DIRECT DEALER TERRITORY POLICY

1st April 2017

POLICY TERMS

The Direct Dealer shall have the right to market, distribute and sell all Products of REDARC (the “Company”) in the country in which REDARC ships each order to. Meaning, orders shipped by the Company to the USA, Canada or Mexico can only be sold by the Direct Dealer in the USA, Canada or Mexico respectively (hereafter “Territory”).

The Company reserves all rights to revise its product sales, marketing, and/or distribution structures and/or practices in any manner it, in its sole and absolute discretion, deems appropriate or desirable. The Direct Dealer irrevocably waives any and all objections to any such revisions to the Company’s sales, distribution, or marketing structures and/or practices, as well as to any sales and marketing activities by the Company in the Territory.

The Direct Dealer shall not market, distribute, or sell Products outside of the Territory, and shall not sell, or facilitate the sale of, any Products outside the United States, Canada, and Mexico.

POLICY VIOLATIONS

The Company routinely checks the order origin and prices for the Products.  In the event that a Direct Dealer is found in violation of the policy described above:

(a)          if there has been no violation by the Direct Dealer within the prior twelve months, the Company will issue a warning notice to the Direct Dealer;

(b)          if a violation continues 10 calendar days after notice of a violation pursuant to paragraph (a) above, the Company will suspend all sales of Products to the Direct Dealer for one month;

(c)           if a violation continues 20 calendar days after notice of a violation, or in the event of a second violation by a Direct Dealer the Company will suspend all sales of Products the Direct Dealer for three months;

(d)          if a violation continues 30 calendar days after notice of a violation or in the event of a third violation by a Direct Dealer within a twelve-month period, the Company will suspend all sales of Products to the Direct Dealer for twelve months;

(e)          in the event of a second violation by a Direct Dealer, the Company, in its sole discretion, may cancel any orders then in effect with the Direct Dealer.