time being in force.

The Schedule

(Particulars of the products and the areas for which the distributorship is obtained).

In witness whereof the parties herein executed these presents on the day month and year first above-written.

Signed, sealed and delivered by

Mr. …………….…..… pursuant to

Board Resolution dated ………….

of the manufacturer in Calcutta

in presence of:

Signed, sealed and delivered by

Mr. ………………..….. pursuant to

Board Resolution dated …..……

Of the Distributor in Calcutta in

presence of:……….

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