This is to confirm our intention to organize an entity (referred to as “Newco”) for the
purpose of entering into an Exclusive Distribution Agreement (the “Definitive Agreement”) with
(the “Company”) for the distribution of systems (the “Units”) and
related products (the “Products”). Subject to the minimum purchase requirements described
below, the Company will grant Newco the exclusive right to sell and distribute the Products
throughout the world. Any existing distributorships of the Company shall be cancelled, and shall
become sub-distributors through Newco. Newco will use its best efforts to market the Products
to end-users throughout the world.
The following are the principal terms of the proposed transaction:
1. Initial Order; Purchase Price and Terms. Within days of execution of the
Definitive Agreement, Newco shall place an order for two Units, at a price of $ per
unit. Concurrently with the order, Newco shall place a cash deposit equal to % of the
purchase price of the Units. The order shall be placed on a standard form of purchase order
which shall specify delivery terms, specifications and other terms of sale, F.O.B. The Company’s
plant in .
The purchase price for each Unit shall be %