The Exclusive Rights To Sell Agreement is a critical commercial contract used when a manufacturer or principal company wishes to grant exclusive distribution or sales rights to another party within a specified territory in India. This document is essential for businesses seeking to establish controlled distribution channels while ensuring compliance with Indian commercial laws, including the Indian Contract Act, 1872, and the Competition Act, 2002. The agreement typically covers crucial aspects such as territory definition, exclusivity terms, minimum performance requirements, pricing structures, and termination conditions. It's particularly important in sectors where brand protection, market control, and dedicated distribution channels are vital for business success. The document requires careful consideration of anti-competition laws and must be structured to ensure enforceability under Indian jurisdiction.
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1. Parties: Identification and details of the principal/manufacturer and the exclusive seller/distributor
2. Background: Context of the agreement, including brief description of the business relationship and purpose
3. Definitions: Definitions of key terms used throughout the agreement
4. Grant of Rights: Explicit grant of exclusive rights to sell, including scope and territory
5. Term and Renewal: Duration of the agreement and conditions for renewal
6. Obligations of Principal: Principal's duties including supply commitments, support, and maintenance of quality
7. Obligations of Exclusive Seller: Seller's duties including minimum purchase requirements, marketing efforts, and performance standards
8. Pricing and Payment Terms: Price determination, payment schedules, and related financial terms
9. Intellectual Property Rights: Usage rights for trademarks, patents, and other IP during the agreement
10. Confidentiality: Protection of confidential information exchanged during the relationship
11. Non-Competition: Restrictions on competing activities during and after the agreement
12. Termination: Grounds and procedures for termination of the agreement
13. Post-Termination Obligations: Parties' obligations and rights after agreement ends
14. Governing Law and Jurisdiction: Applicable law and courts for dispute resolution
15. Execution: Signature blocks and execution formalities
1. Marketing and Promotion: Detailed marketing obligations and cost-sharing arrangements, used when specific marketing commitments are required
2. Training and Support: Details of training and support services, included when technical products or services are involved
3. Insurance: Insurance requirements and coverage details, important for high-value or high-risk products
4. Force Majeure: Provisions for unforeseen circumstances, particularly relevant in long-term or international agreements
5. Assignment and Sublicensing: Rights to transfer or delegate obligations, included when flexibility in business structure may be needed
6. Audit Rights: Right to audit sales and performance, important for agreements with minimum sales requirements
7. Product Warranties: Specific warranty terms and conditions, necessary for product sales agreements
8. Compliance with Laws: Specific regulatory compliance obligations, important in regulated industries
1. Schedule A - Products: Detailed list of products covered under the agreement
2. Schedule B - Territory: Detailed description of the exclusive territory
3. Schedule C - Pricing Structure: Detailed pricing information, discounts, and commission structures
4. Schedule D - Performance Targets: Specific sales targets and performance metrics
5. Schedule E - Technical Specifications: Product specifications and technical requirements
6. Appendix 1 - Marketing Guidelines: Guidelines for marketing and brand usage
7. Appendix 2 - Service Level Agreement: Detailed service levels and response times
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