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EX. 10.59
AGREEMENT
AGREEMENT dated September 13, 2000, by and between ACTION PERFORMANCE
COMPANIES, INC., 4707 East Baseline Road, Phoenix, Arizona 85040 ("ACTN") and
QVC, INC., 1200 Wilson Drive, West Chester, Pennsylvania 19380 ("QVC") (each of
the foregoing occasionally referred to hereafter as a "Party" and collectively
as the "Parties").
WHEREAS, ACTN is engaged in the design, marketing, manufacture,
distribution and sale of motor sports-related die-cast replica collectibles,
apparel, souvenirs and other merchandise (the "Products"), which incorporate
names, likenesses, trademarks and other intellectual property owned by ACTN and
licensed to ACTN by various motor-sports drivers, automobile manufacturers and
other third parties (the "Underlying Rights Owners"); and
WHEREAS, ACTN has organized and operates the Racing Collectables Club
of America ("RCCA"), whose members have the exclusive right to receive from ACTN
catalogs and other sales materials pertaining to certain Products bearing the
"RCCA" and "Elite" brand names (collectively the "RCCA Branded Products") and
the exclusive right to purchase such RCCA Branded Products; and
WHEREAS, ACTN wishes to grant QVC the exclusive right to distribute and
sell the RCCA Branded Products and to assume day-to-day operation of RCCA, as
well as to engage in promotion of RCCA and the RCCA Branded Products in all
media and QVC wishes to accept such rights and obligations, all subject to the
terms and conditions of this Agreement;
NOW, THEREFORE, and in consideration of the mutual agreements contained
herein and other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto agree as follows:
1. GRANT OF DISTRIBUTION RIGHTS; TRANSITION OF OPERATIONS:
(a) ACTN hereby grants to QVC the exclusive right to
distribute and sell all RCCA Branded Products wherever ACTN holds the right to
sell such merchandise, for the Term provided herein, as well as the exclusive
right to use the ACTN and third-party names, likenesses, trademarks and other
intellectual property exclusively associated with the RCCA Branded Products
including, without limitation, the RCCA and Elite trademarks (collectively the
"Licensed Property") solely in connection with QVC's distribution and sale of
RCCA Branded Products hereunder and for no other purpose. Current lists of all
RCCA Branded Products, and the various items of intellectual property owned or
controlled by ACTN which constitute the Licensed Property hereunder, are
attached hereto as Exhibits A and B respectively, and are incorporated by
reference herein. Without limiting the foregoing, QVC will maintain all
inventory warehousing, call center operations, order processing, order
fulfillment, return processing and similar "back end" operations, and will be
responsible for all costs associated therewith. ACTN will retain responsibility
for product selection and development, acquisition of
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rights from Underlying Rights Owners, arrangements for manufacture of products
and delivery of same to QVC-designated warehouse facilities.
(b) QVC will assume full responsibility for ACTN's call center
operations with respect to RCCA Branded Products as soon as practicable, but in
no event later than October 31, 2000, and with respect to all other operations
contemplated hereunder no later than January 31, 2001 (the "Full Assumption
Date"). From the date of QVC's assumption of such operations it will receive all
such inventory from ACTN, pursuant to the terms of its consignment order
attached hereto as Exhibit E (the "Consignment Order"), which is incorporated
herein by reference. Without limiting the foregoing, the following transitional
actions will be taken prior to the Full Assumption Date:
(i) QVC will issue a Consignment Order and take
into its warehouse facility substantially
all of ACTN's current inventory of die-cast
products, and will immediately commence
sales of such inventory at prices previously
established by ACTN or as otherwise mutually
agreed to by the Parties. ACTN will, at its
expense, pack and ship such current
inventory to QVC according to QVC's
reasonable specifications.
(ii) ACTN will deliver to QVC catalog-ready
digital images and detailed text
descriptions of the RCCA Branded Products.
(iii) ACTN and QVC shall each designate one or
more individual representatives who will be
primarily responsible on a first-priority
basis for implementing all aspects of QVC's
assumption of such fulfillment operations.
2. RCCA ADMINISTRATION: QVC will assume day-to-day operation of RCCA in
accordance with the transition deadlines established in subparagraph 1(b) above,
including (at QVC's discretion) promotion via television, print and online
media. ACTN will provide links on its "goracing.com" website to QVC's online
promotion sites. The RCCA membership database (the "Database") will at all times
hereunder remain the sole and exclusive property of ACTN; however during the
Term (as defined below) QVC will be responsible for maintaining the Database and
shall have the non-exclusive right (shared only with ACTN, which shall only
utilize the Database for marketing of ACTN products), to utilize the Database
solely in connection with QVC's distribution and sale of RCCA Branded Products
hereunder, and may also market QVC-sponsored motor-sports shows and other events
to RCCA members (provided that ACTN is the primary merchandise vendor at each
such event). ACTN will deliver the current form of the Database to QVC in such
print and/or electronic form as QVC may reasonably request. During the Term, QVC
will update the Database regularly and will make updated versions of the
Database available to ACTN no less often than quarterly, in such print and/or
electronic form as ACTN may reasonably request. QVC will operate and promote
RCCA pursuant to quality standards and existing levels of member promotional
activity (e.g., frequency of catalogs and other mailings) at least equal to the
standards of operation currently maintained
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by ACTN or as may otherwise reasonably be determined by QVC after consultation
with ACTN with respect to material adjustments.
3. PRODUCT DEVELOPMENT AND MARKETING: The Parties will jointly
determine suggested retail pricing, and maximum edition and order quantities,
with respect to RCCA Branded Products; however, in the event of a disagreement
with respect to such matters the determination of ACTN shall be binding on the
Parties. Designated individual representatives of the Parties will meet no less
often than monthly to discuss such matters, and the development, marketing and
promotion of new RCCA Branded Products generally, including the introduction of
exclusive benefits to RCCA members. The Parties will also consult at such
meetings regarding ACTN's potential acquisition of name, likeness, trademark and
other intellectual property rights from new Underlying Rights Owners and
expansion of rights granted by current Underlying Rights Owners, it being
expressly understood that ACTN shall have sole and exclusive control over all
aspects of such third-party negotiations and such rights will be acquired by
ACTN as sole licensee. Any such rights acquired during the Term shall, as
applied to RCCA Branded Products, be deemed added to the items of Licensed
Property granted to QVC pursuant to the terms of this Agreement.
4. PAYMENTS AND ACCOUNTINGS:
(a) In consideration of its services hereunder, QVC shall be
entitled to retain a percentage of all revenue derived from retail sales of RCCA
Branded Products shipped by QVC (except for sales through QVC on-air and iQVC
sales under subparagraph (b) below), as follows:
(i) Twenty Percent (20%) of revenue for sales
each year up to $35 Million;
(ii) Twenty-Five Percent (25%) of revenue for
sales each year between $35 Million and $60
Million; and
(iii) Thirty Percent (30%) of revenue for sales
each year over $60 Million.
(b) In addition, ACTN will sell to QVC at wholesale price
agreed-upon overages of RCCA Branded Products, for resale via QVC on-air or iQVC
online, in either case after the initial sales window reserved to RCCA members
has expired. For purposes hereof, "wholesale price" shall mean suggested retail
price of such merchandise less forty percent (40%). Such merchandise not sold
via QVC on-air or iQVC online shall continue to be governed by subparagraph (a)
above.
(c) The foregoing participation schedules shall be inclusive
of all distribution, marketing and other expenses of QVC and the fees and
expenses of any sub-distributor or other party engaged by QVC to assist in the
performance of its obligations hereunder. RCCA Membership fees shall be set by
mutual agreement; however QVC shall be entitled to retain all membership fees
resulting from sales of RCCA memberships during the Term. ACTN and QVC will
design a membership kit (if any membership kit is desired) on a mutually
agreeable basis
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and ACTN will sell to QVC any merchandise contained therein at the applicable
wholesale price pursuant to the terms of QVC's Consignment Order.
(d) ACTN and QVC may agree to include in catalog, online or
other RCCA-related promotional media, non-ACTN branded products for sale to RCCA
members ("Other Products"). The terms of such offers and sales shall be subject
to mutual approval in each instance. In addition, fees, royalties and other
compensation resulting from all RCCA sales activity (but not specifically
attributable to product sales) shall be divided equally.
(e) QVC shall maintain accurate records showing the quantity
and sales price of RCCA Branded Products and Other Products sold or otherwise
disposed of by QVC. QVC shall render weekly statements containing good-faith
estimates of all sales activity hereunder. QVC shall render monthly statements
of account relating to the preceding month and shall deliver such statements to
ACTN within fifteen (15) days after the end of each calendar month. QVC shall
make payment to ACTN by wire transfer on Wednesday of each week for estimated
sales of RCCA Branded Products and Other Products by QVC through catalogs for
the preceding fiscal week's end. At the end of each month all such amounts will
be compared to amounts due ACTN for all sales of RCCA Branded Products and Other
Products by QVC in the monthly statement of account, and any differences will be
promptly wire-transferred by the respective party in the event of a discrepancy
after delivery of the monthly statement to which such discrepancy pertains. Such
monthly statements will prepared in accordance with generally accepted
accounting principles and shall include reasonable detail regarding QVC's sales
activity for the relevant period, including without limitation:
(i) the quantity and dollar amounts of RCCA
Branded Products and Other Products sold or
otherwise disposed of during the period,
indicating the nature of such other
disposition;
(ii) the gross invoice price of all RCCA Branded
Products and Other Products sold during the
said quarter and the dollar amounts of all
returns and refundable commissions during
the said period; and
(iii) an itemized statement of revenue due ACTN
for sales made during the said period and
payment of same.
Receipt or acceptance by ACTN of any statements or payments referred to herein
shall not preclude ACTN from questioning the correctness of any such statements
and/or revenues paid or payable for a period of two (2) years from the date of
delivery of such statement and/or payment to ACTN.
(f) ACTN may examine the books and records of QVC pertaining
to its sales and other disposition of RCCA Branded Products and Other Products
hereunder, during normal business hours and at reasonable times through ACTN's
own employees or representative(s), to obtain or verify the information
described in subparagraph (d) hereof, but not more than once annually. In the
event that such inspection reveals an underpayment by QVC of the revenues due
ACTN hereunder, QVC shall pay the difference and if it is determined that QVC
has
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understated the amount due ACTN by five percent (5%) or more, QVC shall
additionally be obligated to pay and shall pay to ACTN the reasonable costs and
expenses directly or indirectly incurred by ACTN in the examination of the books
and records of QVC. In the event that such inspection reveals an overpayment by
QVC of the revenues due ACTN hereunder, ACTN shall pay the difference.
(g) All of QVC's records relating to transactions authorized
or arising from this Agreement shall be maintained for a period sufficient for
ACTN to enforce its audit rights provided herein.
5. TERM; PERFORMANCE STANDARDS:
(a) The Term of this Agreement shall be ten (10) years from
the Full Assumption Date, subject to earlier termination pursuant to
subparagraph (b) hereof and Paragraph 12 below.
(b) Should QVC fail to generate gross revenues from which QVC
is compensated pursuant to subparagraphs 4(a) and 4(b) of this Agreement of at
least Eighty Million Dollars ($80,000,000) in the aggregate for the first two
(2) years of the Term (i.e., commencing on the Full Assumption Date), either
Party shall have the right to terminate this Agreement; provided, however, that
if gross revenues as aforesaid for such initial two-year period equal at least
Seventy-Eight Million Dollars ($78,000,000), the Agreement will not be
terminable provided QVC reaches its minimum performance standard for the third
year of the Term plus any shortfall below $80,000,000 from the first two years
of the Term. The Parties agree that minimum gross revenues as aforesaid for the
third year of the Term will be Forty-Five Million Dollars ($45,000,000), and
thereafter the applicable minimum gross revenues will increase by five percent
(5%) per year for the remainder of the Term (i.e., $47,250,000 in year 4;
$49,612,500 in year 5; and so forth). Should QVC fail to meet this performance
standard in any two (2) consecutive years of the Term (after the first two years
of the Term), either Party shall have the right to terminate this Agreement. In
addition, if ACTN's net revenues from such sales falls below $30,000,000 for any
year of the Term, ACTN may terminate this Agreement. All termination rights
provided hereunder shall be exercised by notice to the other Party in accordance
with the provisions of Paragraph 12 below. It is understood that ACTN shall be
able to produce Product sufficient for QVC to meet the minimum gross revenue
amounts hereunder.
6. EXCLUSIVITY; NON-COMPETITION:
(a) During the Term hereof, QVC will not perform services
substantially similar to those contemplated by this Agreement for any other
motor sports-themed catalog, website or other organization without ACTN's prior
approval, except for such pre-existing relationships as have been disclosed to
ACTN and which are described in Exhibit C attached hereto. Likewise during the
Term, ACTN will not sponsor or operate any other motor sports-themed fan or
activity club which exists primarily to promote sales of motor sports-themed
merchandise, whether or not such merchandise is substantially similar to
then-current RCCA Branded Products, except for such pre-existing relationships
as have been disclosed to QVC and which are described in Exhibit D attached
hereto. ACTN will not distribute or sell RCCA
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Branded Products to any party other than QVC. In addition, ACTN will not
distribute or sell, or cause any third party to distribute or sell, Products
(whether or not substantially similar to RCCA Branded Products) through Direct
Response Television during the Term except through QVC, unless QVC 's prior
written approval is obtained in each instance. For purposes of this Agreement,
"Direct Response Television" shall mean any electronic transmission through
which a consumer is requested to purchase any product or service by mail,
telephone or other electronic means, including without limitation televised
electronic retailing programs, infomercials, direct response commercial spots
and any computer-based shopping services (including without limitation online
services). The Parties agree that ACTN's "goracing.com" website or any other
online service owned or directly controlled by ACTN is exempt from the foregoing
restriction. Notwithstanding the foregoing, ACTN may distribute or sell non-RCCA
Branded Products to NASCAR or NASCAR's designated fulfillment source for
purposes of sale solely on nascar.com or any other website entirely owned or
controlled by NASCAR. Under no circumstances, shall ACTN distribute or sell, or
allow any third party to distribute or sell, Products that are endorsed or
branded by an entity whose primary business is televised home shopping programs.
(b) In addition, to the extent ACTN has obtained the necessary
rights from the relevant Underlying Rights Owner(s) to create, distribute and
sell a particular RCCA Branded Product or other Products licensed to ACTN by
various Underlying Rights Owners, and to the extent that such RCCA Branded
Product or other Products licensed to ACTN by various Underlying Rights Owners
meet all of QVC's standard product guidelines, ACTN will be the exclusive vendor
to QVC with respect to such RCCA Branded Product or other Products licensed to
ACTN by various Underlying Rights Owners. If at any time during the Term, ACTN's
license from any Underlying Rights Owner with respect to a RCCA Branded Product
or other Products should terminate for any reason other than ACTN's material
breach of its agreement with such Underlying Rights Owner, QVC will not purchase
product substantially similar to the RCCA Branded Product or other Products
licensed to ACTN by various Underlying Rights Owners derived from rights
licensed or otherwise granted by such Underlying Rights Owner for the remainder
of the Term or two (2) years, whichever is the shorter period. In no event will
QVC enter into license agreements directly with any of the Underlying Rights
Owners. If such Underlying Rights Owner alleges material breach on ACTN's part,
QVC will provide notice of same to ACTN, which will have not less than thirty
(30) days from delivery of such notice to provide information to QVC rebutting
such allegation. QVC shall then, within thirty (30) days of delivery of such
information by ACTN, inform ACTN of its conclusion regarding ACTN's alleged
breach, acting in good faith after review of all materials submitted by ACTN. If
QVC concludes that ACTN materially breached its agreement with said Underlying
Rights Owner, it shall so notify ACTN and ACTN shall have a period of thirty
(30) days from delivery of such notice to submit the matter to binding
arbitration before a single arbitrator in a location to be mutually determined
by the Parties and otherwise subject to the rules of the American Arbitration
Association then obtaining.
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7. QUALITY STANDARDS: QVC will, prior to publication or other
dissemination of catalogs and other sales materials, and advertising or other
promotional materials, in each case pertaining to RCCA Branded Products or
otherwise utilizing any of the Licensed Property, submit to ACTN for its prior
written approval samples of all such materials. Such samples may consist of
printer proofs, layouts, scripts or other materials reasonably representative of
the final advertising or promotion. Approval by ACTN shall in each instance not
be unreasonably withheld and ACTN will use its best efforts in each instance to
insure prompt approval. Previously approved material may be re-broadcast,
reprinted or otherwise re-used without the aforementioned approval by ACTN,
except as ACTN may otherwise advise QVC.
8. ACKNOWLEDGMENT OF RIGHTS: QVC acknowledges the existence, validity,
enforceability and ACTN's ownership, or authorized use, of the Licensed
Property, and any trademark, copyright and related intellectual property rights
therein, and that as between the Parties ACTN has the exclusive rights in the
Licensed Property set forth herein. QVC shall not contest or oppose in any
fashion the existence, validity, enforceability or ACTN's ownership, or
authorized use, of the Licensed Property, any portion thereof, or any trademark,
copyright or related intellectual property rights therein. QVC further
acknowledges that any unauthorized use of any or all of the Licensed Property
will result in irreparable harm to ACTN, and that ACTN shall be entitled to
injunctive relief from any such unauthorized use by QVC or its agents or
representatives.
9. REPRESENTATIONS, WARRANTIES AND INDEMNITIES:
(a) ACTN represents and warrants that: (i) it has the full
power to enter into this Agreement and to fully perform its obligations
hereunder, (ii) that it is the sole owner of, or otherwise authorized to grant
rights to, the Licensed Property granted to QVC hereunder, (iii) each Product
shall comply with all foreign, federal, state, county, municipal or other
statutes, laws, orders, and regulations of any governmental or
quasi-governmental entity, and (iv) QVC's promotion of the Products, as
permitted hereunder, will not infringe or otherwise violate the copyrights,
trademarks, or other proprietary rights of third parties or constitute unfair
competition. ACTN agrees to defend, indemnify, and hold harmless QVC and its
directors, officers, employees, agents, and representatives from and against any
and all losses, expenses, damages, liabilities, and claims arising from ACTN's
breach of the above warranties, or of any of its other obligations under this
Agreement. Notwithstanding the foregoing, in no event shall ACTN have any
liability for loss to QVC due to consequential damages. These obligations of
ACTN shall survive termination of this Agreement.
(b) QVC represents and warrants that it has the full power to
enter into this Agreement and to fully perform its obligations hereunder. QVC
agrees to defend, indemnify, and hold harmless ACTN and its directors, officers,
employees, agents, and representatives from and against any and all losses,
expenses, damages, liabilities and claims arising out of or relating to (i) the
sale, use, advertising, promotion, or distribution of RCCA Branded Products and
Other Products, or (ii) QVC's breach of its representations, warranties,
covenants, terms, conditions, or obligations under this Agreement.
Notwithstanding the foregoing, in no event shall QVC have any liability for loss
to ACTN due to consequential damages. These obligations of QVC shall survive
termination of this Agreement.
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10. LITIGATION:
(a) QVC recognizes the importance of the Licensed Property and
the exclusivity and non-competition provisions of paragraph 6 herein to the
operations and activities of ACTN and that monetary damages may not adequately
protect or recompense ACTN in the event of QVC's unauthorized use of the
Licensed Property or violation of such exclusivity and non-competition
provisions. Therefore, QVC acknowledges that ACTN may seek, in addition to any
other legal or equitable remedies available to it, injunctive or other relief
against QVC to prevent QVC's unauthorized use of the Licensed Property or
violation of such exclusivity and non-competition provisions. QVC agrees to be
bound by the imposition of such injunctive or other relief.
(b) ACTN recognizes the importance of the exclusivity and
non-competition provisions of paragraph 6 herein to the operations and
activities of QVC and that monetary damages may not adequately protect or
recompense QVC in the event of ACTN's violation of such exclusivity and
non-competition provisions. Therefore, ACTN acknowledges that QVC may seek, in
addition to any other legal or equitable remedies available to it, injunctive or
other relief against ACTN to prevent ACTN's violation of such exclusivity and
non-competition provisions. ACTN agrees to be bound by the imposition of such
injunctive or other relief.
(c) ACTN shall at all times have the right to protect the
Licensed Property, including the defense of any trademark infringement action or
any legal or equitable action to enforce any item of the Licensed Property. In
that event, QVC shall provide ACTN, at ACTN's cost, all reasonable assistance
requested by ACTN in connection with such action or proceeding. If the parties
agree to joint representation in any infringement suit or other action with
respect to the Licensed Property, the respective responsibilities of the
parties, their contributions to the costs, and their share in any recoveries,
will be agreed upon in writing prior to undertaking such action. Notwithstanding
the foregoing, if QVC desires to initiate litigation, whether legal or
equitable, in order to protect any or all of the Licensed Property, and ACTN
declines to commence such litigation, QVC shall be entitled in ACTN's name to
commence and prosecute litigation at the QVC's expense, and shall be entitled to
all monetary damages and other benefits received as a result thereof. ACTN shall
cooperate with QVC in the prosecution of such litigation. QVC and ACTN shall
promptly advise the other if they become aware of the use of any name, likeness,
trademark or other item of intellectual property similar to any item of the
Licensed Property in association with any goods similar to the RCCA Branded
Products.
11. INSURANCE:
(a) ACTN will provide QVC with proof of commercial general
liability insurance, including product liability and contractual liability
coverage, providing protection against any and all claims, demands or damages
(including attorney's fees) arising out of any alleged defect in any RCCA
Branded Products or Other Products covered by this Agreement, or any use
thereof, of not less than One Million Dollars ($1,000,000) per claim with an
aggregate limit of Two Million Dollars ($2,000,000) in any year, with QVC named
as an additional insured party.
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(b) QVC will provide ACTN with proof of commercial general
liability insurance, including errors & omissions and contractual liability
coverage, providing protection against any and all claims, demands or damages
(including attorney's fees) arising out of QVC's promotion, distribution and
sale of RCCA Branded Products or Other Products, or any other actions of QVC
arising from this Agreement, of not less than One Million Dollars ($1,000,000)
per claim with an aggregate limit of Two Million Dollars ($2,000,000) in any
year, with ACTN named as an additional insured party.
(c) Each Party shall forward to the other Party once each year
proof of the aforementioned insurance coverage, and that such is in full force
and effect. Certificate(s) must state that the company will give the other Party
thirty (30) days advance notice of any reduction or cancellation in such
insurance. Each Party shall notify the additionally insured Party immediately of
any claims made under its insurance policies evidenced by the certificates of
insurance.
12. TERMINATION:
(a) Either Party may terminate this Agreement after the
initial two (2) years of the Term in the event the performance standards of
subparagraph 5(b) are not achieved, notice of such termination to be given no
later than April 1 for termination to be effective as of December 31 of that
year. During the nine (9) month period between delivery of notice and the
effective date of termination, the Parties will arrange in good faith for return
of remaining inventory in QVC's possession to ACTN.
(b) Either Party may terminate this Agreement at any time in
the event of material breach by the other Party of its obligations hereunder;
provided, however, that the non-breaching Party shall deliver notice of such
breach to the breaching Party and the breaching Party shall have a period of
thirty (30) days (or in the event of a default in payment, 10 days) to cure such
breach.
13. CONFIDENTIALITY: The Parties acknowledge that, in the course of
performing under this Agreement, each Party will be exposed to certain
confidential and proprietary information of the other Party. Each of the Parties
agrees to hold all such information in strict confidence; to disseminate such
information within its organization only as widely as reasonably necessary to
effectuate the purposes of this Agreement; and not to disclose any such
information, except in accordance with the terms of this Agreement or as
required by law, regulation or court order. Upon termination of this Agreement
for any reason, each Party will promptly return to the other Party all materials
embodying such confidential information. Without limitation of the foregoing, it
is acknowledged that the Database and all other RCCA membership lists in any
form whatsoever represent confidential information of ACTN and shall be returned
to ACTN upon termination hereof.
14. PUBLICITY: The Parties will mutually coordinate all aspects of
publicity concerning the matters contemplated by this Agreement. Without
limitation of the foregoing, it is expressly understood that neither Party will
distribute any press release or make any other public statement
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regarding the execution of this Agreement or the matters contemplated herein,
without the prior approval of the other Party. Notwithstanding the foregoing,
ACTN shall have the right to disclose such information as may be necessary for
compliance with applicable securities law.
15. NOTICES: All notices and reports in connection with this Agreement
and payments required hereunder shall be in writing and shall be given by
postpaid registered or certified mail, return receipt requested, or facsimile
transmission followed by hard copy, addressed, if to ACTN, to R. David Martin,
Chief Financial Officer; and if to QVC, to Executive VP-Merchandising, with
copies to Neal Grabell, Esq., General Counsel; in each case to the address first
given above or to such other address as either party may notify in writing to
the other party. Notice shall be deemed given on date mailed or date transmitted
via facsimile.
16. NO ASSIGNMENT: Neither Party shall have the right to sell, assign
or otherwise transfer any right or obligation hereunder without the prior
written consent of the other Party.
17. MISCELLANEOUS: This Agreement constitutes the entire agreement
between the Parties with respect to the subject matter thereof and supersedes
all prior writings or understandings with respect to the subject matter thereof.
The provisions of this Agreement may not be waived, modified, altered or amended
except by written document signed by both Parties. Failure of either Party to
insist upon strict performance of any covenants, terms or conditions of this
Agreement, or to exercise any rights or remedies upon default, shall not
constitute a waiver or relinquishment of its right to insist upon strict
compliance with this Agreement and to enforce all legal and equitable rights as
to any such default or breach, whether of like or unlike kind. In the event any
arbitration proceeding, lawsuit, cause of action or collection proceeding to
enforce the terms of this Agreement is commenced by either Party hereto, for any
reason, the prevailing Party in any such proceeding shall be entitled to recover
from the non-prevailing Party its actual attorney's fees and costs expended in
pursuit of or in defense of such claim, action, or proceeding. This Agreement
does not constitute an agency, partnership, or joint venture between the
Parties. This Agreement and all its provisions are intended to be severable.
Should a term or provision hereof be unenforceable, the remaining terms and
provisions shall continue to be binding. Section headings used in this Agreement
are for convenience only and shall not be used in the construction or
interpretation of this Agreement. This Agreement shall be governed by the laws
of the State of Delaware applicable to contracts to be performed entirely within
such State.
18. MORE FORMAL AGREEMENT: The Parties may subsequently elect to enter
into a more formal agreement, not conflicting with any of the terms and
conditions of this Agreement but incorporating additional customary terms and
conditions. Until such time as such agreement is negotiated and executed by both
Parties, this Agreement shall remain fully binding on the Parties.
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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
date first written above.
ACTION PERFORMANCE COMPANIES, INC.
By: /s/ Fred W. Wagenhals
-------------------------------------
C.E.O
QVC, INC.
By: /s/ Darlene Daggett
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EVP/Merchandising
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EXHIBIT A
RCCA Branded Products
1:64th Hood Open
1:64th Total View
1:64th Elite
1:24th Clear Window Bank
1:24th Clear Car (Paint on 1/2 side)
1:24th Elite
1:24th Funny Car
1:24th Dragster
1:12th Polystone
1:32nd Ceramic Scene
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EXHIBIT B
Licensed Property
Earnhardt, Dale The likeness of Dale Earnhardt and the #3 race car
displaying the Richard Childress Racing, Inc.
trademark driven by Dale Earnhardt, and the Dale
Earnhardt registered trademarks are used under the
administration of Dale Earnhardt, Inc.
The likeness of the #3 race car, stylized #3 and
the "RCR" checkered flag logo design are trademarks
of Richard Childress Racing Enterprises, Inc. and
are used under license from Richard Childress
Racing Enterprises, Inc.
The Trademarks "Goodwrench" and "GM" are used under
license from General Motors Corporation.
Earnhardt, Dale Jr. The name and likeness of Dale Earnhardt Jr. are
licensed under the authority of Dale Earnhardt,
Inc.
(c) 2000 Anheuser-Busch, Inc.
Gordon, Jeff (c) 2000 JG Motorsports, Inc. The name and likeness
of Jeff Gordon and the likeness of the #24 Dupont
Automotive Finishes Chevrolet are used under
license granted by JG Motorsports, Inc.
PEPSI, PEPSI-COLA and the Pepsi globe design are
registered trademarks of PepsiCo, Inc.
Jarrett, Dale Quality Care and Ford Credit are used under license
from Ford Motor Company. Dale Jarret and Robert
Yates Racing trademarks are used by permission of
Action Performance Companies, Inc.
Wallace, Rusty Licensed by Rusty Wallace, Inc. and Penske Racing
South, Inc.
Stewart, Tony "Tony Stewart(TM)", "Joe Gibbs Racing(R)",
"#20(TM)" and "The Home Depot(R)" licensed under
authority of Redline Sports Marketing, Inc.,
Huntersville, NC.
Labonte, Bobby "Bobby Labonte(TM)", "Joe Gibbs Racing(R)",
"#18(TM)" and "Interstate(R)Batteries" licensed
under authority of Redline Sports Marketing, Inc.,
Huntersville, NC
Labonte, Terry Terry Labonte, Hendrick Motorsports and Kellogg
Company marks are used under license granted by
Kellogg Company and Hendrick Motorsports, TM, (c)
2000 Kellogg Company.
Mayfield, Jeremy The right to use the name, likeness and image of
Penske-Kranefuss Racing's #12 Mobil 1 car and
Jeremy Mayfield are granted under license from the
team owner, driver and sponsor and may not be
reproduced without the written consent of Penske
Performance South, Inc.
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Skinner, Mike The likenesses of #31 race car, the "RCR" Richard Childress
Racing checkered flag logo, and the stylized "31" are
trademarks of Richard Childress Racing Enterprises, Inc. and
along with the likeness and signature of Mike Skinner
(trademarks of Mike Skinner) and the Team Lowe's and Lowe's
Home Improvement Warehouse trademarks (trademarks of Lowe's
Companies) are used under license from Richard Childress
Racing Enterprises, Inc.
Atwood, Casey "Casey Atwood name and likeness, Brewco Motorsports, Inc.,
marks and sponsors marks licensed by Brewco Motorsports, Inc.,
Central City, Kentucky."
Grubb, Kevin "Kevin Grubb name and likeness, Brewco Motorsports, Inc.,
marks and sponsors marks licensed by Brewco Motorsports, Inc.,
Central City, Kentucky."
Burton, Ward The trademarks of "Bill Davis Racing", the number 22, Ward
Burton's likeness and Ward Burton's signature are licensed
under the permission of SCM Marketing Ltd., Winston-Salem, NC.
MB2 Motorsports (c) 2000 MB2 Motorsports
Rudd, Ricky Texaco, Robert Yates Racing and Ricky Rudd are used under
license.
Force, John John Force and all logos and likenesses are trademarks
exclusively licensed to John Force Racing, Inc.
Elliott, Bill Bill Elliott name and likeness licensed by CMG Worldwide,
Indianapolis, IN.
(c) 2000 McDonald's Corporation
"COCA-COLA" is a trademark of the Coca-Cola Company.
Park, Steve The name and likeness of Steve Park are licensed under
authority of Dale Earnhardt, Inc. Pennzoil(R) is a registered
trademark of Pennzoil-Quaker State Co.
Hamilton, Bobby Bobby Hamilton name and likeness and KODAK, MAX and trade
Dress are trademarks licensed to Action Performance Companies,
Inc. by Eastman Kodak Company.
Unser Jr., Al The likeness and signature of Al Unser Jr. are properties and
are used under license from AUJ Motorsports, Inc. The likeness
of the Galles ECR Racing race car are properties and are used
under license from Galles ECR Racing, LLC.
Nadeau, Jerry Hendrick Motorsports and Jerry Nadeau Trademarks are used with
permission or under license by Hendrick Motorsports.
Lapage, Kevin "Kevin Lapage name and likeness, Brewco Motorsports, Inc.,
marks and sponsors marks licensed by Brewco Motorsports, Inc.,
Central City, Kentucky."
Other Drivers All driver names, likenesses, and other trademarks and
copyrights are used under license or with permission.
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Chevrolet "CHEVROLET, Chevrolet "Bow Tie", Chevrolet Racing and Monte
Carlo emblems and body designs are trademarks of Chevrolet
Motor Division, General Motors Corporation, used under
license to Action Performance Companies, Inc."
Ford The trademarks "Ford", "Taurus", "Motorcraft" and Ford Truck
name and Aeromax logos are owned and used under license from
Ford Motor Company.
Pontiac Pontiac, the Pontiac "Arrowhead" emblem and Grand Prix are
trademarks of and used under license from General Motors
Corporation.
NASCAR NASCAR is a registered trademark of The National Association
for Stock Car Auto Racing, Inc.
General Motors GM trademarks used under license.
RCCA Racing Collectables Club of America (RCCA) is a trademark of
Racing Collectables Club of America, Inc.
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EXHIBIT C
QVC PRE-EXISTING MOTOR-SPORTS SALES AGREEMENTS
To the extent QVC's existing relationships with the following entities are
deemed to be governed by paragraph 6(a) of the Agreement, QVC discloses the
following relationships (provided such disclosure shall not be deemed an
admission that any of the following relationships would be subject to paragraph
6(a) of the Agreement):
1. TSI
2. Concept One International, Inc.
3. ESPN
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EXHIBIT D
ACTN PRE-EXISTING MOTOR SPORTS CLUBS
1. Drivers fan clubs
2. NASCAR fan club
3. Activities by ACTN's 80%-owned German subsidiary
15
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EXHIBIT E
FORM OF QVC CONSIGNMENT ORDER
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THIS CONSIGNMENT ORDER ("Order") IS EXPRESSLY CONDITIONED ON ACCEPTANCE OF THE
TERMS AND CONDITIONS HEREOF. Oral or written notice of acceptance by Consignor,
preparation to perform by Consignor and/or shipment of all or any part of the
merchandise specified in this Order ("Merchandise") shall constitute acceptance
by Consignor of the terms and conditions contained herein. BY ACCEPTANCE OF THIS
ORDER, CONSIGNOR REPRESENTS AND AGREES AS FOLLOWS:
1. Consignor will ship to a warehouse designated by Consignee (the "Warehouse")
the Merchandise on the terms specified herein. All Merchandise shall be held on
consignment at the Warehouse at Consignor's risk. From time to time, Consignee
may withdraw Merchandise from consigned stock at the Warehouse and take delivery
thereof by packaging Merchandise for delivery to Consignee's identified
customers. Upon each such withdrawal, title to the Merchandise so withdrawn
shall pass to Consignee at the prices and on the terms and conditions herein.
2. Consignor hereby grants to Consignee the irrevocable right, by all means now
or hereafter existing, to: (a) market, promote the sale of and sell the
Merchandise; (b) use the trademarks, trade names, service marks, patents and
copyrights (collectively the "Marks") registered, owned, licensed to or used by
Consignor in connection with the Merchandise; (c) use, perform, play,
synchronize and/or demonstrate, as applicable, the Merchandise, its contents,
and/or any promotional, advertising or similar material supplied by Consignor
for use in connection with such Merchandise ("Promotional Material"); and (d)
use the names, photographs, likenesses, voices and/or biographies of any
individuals performing in or otherwise associated with the production of the
Merchandise as contained in the Merchandise, its contents and/or any
Promotional Material. Consignee makes no representations with regard to the
number of times, if any, that Merchandise will be marketed, promoted or sold by
Consignee.
3. In addition to and without prejudice to any and all other warranties, express
or implied by law, Consignor represents, warrants and covenants to Consignee
that: (a) Consignor possesses all licenses, permits, rights, powers and consents
required to enter into and perform this Order, to sell to Consignee the
Merchandise referenced herein and to grant to Consignee the rights granted
herein; (b) Consignor's performance hereunder does not violate any agreement,
instrument, judgment, order or award of any court or arbitrator; (c) all
Merchandise furnished hereunder, including the production, sale, packaging,
labeling, safety, testing, importation and transportation thereof, and all
representations, advertising, prices, and allowances, discounts or other
benefits made, offered or authorized by Consignor in connection therewith, shall
at all times comply with all applicable federal, state, local, industry and
foreign statues, laws, rules, regulations, orders, standards and guidelines
(collectively, "Laws"); (d) where applicable, reasonable and representative
tests as prescribed by Laws or governmental authorities have been performed or
will be performed before shipment from Consignor to the Warehouse; (e) all
Merchandise furnished hereunder shall be new, first quality merchandise and
conform to all representations by Consignor, instructions, specifications, and
samples, shall be free from all defects (including latent defects) in
workmanship, material and design, and shall not be reworked, rebuilt or
refurbished merchandise; (f) all manufacturers' warranties are effective and
enforceable by Consignee and its customers; (g) all Marks which are part of
or appear in connection with the Merchandise and/or Promotional Material, and/or
any component thereof, are valid and genuine, and the sale, promotion of the
sale and performance of the Merchandise and/or Promotional Material, and/or any
component thereof, will not infringe upon any domestic or foreign Marks, rights
of privacy or publicity and/or any other third party rights, or cause Consignee
to be liable to Consignor or any third party for any additional fees, costs or
expenses; (h) the title of Consignor to the Merchandise is good and free and
clear of all encumbrances and liens, and its transfer hereunder rightful; (i)
neither the Merchandise nor any component part thereof is subject to any import
quota restriction, rule or regulation preventing or forbidding the importation,
use, promotion for sale or sale of the Merchandise or any component part
thereof, or any duty, tariff, or penalty in connection therewith, except as
previously disclosed in writing by Consignor to Consignee; (j) the Merchandise
and similar goods are not and have not been subject to product liability or
infringement claims, except as disclosed on the face hereof; (k) Consignor shall
maintain for the life of the Merchandise general liability insurance coverage on
the Merchandise, including full product liability, infringement and advertising
injury, in amounts no less than One Million Dollars per occurrence, unless
otherwise specified on the face hereof, with carriers acceptable to Consignee,
and which shall include broad form vendor's coverage in favor of Consignee, and
Consignor will promptly provide Consignee with a certificate of insurance naming
Consignee as an additional insured; and (l) the same or similar merchandise is
not being and will not be offered to any other consignee or purchaser at a
lesser cost or under more favorable terms than appear herein.
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Consignor agrees to provide Consignee with any and all documents requested or
required by Consignee at any time and from time to time to support the
representations, warranties and covenants herein contained.
4. Consignor hereby agrees to protect, defend, hold harmless and indemnify
Consignee, its subsidiaries and affiliates, and each of their respective
customers, programming and other distributors, employees, agents, officers,
directors, successors and assigns, from and against any and all claims, actions,
suits, costs, liabilities, damages and expenses (including, but not limited to,
reasonable attorneys' fees) based upon or resulting from: (a) any alleged or
actual infringement of any Marks, rights of publicity or privacy and/or any
other third party rights arising from the sale, promotion of the sale and/or
performance of the Merchandise, its contents and/or the Promotional Material;
(b) any alleged or actual defect in any of the Merchandise; (c) any alleged or
actual injury or death to person or damage to property arising our of the
furnishing, use or performance of the Merchandise; (d) breach by Consignor of
any representations, warranties or covenants; and (e) any alleged or actual
violation by Consignor and/or the Merchandise of any applicable Laws. In the
event Consignee notifies Consignor in writing of a claim, demand, action, suit
or other matter ("Claim") to which the foregoing indemnity applies, Consignor
shall provide prompt assurance of its ability to so indemnify Consignee, to
Consignee's reasonable satisfaction, and Consignor shall commence to defend such
Claim, at its sole cost and expense, within five (5) days after receiving
Consignee's written notice. If Consignor fails to provide such assurance or
fails to commence such defense within such five (5)-day period, Consignee may,
at its option, assume the defense or settlement of such Claim in its own name
and all recoveries from such Claim shall belong to Consignee. In the latter
event, which shall be in addition to any and all other rights Consignee may have
at law or in equity, Consignee may elect counsel to represent it, and Consignor
shall be solely responsible for the payment or reimbursement, at Consignee's
option, of counsel fees and all other fees and costs incurred in defending such
Claim, for any and all damages arising thereunder, and for any and all amounts
paid by Consignee in settlement thereof.
5. Time is of the essence. Consignee reserves the right to cancel this Order or
any part hereof, with no liability or obligation to Consignor, in the event;
(a) Consignee is notified that any Merchandise or Mark infringes or is alleged
to infringe upon any third party rights; (b) Consignor breaches or is
anticipated to breach this Order; (c) Merchandise conforming to specifications
will not be delivered or arrive at the Warehouse on the dates and in the
quantities specified on the face hereof; (d) fire, flood, windstorm,
earthquake, war, strike, or any other casualty or occurrence of a similar
nature substantially and adversely affects Consignee's premises or business; or
(e) any substantial change to Consignee's business (for whatever reason) occurs.
6. Merchandise shipped or delivered to the Warehouse prior to the first
permitted ship or delivery date specified on the face hereof, may, at
Consignee's option be returned to Consignor, at Consignor's risk and expense,
and upon such return, shall be held by Consignor for Consignee until shipment
or delivery on the specified date. Merchandise shipped or delivered to the
Warehouse after the last permitted ship or delivery date specified on the face
hereof may, at Consignee's option, be returned to Consignor, at Consignor's
risk and expense, and upon such return. Consignee may cancel this Order, in
whole or in part, without liability or the Merchandise may be held by Consignee
on consignment hereunder. Unless otherwise stated on the face hereof, Consignor
shall ship the Merchandise in one shipment. In the event of shipment or receipt
of an unauthorized quantity, Consignee may, at its option, either reject or
accept the entire shipment unless partial shipments are authorized on the face
hereof. Additional freight charges resulting from partial shipments shall be
borne by Consignor. Partial shipments shall not cause Consignor's obligations
to become severable. Unless otherwise stated on the face hereof, Consignor
shall pay or reimburse Consignee, at the direction of Consignee, for all
freight, packing and insurance incident to the shipment of the Merchandise,
including, but not limited to, loading and unloading charges, mileage charges,
taxes, tolls and other fees. Consignor agrees to follow Consignee's
instructions with respect to shipment, routing and packaging. Consignor's
failure to comply with the terms and conditions set forth in this Section or in
Consignee's shipping regulations (including chargeback program) ("Regulations")
or in any applicable standards provided by Consignee to Consignor ("Standards"),
in effect as of the date of this Order, and which are incorporated herein by
reference, may, at Consignee's option, result in the imposition of charges as
set forth in such documents. Any such charges assessed may be deducted from any
amounts due or which may become due to Consignor. Copies of the Regulations and
the Standards are available to Consignor upon written request to Consignee.
7. Merchandise furnished hereunder which is not in compliance with this Order,
the Regulations or the Standards, which is returned by any of Consignee's
customers for any reason, which fails to meet Consignee's quality control
tests, which fails to
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meet Consignee's carrier's quality, drop or other tests, or which is or may be
used in conjunction with merchandise furnished and rejected (or acceptance
thereof revoked) under this Order or another order, may be rejected (or
acceptance thereof by Consignee revoked) at Consignee's option and returned to
Consignor. All expense of unpacking, examining, repacking, storing, returning
and reshipping any Merchandise rejected (or acceptance of which has been
revoked) as aforesaid shall be at Consignor's expense and risk. With respect to
such returned Merchandise, Consignee shall, at its option, receive a credit or
refund of all amounts paid by Consignee for such Merchandise, including, without
limitation, in-bound freight charges (notwithstanding contrary Freight Terms, if
any, set forth on the face hereof). In the event that Consignee shall opt to
receive a refund, Consignor shall pay Consignee in immediately available funds
within fifteen (15) days of Consignee's request. In the event that Consignee
shall opt to receive a credit, Consignee may apply such a credit toward any
amounts due or which may become due to Consignor. Upon receipt by Consignee of
returns from its customers, title and risk of loss to such returned Merchandise
shall immediately revert to Consignor. Consignor agrees that Merchandise
rejected or returned for any reason pursuant to the terms of this Order, whether
or not such rejection is disputed by Consignor, will not be resold or otherwise
distributed by Consignor unless all labels and other characteristics identifying
Consignee and/or displaying any trade name or trademark of Consignee have been
first removed. Authorization is granted to Consignee to return Merchandise
without additional authorization, and Consignor hereby agrees to accept such
returns even without Consignee's request for return authorization labels.
Merchandise returned or rejected by Consignee is not to be replaced by Consignor
without the prior written approval of Consignee. Consignor acknowledges that the
Consignee does not inspect each item at receipt of Merchandise and that defects,
imperfections or nonconformity with any representations, warranties or covenants
set forth herein may not be discovered by Consignee until Merchandise shall have
been purchased by its customers and returned to Consignee. Consignee's
inspection, discovery of a breach of warranty, failure to make an inspection or
failure to discover a breach of warranty shall not constitute a waiver of any of
Consignee's rights or remedies whatsoever.
8. Consignee may, at any time, elect to return to Consignor all or any portion
of the Merchandise held on consignment hereunder. Consignee shall give notice
to Consignor of Consignee's election to make such return, and Consignee shall,
without the requirement of any return authorization, return such Merchandise or
portion thereof to Consignor at Consignee's expense and Consignor shall accept
such Merchandise.
9. Consignor shall not assign this Order, or any part hereof, without the prior
written consent of Consignee, and any such attempted assignment shall be void at
the election of Consignee. All claims for money due or to become due from
Consignee shall be subject to deduction by Consignee for any set-off or
counterclaim arising out of this Order or any other of Consignee's orders or
agreements with Consignor, whether such set-off or counterclaim arose before or
after any assignment by Consignor.
10. Until date of purchase by Consignee, Consignor shall meet its lower prices
and the lower prices of legitimate competition, or accept cancellation at
Consignee's option. Consignee, in its sole discretion, shall determine the price
at which Merchandise shall be offered for sale to its customers and shall retain
all handling and shipping charges collected from its customers.
11. Prior to the thirtieth (30th) day of each month, Consignee shall remit
payment to Consignor for Merchandise sold and shipped by Consignee to its
customers during the previous month, less the Reserve (as defined below), and
adjusted for any credits, debits, customer returns, refunds, and allowances. If
a percentage greater than zero is indicated in the "Payment Reserve" designation
on the face hereof, then Consignee will withhold an amount equal to such
percentage of the gross monthly sales (the "Reserve") from each such monthly
payment to Consignor. The amount so withheld shall be applied toward actual
Consignee customer returns occurring during the succeeding calendar month. In
the event that actual returns during such period exceed the Reserve deducted in
the prior month, such excess amount shall, at Consignee's option, be immediately
debited against Consignor's account with Consignee or paid by Consignor to
Consignee within fifteen (15) days of receipt of Consignee's request for such
payment. In the event that actual returns during such period are less than the
Reserve deducted in the prior month for such returns, the balance of the Reserve
remaining at the conclusion of such period shall, at Consignee's option, be
credited to Consignor's account or paid to Consignor. Neither the arrival of the
Merchandise at the Warehouse, nor payment hereunder, shall constitute acceptance
of Merchandise, and such arrival or payment is without prejudice to any and all
claims of Consignee against Consignor.
12. At Consignee's request, Consignor agrees to meet with Consignee or its
agents at a location determined by Consignee to reconcile Consignor and
Consignee records regarding Merchandise. In the
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event that Consignor fails for any reason to attend such meeting, or in the
event that Consignee shall not request that a meeting be held, Consignee shall
submit its reconciliation report to Consignor. Any discrepancy must be
reconciled within thirty (30) days from the date of the reconciliation meeting
or within thirty (30) days from the date of Consignor's receipt of Consignee's
reconciliation report (whichever shall apply) and a reconciliation statement
must be signed within such thirty (30) day period. Should the parties fail to
sign a reconciliation statement within such period of time, Consignee's records
shall be binding on the parties.
13. For purposes of this Order, "Confidential Information" means any agreement
between Consignee and Consignor, all information in whatever form transmitted
relating to the past, present or future business affairs, including without
limitation, the sale of Merchandise, customer lists and other customer
information, research, development, operations, security, broadcasting,
merchandising, marketing, distribution, financial, programming and data
processing information of Consignee or another party whose information Consignee
has in its possession under obligations of confidentiality, which is disclosed
by Consignee, its subsidiaries, affiliates, employees, agents, officers or
directors to Consignor or which is produced or developed during the working
relationship between the parties. Confidential Information shall not include any
information of Consignee that is lawfully required to be disclosed by Consignor
to any governmental agency or is otherwise required to be disclosed by law,
provided that before making such disclosure Consignor shall give Consignee an
adequate opportunity to interpose an objection or take action to assure
confidential handling of such information. Consignor shall not disclose any
Confidential Information to any person or entity except employees of Consignor
as required in the performance of their employment-related duties in connection
with this Order, nor will Consignor use the Confidential Information for any
purpose other than those purposes expressly contemplated herein. Consignor shall
not use any information obtained from Consignee's customers (e.g., through
warranty cards or otherwise) to offer for sale to such customers any goods or
services. Consignor shall not include with any Merchandise, any information that
would enable Consignee's customers to acquire, either directly or indirectly,
any additional merchandise from persons other than Consignee, without first
obtaining Consignee's written consent. In the event of a breach or threatened
breach of this Section by Consignor, Consignee shall be entitled to obtain from
any court of competent jurisdiction, preliminary and permanent injunctive
relief, including, but not limited to, temporary restraining orders, which
remedy shall be cumulative and in addition to any other rights and remedies to
which Consignee may be entitled. Consignor agrees that the Confidential
Information referred to in this Section is valuable and unique and that
disclosure or use thereof in breach of this Section will result in immediate
irreparable injury to Consignee. Consignor shall inform those persons or
entities having access or exposure to Confidential Information hereunder, of
Consignor's obligations under this Section.
14. This Order shall be governed by the laws of the Commonwealth of Pennsylvania
applicable to contracts to be performed wholly therein, regardless of place of
acceptance. Consignor and Consignee expressly exclude the application of the
United Nations Convention on Contracts for the International Sale of Goods, if
applicable. Consignor hereby consents to the exclusive jurisdiction of the state
courts of the Commonwealth of Pennsylvania for the County of Chester and the
federal courts for the Eastern District of Pennsylvania in all matters arising
hereunder. Consignor hereby irrevocably agrees to service of process by
certified mail, return receipt requested, to its address as set forth on the
face of this Order or to such other address as Consignor may deliver to
Consignee in writing.
15. Consignor shall include the value of all consigned stock in any tax return
of personal property required to be filed with the local taxing authority and
Consignor shall pay the taxes applicable thereto.
16. No waiver by Consignee of any term, provision or condition hereof shall be
deemed to constitute a waiver of any other term, provision or condition of this
Order, or a waiver of the same or of any other term, provision or condition with
regard to subsequent transactions or subsequent parts of the same transaction,
including without limitation, subsequent shipments under this Order.
17. If any provision contained in this Order shall be determined to be
unenforceable or prohibited by law, then such provision shall be void, and the
remaining provisions herein shall not in any way be affected or impaired
thereby.
18. Consignor shall not issue any publicity or press release regarding
Consignee or Consignee's activities hereunder without first obtaining
Consignee's prior written approval and consent to such release.
19. This Order and any other written warranties and specifications, the
Regulations and Standards, and the terms, conditions and agreements herein and
therein, constitute the full understanding of the parties hereto and a complete
and exclusive statement of the terms of the parties' agreement concerning the
Merchandise furnished hereunder.
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20. No condition, understanding or agreement purporting to modify or vary the
terms of this Order shall be binding unless hereafter made in writing and duly
executed by the party to be bound, and no modification shall be effected by the
acknowledgment or acceptance of this Order or of invoices, shipping documents or
other documents containing terms or conditions at variance with or in addition
to those set forth herein.
21. Notwithstanding any legal presumption to the contrary,the covenants,
conditions, representations, indemnities and warranties contained in this Order,
including, but not limited to Sections 3, 4, 7 and 13 hereof, shall survive
inspection, delivery, acceptance and payment, shall be binding upon Consignor
and its successors and permitted assigns, and shall run in favor of Consignee
and its successors and assigns.