Request for the Business with Mexico,
Latin American and Caribbean Countries
We, hereby request for your cooperation and understanding in regard to the sale
of Tajima embroidery machines (hereinafter called as "Products") in case the
company located in the U.S.A. will establish a new factory or invest to the
business in Mexico, Latin American countries and Caribbean countries. All the
details are as follow.
Article 1: Basic rule
(1) As for all business transactions occurred in U.S.A./Canada for Mexico,
Latin American and/or Caribbean countries except Brazil (hereinafter called
as "Market") TM Trading Co., Ltd. (hereinafter called as "TMT") shall have
the right to determine how to handle those business transactions.
(2) Hirsch International Corp. (hereinafter called as "HIC") shall be able to
negotiate and/or contract with the possible customers for the sale of
Products to Market subject to the consultation with TMT in advance.
(3) Whenever an inquiry and/or a business transaction occurs, HIC shall inform
TMT of its details each time to get TMT's approval before starting the
business negotiation.
Article 2: Sales Price/Contract
(1) Contracted price should not be lower than the standard market price of the
territory of HIC in principle. However, due to the special case, if price
discount is necessary to conclude the sale, HIC shall consult with TMT in
advance to find a solution.
(2) Payment for the business mentioned in this document shall be settled within
own territory of HIC in principle.
(3) After sales contract is completed, HIC shall submit a copy of the contract
with a detailed report to TMT within three -3- working days. Then, TMT
shall consign job for installation and after-sale service of Products to
the distributors in Mexico, Latin American and/or Caribbean countries
(hereinafter called as "Latin American Distributors").
Article 3: Fee for installation and after-sale Service
(1) Countries where the Tajima's authorized distributor exists (hereafter
called as "Market -A")
Fee for installation and after-sale service (hereinafter called as "Service
Fee")
[Page 1 of 4]
for the products sold to Market-A shall be stipulated as follows.
Regular Models
- --------------------------- ------------------------------------------------------------------------------
Quantity of sale Service Fee
- --------------------------- ------------------------------------------------------------------------------
1 set 15% against contracted amount
- --------------------------- ------------------------------------------------------------------------------
2 to 5 sets 14% against contracted amount
- --------------------------- ------------------------------------------------------------------------------
6 to 9 sets 13% against contracted amount
- --------------------------- ------------------------------------------------------------------------------
The service fee will be decided through discussions between North American
10 sets and more distributors, Latin American distributors and TMT each time.
- --------------------------- ------------------------------------------------------------------------------
TMFX (6 heads and less)/TMCE mix
(2 stations or less)/TMEXC/TMCE601 series
Service Fee shall be decided through discussions between HIC, Latin American
distributors and TMT each time.
(2) Countries where Tajima's authorized distributor does not exist (hereafter
called as "Market-B")
1) In principle, HIC is allowed to sell products in case the business is 100%
investment from U.S.A. to Market-B. However HIC shall be requested to
consult with TMT and get TMT's approval before starting the business
negotiation.
2) HIC shall pay 10% against contracted amount to Latin American distributors
as commission, and HIC has to take full responsibility for Installation and
after-service of Products. However, when the Installation of Products is
performed, TMT shall arrange to send the technician from Latin American
distributor and/or sub-distributor of each territory in order to help and
cooperate with HIC's technician for the installation and the technical
instructions to the customer. Or depending on the situation, regarding
installation and after technical service, Contents of Article No. 3-(1)
shall be applied.
(3) As a manufacturer, Tajima considers that the prompt technical service to
the customer is most important, therefore, upon request from the customer,
local Latin American distributor or sub-distributor shall have the right to
give the technical after service to the customer irrespective of the
guarantee period. However, even in the guarantee period, Local Latin
American distributor or sub-distributor is not allowed to give the
technical after service to the customer free of charge. Irrespective the
guarantee period, if HIC needs the urgent technical service to the
customer, we shall suggest that HIC asks Local Latin American distributor
or sub-distributor for technical service to the customer.
[page 2 of 4]
(4) HIC is prohibited to establish his own office and/or sub-distributor in
Market.
(5) Regarding the article 3-(2), we shall observe HIC activities such as sales
result and technical service result in one year trial period, then we shall
decide how treat this article No. 3-(2) for the following years.
Article 4: Payment procedure of Service Fee
Payment of Service Fee and payment of commission shall be made by the following
procedure.
(1) Payment of Service Fee
1) After installation of Products is completed, Latin American Distributors
shall submit a report of completion of installation with the customer's
confirmation to HIC immediately.
2) HIC shall remit Service Fee by Wire Transfer to Latin American distributor
within ten -10- working days from a receipt of the report.
(2) Payment of commission Within ten -10- working days from completion of
installation by HIC technician, HIC shall remit by Wire Transfer to Latin
American distributor.
Article 5: Claims from the Customers
(1) In case of installation by Article 3-(1) In case HIC receives a claim from
the customer after Installation of products, HIC shall report its details
to Latin American Distributors through TMT immediately in order to make
prompt measures.
(2) In case of installation by Article 3-(2)
(3) In principle, HIC has to take full responsibility, however as the need
arises, HIC shall resolve the technical claim rapidly, consulting with
Latin American distributor and/or sub-distributor.
Article 6: Sale of used embroidery machines(s)
In principle, HIC is prohibited to sell used embroidery machines to Market
without permission from Latin American Distributors.
Article 7: Exceptional Matter
As for an exceptional matter which is not covered by this document, related
distributors should discuss the matter in order to find the solution in an
amicable manner.
[Page 3 of 4]
Article 8: Validity of this document
The condition described in this document shall be effected from the date written
end of this document for a period of one year. In case any change or amendment
is needed, TMT shall inform related distributors of its details each time by a
written notice.
Article 9: Supplement
Any rule, regulation and/or memorandum with regard to an investment or joint
venture business in Market has been announced before shall be withdrawn and void
with the issue of this document.
Date: 7/27/99
Tajima Industries Ltd.
TM Trading Co., Ltd.
/s/ Hitoshi Tajima
- ---------------------------
Hitoshi Tajima, President Agreed by:
Hirsch International Corp.
/s/ Paul Levine
----------------------
Paul Levine, President
Date: 7/16/99
[Page 4 of 4]