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Territorial Cost of Exclusive Distributorship

HOW THE TERRITORIAL FEE IS COMPUTED

The cost of an Exclusive Distributorship is based on the construction activity in the desired exclusive territory. The cost of a given distributorship territory is based on $50.00 for each building permit issued in the immediate past year within the requested territory. For example, if an Exclusive Territory is desired for an area near Miami/Dade and the number of permits issued the previous year were 5,000, the Territorial Distributorship Fee would be $250,000.00 plus the Initial Distributorship fee of $25,000.00 for a total Distributorship fee of $275,000.00.

However, if the permits pulled in the prior year were 200 in a less expanding area, the Territorial Fee would be $ 10,000.00 (200 x $50.00) plus the Initial Distributorship fee of $25,000.00 for a total Distributorship fee of $ 35,000.00, in this example.

UNDERSTANDING THE CONCEPT

Simply put, the higher the construction activity in a given requested territorial area the more risk Omnicrete will be undertaking by placing the territory in the hands of one entity. If that entity is limited by resources or management the less royalty fee will be collected. The only measurable barometer available to determine the construction growth health of an area is the actual permits being pulled. As the demand for the Omnicrete process increases, the $50.00 permit basis will increase, along with the initial fee of $25,000.00. Now is the time for aggressive, well financed construction entities to get the areas secured where the construction is experiencing rapid growth.

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