Party 1: Abesh Chatterjee

Party 2: Future Colours (Check with Mr. Noor pls)

The contract to be made in a way so that the same can be used for all future transactions. Only the
products to be imported and their import price, supplier and total import amount, base selling price in
local market and total selling amount will be decided between the two parties for each leg of
transaction.

Commercial terms and payment calculations

 Party 1 will provide cash to Party 2 for importing products from its supplier and selling locally in
Bahrain. The import has to be based on letter of credit opened with a bank based in Bahrain.
 Both the parties together will decide on the products to be imported, the supplier and import
cost per unit for each type of product (including cost of shipping and other charges as
applicable) each time. Both the parties will also agree on base selling price in Bahrain market for
each of the products.
 Party 2 is expected but not obliged to sell at the base selling price and the actual sales price may
be different from the base selling price at the full discretion of party 2. However, if the actual
price is lower than the base selling price, the sharing of profit will be based on the base selling
price. Otherwise, the profit sharing will be based on actual selling price.
 Party 2 will pay 50% of profit calculated as below to party 1.
Profit calculation = Greater of (Base selling price per unit, actual selling price per unit) – import
cost per unit
 At the starting of each week (on Saturdays) party 2 will share system generated transaction
report showing sales quantity and sales price per unit for each type of products (purchased
under this agreement). For calculation purpose each week will start on Saturday and end on
Friday.
 Based on the weekly transaction report profit payable to party 1 will be calculated.
 Total weekly payment to be made to party 1 = import cost for the quantities sold during the
week + weekly Profit payments
 Party 2 will make the weekly payment to party 1 within 3 business days from starting of next
week. (i.e., within Mondays every week)
 The payable amount will be based on sales recorded by party 2 and not based on cash received
by party 2 from its customers. For clarification, if party 2 sells a product on credit to a customer,
payment to party 1 cannot be linked or delayed based on receipt of the payment from the
customer.
 At the end of 6 months from the date of first payment made by the first party under each import
transaction the difference between the total payment received from party 1 and the import cost
paid to party 1 for the sold quantities under an import transaction needs to be paid back to
party 1 by party 2 in cash.
Responsibilities of party 1:

1. To make the payments of agreed amount to party 2 as and when required in order to complete
the import from its supplier under letter of credit.

Responsibilities of Party 2:

2. Party 2 is responsible for:

a. Display and Selling the products through its shop and other sales channels
b. Share transaction details reports to Party 1 on weekly basis and as and when requested
by party 1.
c. Maintain proper storage of the goods imported to ensure that the product is stored as
per manufacturer’s requirement
d. Share the details of locations/ storage facilities with the first party where the products
will be stored.
e. Allow the party 1 to carry out any stock inspection at all its premises and other store
locations where the material is kept.

Reps and Warranties by Party 2

3. In case there is additional import charges/service charges/penalties/damages etc under the

import contract the same needs to be paid by party 2.
4. In case of any wastage, theft or loss of the products purchased for whatsoever reason including
any natural disaster or accident, the cost of wastage needs to be compensated by the second
party to the first party.
5. Second party need to ensure adequate insurance coverage for the products purchased.
6. During stock inspection if it is found that the amount of quantities stored in the disclosed stores
is less than the amounts unsold as per transaction report, seconds party will have the rights to
cancel the contract and demand the total amount including profits under the import transaction
immediately.