E.(i)Sales and Marketing Strategy
The Company's anaerobic biofiltration system will be marketed through an
affiliate company, which is wholly owned by the majority shareholders of the
Company. The Company has negotiated a National Sales Agreement with the
affiliate whereby the related company provides exclusive national sales
services. The term of the agreement is for a one-year period, automatically
renewable for an additional one-year period. Either party can terminate this
agreement with a one-year notice.
The agent shall be paid (30%) of the retail sale, and/or lease collected
revenue, provided, the sale and /or lease shall be accomplished at full list
price or higher. List price is considered to be three times the manufactured
installed cost. If the sale is not for a minimum of three times cost, the
commission will be adjusted accordingly. The agent shall in no way be paid more
money than is retained by the company, before taxes. If a lease is agreed upon
by the company for less than three times cost the agent shall not be entitled to
any payment until the company receives all cost back including interest and
operating expenses. After the company has been reimbursed, any additional lease
income will be paid to the agent in accordance with the terms shown above.
In accordance with the agreement and at its option, the Company may advance
funds against future commissions to the related company. As of the date hereof,
all prepaid sales commissions except for $18,000 have been repaid and the
financial statements now reflect no prepaid commissions.
The Company's sales and technical representatives will attend trade shows held
by environmental and agricultural associations to increase the overall
awareness of the product. The marketing department of the agent will follow up
requests with contacts made and developed through these sources.
Promotional materials such as brochures, CD-ROM, documentation videos and an
Internet web page are currently being designed and prepared and will be
available for distribution by all sales staff. As well, there is a telephone
marketing program being contemplated that will generate leads for the sales
staff.
9
A professional exhibit will be designed and built for use at various conferences
and trade shows. This information exhibit will focus on the mechanics of the
biofiltration system, the problems the system resolves, and the benefits and
savings that result from the use of the system. Current industry articles,
published research papers and other information discussing the industry,
bioremediation solutions and the Company will be made available.
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