Sole Distributor Agreement
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At a Glance
A short Distributor Agreement appointing independent sole distributor to sell a product within a specific territory. The appointment does not prevent the manufacturer from selling directly in the territory without any intervention by the distributor. The manufacturer reserves the right to terminate the agreement if sales targets. 5 pages long.
This agreement ensures that both parties clearly understand their roles, responsibilities, and obligations, including supply arrangements, pricing structures, and distribution rights. This agreement ensures that both parties have a clear understanding of their roles, responsibilities, and expectations, including supply arrangements, pricing structures, and distribution rights. It serves as a crucial tool for businesses looking to expand their market presence through third-party distributors while ensuring contractual obligations are met.
Sole Distributor Agreement Template
This Sole Distributor Agreement Template sets out the terms under which a manufacturer appoints a distributor to act as its sole representative within a defined territory. It provides clear rules on commissions, reporting, and termination.
Appointment & Term
The manufacturer appoints the distributor as sole distributor for the listed products within the specified territory. The agreement runs for a defined term, but may be terminated early if sales fall below required thresholds or conditions are breached.
Commissions
The distributor earns commission on orders and repeat orders from the territory that are executed by the manufacturer. Payments are made monthly, with provisions for refunding commission on bad debts (clawback).
Orders & Reporting
The distributor must forward all orders to the manufacturer within two business days and provide weekly reports of canvassed clients, enquiries, and monies received. Funds collected must be transmitted promptly and cannot be withheld against commission.
Clawback of Commission
If commission is paid on orders that later result in bad debts, the distributor must refund those amounts. The manufacturer may deduct such sums from future payments.
Termination & Indemnity
The manufacturer may terminate with short notice if sales targets are not met. The distributor is not indemnified for costs or liabilities unless expressly agreed in writing.
This template is particularly suitable where a manufacturer appoints one distributor to act as sole representative in a territory, with strict controls on reporting and commissions.
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