MINNESOTA COMMERCE - Unhappy Franchisee

Web Page
Maintenance
Fee^^'
$195*^*
Aimually, on the
anniversary date of
Web Page
Agreement
See Note 6
Insurance*^' Varies (see Item 7) See Note 7 See Note 7
Late Fee on
OPA
5% of amount due, per week; maximum $100 Upon invoice or
demand
See Item 10
Inventorv
Returns^
Restocking Fee
J S^lreJlQckingJee (35% in limited
circumstances)
yplin invoice or
demand, chargedJ.Q
OPA (restocking
fee)
See Note,^
Repair Kits $10 to $40 per kit (but. generally $10 oer kit) Upon invoice or
demand
See Note 9
Notes:
(1) You are not required to pay any monthly or periodic royalty, franchise, license, advertising or other
fee (except the annual sofhvare maintenance fee described below) during the term of the
Distributorship Agreement.
(2) You must purchase a minimum amount of Products from Mateo on a regular basis, at least equal to the
following: (i) maintain a minimum inventory of Products equal to or in excess of the New Distributor
Starter Inventory; (ii) on a weekly basis, purchase Products from Mateo in an amount not less than £a}
80% of the "National Distributor Purchase Averager^" fsomedmes referred to as "NDPA") or (h) 80%
of vour "District Distributor Purchase Average" (sometimes referred to as 'PDFA"), whichever is
less, based on your 12-month rolling average, or, if you have been operating the Distributorship for
less than 12 months, based on your year-to-date average; and (iii) maintain a minimum of a 60% ratio
of a calculation of your year-to-date purchase average divided by your year-to-date sales average.
As of December 31, 204^2011. the "Nadonal Distributor Purchase Average" was $3,00^3M. The
National Distributor Purchase Average is determined by dividing the total number of active Mateo
distributors for any given weekly period during a calendar year into the year-to-date total dollar
amount of qualifying Mateo Products purchased by such distributors during such poriod.j^ The
ealeulatieft-of4he4^atienaipistric Distributor Purchase Average deesis calculated in a similar manner
as the NDPA. except the comparison group includes only distributors in vour district. The
calculations of the NDPA and DDPA do not include the purchases of Mateo Products by new
distributors as part of their New Distributor Starter Inventory. In addidon, you must at all dmes
maintain your inventory of Products at a level at least equal to the New Distributor Starter Inventory.
(3) The computer maintenance and support charge is payable on the second month of the term of the
Software License Agreement and annually thereafter upon the anniversary date of the Sofhvare
License Agreement. The current annual charge is $400, and this amount is subject to change by
Mateo from time to time. Mateo has set specific hardware requirements in order to ensure proper
funcdoning of the MDBS Sofhvare. The hardware specifications for the computer system are
described in paragraph 4 of the Software License Agreement.
(4) In the second year of the Sofhvare License Agreement, the annual maintenance and support charge
may include an addidonal $400 charge if your system does not satisfy our required and exact PC
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Mateo 2aRFDD/PK ;»j»?^4^^-U349051.8 .01/09/4412