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Consignment Agreement

Consignment Agreement

This Consignment Agreement (the “Agreement”) states the terms and conditions that govern thecontractual agreement between Celeste Mendis (Pvt) Ltd Business registration no. PV00300725 of53/C Yagodamulla Kotugoda (the “Consignor”) and Urban Island (Pvt) Ltd. a company dulyincorporated under the Companies Act No.7 of 2007 bearing registration No. PV00247474 having itsOffice located at no. 477, R A de Mel Mawatha, Colombo 4 (the “Consignee”) who agree to be bound bythis Agreement.

WHEREAS, the Consignor owns right and title to the items described in the Consignment Delivery Note(hereinafter collectively called and referred to as the “Consigned Items”), and the Consignee desires totake possession of the Consigned Items with the intention of selling it to a third party. NOW, THEREFORE,in consideration of the mutual covenants and promises made by the parties hereto, the Consignor andthe Consignee (individually, each a “Party” and collectively, the “Parties”) covenant and agree as follows:

1. RIGHT TO SELL. The Consignor hereby grants to the Consignee the right to display and sell theConsigned Items according to the terms and conditions of this Agreement

2. CONSIGNMENT DELIVERY NOTE: The Consignor will issue a consignment delivery note(hereinafter collectively called and referred to as the “Consignment Delivery Note”) addressed toConsignee with the mandatory information 1. Item description 2. Item code 3. Number of items4. Price per unit each time the Consignor delivers the consigned items to the Consignee. The itemscould be handed over to Urban Island only after the barcode confirmation is given via emailthrough the Inventory Controller. The consignee has the right to refuse any Consigned productswhich is delivered outside the delivery process. All deliveries must take place on Tuesday &Thursday between 9.30am and 4.30pm.

3. PRICE. The price at which the Consignee may sell the Consigned Items shall be price mentioned inthe Consignment Delivery Note (the “Price”). In the event the Consignee sells the Consigned Itemsfor less than the Price, the Consignor shall be entitled to the same payment the Consignor wouldreceive as its share of the sale price under this Agreement had the Consigned Items been sold forthe Price.

4. CONSIGNMENT FEE. The Consignee shall be entitled to consignment fee by a way of a discount35% on the price of the Consigned Items (the “Consignment Fee”). To be collected on the 10thworking day of the following month when the Consignee shall deliver to the Consignor the saleprice of the Consigned Items less the Consignment Fee, communicated through the sales report.Upon receipt of the monthly sales report, the consignor shall promptly raise a sales invoicedetailing the consignors commission. The consignor shall send the sales invoice to the consigneewithin two days of receiving the sales report.In the event how so ever where the monthly sales commission payable to the consignee is lessthan the rent amount specifies as per clause (5) of this agreement, the consignee shall recoverthe rent portion from the sales proceeds and then send an amended sales report for whichconsignor shall send the sales invoice within the same 2-day time frame.If the total monthly gross sales generated by the consignor is less than the rent amount specifiedin the agreement, the consignor shall be responsible for paying the balance amount to completethe rent payment. The consignor must submit the balance payment within two weeks of receivingthe sales report.

Urban Island (Private) Limited|
477, R A DE MEL MAWATHA, COLOMBO
04, SRI LANKA. TEL:

+94 11 786 7700 | E-MAIL:
info@urbanisland.lk | P V 00247474

5.Space Rent: The consignor is obligated to pay a monthly rent of Rs.00 or the sales commission whichever is higher, for use of the consignment space. In the event that the consignor is liable for payment of rent, such payment has to be made within two days of the issuance of the sales report issued by the consignee. In the event of the consignor being an AOD graduate, such consignors will be granted a grace period of a maximum of six consecutive months where the aforesaid monthly rental payment will be exempt, and the consignor will only be liable for the lower monthly sales commission value. After the expiration of the said grace period of six months all such AOD graduates will have to comply with the general rental condition at a monthly rental of Rs.00 Per month or the sales commission value, whichever is higher.

The rent payment should be remitted to the following account number and
the consignor has to email the
receipt to jared@aod.lk

Account Name: Urban Island
(Private) Limited Account Number: 129010013784

Branch: Kohuwela Branch
Code: 129

6.TAXES & BANK CHARGES The Consignor shall pay Consignee all applicable taxes including VAT, NBT and or any other statutory taxes and levies that may be imposed from time to time by the Central and/or Provincial and/or Local Governmental Authorities and all applicable Bank charges. All applicable Taxes and Bank Charges will be deducted from the Sales Receipts.

7.INSURANCE. The Consignee represents and warrants that the Consignee shall maintain insurance coverage sufficient to compensate the Consignor for the fair market value of the Consigned Items in the event of damage due to fire, theft, or otherwise.

8.SALES RECEIPTS: The Consignor’s Goods shall be barcoded by Consignee and all customers shall pay at the main cash desk which shall be controlled by Consignee. All Revenue from Sales (The “Sales Receipts”) shall be collected and handled by Consignee.

9.GRN, IRN & GDN: All the goods that are brought into the Retail Store Area shall acknowledged on the basis of Goods Received Note (hereinafter collectively called and referred to as the “GRN”) issued by the Consignee. All such good brought into the store may only be removed at the discretion of the consignee. In the event of consignor goods being unsold for a maximum period of three months from the date of entry, the consignee has the right to exercise his discretion to retain or return such goods. If the consignee’s decision is to return the goods, the consignee shall give the consignor at least 72 hours’ notice of such a return through the dispatch of an intention to return notice (Hereinafter collectively called and referred to as the “IRN Services”). On dispatch of the IRN it will be incumbent and the responsibility of the consignor to remove such goods from the consignee’s premises within the said 72 hours, on the listing of the goods on a Goods Dispatch Note (hereinafter collectively called and referred to as the “GDN Services”) issued by the consignee. In the event of the consignor not complying with these requirements in not removing such goods despite the issuance of the said IRN by the consignee, the consignee will have the right to dispose of such goods as deemed fit without any re-imbursement or compensation to the consignor. The Consignor shall follow the rules associated with such removal including the scanning of the item by Consignee.

10.ACCOUNTING & SETTLEMENTS: All consignment sales receipts for the calendar month will be calculated by the Consignee by the 5th working day of the following month. Settlements by the 10th working day of the new month, net of commission and charges to the following bank account of the Consignor.

Bank Details Table
Bank Account Number: 094020274370
Bank Account Name: M. H. Celeste Heshani Mendis
Bank Name: Hatton National Bank PLC
Branch Name: Minuwangoda
Bank Code: 7083
Branch Code: 094

11. REPLENISHMENT OF STOCKS: Consignor is responsible to maintain sufficient stocks for one month minimum of the consigned items in the shop space and at the stores. Consignee will share a stock report with sales on a monthly basis and consignor to deliver new stocks sufficient to meet the sales and reorder levels of consigned items. The delivery process needs to be followed when delivering products to Urban Island.

12. REPLACEMENT OF STOCKS: The consignee will analyze the performance of each collection monthly and based on performance the consignee may request replacements every 2/3 months.

13. CONTRACT PERIOD: The period of 12 months from 05th August 2024 to 04th August 2025 (Hereinafter collectively called and referred to as “the contract period”). The commercial terms of the agreement are subject to renewal for a further period with the consent of both parties. In the event it is agreed not to renew either party to give One (01) month, notice in writing and Consignor to keep the stocks until the end of the period. Brand performance will be analyzed every 3 months and the consignee has the right to terminate the agreement based on the performance before the contract expiry.

14. PERFORMANCE EVALUATION: The consignee and consignor agree to conduct performance evaluation meetings on a quarterly basis, scheduled once every 3 months. The consignor must attend these evaluation meetings and provide detailed product, sales and marketing plans for the upcoming 3- Month period.

15. EXPENSES. The Consignor shall bear all expenses for shipping and return of the Consigned Items.

16. SPECIAL SALES PROMOTIONS. Both Parties to agree on special sales promotions and discounts from time to time, which will be communicated in writing.

17. NOTICES. Notices under this Consignment Agreement shall not be deemed valid unless given or served in writing and forwarded by mail, postage prepaid, addressed as follows to every interested party:

Contact Information Table
Company Name: Urban Island (Private) Limited
Name: Jared Spaar
Mobile Number: 0770369310
Email Address: jared@aod.lk
Address: 477, R.A. De Mel Mw, Colombo 4

Such address may be changed at will by any party. A party changing their address will provide written notice to the other interested parties as described above.

18. NO MODIFICATION UNLESS IN WRITING. No modification of this Agreement shall be valid unless in writing and agreed upon by both Parties.

19. APPLICABLE LAW. This agreement, the interpretation of its terms and any dispute or claim (including non-contractual disputes or claims) arising out of or in connection with it or its subject matter or formation shall be governed by and construed in accordance with the law of Sri Lanka.

20. CONFIDENTIALITY. Each Party will not without the other Party’s prior written consent disclose the content of this Agreement

21. IN WITNESS WHEREOF, each of the Parties has executed this Contract, both Parties by its duly authorized officer, as of the day and year set forth below.

Two Columns with Image, Heading, and Text
Image Description 1

Celeste Mendis (Pvt) Ltd.

Celeste Mendis
Date: 05th August 2024
.

Image Description 2

Urban Island (Pvt) Ltd.

Authorised Signatory
Date: 05th August 2024
WITNESS

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