DISTRIBUTION AGREEMENT

BETWEEN
KINANGOP DAIRY LTD

AND
………………………………………………………………………………………………………………………………………………..

Phone ………………………………………….. …………………….

THIS AGREEMENT is made on this______ day of__-------------------- __2024

BETWEEN Kinangop Dairy Limited a private limited liability company incorporated in the Republic of Kenya whose
postal address is care of P. O. Box 64954-00620 Nairobi (hereinafter referred to as “KDL”) of the first part and
……………………………….whose postal address is of P.O. Box……………………………………………………….
(Hereinafter referred to as “Contractor”) of the other part:-

WHEREAS KDL is a company engaged in the processing of fresh milk, and in the sale and the distribution

of milk and other dairy products.

AND WHEREAS the Contractor is engaged in the business of re selling of KDL’s milk and milk products. Now therefore
both parties now agree as follows:-

A. KDL RESPONSIBILITIES

1. Sale and supply of milk and milk products

KDL shall supply and sell processed milk and other milk products to Contractor and shall deliver to the designated depots
agreed by both parties.

2. Form and Packaging

The milk and milk products supplied to the Contractor shall be sold as a finished product. The milk delivered shall be packed
in cartons containing 12 packets of 500ml and 21 packets for 200ml (or any alternative packaging

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mutually agreed to by both parties). The yoghurt and other milk products will be packaged in plastic bottles and cups.

3. Market Area Allocation

The Contractor shall confine themselves within the geographical limits allocated by KDL and shall not sell the milk and other
products outside the designated area. The designated area allocated will be exclusive to the Contractor. The Designated
areas are…………………………………………………... KDL reserves the right and shall be entitled to reduce or adjust the
Contractor’s geographical area if the volume targets are not met as outlined on clause 4.

4. Sales Targets

The sales target for the Contractor’s designated distribution area shall be mutually agreed to by both parties. The sales target
shall be set at the beginning of each quarter.

5. Transportation and Delivery to Contractor’s depots

Milk and other milk products shall be transported to a maximum of two depots within a radius of fifty kilometers at the cost of
and in the trucks of KDL from its factory in Kinangop. Subject to Part B (1), KDL shall ensure each delivery is made on time
and in full. The minimum delivery order shall be 8 tonnes.

6. Delivery and Invoicing.

The delivery of the milk products to the Contractor will be done through Delivery Note Invoice which the Contractor will be
required to sign to acknowledge the receipt of the consignment. It is hereby agreed by both parties that the delivery note
signed for and on behalf of the Contractor by their proxy shall be conclusive evidence that the consignment shown on such
delivery note were sold and delivered to the Contractor. (The proxy shall be introduced to KDL in writing).The Contractor is
obligated to take receipt of all the milk products ordered subject to clause B(1) and B (2).

7. Prices

KDL will be responsible for regulating prices for all the dairy products processed/produced by the company. The Contractor
will ensure conformance with KDL pricing guidelines and adherence by Retailers to retail prices recommended by KDL. KDL
may adjust the prices depending on prevailing economic condition subject to provision of a 7days’ notice to the Contractor.

8. Passing of Title

The title and ownership in the property of that milk and the risk there in shall pass to Contractor immediately upon delivery to
them subject to Part B (3).

9. Mode of communication

The Contractor will be communicated to in writing or through SMS in case of delivery orders. All communication must be
acknowledged.

10. Consequences of suspension or termination of the agreement

Upon the lawful suspension of milk supplies and/or lawful termination of this agreement, KDL shall be entitled to take any
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action or make such alternative arrangements with any person, firm or company as it may deem necessary to ensure that
adequate supplies of KDL PRODUCTS are delivered for sale to markets in the Contractor’s area; and if that happens, the
Contractor shall not have any claim of any kind against KDL in respect of any such arrangements made or action taken as
aforesaid.

11. Promotion and Marketing Campaigns

KDL shall carry out promotion campaigns at its own cost where it deems it necessary to boost the sales and build up the
image and brand of Kinangop milk in the market. The Contractor must do everything within their power to promote the interest
of KDL.

12. Force Majeure

KDL shall not be held liable in case delivery of milk is prevented or delayed by riots, civil commotion, earthquakes, floods,
acts of God or by any other circumstances beyond the control of KDL, or if the normal supply of milk is reduced by drought or
other weather conditions. The Contractor shall also not be held liable if they fail to meet the sales targets for reasons beyond
their control (Force Majeure).

B. CONTRACTOR RESPONSIBILITIES

1. ORDERS

The Contractor shall on the first day of each month provide an order forecast for the month together with a delivery schedule
to KDL. The Contractor shall in addition confirm each delivery to KDL 48 hours prior to each delivery date through email and
by SMS to K.D.L. customer care representative, Mobile phone number 0702660400. KDL will invoice for all confirmed milk
product orders unless cancelled by email or SMS to K.D.L. customer care representative by 12 noon of the day preceding
the date of delivery for the confirmed order.

2. Leakages

It shall be the responsibility of Contractor to inspect the delivery for any milk leakage at the time of delivery.KDL delivery
clerks will not invoice the leaking packets.

3. Sourage and Blow – up

It is the responsibility of the Contractor to ensure the products delivered to them by KDL are handled and kept in appropriate
storage to avoid sourage and blow-ups. KDL will accept claims for milk sourage/blow-up occurred prior to the expiry date of
the milk.

4. Security/Guarantee

The Contractor will be required to provide security/guarantee to cover the value of each milk product order or total outstanding
payments. No further deliveries will be made should outstanding payments exceed the level of security/guarantee held by
KDL. The contractor will give a ………………..days postdated cheque for the delivered products.

5. Payments

The payments for the milk and milk products should be made in the following bank accounts:

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 1. Barclays Bank of Kenya, Barclays Plaza Branch Account
Name: Kinangop Dairy Ltd

Account No: 0775032944

2. M-PesaPay bill Business No:

988900
Account No: Indicate your full names

3. KCB,TOM MBOYA BRANCH Account Name:

Kinangop Dairy Ltd Account No: 1163711152

It is the responsibility of the Contractor to ensure that their name appears on the banking slip. The banking slip must be
brought to the office or given to the salesmen before delivery. In the case of online banking, the Contractor must ensure to
include a clear reference for payment made and send a proof of payment to KDL

6. Contractor shall be an Independent Contractor not an Agent on commission.

The Contractor shall sell the milk bought from KDL on their own account and as an independent business and hence no
commission is entitled to them whatsoever. Moreover, they will not enter into any agreement, contract or commitment with
third parties for or on behalf of KDL. The Contractor shall also not sell fresh milk of any person, firm or company who is in
competition with KDL.

7. Milk shall be sold as delivered

The Contractor shall sell milk as a finished and “ready to drink or use” product in the same form, content and packaging in
which it is delivered by KDL, and the Contractor shall not repackage , mix or blend it with any other milk or water, or with any
other material, substance or product.

8. Exclusive ownership of Kinangop Long Life brand.

The Contractor shall not acquire any interest or make any claim to the brand name, trademark, and goodwill of the brand
name.

Termination of the Agreement

1.1. The Contractor will be expected to adhere to the conditions stipulated in the agreement and any other
amendments mutually agreed by both parties.

1.2. The company may terminate the Agreement without notice if the Contractor violates any of the following:
1.3. Non-payment of supplies made. Mutual consent.
1.4. Violation/non-conformance with this agreement. Selling / dealing with competitors products.
1.5. Non – attainment of target

If the terms of this agreement are breached by any party, the agreement shall be terminable at the option of the innocent
party by the service of 30 days’ notice.

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