Sales

Policy
Manual

Morlite Sales Policy Manual, 10/20/2007 • Supercedes PolMan, 8/01/2007

1805 Pittsburgh Ave • Erie, PA 16502 • 814-453-2229 or 800-865-5954 • Fax 814-453-2602 or 800-667-9959

Morlite is a Philips group brand

 TABLE OF CONTENTS

• Introduction Page 2
• Personnel Directory Page 2
• Commission Structure Page 3
• Commission Splits Page 3
• Overage Page 3
• Return Goods Authorization Page 4
• Sales Samples Page 5
• Catalog and Literature Page 5
• Trade Shows and Advertising Page 6
• Factory Visits Page 7
• Terms and Conditions of Quotations,
Order Acknowledgements and Sales Page 8
• Freight Policy Page 9
• Quality Assurance Page 10
• Limited Five Year Warranty Page 11

(Page 1)
 INTRODUCTION / DIRECTORY

Introduction

This manual is intended to provide the manufacturer's representative with policy guidelines for use
in fulfilling his/her obligations to MORLITE. These policies and procedures should be reviewed by
field sales personnel, as well as operations personnel and management within the sales agency. It
is recommended that this manual be kept in a secure, accessible location in the agency's main
office.

Personnel Directory

Note: All personnel below are located at the factory (Sale Managers may be out)
Phone: 800-865-5954 FAX: 800-667-9959

Charlie White Order Entry/Customer Service X-4102

Rhonda Fassett Quotations/ Customer Service X-4106

Chris Carter Customer Service Mgr/Quotations X-4105

Becky Ellis Product Mgr X-4111

Michelle Lohrer Regional Sales Mgr Cell 814-449-4791

Pete Mitchell Regional Sales Mgr Cell 203-521-1002

Jim Fowler General Manager Cell 814-490-0668

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 COMMISSION / OVERAGE POLICY
Commission
Published Price Sheets
Commissions paid as indicated each individual price sheet.
Factory Quotations
Should be requested on all potential orders in excess of $3,000.

Unless otherwise specified factory quotations are provided at 5% commission. Consult factory for
discounting and/or special pricing to meet specific competitive situations.

All requests for quotations on standard, modified, or custom designed MORLITE products, should be
directed to the Quotations/Customer Service Department. MORLITE policy is to quote prices to its
manufacturer’s representatives only. Under no circumstances will MORLITE quote prices directly to a
distributor in a territory that is assigned to an agent.

Commissions are paid 45 days from the last day of the month in which the invoice was issued.

Morlite does not pay commissions on the freight charges.

On orders that are quoted or received freight allowed, the actual freight costs are deducted from the net
dollar amount of the order prior to calculating the commission due.
Below is an example of a $20,000.00 order received @ 10% commission.
Order total $20,000
Freight Costs Incurred -$500.00
Net Order $19,500
x.10
Comission at 10% $1,950
Commission Splits
For specification: 50%
For securing the order: 25%
For shipment into the agent's territory: 25%

Overage
Overage is defined as:
● the difference between our standard 5% commission level price and actual sale
price paid by the customer.
or
● the difference between the price (as confirmed on a factory quotation) and the actual sale price
paid by the customer.

On orders with mixed pricing (line items at specially discounted prices along with line items qualifying for
overage) the discounted items will be “normalized” first, then overage calculated.
Normalized means adjusted to a 10% price level (within the total order lot net price) prior to calculation of
overage.

Our normal overage split is:

70% to the Agent
30% to the Morlite

The split may be negotiable up to a 90/10 split. Contact factory in advance for quotation.

(Page 3)
 MATERIAL RETURNS

Return Goods Authorization

MORLITE will accept return of defective materials in accordance with its published applicable warranty.
Contact Customer Service Supervisor for approval to return and written RGA.

All sales are manufactured “to order” and materials are not returnable except as noted above.
If circumstances warrant special consideration of an exception, contact Customer Service Supervisor. If an
exception is made, it will be confirmed in writing and the appropriate RGA
will be issued.

Under no circumstances are return shipments to be made without a formal RGA having been issued.
No return will be accepted without the proper RGA form.

Returns made against a formal RGA must be made within 30 days of the RGA issue date. Debits
anticipating credit for materials being returned are not to be taken, and will not be allowed. After receipt and
inspection of returned materials, the appropriate credit will be issued.

Commissions previously paid or credited on returned materials will be debited against the agencies next
commission settlement following receipt of returned material.

(Page 4)
 SALES SAMPLES & LITERATURE

Sales Samples

Standard Samples
Morlite offers selected samples of typical products for sales demonstrations. These are provided in cases to
the representative at 50% of the normal distributor net costs. Payment for these samples is due after 90
days and agency commission accounts will be debited unless we are advised that the agency prefers
payment by check.

New Product Roll-Out Samples

On new product roll-outs, the cost of the sample case billing will be on a memorandum basis, and will be
offset by a credit when specific introductory sales goal has been met.
Samples of cataloged fixtures are available to your agency for a nominal fee. Typically 50% less than the
published distributor net price.

All Other Samples: Standard or Modified Fixtures for Mock-up or Submittal Review
Samples of prototype fixtures and specials will be invoiced at the full distributor net price and are not
returnable.

Discuss sample requirements with the sales manager.

All requests for samples must be made to the factory in writing.

Catalogs and Literature

Website Based Electronic (www.morlitelighting.com)
Full specification catalog data (continuously updated)
Application information for Security, Transit, Cleanroom and Food Processing fixtures
Interactive cut sheets may be downloaded
IES format photometric data may be downloaded
Printed Specification Catalogs (3-ring binders)
Specification binders are updated periodically (about every 2 years).
Available to sales representatives (in reasonable quantities).
Since print runs are limited, allocation may be based on territory activity and production.
All requests must be made in writing. Contact Customer Service or sales manager.
Sales Literature (product brochures)
Produced as needed, generally concurrent with new product roll-outs.
Distributed with sample cases.
Additional quantities upon request. Contact Customer Service or sales manager.

(Page 5)
 TRADE SHOWS / Advertising

Trade Shows
MORLITE participates in a limited number of selected national trade shows each year.

MORLITE participates more frequently in local or regional IES, AIA or Sales Rep Agency sponsored trade
shows. Requests for participation in this type of trade shows should be made as early in the year as
possible. Participation must be approved by the sales manager, and is based on available budgeted funds.
Requests for such approval should be made in writing through the Sales Department.

Manufacturer's representatives are encouraged to sponsor "product luncheons." In such cases, where a
MORLITE factory representative is present, we will split the costs with the representative.
Prior to scheduling contact the sales manager for advance approval.

Advertising
MORLITE has an outside ad-agency firm that handles its media advertising. Planning and scheduling is
generally completed by year-end for the following year. The advertising is done in trade journals that are
relevant to the market served and distributed to appropriate buying or specification influences.

MORLITE does not have a structured program for co-op advertising. Special requests will be considered on
a case-by-case basis.

(Page 6)
 FACTORY VISITS

Agent Training meetings

Participation in scheduled rep training sessions is occasionally required. Generally participation is voluntary.
In either case, the following financial arrangements will generally apply:
• Travel to and from Erie provided by Agent.
• Hotel, meals, local transportation, etc. provided by MORLITE.

Rep training meetings are generally scheduled on Fridays, except none are scheduled in the months during
which snow is likely (November – March).

Typical schedule as follows:

Thursday: Arrive and check into hotel (3-5:00 PM)
Group dinner hosted by MORLITE
Friday: Transport to MORLITE facility
Continental breakfast and lunch at MORLITE
Meeting from 8:30 AM – 3:00 PM

Specifier meetings
Many reps find it advantageous to bring small groups of specifiers to MORLITE for the express purpose of
training them in both product and application. MORLITE encourages reps to bring specifiers to its facility.

Typically a meeting format will be tailored to the needs of the visiting group. AIA continuing education credits
may be available. Consult with the sales manager in advance to allow time to properly register class
presentation materials.

The agenda and schedule will generally be similar to the agent training meeting format above.

All factory trips, tours, or other travel involving financial participation by MORLITE require advance approval.
Contact Customer Service or the sales manager.

(Page 7)
 Terms and Conditions
Quotations, Order Acknowledgements, and Sales
Essential Knowledge
Sales Representatives are expected to be familiar with standard MORLITE Terms and Conditions as printed
on the back of order acknowledgement forms. (see below)
Acceptance
Acceptance of Buyer's order is expressly made conditional on Buyer's assent to the terms and
conditions contained herein and the credit approval of Buyer by Seller.
Cancellation
Seller reserves the right to cancel or suspend all or any undelivered or unexecuted portion of the
goods or services covered by this agreement without any liability whatsoever (I) if Buyer breaches any
of the terms hereof or (II) if any proceeding by or against Buyer in bankruptcy, reorganization or
insolvency, or the appointment of a receiver, or any assignment for the benefit of creditors on behalf of
Buyers occurs. Upon cancellation of an order by Buyer, Buyers must reimburse Seller for any and all
losses or expenses incurred.
Price
If seller has included a price on the front hereof, such price shall control. Except, as may be otherwise
noted herein, the price does not include any applicable federal, state or local taxes.
Changes
No change in the terms of this agreement shall be binding upon seller unless in writing and signed by
Seller.
Entire Agreement
This agreement and any document referred to herein supersede all prior understanding, transactions
and communications (oral or written) with respect to the matters covered herein and from the complete
contract between Buyer and Seller.
Confidentiality
Any knowledge or information concerning Seller's products, methods or manufacturing processes
which Seller may disclose to Buyer incident to the production of goods or performance of services
covered by this agreement shall, unless otherwise specifically agreed to in writing, be kept secret and
confidential by Buyer and will not be divulged by Buyer to any third party or used by buyer otherwise
than in connection with the goods or services covered herein. If the production of goods or
performances of services covered by this agreement involves experimental development or research
work, the parties agree that no license to make, have made, employ or sell any inventions resulting
from the work shall have been granted . The rights and obligations under this clause shall survive the
cancellation, termination or completion of this agreement.
Buyer's Damages
In no event shall the Seller be liable for prospective profits, special indirect or consequential damages.
In all cases, Seller's liability shall be strictly limited to, at Seller's option, either (I) the repair or
replacement of the goods or (II) the price of the goods.
Payment
Except as otherwise provided on the face hereof, payment shall be net 30 days, F.O.B., MORLITE
factory, Erie, PA. A charge of 1.5% per month or fraction thereof, 18% per year, will be made on all
overdue bills unless such charge exceeds the maximum allowable under law, in which case the charge
shall be reduce to the maximum allowable under law.
Title and Rise of Loss
Unless otherwise specified on the face hereof, the F.O.B. point shall be Sellers location designated on
the face hereof. Claims for damage or loss must be made by Buyer with carrier.
Delivery
The terms of delivery are approximate and based upon prompt receipt of all needed data. The Seller
shall not be liable for delays in delivery or performance or failure to deliver or perform (I) due to causes
beyond its reasonable control, (II) due to acts of God, Buyer, of civil or military authorities, firs, strikes,
floods, epidemics, quarantines, wars, riots, delays in transportation, or car shortages, (III) due to
unavailability of needed labor, materials, components, or production facilities or (IV) due to any other
commercial impracticality. In the event of any such delay the date of delivery shall be deferred for a
period equal to the time lost by reason of delay. Seller shall determine routing except when Buyer
specifies and otherwise and pays all extra costs incurred thereby.
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 Assignment and Set-off
This contract between Buyer and Seller and any payments to be made thereunder may not be
assigned or transferred without prior written approval by Seller. No claims for monies due or to
become due from Buyer shall be subject to deduction by Buyer for any setoff or counterclaim arising
out of this or any other contract with Seller.
Remedies
Each of the rights and remedies of the seller in this agreement shall be cumulative and additional to
any other or further remedies provided in law or in equity or in this agreement.
Attorney's Fees
In the event Seller shall sue buyer for any reason, Seller shall be entitled to recover from Buyer all
costs of suit and reasonable attorneys' fees in addition to all other available remedies.
Returns
Products of Seller are made to order, thus Seller is not obligated to accept returns and there is no
standard "Restocking" charge. Under no circumstances will returns be accepted without written factory
authorization. Requests for returns must be made in writing within 30 days of shipment and material
must be returned within 30 days from receipt of authorization. Since each request will be considered
individually, a customer agreement letter must be executed before an RGA will be issued. This letter
will establish the terms and conditions of return agreeable to both the Seller and Buyer.
Venue and Jurisdiction
This agreement between Buyer and Seller shall be deemed to have been executed and delivered at
the place of business of Seller, and shall be construed and interpreted under the laws of the state
where the place of business of Seller is located without giving effect to its choice of law provisions.
Jurisdiction and venue, with respect to any suite in connection with this agreement, shall reside in the
state or federal courts where the Seller's place of business is located.
Waiver
Seller's failure to insist on performance of any of the terms or conditions herein or to exercise any right
or privilege or Seller's waiver of any breach hereunder shall not thereafter waive any other terms,
conditions, rights, or privileges.
Severability
In the event that any word, phrase, clause, sentence, or other provision hereof shall violate any
applicable statute, ordinance or rule of law in any jurisdiction in which it is used, such provision shall
be ineffective to the extent of such violation without invalidating any other provisions hereof.

FREIGHT POLICY
Freight Allowance
Morlite’s freight allowed terms have changed as of 2-1-2008. Please reference map below.
Deliveries into Zone 1 are freight allowed at $20,000 and up. Deliveries to either Zone 2 or Zone 3 are freight
allowed at $25,000 and up. We are all painfully aware of rising fuel prices, and, as freight costs soar we’ve
tried to accomodate our customers. Recent increases in fuel and other surcharges require an adjustment of
our terms. In special circumstances, arrangements may be negotiated, in writing, with Morlite Inside Sales. If
you have questions, please do not hesitate to contact us.

MORLITE LIGHTING FREIGHT ZONES

(Page 9)

Damage Claims
All shipments will be made FOB Erie, PA* and ownership passes to consignee upon shipment. All transit
claims shall be made by consignee directly with carrier. A clear receipt at the factory places the responsibility
for complete and proper delivery upon the carrier. Morlite products are fully tested for mechanical defects
prior to shipment.
* For Alaska, Hawaii, Puerto Rico or other points outside the continental United States,
freight allowance will be made to the nearest port of embarkation in the continental
United States.

QUALITY ASSURANCE

Quality Assurance Policy

MORLITE's first priority is customer satisfaction. We take every step possible to ensure that our products
are well designed, of superior quality, and are received by our customer in good working order. It is our
intention that any problems resulting from defective materials or workmanship be promptly addressed.

Field Problems
Detailed below are the general procedures and guidelines we ask you to follow in the event a field problem
arises due to defective materials or workmanship. This policy statement is not intended to create a warranty,
nor to become a part of, nor extend the existing MORLITE customer warranty.
• Acknowledgment of Problem
In order to serve our customers better, the MORLITE Customer Service Department should be promptly
notified by you of all problems which you or your customers encounter with our products. MORLITE, once
notified, will acknowledge your comments and complaints in writing.
• Limits of Responsibility
The correction of any problem resulting from abuse, neglect or misuse of the product after it leaves the
factory is not the responsibility of MORLITE. MORLITE also has the right to limit its financial responsibility
for warranty repairs to the furnishing of new parts free of charge, in exchange for parts which have been
proven defective.
• Authorization for Warranty Repairs
All warranty repairs made by you, or your customer, must be authorized by MORLITE in writing prior to the
performance of chargeable work. Contact Customer Service to determine labor allowances acceptable to
MORLITE prior to any commitment to proceed.
MORLITE cannot be held responsible for excessive time lags between discovery and reporting of the
problem.

Back charges
Back charges require prior approval. Any back charge made without prior approval will be disallowed.
Disallowed back charges may be debited against rep commission statements.
We cannot over emphasize the need to obtain prior approval.

If the problem requires work to be performed in the field, MORLITE reserves the right to perform this work
with factory personnel, but we do recognize the fact that the contractor may be required to do any work. In
these cases MORLITE will advise its acceptable labor rate, and follow with a purchase order and/or written
authorization to proceed.

(Page 10)
 Limited FIVE-Year Warranty
For
Morlite Lighting Fixtures
MORLITE lighting fixtures (the “Good”) are carefully designed, manufactured, and inspected. MORLITE
warrants that the Goods are free from defects in workmanship and materials for a period of five years from
the date of delivery. LED sources and power supplies are not included in five year warranty. Sales literature
will reflect warranties for individual products as they are developed.

In the event of defect of the Goods which are still in their original installation not caused by unreasonable use
or damage to the Goods while in possession of the purchaser, MORLITE will repair or replace the defective
Goods. Discolored lenses due to excessive UV exposure or damage by firearms are specifically excluded
from warranty. Lamps, ballasts, and starters used in the Goods are covered by their respective
manufacturers and are excluded from this warranty.

Under no circumstances shall morlite be liable to the purchaser or any other person for any
consequential, incidental, ergonomic, direct, indirect, general, or special damages arising out of any
breach of warranty express or implied, under this contract. Some states do not allow limitations on
how long an implied warranty will last, so the above limitations may not apply to you.

There are no implied warranties of merchantability or fitness for a particular purpose. Some states do
not allow limitations on how long an implied warranty will last, so the above limitations may not
apply to you.

In order to obtain performance under the warranty obligation, contact MORLITE’s customer service
department. MORLITE will determine whether a field representative will be sent to investigate the warranty
claim or the fixture will be returned. For returned fixtures, the purchaser must deliver all defective material
freight prepaid to MORLITE. Replacement or repaired products will shipped to you F.O.B. our factory.

Special Warranty

Selected products in the Vandal Resistant family have a special LIMITED LIFETIME WARRANTY. Contact
Customer Service for details

(Page 11)