Distributor Agreement Template

Template Series · Sales & Channel

Your Brand Name

Distribution Agreement

Effective Date

________________

Territory Type

Exclusive

Initial Term

2 Years

Annual Minimum

________________

Governing Law

________________

↓

Distributor vs Rep - the key difference A distributor purchases your products, takes title and inventory risk, and resells to their retail network. They are your customer. A sales rep only solicits orders on your behalf and earns commission - they never own the inventory. This agreement governs the former.

1Appointment & Grant of Rights

1.1Your Brand Name ("Supplier") hereby appoints Distributor ("Distributor") as a exclusive distributor for the purchase and resale of the Products (as defined in Section 3) within the Territory (as defined in Section 2).

1.2During the term of this Agreement and subject to Distributor meeting the Minimum Purchase Requirements set out in Section 6, Supplier shall not appoint any other distributor for the Products within the Territory, and shall not sell the Products directly to retailers within the Territory except through Distributor or through Supplier's own branded DTC channels.

1.3Distributor is appointed solely as an independent reseller. Nothing in this Agreement constitutes Distributor as an agent, partner, employee, or joint venturer of Supplier. Distributor has no authority to bind Supplier to any obligation.

2Territory

2.1The territory covered by this Agreement ("Territory") is: ________________. Distributor shall not actively market or solicit orders for the Products outside the Territory without Supplier's prior written consent.

2.2Distributor may fulfil unsolicited ("passive") orders from outside the Territory at its discretion. Distributor shall promptly notify Supplier of significant passive order activity that may indicate demand for Products in unallocated territories.

2.3Supplier reserves the right to adjust the Territory upon 90 days' written notice, provided that any reduction in Territory size that materially impacts Distributor's business will be subject to good-faith renegotiation of the Minimum Purchase Requirements.

3Products

3.1The products covered by this Agreement ("Products") are: All current wholesale lines. Supplier may add new products to the line by written notice; Distributor may elect to carry new products within 30 days of notification.

3.2Supplier may discontinue Products with 60 days' written notice. Supplier will use reasonable efforts to fulfil any open orders for discontinued Products and will discuss inventory implications with Distributor in good faith.

3.3Distributor shall not modify, repackage, re-label, or alter the Products in any way without Supplier's prior written consent. Products must be presented and sold in their original condition and packaging.

4Pricing & Purchase Terms

4.1Supplier shall sell Products to Distributor at the Distributor Price, which is as set out in the Distributor Price List attached as Exhibit B. Supplier may update pricing with 60 days' written notice. Orders placed before the effective date of a price change will be fulfilled at the prior price.

4.2Payment Terms: NET 30 from invoice date, unless otherwise agreed in writing. All invoices are denominated in USD. Overdue invoices accrue interest at 1.5% per month.

4.3Minimum Order: Each purchase order must meet a minimum order value of $500. Supplier may decline orders below this threshold.

4.4Distributor is responsible for all import duties, taxes, customs clearance, and freight costs unless Supplier has agreed in writing to specific Incoterms (e.g. DDP, DAP). Default shipping terms are FOB Supplier's warehouse.

5Resale Pricing & MAP

5.1Distributor is free to set resale prices to its retail customers, subject to Supplier's Minimum Advertised Price ("MAP") policy. Distributor shall ensure that its retail customers comply with Supplier's MAP policy on all public-facing advertising channels.

5.2Distributor shall not advertise, list, or sell Products below MAP on any public channel, including but not limited to: Distributor's own website, third-party marketplaces, trade catalogues, and promotional materials.

5.3MAP prices are as set out in Supplier's current MAP price list, updated from time to time with 30 days' notice. Consistent MAP violations by Distributor or its sub-accounts constitute material breach of this Agreement and grounds for termination under Section 11.3.

6Minimum Purchase Requirements

6.1To maintain its rights under this Agreement (including exclusivity, if applicable), Distributor must meet the following Minimum Purchase Requirements ("MPR"):

6.2MPR is calculated on net invoiced value of Products purchased and paid for during each 12-month period. Returns, credits, and cancellations are deducted. Supplier will provide Distributor with a written MPR summary within 30 days of each annual anniversary.

6.3If Distributor fails to meet the MPR in any year, Supplier may, at its option: (a) reduce the Territory; (b) convert an exclusive appointment to non-exclusive; or (c) terminate this Agreement, in each case upon 30 days' written notice and opportunity to cure.

7Duties of Distributor

7.1Distributor agrees to: (a) actively market and distribute the Products within the Territory; (b) maintain adequate inventory to service its accounts without unreasonable delay; (c) employ sufficient qualified staff to effectively represent the Products; (d) provide Supplier with quarterly sales reports in a format reasonably requested by Supplier; (e) comply with all applicable laws, including import regulations, labelling requirements, and consumer protection laws in the Territory.

7.2Distributor shall maintain the Products in appropriate storage conditions and handle them in a manner that preserves their quality and packaging integrity. Distributor is responsible for product liability arising from its own handling, storage, or misrepresentation of the Products.

7.3Distributor shall use Supplier's brand assets, marketing materials, and product descriptions accurately and in accordance with Supplier's brand guidelines. Distributor shall not create any advertising or promotional materials featuring the Products without Supplier's prior written approval.

7.4Distributor shall promptly notify Supplier of any: (a) product safety issues or customer complaints; (b) counterfeit or grey-market Products encountered in the Territory; (c) changes in ownership or control of Distributor's business; or (d) financial difficulties that may affect Distributor's ability to meet its obligations.

8Duties of Supplier

8.1Supplier agrees to: (a) supply Products ordered by Distributor in accordance with confirmed lead times; (b) maintain reasonable product availability and keep Distributor informed of stock constraints; (c) provide current marketing materials, imagery, and product information; (d) notify Distributor of new products, price changes, and discontinuations with reasonable advance notice; and (e) cooperate with Distributor's reasonable marketing initiatives.

8.2Supplier shall provide Distributor with a sample set per season at cost to support sales and marketing activities. Supplier is not obligated to contribute to Distributor's marketing or trade show expenses unless separately agreed in writing.

9Intellectual Property & Brand Standards

9.1Supplier grants Distributor a limited, non-exclusive, non-transferable licence to use Supplier's trademarks, trade names, and brand assets solely for the purpose of marketing and selling the Products within the Territory during the term of this Agreement.

9.2Distributor shall not register or attempt to register any trademark, domain name, or social media handle that incorporates Supplier's brand name or any confusingly similar variation in any jurisdiction. Any such registration shall be held in trust for Supplier and immediately transferred upon request at no cost.

9.3All intellectual property remains Supplier's property. The licence granted herein terminates immediately upon expiry or termination of this Agreement. Distributor shall cease all use of Supplier's brand assets upon termination and destroy or return all marketing materials at Supplier's election.

10Confidentiality

10.1Each party agrees to keep confidential all non-public information of the other party received in connection with this Agreement, including pricing, customer lists, business strategies, and product roadmaps. This obligation survives termination for 3 years.

10.2Distributor shall not disclose Supplier's wholesale pricing or distributor pricing to any third party. Supplier shall not disclose Distributor's customer lists or sales data to any third party, including other distributors in adjacent territories.

11Term & Termination

11.1This Agreement commences on the Effective Date and continues for an initial term of two (2) years, automatically renewing for successive one-year periods unless either party provides written notice of non-renewal at least 90 days before expiry.

11.2Either party may terminate this Agreement without cause upon 90 days days' written notice.

11.3Supplier may terminate this Agreement immediately upon: (a) Distributor's material breach not cured within 21 days of written notice; (b) Distributor's insolvency, liquidation, or bankruptcy; (c) change of control of Distributor without Supplier's prior written consent; (d) repeated MAP violations; (e) Distributor's failure to meet MPR for two consecutive periods; or (f) fraudulent conduct.

11.4Upon termination, all outstanding invoices become immediately due. Supplier will fulfil orders already placed and confirmed prior to the termination notice date.

12Post-Termination & Inventory

12.1Following termination, Distributor may sell through existing inventory of the Products for a period of 90 days, subject to continued compliance with MAP and brand standards.

Optional Clause - Inventory Buyback

12.2Inventory Buyback: Upon termination (other than termination for Distributor's material breach), Supplier shall repurchase Distributor's remaining undamaged, saleable inventory of the Products at the original Distributor Price less 15%, provided that Distributor notifies Supplier of its remaining inventory within 30 days of termination notice and the inventory is in its original, undamaged condition.

12.3Upon expiry of the sell-through period, Distributor shall cease all use of Supplier's brand assets, return or destroy all marketing materials at Supplier's election, and cease representing itself as an authorised distributor of Supplier's Products.

13Representations & Warranties

13.1Each party represents that it: (a) is duly organised and in good standing; (b) has full authority to enter into this Agreement; (c) is not subject to any agreement that would conflict with this Agreement; and (d) will comply with all applicable laws in the performance of its obligations.

13.2Supplier warrants that the Products will conform to their specifications at time of shipment and will be free from material defects. Supplier's liability for defective Products is limited to replacement or refund of the Distributor Price for the affected units.

13.3Supplier does not warrant that the Products comply with the regulations of the Territory. Distributor is solely responsible for ensuring the Products meet all labelling, safety, import, and consumer protection requirements applicable in the Territory.

14Limitation of Liability

14.1IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL, OR PUNITIVE DAMAGES, INCLUDING LOSS OF PROFITS OR BUSINESS OPPORTUNITY, ARISING OUT OF OR RELATED TO THIS AGREEMENT, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

14.2Each party's total aggregate liability under this Agreement shall not exceed the total net value of Products purchased by Distributor in the twelve months preceding the event giving rise to the claim.

15General Provisions

15.1Governing Law. This Agreement is governed by the laws of ________________. The parties acknowledge that local competition and distribution laws in the Territory may impose additional obligations; such laws are incorporated by reference to the extent required.

15.2Dispute Resolution. Disputes shall first be subject to senior management negotiation for 30 days. If unresolved, disputes shall be referred to binding arbitration under ICC Rules seated in ________________, conducted in the English language.

15.3Assignment. Neither party may assign this Agreement without the other's prior written consent, except that Supplier may assign to a successor entity in connection with a merger, acquisition, or sale of substantially all assets.

15.4Entire Agreement. This Agreement, together with all Exhibits, constitutes the entire agreement between the parties and supersedes all prior negotiations and understandings. Amendments must be in writing signed by both parties.

15.5Severability & Waiver. Invalid provisions shall be severed without affecting remaining provisions. Failure to enforce any provision on any occasion does not constitute a waiver.

Exhibit A - Territory Detail

Attach a precise geographic description of the Territory, including any excluded sub-regions, named accounts, or channel restrictions. For international agreements, list specific countries.

Exhibit B - Distributor Price List & MPR

Attach the current Distributor Price List showing wholesale prices, any volume tier pricing, and the agreed Minimum Purchase Requirements by year. Update by written amendment signed by both parties.

✦Execution

IN WITNESS WHEREOF, the parties have executed this Distribution Agreement as of the Effective Date first written above.