e-Fulfillment & Consignment Agreement

E-FULFILLMENT & CONSIGNMENT TERMS

This document states the terms and conditions that govern the contractual agreement,

BETWEEN: EcomCoop a cooperative formed under Rwanda Laws with business offices at Poids Lourds, KN7, Kigali, Rwanda, (herein referred as the Consignment Service Provider “The CSP”);

AND: The Online vendor (herein referred as “The Consignor”). 

(The “The CSP” and “The Consignor” each a “Party” and collectively, the “Parties”),

BACKGROUND

WHEREAS, the CSP operates a warehouse, also called eCommerce Service Center (ECSC) for Made in Rwanda and non-Made in Rwanda products as well an online marketplace for Made in Rwanda products is available for SMEs consigning their goods at the ECSC, collectively, the “Infrastructure”.

WHEREAS, the ECSC and the online marketplace will aim at supporting SMEs that are willing to sell online, either through the online marketplace or by their own means, and will consist of not only a transactional infrastructure for sales and inventories management to happen but also as an incubation space. During this incubation time, SMEs will be expected to go through an intense learning program where they learn how to list their products online, sell online, manage inventories, handle customer inquiries, etc. After that period, SMEs will have the opportunity to continue fully or partially using the infrastructure (the ECSC and/or the online Made in Rwanda marketplace) or decide not to renew this agreement and run their operations the way they see fit.

WHEREAS, SMEs consigning their goods at the ECSC and/or selling through the Made in Rwanda online marketplace will benefit during the first year from preferential conditions before a standard fee scheme be applied for the subsequent years.

WHEREAS, the Consignor’s legal representative is at least 18 years of age; has the legal right to enter into this Consignment Agreement; owns right and title to the goods described herein and desires to consign to the CSP certain goods described on Exhibit C hereto (the “Consigned Goods”), for the purpose of facilitating a sale of the Consigned Goods to a third party by the CSP (herein referred to as “Consignment Option 2”) or by the Consignor (herein referred to as “Consignment Option 1”) itself; and

WHEREAS, the CSP desires to accept delivery of the Consigned Goods and, in the case of Consignment Option 2, to remit payment to the Consignor upon the sale of such goods on the terms and subject to the conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and promises made by the parties hereto, the CSP and the Consignor (individually, each a “Party” and collectively, the “Parties”) covenant and agree as follows:

1. Definitions, Interpretation, Grand of Rights and Engagement

• Definitions and Interpretation. Words and expressions used in this Agreement shall have the meaning set out in Exhibit A.

• Granted in the following order:

• In the case of Consignment Option 2, the Consignor hereby grants to the CSP the non-exclusive right to take and sell the Consigned Goods during the applicable Consignment Agreement Period and according to the terms and conditions of this Agreement. The Consignor hereby grants the CSP a worldwide, non-exclusive license, with right of sublicense, to use, reproduce and display the Consignor’s trademarks, service marks, trade names, business names, product names and logos for the purpose of marketing, promoting and selling the Consigned Goods either physically or online. 

• In the case of Consignment Option 1, the CSP hereby grants the Consignor the non-exclusive right of inclusion of Consignor’s Goods in the CSP’s digital marketplace and/or use of CSP’s last mile logistics and the Consignor shall retain the full charge of their sales.

1.3            Ownership. In the case of Consignment Option 2, the title to and ownership of the Consigned Goods shall remain with the Consignor until a Sale occurs or title is transferred to the CSP in accordance with Section 4.3. The CSP agrees and acknowledges that the agreement includes both the consignment (in the case of Consignment Option 1) and/or sale (in the case of Consignment Option 2) of Consigned Goods. The CSP shall have the duty to protect the Consigned Goods under option 2 and shall be liable for any damage to the Consigned Goods once in the CSP’s possession, sold or returned to the Consignor.

1.4            Successors. This Agreement binds and benefits the respective successors, inheritors, assigns, and personal representatives of the parties, except to the extent of any contrary provision in this Agreement or any applicable Law.

1.5            No Partnership. This Agreement does not create a partnership relationship. The CSP shall conduct the entire business of consigning and eventually selling the Consigned Goods in their capacity.  Nothing in this Agreement shall authorize or empower the CSP to assume or create any obligation or responsibility whatsoever, expressed or implied, on behalf or in the name of the Consignor, or to bind the Consignor in any manner, or make any representation, warranty, or commitment on behalf of the Consignor, this Agreement being limited solely to the consignment and eventual sale of the Consigned Goods herein specified.

2. Conditions Precedent

2.1            Eligibility. The enterprise, registered group or individuals, in order to be eligible, must fulfill conditions including but not limited to: (a) be a registered entity; (b) have an address/area of operation/production; (c) be compliant with the trust mark which is part of the registration; (d) be compliant with the basic quality standards as may be set out by Rwanda Standards Board (RSB); (e) be certified by the Rwanda ICT Chamber to the internationally recognized e-commerce Foundation’s Safe.shop Trustmark. Food products and others regulated by the standards bodies must have requisite certification and quality seals.

2.2            Training.  Initially, before taking advantages of this scheme, the Consignor shall have attended an induction workshop that explains the requirements for consigning and eventually selling goods on consignment.  The workshop shall cover topics such as, the product information required, pricing, product specifications, photos, barcodes, and product certification requirements. The workshop shall also cover among other things parties’ responsibilities, expectations, payments, returns/refunds, and more. Participation in such workshop is mandatory. The Consignor may not submit goods to the CSP for consideration until the Consignor has completed this workshop.  At the CSP’s option, the workshop shall (a) take place in person at a time and location to be determined by the CSP or (b) be provided by the CSP online. The CSP may also accept a workshop provided by a third party, subject to the CSP’s review and approval and the Consignor’s submission of proof of completion. 

2.3            In case of the Consignment Option 2, the Consignor agrees to deposit to the CSP an amount equivalent to One hundred thousand Rwandan francs (Rwf 100,000) to cover the costs related to sections 4.4.2, 4.4.3, 4.4.4, and 4.5.  Such amount will be returned to the Consignor at the end of the Consignment Agreement Period provided the Consigned Goods were sold.

3. Consigned Goods

3.1            Selection of Consigned Goods.  From time to time, the Consignor shall submit to the CSP all required information for each of the goods the Consignor requests the CSP to consign and eventually sell on consignment (“Goods Submission”). The CSP shall review the Goods Submission and determine in its sole discretion which goods, if any, the CSP wishes to receive on consignment from the Consignor under this Agreement (the “Consigned Goods”); provided however, that the CSP shall have no obligation to select any goods of the Consignor for consignment.  Upon selection of the Consigned Goods, if any, the parties shall execute a “Consignment Order” in the form attached hereto as Exhibit C. 

3.2            Compliance with Laws.  The Consignor is solely responsible for ensuring that its activities and those of its subcontractors, including the production and delivery of Consigned Goods, and the Consigned Goods themselves comply with all applicable Laws of all countries in which they are produced, manufactured, exported, delivered or sold, including all Laws relating to (a) facilities operation; (b) business and labor practices, including working conditions, wages, hours and minimum ages of workers; (c) marking, labeling and quality of goods; (d) required certifications; and (e) import and export of goods.  No Consigned Goods have been or shall be produced or manufactured, in whole or in part, by child labor or by convict or forced labor or contain any sexually explicit, defamatory or obscene materials.

3.3            Shipment to the CSP.  The Consignor shall deliver the Consigned Goods in accordance with the applicable Consignment Order and the CSP’s policies to the Consignment Location or another location agreed by both parties.  The Consignor shall pay all costs incurred in connection with such shipment within Rwanda, either as an upfront payment or as a deduction from the Net Revenues due to the Consignor hereunder, as set forth in the Consignment Order. In case the shipment is outside Rwanda, the CSP shall be responsible for clearing the customs, payment of all customs, duties and taxes related to shipping the Consigned Goods to the Consignment Location.  It is the Consignor’s obligation to provide the CSP with complete and accurate documentation on the Consigned Goods for the purposes of customs clearance. Risk of loss of or damage to the Consigned Goods shall pass to the CSP only when it takes physical possession of the Consigned Goods.  The Consignor retains all risk of loss or damage to the Consigned Goods until that time.  The CSP shall not be liable for any delay, damage or loss incurred during shipment pursuant to this Section 3.3.

3.4            Acceptance.  The CSP shall have the right to inspect all shipments and may reject any Consigned Goods that do not, for obvious and proven reasons, comply with applicable Laws or the CSP’s policies, meet the CSP’s reasonable quality standards or meet the Consigned Goods’ descriptions or specifications. If the CSP rejects any Consigned Goods, the CSP will directly return the shipment of the rejected Consigned Goods with a rejection notice specifying the reasons for that rejection. Such shipment will be on the Consignor’s expenses. Notwithstanding the foregoing, the CSP’s acceptance of a shipment does not: (a) indicate that all Consigned Goods have been delivered free of loss or damage or that any loss or damage later discovered occurred after acceptance; (b) indicate that the shipment the CSP received included the number of units of Consigned Goods set forth on the shipment documentation; or (c) waive, limit or reduce any of the CSP’s rights under this Agreement. Once Consigned Goods are accepted, the Consignor shall receive an automated receipt delivered by the Stock management system through mail or email.

3.5            Taxation. The Consignor shall be responsible for preparing and filing all tax returns and paying for all taxes, commissions and other charges assessed and levied on the goods or products while in possession.  

3.6            Information. The Consignor shall promptly provide to the CSP all information the CSP requests with respect to the Consigned Goods at any time and shall promptly update such information to ensure that it is at all times accurate and complete.

4.               Inventory Management, Marketing and Sale of Goods

4.1            Inventory Management. The CSP shall store and manage the Consigned Goods shipped by the Consignor. The CSP shall store the Consigned Goods at the Consignment Location. The CSP reserves the right to store the Consigned Goods at other CSP’s facilities or at a third party’s storage location, provided that the CSP advises the Consignor of where the Consigned Goods are located and provided that the CSP bears all costs associated with relocating the Consigned Goods to the other CSP’s facilities.

4.2            Sales Efforts (Consignment Option 2 only). The CSP shall use commercially reasonable efforts to promote and sell the Consigned Goods during the Consignment Agreement Period.  The CSP shall market, promote and sell the Consigned Goods during the Consignment Period set forth in each Consignment Order. 

4.3            Customer Service and Returns.  The CSP shall be responsible for and handle all customer service issues relating to the Consigned Goods during the applicable Consignment Agreement Period in its sole discretion and in accordance with its current policies, including accepting and processing returns and providing refunds and pricing adjustments, and that depending on the Consignment Option chosen.  All units of Consigned Goods that are returned during the Consignment Agreement Period and remain in sellable condition upon return shall be placed back into the CSP’s inventory of Consigned Goods.  Consigned Goods returned after the end of the Consignment Agreement Period shall be treated as set forth in Section 4.4.3. 

4.4            Recall, Return and Disposal

4.4.1       Recall.  The CSP shall promptly notify the Consignor of any recalls or potential recalls of any Consigned Goods and provide the reason. The CSP shall be solely responsible for all costs and expenses incurred, by the CSP or any the CSP’s affiliate or customer in connection with any recall or potential recall (including the costs to return, store, repair, liquidate or return the recalled units to the CSP).

4.4.2       Right to Inspection. The Consignor shall have the right to request for the information about the Consignor’s Consigned Goods and the right to inspect the CSP’s inventory of Consigned Goods at any time during the CSP’s normal business hours provided that the CSP was informed 24hours before.

4.4.3       Return.  The CSP may return unsold Consigned Goods to the Consignor at any time for the reasons set forth in this Agreement.  All returned units should be shipped back to the Consignor’s designated shipping address at the Consignor’s expense.  Upon delivery to the shipping point, the Consignor shall assume all risks of loss or damage to such Consigned Goods and shall have the unrestricted right to sell them to anyone.

4.4.4       Abandoned Goods. The CSP after having notified the Consignor through either email or mail, may destroy or otherwise dispose off all abandoned Goods in any manner of its sole discretion. Title to each Abandoned Good shall transfer to the CSP at no cost as necessary for the CSP to dispose of it. The CSP shall pay all proceeds, if any, received from the disposal of Abandoned Goods after deduction of disposal cost.

4.5            Consigned Goods and end of Consignment Agreement Period: Upon the end of the Consignment Agreement Period, the Consignor may instruct the CSP to either: (i) donate any remaining unsold goods to a nonprofit organization of the Consignor’s choice; (ii) send such unsold goods to the Consignor’s designated third party; or (iii) return such unsold goods to the Consignor at the cost of the Consignor.  All expenses incurred by the CSP under clauses (i), (ii) or (iii) shall be deducted from Net Revenues, or billed to the Consignor; provided however, if the Net Revenues due and outstanding are insufficient to cover such costs and the parties are unable to come to agreement on another means for the Consignor to pay such costs, the unsold goods shall be deemed “Abandoned Goods”.

• Pricing and Payment (applicable to the Consignment Option 2)

5.1            Pricing.  Each Consignment Order shall include, for each Consigned Good, a “Retail Price”, a “Wholesale Price” and a “Production Cost Price”.  The CSP shall offer the Consigned Goods at the Retail Price; provided however, the CSP may, subject to Section 4.2, in its sole discretion and without notice to the Consignor, offer discounts on the Retail Price as a means to efficiently market and sell the Consigned Goods, so long as the price during the Consignment Period for the applicable Consigned Goods remains above the Wholesale Price. If any units of Consigned Goods remain unsold after the end of the Consignment period, subject to Section 4.2, the CSP may liquidate such units at any price above the Production Cost Price, including via auction (whether online or offline), as determined by the CSP after approval by the Consignor.

5.2            Payments to the Consignor. Whenever the sale has happened to the consigned goods, the CSP shall pay the Consignor an amount equal to Net Revenues minus the CSP’s Commission every period of 30 days. The payment of the Net Revenues due to the Consignor shall be paid via bank wire transfer, online payment, cheque, cash or mobile money and shall be accompanied by the report within the time referred to in Section 6.2.

5.3            Proceeds.  Except as expressly set forth in Section 5.2, the CSP shall keep all proceeds from all Sales of Consigned Goods, including returned, damaged, or Abandoned Goods.

5.4            Currency.  All prices shall be quoted in and all payments shall be made in Rwanda Francs, Euros, United States Dollars or relevant international currencies as the case may be.

5.5            Right of Set Off.  The CSP may set off any Net Revenues or other amounts otherwise due to the Consignor hereunder against any amounts due to the CSP from the Consignor.

• Consignment Fee and Reporting

6.1            The CSP shall receive a Commission (as defined below, the Exhibit B”Fees”) and other types of fees defined in Exhibit B.

6.2            Reporting. Depending on the Consignment Option, the CSP shall deliver to the Consignor, a sales report detailing the Consigned Goods sold, the Net Revenues due to the Consignor and the number of units of unsold Consigned Goods, if any, remaining in the CSP’s possession on a monthly basis; (a) [fifteen (15) days minimum and thirty (30) maximum after the end of the Consignment Agreement Period; and (b) [thirty (30) days after the expiration or termination of this Agreement.

• Confidential Information

7.1            The CSP hereby agrees that it will not knowingly provide or distribute any confidential information related to the copyright of the Consignor to any third party. The Consignor maintains complete responsibility for determining copyright status of all goods used in creating item(s) for sale.

7.2            The Consignor and the CSP hereby agrees not to disclose any information contained herein to any third party or use any confidential information disclosed to it, except as expressly permitted under this Agreement and that the Consignor and the CSP will take all reasonable measures and actions to maintain the confidential information in its possession or control.

• Indemnification

8.1            The Consignor shall hold harmless and indemnify, to the fullest extent possible, the CSP, its affiliates, employees, officers, directors, representatives and agents (the “Indemnities”) from and against all claims, liability, losses, damages, judgments, fines, settlements, awards, expenses and costs (including reasonable attorney fees and costs of investigation).  

8.2            The indemnification set forth on 7.1 shall also be extended to liability arising from or related in any way to: (a) the Consignor’s actual or alleged breach of this Agreement; (b) the Consigned Goods (including their offer, sale, performance, fulfillment and shipment), including any personal injury, death, or property damage related to the Consigned Goods; or (c) the collection, payment or failure to collect or pay any taxes that the Consignor owes in connection with this Agreement and the activities contemplated hereunder. 

8.3            The CSP hereby agrees to indemnify and hold the Consignor harmless from payment of any premiums, taxes, charges or contributions respecting the CSP’s employees, affiliates, officers, directors, representatives, agents and business (the “Indemnities”) which may be assessed against the CSP.

• Representations and Warranties (applicable to the Consignment Option 2)

Each party agrees to execute and deliver such further documents and to cooperate as may be necessary to implement and give effect to the provisions contained herein.

9.1            The CSP’s Warranties

9.1.1       Inspection of the Consigned Goods. The CSP warrants that it shall, prior to using OR selling any products hereunder, examine and inspect the Consigned Goods. The CSP shall inspect all Consigned Goods promptly and shall be deemed to have accepted all Consigned Goods if the CSP has not specifically rejected any portion thereof within 30 days of delivery. Any rejected portion of the Consigned Goods shall be segregated and clearly marked.

9.1.2       Authority. The CSP warrants and represents that the CSP has full power and authority to execute, deliver, and perform this agreement, document, or instrument executed and delivered pursuant or in connection to this agreement. The CSP’s execution, delivery, and performance of this agreement, document or instrument executed and delivered pursuant to this Agreement or in connection with this Agreement, have been duly authorized and approved by all necessary action, including all necessary corporate, board, and shareholder action.

9.1.3       No Conflict. The CSP warrants that (i) the execution or the delivery of this Agreement, (ii) the consummation of any and all of the transactions contemplated hereby, and (iii) compliance with or fulfillment of the terms, conditions, and provisions hereof will not violate or conflict with the laws.

9.1.4       Identity of Ownership of the Consigned Goods. The CSP shall not co-mingle any of the Consigned Goods with its own property or merchandise of any other the Consignor. The CSP shall segregate the Consigned Goods so that they are readily identifiable as belonging to the Consignor. The CSP shall not represent to any third-party that he/she holds title to the Consigned Goods, and shall place a clearly visible tag or other marker on the Consigned Goods which clearly identifies that the Consigned Goods belong to the Consignor. However the CSP reserves the right to sell the goods either individually or in combination with other items received from the Consignor and other the Consignors.

9.2            The Consignor’s Warranties

9.2.1       Rightful/authorized owner. The Consignor warrants to the CSP that the Consignor is the true and beneficial owner of the Consigned Goods on the reverse or is properly authorized to sell the Property by the true owner and is able to transfer good and marketable title to the Property from any third party claims.

9.2.2       Defect. The Consignor hereby warrants and represents that the Consigned Goods are free and clear of any encumbrances, liens or, other restriction. Further warrants the Consigned Goods: (i) are not adulterated or misbranded within the meaning of the Rwanda Standards Board rules, (ii) are merchantable, (iii) conform in all material respects to identified specifications, and (iv) comply with all applicable Rwandan laws.

9.2.3       Authority. The Consignor warrants that he/she has full power and authority to execute, deliver, and perform this Agreement and any agreement, document, or instrument executed and delivered pursuant to this Agreement or in connection with this Agreement.

9.2.4       No Conflict. The Consignor warrants that (i) the execution or the delivery of this Agreement, (ii) the consummation of any and all of the transactions contemplated hereby, and (iii) compliance with or fulfillment of the terms, conditions, and provisions hereof will not violate or conflict with, or result in a breach of the terms, conditions, or provisions of, any material instrument, agreement, or other obligations to which the Company is a party.

• Term and Termination

10.1         Term. This Agreement shall commence on the Effective Date and shall remain in effect for one (1) year renewable or the earlier termination as provided for under section 10.3.

10.2         Renewal. Both parties in writing may renew this Agreement.

10.3         Termination. This Agreement may be terminated (a) by either party at any time and for any reason, (b) by either party in the Consignment Agreement Period of any material breach by the other party of this Agreement, which breach is not cured within twenty (20) days after receipt of written notice thereof, (c) by either party becomes bankrupt or insolvent or is subject to any proceedings under any bankruptcy or insolvency laws, whether domestic or foreign, or (d) by either party is unable to perform any of its obligations hereunder.

10.4         Effect of Termination. Upon the expiration or the termination of this Agreement pursuant to Section 10.3, the provisions of Sections 3.3, 4.4.3, 5.5, and 6.2, shall apply.

• Dispute Resolution

11.1         Amicable Settlement. The parties shall attempt, whenever practicable, to resolve any disputes arising under this Agreement in an amicable and expedient manner between them.  The party raising a dispute shall transmit a “Notice of Dispute” to the other party.

11.2         Court. Any controversies, disputes or claims arising out of or relating to this Agreement or breach thereof which have not been amicably settled by the parties within sixty [60 days] after transmission of the Notice of Dispute shall be referred to competent court of law in Rwanda.

• Miscellaneous

12.1         Notices. Any notice, certificate, consent, determination or other communication required or permitted to be given or made under this Agreement shall be in writing and shall be effectively given and made if (i) delivered personally, (ii) sent by mail, or (iii) electronic mail (“e-mail”) or other similar means of electronic communication, in each case to the following addresses: Attention to, Address, Email.

12.2         Publicity; Use of Names. The Consignor shall not, without the CSP’s prior written consent, (a) advertise or otherwise publicize the existence or the terms of this Agreement or any other aspect of the relationship between the CSP and the Consignor or (b) use the CSP’s name or any trade name, trademark or service mark belonging to the CSP in press releases or in any form of advertising.

12.3         Governing Law. This Agreement and all Consignment Orders shall be governed by and construed in accordance with the laws of the Republic of Rwanda.

12.4         Assignment. This Agreement shall be binding upon and for the benefit of the Consignor, the CSP and their permitted successors and assignees.  The CSP may assign this Agreement to an affiliate or as part of a corporate reorganization, consolidation, merger or sale of all or substantially all of its assets or the business to which this Agreement relates after approval by the Consignor. Neither party may assign its rights or obligations under this Agreement, in whole or in part, without prior written consent of the other party, and any attempted assignment or delegation without such consent is void.

12.5         Entire Agreement; Amendment. This Agreement, its Exhibits and each Consignment Order form, all of which are incorporated herein by reference, represent the parties’ entire agreement and supersedes all prior agreements, understandings and representations, written or oral, between the parties with respect to the subject matter hereof and may not be amended except in a writing signed by both parties.

12.6         Waiver & Severability. If any provision of this Agreement is held to be invalid, illegal or unenforceable, the remaining provisions of this Agreement shall be unimpaired and shall remain in full force and effect, and the invalid, illegal or unenforceable provision shall be replaced by a valid, legal and enforceable provision that comes closest to the parties’ intent underlying the invalid, illegal or unenforceable provision. The failure of a party to require performance of any provision of this Agreement shall in no manner affect its right to enforce the provision, and no delay or failure by either party to exercise any right or remedy shall operate as a waiver thereof.

12.7         Counterparts. This Agreement may be executed in one or more counterparts and by facsimile or other electronic transmission (including via email in “portable document format” also known as PDF), each of which shall be deemed an original, but all of which shall constitute the same instrument.

12.8         Language. This Agreement is being executed in the English and Kinyarwanda languages for convenience. In case of any conflict between the two languages, the Kinyarwanda version shall prevail. Documents, notices, and all other communications written or otherwise between the Parties in connection with this Agreement shall be accepted and valid when it is written in any of those languages.  

12.9         Force Majeure.  The CSP shall not be liable for any delay or failure to perform any of his/her obligations under this Agreement by reasons, events or other matters beyond reasonable control.