Distribution:

Business Agreement

The following is a proposal of how we intend to conduct our relationship with our distributors. We look forward to discussing this proposal in detail in an effort to establish a mutually agreeable framework for conducting business.

Summary

Distributor’s sales territory will be exclusive if the distributor does not carry competing lines of robotic tool changers, compliance or breakaway safety devices. RISTEC will not consider grippers when determining competitive lines. Every effort will be made to include all territory the distributor covers with automation products.

Distributor is required to carry a “to be determined” quantity of stock RISTEC products for “off the shelf “ delivery. Distributor receives terms of NET90 from RISTEC for the initial stocking shipment. All orders for stock products following initial stocking shipment will be made in “to be determined” lot quantities with terms of net 60.

RISTEC will sell stock product to the distributor at a cost of list price less 30% commission.

RISTEC will forward any customers to their appropriate distributor for sales support, placing orders & for technical support.

RISTEC will provide distributor with promotional literature, catalogs and various media. Distributor will be responsible for the delivery of media thru whatever means they see fit.

Distributor will be required to purchase an appropriate number of product demonstration kits. Kits are sold to the distributor at 45% of list price for the items contained within. Terms for demo kits are net 30.

Details

• Distributor’s geographical territory would be assigned by RISTEC

• Territory will be exclusive to the distributor as long as the distributor does not sell competing lines (grippers not included).

• RISTEC will attempt to assign total area covered by distributor to the extent that RISTEC is limited by existing distributor territories.

• RISTEC will clearly define Territory’s geographic boundaries.

• Split commission may be required if one distributor services an account in his territory but the product is shipped and billed to another distributor’s territory.

• RISTEC will discourage distributors from selling outside their designated territory.

Credit Account

• A corporate credit account is required for distributor credit purchases using a purchase order (PO).

• Required information for distributor credit account application

1. Company name

2. Accounts payable telephone number

3. Accounts payable fax number

4. Accounts payable contact

5. Accounts payable address

6. Bank references & account numbers

7. Three business references

8. Tax exempt #

9. Federal id#

• Approval of credit usually takes 2 weeks.

• Distributor credit can be revoked at any time for any reason at RISTEC’s discretion.

Credit Limit

• Credit limit is based upon ability to pay, past purchases, and payment record.

• To increase credit limit the distributor must contact RISTEC and request an extension of their credit limit, credit limit will not be automatically increased.

• Distributors with Poor payment history will have their credit limit lowered prior to being put on credit hold. A statement of reduced credit limit will be faxed to accounts payable.

Terms for Distributors with Approved Credit

• Distributor receives terms of net90 from RISTEC for the initial stocking shipment.

• Distributor receives terms of net60 from RISTEC for all subsequent shipments.

• Demonstration equipment is net 30 days

• RISTEC will sell product to the distributor at a cost of list price less 30% commission for selected products

• Commission for resale items will be at a reduced commission of 15%. Resale items include sensors, plumbing fittings, spare parts, etc.

• The distributor will be billed for repairs at 15% less total repair price quote.

Placing an Order with RISTEC

• Via e-mail (preferred).

• Fax orders (preferred) on company stationary.

Order Confirmation

• We will fax or e-mail an order confirmation only if requested to do so.

• Please do not send confirming PO’s unless clearly & unmistakably marked as confirming.

Minimum Order Charge

• There is a  $25 minimum order charge regardless of item price or quantity.

Custom Product (Specials)

• Custom (special) products require 50% of quoted customer purchase price less commission at time of order.

• Payment to be made according to standard payment methods as listed below.

• Payment is non-refundable

• Prices quoted from the factory in writing for custom product are good for 90 days

Cancellation or Change of Order

• Change to order prior to shipment will be accepted for “off the shelf” items only.

• No cancellation of custom (special) orders will be accepted. Prepayment is non-refundable.

 “Off the Shelf” Product

• RISTEC will establish “minimum order lot size” for “off the shelf “products in conjunction with the distributor.

• Lot sizes will be specific to each product and each distributor.

• RISTEC will adjust quantities based upon projections & distributor sales history.

Configured & Custom Product

• Configured and custom items can be ordered in “as needed” quantities.

Price List

• RISTEC will maintain an unpublished price list used for customers not covered by a distributor.

• RISTEC will define a standard “list” price list, an OEM price list and a distributor price list.

• List price will be used for all non-OEM customers, normally referred to as end users.

• OEM price is 85% of list price; OEM pricing will be used for systems integrators.

• Distributor pricing is 70% of list price.

• Distributor is encouraged to follow RISTEC price structure.

• Distributors will be notified of price structure changes in advance of implementation.

Distributor Discounts

• Distributor does not receive any discounts from RISTEC over and above commission

Customer Discounts

• RISTEC will maintain an unpublished discount schedule used for customers not covered by a distributor.

• Quantity discounts, 11-20 2%, 20-50 5%, 50+ consult factory.

• Certified OEM’s receive 15% discount off list price. Customer must be a certified OEM.

• Educational discounts for qualified non-profit educational institutions receive 5% discount off list only if requested.

• Distributor is encouraged to follow RISTEC discount structure

“Off the Shelf” Product

• RISTEC will stock “off the shelf” products in sufficient quantity as to be able to deliver to the distributor the same day the order is received.

• Larger quantity orders must have delivery quoted well in advance of placing order.

Configured Product

• Configured products can be shipped within one week or less.

Custom Product

• All custom products will have delivery quoted along with the price quote.

Customer Orders

• RISTEC will forward any customers who call directly to RISTEC to their appropriate distributor for placing orders.

• RISTEC will take orders from customers outside territories covered by distributor.

Technical Support

• RISTEC will forward any customers who call RISTEC directly to their appropriate distributor for technical support.

• RISTEC will handle tech support from customers outside territories covered by distributors.

• RISTEC is available to offer support directly to the customer of a distributor if the distributor requires.

Returns

• The distributor will handle all customer returns.

Repairs

• Repairs will be quoted by RISTEC as requested by the distributor.

Consignments 

• Distributor is fully responsible for offering products from his inventory for consignment to his customers if the customer meets the distributor’s criteria for eligibility.

Distribution of Media

• RISTEC will provide distributor with promotional literature, catalogs and various media as requested by the distributor.

• Distributor will be responsible for the delivery of media thru whatever means they see fit.

Demonstration Kits

• Distributor will be required to purchase from RISTEC an appropriate number of demonstration kits.

• Demo kits will be sold at 45% of list price for RISTEC products and cost of resale items, case and additional equipment with a 10% handling markup.

• Demo kit terms are net 30

FOB

• FOB from point of shipment from various shipping locations around the country.

Preferred Carriers

• UPS will be used unless the distributor specifies another carrier.

Shipping Charges

• Shipping charges are based upon carrier & method.

• Insurance will be added to all orders based on the invoice value of the shipment.

• Distributor is responsible for cost of shipping and insurance.

Distributor’s Shipping Account

• Distributor’s shipping account can be used for shipping and insurance.

Partial Shipments

• Orders will be shipped partial to meet due date if entire order isn’t ready to ship.

• Specify, “Do not ship partial” if partial shipment is unacceptable.

Drop Shipping

• RISTEC will drop ship to any distributor-specified location provided the bill to address is the distributor.

Packing List, Shipping Papers

• All orders whether partial or complete will be shipped with a packing slip.

Invoice

• Invoice date is date of shipment.

• Invoices will be sent via fax or email on the business day following shipment.

Statement

• An account statement will be faxed for overdue accounts only.

• An account report can be requested at ay time.

Method

• Payment To Be Made By Check Or EFT

Finance Charge

• If payment goes past 90 days from date of invoice for the initial stocking shipment, a finance charge will be assessed.

• If payment goes past 60 days from date of invoice for all following restocking orders, a finance charge will be assessed.

• Monthly finance rate is 1.5%.

• Annual percentage rate (APR) is 18%.

All Returns to RISTEC

• All returns, whether repairs, restocks or warranties, require an RA number.

• RA numbers are available through RISTEC sales department.

• Customers contacting RISTEC in regards to obtaining an RA number will be sent to the distributor.

• Items received without an RA number will not be processed until disposition is established.

• Packaging must be suitable to protect product against damage in shipment.

• Distributor or customer is advised to insure returned items and is fully responsible for the ‘as received’ condition of the product.

• Cost of return shipping and insurance is not covered by RISTEC.

Restock Returns

• Restocking charge is 25% of original purchase price.

• No returns will be accepted for custom (special) products.

• Restock returns are not accepted after 90 days from invoice date.

• Products must be returned with original serialization label.

• A credit memo will be issued within 30 days of the receipt of return.

Warranty Returns

• Warranty covers materials and workmanship.

• We will repair or replace the defective product at our desecration.

• Warranty period extends one year from date of invoice & shipment to the customer.

• Extended warranty is available for a nominal charge.

• Disassembly of the unit during the warranty period will void the warranty.

Repair Returns

• Distributor receives returns from customer and ships to RISTEC.

• Customer can send repairs directly to RISTEC but must be accompanied by an RA number.

• Estimated repair cost quote will be sent to the distributor at a repair price less 15% markup for the distributor.

• A PO for the repair from the distributor is required prior to commencement of repair.

• Repair can be sent either the distributor or the customer.

• The invoice for the repair will always be sent to the distributor.

End of Distribution Section.  Now Entering Marketing Section.

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