Co-op Promotional Agreement
This
Co-op Promotional Agreement ("Agreement") is made and effective this
________ (Date), by and between
("Vendor")__________________________________________ (name and
address) and ("Reseller") _____________________________________ _
(name and address).
Vendor
sells products under the trade name ________________________ (“Product).
Reseller resells and/or promotes the sale of many goods.
Vendor
and Reseller desire to arrange for Vendor to supply the following materials and
pay to Reseller for Reseller's promotion of the Product as set forth herein.
Therefore,
in consideration of the foregoing, it is agreed:
1.
Product Promotion.
Reseller
agrees to provide the following special promotion or promotions of the Product
("Promotion"): _________________________________________________.
Reseller will take the necessary steps to insure the Promotion is timely and
completely carried out by doing one or more of the following, as
appropriate: delivering through
messenger or other service to each of Reseller's selling locations or outlets
the promotional material (s) and/or products described in this Agreement,
informing local managers that Vendor's personnel will be present to provide
additional training and or support, and the dates of the training and support,
and/or confirming with local managers that Reseller's obligations are being
timely completed. If the Promotion
involves placement of Vendor's advertising in a catalog, tabloid or circular
insert, Reseller shall insure that such advertisement or insertion, if any, is
made exactly as specified in this Agreement.
2. Materials.
A. The following materials, if required, are provided by
Vendor upon execution of this Agreement or will be provided shortly to enable
Reseller to timely complete the Promotion:
_________________________________________________________.
B. The following materials, if any, are in the
possession of Reseller and will be used by
Reseller
in performing their duties in the Promotion (s): _________________________.
3.
Term.
The
Reseller will completely implement the Promotion not later than ____________
and the promotion shall continue until ______________________.
4.
Principal Contacts and Notices.
The
principal contact for each party for the purpose of discussing matters related
to this
Agreement
is as follows:
If to Reseller: __________________________________________________________.
If
to Vendor:
__________________________________________________________.
Any
notice given pursuant to this Agreement shall be in writing to the firms
identified above by a recognized overnight delivery service such as Federal
Express.
5.
Proof of Performance.
Reseller shall provide Vendor
reasonable proof that the Promotion has been completed on a timely basis
including, but not limited to the following evidence:
______________________________________________________________________.
6.
Fees & Charges.
In
consideration of the performance of the Promotion as set forth herein, Vendor
shall pay Reseller ____________________.
Vendor shall pay the fee to Reseller not later than thirty (30) days following
Reseller's' delivery to Vendor of proof of performance as set forth in Section
5 above together with Reseller's invoice.
Reseller is entitled to deduct the amount of its fees for the Promotion
from amounts to be paid to Vendor for Product purchases or any other
charges. In the event of a good faith
partial performance by the Reseller, Vendor shall pay Reseller a pro rata
portion of the fees, but only if Reseller has substantially completed its
obligations in this Agreement.
7.
Use of Trademarks.
Vendor
hereby grants to Reseller a limited right and license to use Vendor's name,
logo, and trademarks associated with the Product to perform Reseller's
obligations in this Agreement. Use of
the trademarks is subject to Vendor's prior approval. Reseller's license in the Marks shall
terminate upon the conclusion of the Promotion.
8.
Complete Performance.
In
the event the Reseller fails to supply adequate proof of performance, or if
Reseller has not substantially completed the Promotion for the benefit of the
Vendor as set forth in this Agreement, then Vendor shall not be obligated to
pay any part of the fee to Reseller. In
such event, Vendor may offer to Reseller its next available similar promotional
opportunity that Reseller may accept or reject at its own discretion.
9.
No Waiver.
The
waiver or failure of either party to exercise in any respect any right provided
in this agreement shall not be deemed a waiver of any other right or remedy to
which the party may be entitled.
10. Entirety of Agreement.
The terms and conditions set forth herein constitute the
entire agreement between the parties and supersede any communications or
previous agreements with respect to the subject matter of this Agreement. There are no written or oral understandings
directly or indirectly related to this Agreement that are not set forth
herein. No change can be made to this
Agreement other than in writing and signed by both parties.
11.
Governing Law.
This
Agreement shall be construed and enforced according to the laws of the State of
____________________ and any dispute under this Agreement must be brought in
this venue and no other.
12.
Headings in this Agreement
The
headings in this Agreement are for convenience only, confirm no rights or
obligations in either party, and do not alter any terms of this Agreement.
13.
Severability.
If
any term of this Agreement is held by a court of competent jurisdiction to be
invalid or unenforceable, then this Agreement, including all of the remaining
terms, will remain in full force and effect as if such invalid or unenforceable
term had never been included.
In
Witness whereof, the parties have executed this Agreement as of the date
first written above.
_________________________ _______________________
Vendor Reseller
Co-Op Promotional Agreement
Review List
This
review list is provided to inform you about the document in question and assist
you in its preparation.
1.
Co-op
allowances are typically “coerced” by resellers and retailers to entice vendors
to get them to buy. Percentage of Sales
are less risky from a business sense than flat fees which often exceed the
value of the actual transaction the vendor is seeking. In other words, vendors are often much better
off to offer a “price” discount, even if a steep one, than risk that a flat fee
will not be profitable from their standpoint.
2.
Each
party should review the terms of the Co-op Promotional Agreement. Make sure you
are comfortable with all of the provisions, particularly concerning: definition
of the "Promotion"; proof of performance; amounts to be paid and
under what circumstances.
3.
As
with any Agreement, consider consulting a lawyer and print two copies of the
Co-Op Promotional Agreement, so each party can have an original.
4.
Finally,
vendors should be aware that in entering the first of these kind of co-op
agreements with a reseller or retailer, the reseller or retailer is apt to look
to them for more of the same in the future.
In other words, although the first such Agreement is indeed temporary
from a legal point of view, most resellers consider it an ongoing “opportunity”
to require the Vendor to do more of the same from a business point of
view. In the most practical of terms,
Simply Media rarely enters into these agreements, and when it does so, only on
a percentage discount basis. Co-op funds
have killed more than a few of our competitors through requiring them to
“overpay” for distribution and then being trapped into more of the same in the
future. Price discounts for promotional
events, however, can be a win/win for both parties. At least with a price discount, you “know”
your costs. With a front-end co-op
Agreement, you cannot be sure you can earn out the fee.
5.
From
the Reseller or Retailer’s point of view, they should consider requesting a
larger price discount, as opposed to a front-end fee, from their
suppliers. You can often negotiate quite
a good deal if you approach the vendor appropriately on the subject. Some of the best negotiations by Resellers
and Retailers include doing the promotion a bit off-season which gives the
Vendor added incentive to provide a good or even great deal.
6.
Print
two copies of the Agreement so each party may retain an original for their
records.
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