British crystal Ltd

Glazier House, Green Lane, Derby DEI 1RT

Telephone: 0332 45790 Te!ex:901614 Fax: 0332 51977

S.A. Importers Ltd. 4 May 20 —

Al Manm Way

Riyadh

SAUDI ARABIA

Dear Sirs,

Mr Mohammed Al Wazi, of the Saudi Arabian Trade Commission in London, informed us that you may be interested in acting as our agent in your country.

As you will see from the catalogue enclosed, we are manufacturers of high Quality glassware and produce a wide selection of products from moderately-priced tableware in toughened smoked glass to ornate Scandinavian and Japanese-designed light coverings.

We already export to North and South America and the Far East, and would now like to expand into the Middle Eastern market where we know there is an increasing demand for our products.

The type of agency we are looking for will have resources to cover the whole area of Saudi Arabia in selling our products, and we are offering a 10% commission on net list prices, plus advertising support. There would be an additional 2'/2% del credere commission if the agent is willing to guarantee his customer's accounts, and he may offer generous credit terms once we have approved of the account.

This is a unique opportunity for someone to start in an expanding market and grow with it. Therefore, if you believe you have the resources to handle a sole agency covering the area mentioned, and feel that you can develop this market, please write to us as soon as possible.

Yours faithfully,

S.A. Importers Ltd.

Al Manni Way, Riyadh

Telephone: 4356698 Telex: 991546 Cable: SAIL Riyadh Fax: 3134981

Mr N. Jay Your ref: 4 May 20—

British Crystal Ltd. Our ref: SA/8016

Glazier House

Green Lane

Derby DEI 1RT Date: 17 May 20—

UNITED KINGDOM

Dear Mr Jay,

Thank you for your letter of 4 May in which you offered us a sole agency for your products in Saudi Arabia.

First, let me say that we can handle an agency of the type you described, and that we agree that the demand for Western goods here is increasing. However, there are some points we would like answered before we make a decision.

Payment of accounts. Would customers pay you direct in the UK or will they pay us, and we in turn would settle with you deducting our commission? How would payment be arranged? Bill of exchange, letter of credit, or bank draft?

Delivery. Would we be expected to hold stocks or will you supply from stock? If you supply the customers direct, how long will it take an order to be made up and shipped once it has been received?

Advertising, You mentioned that you would be willing to help with advertising. We would like more details about the type of assistance you would give us.

Disputes. If a disagreement arises over the terms of the contract, who would be referred to in arbitration'

Length of contract. Finally, how long would the initial contract run? I think three years would allow us to see how your products sell in this market.

If you can send us this information, and possibly enclose a draft contract, we could give you our answer within the next few weeks.

Yours sincerely,

10.5.2

Agent's reply, asking for more details

Mr Kassim, of S.A. Importers Ltd., is interested but wants more information.

Questions

1. What sort of agency was offered?

2. How long does Mr Kassim want the agency to run?

3. Does Mr Kassim suggest a method of payment?

4. What does he mean when he says: arbitration; initial contract; disagreement arises; make up an order?

5. Is he confident about selling the product in his country?

6. What is a draft contract?

10.5.3

Manufacturer's reply, giving

more details

Mr Jay provides the information and encloses a draft contract.

Questions

1. How will customers pay British Crystal unless Mr Kassim accepts a del credere commission?

2. Would customers be supplied from Mr Kassim's warehouse?

3. What sort of advertising will Mr Jay offer?

4. How long will the agency run initially?

5. What does 'mutual agreement' and 'disputes' mean?

6. Which words in the letter correspond to the following: remit; fulfil; distributed; press; conditional?

BRITISH CRYSTAL Ltd.

Glazier House, Green Lane, Derby DEI 1RT

Telephone: 0332 45790 Telex:901614 Fax-0332 51977

Mr M Kassim 6 June 20—

S.A. Importers Ltd.

Al Manm Way

Riyadh

SAUDI ARABIA

Dear Mr Kassim,

Thank you for your letter which we received today. As you requested, we have enclosed a draft contract of the agency agreement.

You will see that we prefer our customers to pay us direct, and usually deal on a letter of credit basis, unless we can obtain references or your guarantee if you take the del credere commission.

You would not be required to hold large stocks of our products, but a representative selection of samples, and we can meet orders from the Middle East within four weeks of receipt.

Leaflets and brochures will be sent to you to hand out to your customers as one method of advertising, but we will also allow £3,000 in the first year for publicity which can be spent on the type of advertising you think suitable for glassware. We find that newspapers and magazines are the best media.

The initial contract will be for one year, subject to renewal by mutual agreement, and that disputes will be settled with reference to Dutch law, as our relative legal systems are different.

If you have any further questions with regard to the contract, or anything else, please contact me. I look forward to hearing from you.

Yours sincerely,

N.Jay

Enc: Draft contract

Allison & Locke Importers Ltd.

Rooms 21-8, Rothermede House, Eastgage Street, London WC1 1AR.