Exhibit 10.11
WAREHOUSING AND SERVICE AGREEMENT
WAREHOUSE AND SERVICE AGREEMENT, dated as of August 1,2004
(the "Agreement") between Achim Importing, Co., Inc. ("Achim") and Dynamic
International Inc. ("Dynamic").
WITNESSETH:
WHEREAS, Achim rents and maintains a warehouse located at 0000
Xxxxxxxxxx Xxxxxx, Xxxxx Xxxxxxxxx, XX 00000 (the "Warehouse"); and
WHEREAS, Dynamic desires to retain Achim to provide
warehousing and general administrative services for Dynamic's sports bag and
luggage importation and distribution business (the "Business"), and Achim is
willing to provide such warehousing and general services on the terms and
conditions set forth in this Agreement; and
NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants contained herein, the parties hereto agree as follows:
1. General Services. Achim shall provide to Dynamic during
the term of this Agreement the services described below (the "General Services")
on a basis consistent with the type, and level of such General Services
currently being provided to the Business. Without limiting the generality of the
foregoing, the General Services shall include the following general and
administrative functions and services:
(a) assisting in the maintenance of financial and accounting books
and records of the Business;
(b) preparation of monthly accounts receivable aging schedules;
(c) handling of all routine collection matters with respect to
Dynamic's accounts;
(d) maintaining accounts payable and accounts receivable ledgers
(including all necessary accounting and/or paperwork for sales
discounts, chargeback and returns), fixed asset accounts; sales
accounts and inventory accounts;
(e) performing credit checks on customers as requests for orders are
received and informing Dynamic of known credit risks;
(f) providing monthly reports of selling and production levels,
inventory levels, stock status, open purchase order reports,
book/ship reports and sales analysis relating to the Business;
(g) assistance in accordance with the conduct of Dynamic's books and
records;
(h) assistance in connection with the printing and stationery needs
of the Business; and
(i) any other miscellaneous account reconciliations and computer
generated reports reasonably requested by Dynamic.
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2. Availability of the General Services. The General Services
shall be furnished during normal business hours. Achim shall devote only so much
time to the General Services as it deems necessary in its sole discretion.
3. Warehousing Services. Achim shall provide to Dynamic during
the term of this Agreement warehousing services for the Business, including
receiving, storing and shipping of all of Dynamic's merchandise from the
Warehouse.
4. General Services and Warehouse Fee. In consideration of the
General Services and Warehouse Services (together the "Services"), Dynamic shall
pay to Achim a monthly fee equal to fifteen (15%) percent of Dynamic's invoiced
sales.
The Services Fee shall be payable monthly within fifteen (15) days following
the date of Achim's invoice thereof. Within ninety (90) days following the end
of each year during the term hereof, Achim shall submit to Dynamic a statement,
in reasonable detail, showing the total Services Fee payable by Dynamic with
respect to such year, less the total of all monthly installments paid on account
thereof. To the extent that the Services Fee shall exceed the sum of monthly
installments previously paid for such year, the balance shall be payable by
Dynamic to Achim within thirty (30) days thereafter. To the extent that the sum
of all monthly installments previously paid for such year shall exceed the
Services Fee for such year, Achim shall apply the excess against monthly
installments otherwise payable in respect of the excess to Dynamic within thirty
(30) days thereafter. Upon termination of this Agreement, Achim shall pay to
Dynamic or Dynamic shall pay to Achim, as the case may be, within thirty (30)
days, any excess amounts theretofore paid or payable in respect of the Services
Fee through the date of such termination.
5. Term. The initial term of this Agreement is for a period of
two (2) years and shall commence on or about August 1, 2004. This Agreement
shall automatically be renewed from year to year thereafter unless either party
shall give written notice to the other at least six (6) months prior to the
commencement of any renewal term of its intention not to renew.
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6. Confidentiality. Achim agrees to accept and use all books,
records and other information relating to the Business furnished to it by
Dynamic solely for the purpose of performing the Services as contemplated
herein. All books and records relating to the Business shall be kept
confidential and Achim shall not intentionally and knowingly communicate such
information to any third party (except as authorized by an appropriate officer
of Dynamic or otherwise as required by law) and Achim shall use the same efforts
that it uses to protect its own confidential information to prevent inadvertent
disclosure of any information relating to the Business to any third party.
7. Illegality and Severability. If application of any one or
more of the provisions of this Agreement shall be unlawful under applicable law
and regulations, then the parties will attempt in good faith to make such
alternative arrangements as may be legally permissible and which carry out as
nearly as practicable the intent of the terms of this Agreement.
8. Relationship. Achim is an independent contractor and
nothing contained herein or done pursuant to this Agreement shall be construed
as creating a partnership, agency or joint venture. Except as may be otherwise
expressly provided in this Agreement, neither party shall become bound by any
representation, act or omission of the other party. Achim is solely responsible
for hiring, maintaining and firing of all of the employees performing the
Services and Achim expressly acknowledges that Dynamic shall have no obligation
whatsoever to any of Achim's employees.
9. Assignment. This Agreement and all of the provisions hereof
shall be binding upon and insure to the benefit of the parties hereto and their
respective heirs, administrators, executors, legal representatives, successors
and permitted assignee, but neither this Agreement nor any of the rights,
interest or obligations hereunder shall be assigned by any of the parties hereto
without the prior written consent of the other party, except by operation of
law.
10. Access to Records/Termination. Dynamic and its
representatives shall have full and complete access during normal business hours
to any and all financial and accounting books and records in Achim's possession
which relate to the Business. Upon the termination of this Agreement and for a
period of one
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(1) year thereafter, Achim shall permit Dynamic and it's representatives
reasonable access to, and use of, Achim's computerized record systems, subject
however, to Achim's own needs, priorities and reasonable allocation of computer
availability to Achim in order to retrieve any records relating to the Business.
11. Entire Agreement Amendment. This Agreement, when it
becomes effective, will constitute the entire agreement of the parties hereto.
No amendment or modification hereof shall be valid or binding unless made in
writing and signed by the party against whom enforcement thereof is sought.
12. Notice. Any notice, approval, consent, or other
communication under this Agreement shall be in writing and shall be considered
given when (a) delivered personally, or (b) mailed by registered or certified
mail, or by overnight mail or courier service, in any case, return receipt
requested, or (c) received by telecopy with a confirming copy sent by overnight
mail or courier, return receipt requested the parties at the addresses indicated
below (or at such other address as a party may specify by notice to the other
pursuant to the terms of this Section 11. Notice given by a party's counsel, if
any, shall be considered notice given by that party.
If to Achim Importing Co., Inc:
Achim Importing Co., Inc.
00 Xxxxxx Xxxxxx
Xxxxxxxx, XX 00000
(000) 000-0000
(000) 000-0000
If to Dynamic International Inc:
Dynamic International Inc.
00 Xxxxxx Xxxxxx
Xxxxxxxx, XX 00000
(000) 000-0000
(000) 000-0000
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13. Waiver. No course of dealing nor any delay on the part of
the Corporation in exercising any rights hereunder shall operate as a waiver of
any such rights. No waiver of any waiver or a wavier of any other breach or
default.
14. Binding Effect. If any clause, paragraph, section or part
of this Agreement shall be held or declared to be void, invalid or illegal, for
any reason, by any court of competent jurisdiction, such provision shall be
ineffective but shall not in any way invalidate or affect any other clause,
paragraph, section or part of this Agreement.
15. Governing Law. This Agreement and, unless otherwise
provided, all amendments hereof, shall be governed, interpreted and construed in
accordance with the laws of the State of New York applicable to agreements
entered into and to be performed entirely therein, without regard to conflicts
of law and principles thereof.
16. Headings. The headings of the paragraphs of this Agreement
are inserted for convenience only and shall not constitute a part hereof or
affect in any way the meaning or interpretation of this Agreement.
IN WITNESS HEREOF, the parties hereto duly executed this Agreement the day and
year first above written.
ACHIM IMPORTING CO., INC.
By: /s/ Xxxxxx X. Xxxxxxxx
------------------------------
President
DYNAMIC INTERNATIONAL INC.
By: /s/ Xxxxxx X. Xxxxxxxx
------------------------------
President
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